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SDI, Inc. v. Pivotal Parker Commer., LLC

Supreme Court of Colorado, En Banc

December 8, 2014

SDI, Inc., a Colorado corporation, Petitioner
v.
Pivotal Parker Commercial, LLC, a Delaware limited liability company, Respondent

Certiorari to the Colorado Court of Appeals. Court of Appeals Case Nos. 11CA134 and 11CA1427.

SYLLABUS

In this case, the supreme court holds that the Special District Act (" the Act" ), sections 32-1-101 to -1807, C.R.S. (2014), gives special districts the power to assign to 14 private parties the right to receive revenue from development fees. It holds that the 15 power to assign revenue falls within the express power given to districts to " dispose of 16 . . . real and personal property." § 32-1-1001(1)(f). It also concludes that under section 32-1-1001(1)(n), the Act should be interpreted as empowering a district to act, not as a 18 limitation on powers found elsewhere in the statute. The court of appeals therefore 19 erred in finding that the power to " pledge" under section 32-1-1001(1)(j)(I) of the act 20 necessarily restricts the power to assign. The supreme court accordingly reverses the 21 court of appeals' holding and remands to the court of appeals for consideration of the 22 other issues raised by Pivotal on appeal, including whether SDI was entitled to increase 23 the fees.

For Petitioner: Silver & DeBoskey, A Professional Corporation, Joe L. Silver, Martin D. Beier, Denver, Colorado.

For Respondent: Seter & Vander Wall P.C., Kim J. Seter, Jeffrey E. Erb, Greenwood Village, Colorado.

For Amicus Curiae Special District Association of Colorado: Special District Association of Colorado, Ann A. Terry, Denver, Colorado; Kutak Rock LLP, Neil L. Arney, Mia K. Della Cava, Denver, Colorado.

OPINION

Page 673

EID, JUSTICE.

[¶1] In this case, we consider whether the Special District Act (the " Act" ), sections 32-1-101 to -1807, C.R.S. (2014), gives special districts the power to assign to a private party the right to receive development fees. Here, Cherry Creek South Metropolitan District #1 (" the District" ) assigned to a predecessor-in-interest of petitioner SDI, Inc. (" SDI" ) the right to receive fees that the District had assessed upon developers within its boundaries to finance the development of municipal infrastructure. The District had increased these development fees by about four percent in each of the years prior to the assignment. SDI also increased the fees it collected, but at a rate of eight percent per year. SDI brought an action against respondent Pivotal Parker Commercial, LLC (" Pivotal" ), seeking to recover unpaid development fees and requesting a declaratory judgment that it was entitled to the fees, as increased annually, in the future.

[¶2] The trial court determined that SDI was entitled to receive the fees as increased annually, rejecting Pivotal's argument that the fee increase amounted to an improper delegation of legislative authority. On appeal, Pivotal again argued that the fee increase constituted an improper delegation of legislative authority. The court of appeals reversed the trial court. The court concluded that the District had no authority to assign fee revenue in the first place, an argument not raised by the parties or presented to the trial court. SDI, Inc. v. Pivotal Parker Commercial, LLC, 2012 COA 168, ¶ 17, 292 P.3d 1165. More specifically, it held that because the Act expressly authorizes special districts to " pledge" revenue under section 32-1-1001(1)(j)(I), and because an assignment differs from a pledge, the Act necessarily precludes districts from assigning revenue. Id. at ¶ ¶ 20-22.

[¶3] We now reverse. We conclude that the reasoning of the court of appeals is contrary to the Act itself, which states that " specific powers shall not be considered as a limitation upon any power necessary or appropriate to carry out the purposes and intent" of the Act. § 32-1-1001(1)(n). Thus, the express power to pledge does not, by itself, restrict the power to assign. We hold that the power to assign revenue falls within another express power given to districts, namely, the power to " dispose of . . . real and personal property." § 32-1-1001(1)(f). The District's assignment of the right to collect development fee revenue was therefore a lawful exercise of its statutory authority. Accordingly, we reverse the court of appeals' holding to the contrary and remand to the court of appeals for consideration of the other issues raised by Pivotal on appeal, including whether SDI was entitled to increase the fees.

I.

[¶4] In 1984, the town of Parker annexed a parcel of undeveloped land known as Stroh Ranch. The town then formed the District under the Act to facilitate development of the parcel. To raise revenue for developing public ...


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