Volume 3 Issues 3

Colorado Supreme Court Declines Telling Legislature How to Allocate Tax Dollars

by Joshua Dunn

This article was originally printed in the Greeley Tribune on October 1, 2015.

Last week, the Colorado Supreme Court was invited to hurl the state into a constitutional crisis. Wisely, it said “No thanks.” 

While the court’s decision in Dwyer v. Colorado is undeniably good news for basic principles concerning separation of powers, it raises more fundamental questions about what our constitution can actually guarantee.

In 2000, the voters of Colorado added Amendment 23 to the state constitution.  It requires the legislature to increase “statewide base per pupil funding” each year by the rate of inflation. Because of the recession, the legislature could not both increase base funding and maintain other education funding.  

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In addition to a base level of funding for all school districts, the state provides supplemental funding based on other “factors” such as a district’s size, cost of living, and number of at-risk students.  With declining tax revenue, the legislature decided to implement a “negative factor” that decreased factor funding while increasing base funding to satisfy Amendment 23.  As a result base funding increased, while overall education funding declined.

This decrease in overall education spending led parents and several school districts to sue in Dwyer, claiming that the “negative factor” violated Amendment 23 and demanding that the court order the legislature to increase educational funding. 

Their claims faced two insurmountable obstacles: plain English and fiscal reality.

Unfortunately for the plaintiffs, Amendment 23 clearly says that the state only has to increase base per pupil spending. The plaintiffs were compelled to argue that “base” does not mean base, but instead means total.  If it means total, then spending could not decrease from the previous year’s level.  The court declined to be drawn into this game of postmodern linguistic gymnastics.  It simply said base funding means base funding, “because this is exactly what Amendment 23 says.”

The plaintiffs faced even more fundamental fiscal obstacles. In the real world, limited resources force the state legislature to make tough choices about allocating tax dollars in many areas.  Among them are roads, police, prisons, and parks, along with K–12 education. 

Only the legislature has the capacity to make the kinds of budgetary tradeoffs required for the rational allocation of tax dollars. The plaintiffs wanted the court to tell the legislature to either ignore those other obligations or to mandate a tax increase in violation of the state constitution. 

Of course, the Dwyer litigation’s real target might have been the Taxpayer’s Bill of Rights (TABOR) which requires voter approval of tax increases. Twice in the past four years, huge majorities of Coloradans have rejected education tax increases. 

Ruling for the plaintiffs in Dwyer would have required the Court to tell the people of Colorado that they are not sovereign. One suspects Coloradans would not have responded favorably to the court declaring that TABOR was unconstitutional.

Even setting aside TABOR, Amendment 23 raises questions about what we can expect from our constitution. The amendment demands that education spending increase regardless of economic reality. States, however, cannot print money and thus cannot run long-term deficits. Also, like many states, Colorado is constitutionally required to have a balanced budget. 

In a federal system, states compete with each other to offer an attractive basket of goods and services to residents and businesses. A state with a regulatory and tax structure less attractive than other states’ can expect to see its taxpayers move to more inviting climes. This competition, in turn, forces states to spend tax dollars more wisely. But most importantly, states cannot control recessions. Regardless of TABOR limitations, economic slowdowns sometimes will cause revenue declines.


These limitations on states all point to the folly of mandating specific spending levels and the even greater folly of mandating specific levels of increased spending. Mercifully, Amendment 23 allowed for some legislative flexibility to reallocate dollars from factor funding to base funding. But one day an economic downturn might prevent the legislature from increasing base funding, forcing the state to violate the constitution. 


In the abstract, mandating increased spending on popular programs is always attractive. But constitutions, as James Madison said, should not contain provisions that require their own “usurpation.” 


In short, constitutions should not write checks that the government might not be able to cash. Littering our state charter with such mandates is poor constitutional hygiene.


Prof. Joshua Dunn is Director of the Center for the Study of Government and the Individual at the University of Colorado-Colorado Springs.  His research primarily focuses on constitutional history and judicial policymaking.