1405 Hotel, LLC; 550 15th Owner, LLC; Broadmoor Hotel Inc.; Brown Palace Hotel Associates Limited Partnership; Cheyenne Mountain Conference Resort; CHSP Denver LLC; DiamondRock Cherry Creek Tenant LLC; DiamondRock Denver Downtown Tenant LLC; HEP Denver Ltd., d/b/a Magnolia Hotel; Oxford Hotel 2005 Holdings LLC; and Westminster Boulevard Finance, LLC, Plaintiffs-Appellants,
Colorado Economic Development Commission, Division of the Office of Economic Development and International Trade, State of Colorado; and City of Aurora, Colorado, Defendants-Appellees
and County of Denver District Court No. 13CV34006. Honorable
Karen L. Brody, Judge.
Roca Rothgerber LLP, James M. Lyons, Hilary D. Wells, Hermine
Kallman, Denver, Colorado, for Plaintiffs-Appellants.
H. Coffman, Attorney General, LeeAnn Morrill, First Assistant
Attorney General, Denver, Colorado, for Defendants-Appellees
Colorado Economic Development Commission, Division of the
Office of Economic Development and International Trade, State
Rock LLP, Thomas W. Snyder, Daniel C. Lynch, Michael M.
Frandina, Denver, Colorado, for Defendant-Appellee City of
and Berger, JJ., concur.
[¶1] Plaintiffs, eleven hotels along
Colorado's Front Range, (collectively the Hotels)
appeal the trial court's order dismissing their complaint
against the Colorado Economic Development Commission (CEDC)
and the City of Aurora (Aurora). The Hotels allege that the
trial court improperly refused to review the CEDC's
decision to award Aurora an $81 million tax subsidy pursuant
to its authority under the Colorado Regional Tourism Act (the
RTA). Because we agree with the trial court's conclusion
that the Hotels lack standing to challenge the CEDC's
decision, and because we do not reach their constitutional
claim, we affirm.
The Regional Tourism Act
[¶2] In 2009, the General Assembly enacted
the RTA to provide a mechanism through which as many as two
local governments per year can obtain sales tax increment
financing for the development of large-scale regional tourism
projects. § § 24-46-301 to -310, C.R.S. 2014. The
law permits successful applicants to establish regional
tourism zones or authorities within their borders and allows
them to collect a portion of the revenue derived from state
sales taxes within those zones. See §
24-46-303, C.R.S. 2014 (defining, among other terms, "
regional tourism authority," " regional tourism
zone," and " state sales tax increment
revenue" ). The revenue is then used to fund the
development of a specific large-scale tourism project within
the zone. See § 24-46-302(1)(c), C.R.S. 2014
(" Colorado is in competition with other states to
attract large-scale regional tourism projects." );
§ 24-46-302(1)(d) (" It is in the interest of
[Coloradans] to provide a financing mechanism for attracting,
constructing, and operating large-scale regional tourism
projects that will attract significant investment and revenue
from outside the state." ).
[¶3] The RTA prescribes a detailed
application process which requires applicants to submit,
among other documents, maps of the proposed project area,
§ 24-46-304(2)(a), C.R.S. 2014; a narrative description
of the project, including cost estimates, id. at
(2)(c); an economic analysis detailing the project's
impact on the local economy, id. at (2)(d); and
information regarding the project's financing,
id. at (2)(e) to (h). The RTA also requires
applicants to provide an economic study from a third-party
analyst selected by the Office of State Planning and
Budgeting. Id. at (2)(i). The third party reviews
the data provided by the applicants to ensure the
application's general accuracy. Id. at (2)(i)(I)
[¶4] Consideration of an RTA application is
a two-step process. First, before approving a project, the
CEDC must make several findings: (1) the project is
extraordinary and unique in nature and reasonably anticipated
to contribute significantly to economic development and
tourism in the state and region where the project is located;
(2) the project is reasonably anticipated to result in a
substantial increase in out-of-state tourism; (3) a
significant portion of the sales tax revenue generated by the
project is reasonably anticipated to be attributable to
transactions with nonresidents of the state;  and (4) in
the absence of the award, the project is unlikely to be
developed within the foreseeable future. Id. at
(3)(a) to (d).
[¶5] Second, section 24-46-305(3), C.R.S.
2014, requires the CEDC to adopt a resolution specifying (1)
the local government that has been approved to undertake the
project; (2) the area of the regional tourism zone; (3)
whether the CEDC has authorized the creation of a regional
tourism authority; and (4) the percentage of state sales tax
increment revenue that will be dedicated to the regional
Aurora's RTA Application
[¶6] For the purposes of this appeal, the
parties do not dispute the following facts as set forth in
the Hotels' second amended complaint.
[¶7] During the RTA's inaugural
application cycle in 2011, Aurora submitted a proposal
requesting a tax increment subsidy to support the building of
a $824 million hotel and conference center with 1500 rooms
and approximately 350,000 to 400,000 square feet of meeting
space to be developed by the Gaylord Entertainment Company
(the Gaylord Project). The Gaylord Project's application
presented a detailed description and economic analysis,
including a third-party analyst's conclusion that the
project would likely not be developed but for RTA funding.
[¶8] In May 2012, the CEDC announced its
intention to approve the Gaylord Project's requested $81
million tax increment subsidy, pursuant to the RTA, so long
as Aurora satisfied certain conditions within 120
days. However, the CEDC did not adopt a
resolution memorializing the award at that time.
[¶9] Later that same month, Gaylord
Entertainment announced its decision to withdraw from the
Gaylord Project. The company further announced that it was
selling its brand name and management rights to Marriott
International. In October 2012, Gaylord Entertainment
announced that it had merged with a wholly owned subsidiary
called Ryman Hospitalities.
[¶10] One year later, during the May 2013
CEDC meeting, Aurora announced that RIDA Development Corp.
(RIDA) had agreed to develop a similar hotel and conference
center, and that Marriott International would operate the
project (the RIDA/Marriott Project). However, Aurora did not
submit a new RTA application.
[¶11] In July 2013, the Hotels, joined by
additional hotels, the Colorado Hotel and Lodging
Association, and the Metro Denver Hotel Association,
submitted a petition to the CEDC requesting that it require
Aurora to submit a new RTA application for the RIDA/Marriott
Project. Specifically, it claimed that material
changes to the proposed project, as well as the change in the
developer from Gaylord to RIDA, necessitated a new
application. The petition also requested that the CEDC hold a
public hearing to address these concerns and alleged that the
CEDC's May 2012 preliminary approval of the Gaylord
Project had expired on its own terms.
[¶12] At its regularly scheduled July 2013
meeting, the CEDC heard the petitioners' concerns and
notified them that it would take the petition under
advisement. In August 2013, the Attorney General wrote to
petitioners, denying their petition on the ground that it was
untimely under section 24-4-106(4), C.R.S. 2014, of the State
Administrative Procedure Act (APA), and C.R.C.P. 106(b). The
Attorney General asserted that the CEDC's May 2012
preliminary approval of the Gaylord Project constituted final
agency action, giving petitioners either thirty-five days
from that date to challenge the action pursuant to section
24-4-106(4) or, in the alternative, twenty-eight days to
petition for judicial review under C.R.C.P. 106(b). Because
the petition was untimely under either deadline, the Attorney
General denied it on behalf of the CEDC.
[¶13] In October 2013, the CEDC adopted a
final resolution approving Aurora's RTA application for
the RIDA/Marriott Project.
[¶14] In September 2013, the Hotels filed
this action against the CEDC and Aurora in Denver District
Court. A second amended complaint was filed in October 2013.
The complaint alleged four claims for relief: (1) a claim in
the nature of mandamus brought under C.R.C.P. 106(a)(2) to
compel the CEDC to require Aurora to submit a new application
for the RIDA/Marriott Project, as required by the RTA; (2) a
claim brought pursuant to the APA, section 24-4-106(4),
seeking review of the CEDC's final agency action denying
their petition for reconsideration and approving the
RIDA/Marriott Project; (3) a claim for declaratory relief
pursuant to C.R.C.P. 57 and section 13-51-105, C.R.S. 2014,
challenging the constitutionality of section 24-46-309,
C.R.S. 2014, of the RTA; and (4) a claim seeking a
declaration that procedural irregularities in the CEDC's
approval of the initial Gaylord Project invalidated that RTA
[¶15] In December 2013, Aurora moved for a
C.R.C.P. 12(c) judgment on the pleadings, asserting that the
Hotels lacked standing to bring claims one, two, and four.
Aurora conceded that the Hotels had standing to bring their
third claim, but maintained that this claim should be
resolved in its favor on its merits. The court held a hearing
in March 2014 and, in April 2014, granted Aurora's
C.R.C.P. 12(c) motion in an oral ruling. In July 2014, the
trial court entered a written order denying the Hotels'
C.R.C.P. 59 motion.
[¶16] On appeal, the Hotels contend that (1)
the trial court erred in ruling that they lacked standing to
bring their first, second, and fourth claims for relief; and
(2) the court misconstrued their third claim as a facial,
rather than an as applied, challenge to the constitutionality
of section 24-46-309. Aurora and the CEDC maintain that the
trial court correctly resolved these two issues and further
assert, as a jurisdictional matter, that the Hotels'
complaint was untimely under both section 24-4-106(4) and