TC Res. No. 1985-05RESOLUTION NO-:'#85=5
SERIES OF 1985
A RESOLUTION SUPPORTING HOUSE BILL 1134 - LOCAL
GOVERNMENT ANTITRUST LIABILITY
WHEREAS, the State of Colorado relies upon local
governments to carry out many licensing and regulatory
activities and, should provide local governments and their
taxpayers with sufficient protection to excerise that
responsibility without the fear of expensive antitrust
litigation and liability; and
WHEREAS,,the exposure~of municipalities in Colorado
and throughout the country .to antitrust lawsuits has been
expanded as a result of recent decisions of the United States
Supreme Court; and
WHEREAS, the-potential for damage awards and the substantial
expense of defending antitrust litigation, even if successful,
rtiay - 'i:nhibit municipalities from -,enactingcor - enforcing ih4l-regiil at ions
which protect-the public health, safety and welfare, but which
also may be deemed.to restrict competition; and
WHEREAS, at least five Colorado municipalities already
have been sued under the antitrust laws; and
WHEREAS, other Colorado municipalities have been
threatened with antitrust lawsuits for licensing or regulatory
decisions; and
WHEREAS, the cost to-the taxpayers.of'Boulder, Colorado,
in defending one federal antitrust lawsuit, which was settled
prior to trial, was an estimated one=quarter::_milliori `_ldollars,..--and
WHEREAS, municipalitiesc differ---from'pri:vat.e :enterprise
in that private enterprise is not charged with protecting the
public health, safety.and welfare through licensing and regular
tion; and
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WHEREAS, numerous protections from municipal licensing
and regulatory actions, other than damages under the antitrust
laws, are available such as, public notice, public hearing, public
meeting and public record requirements, court review of actions,
periodic elections and the rights of initiative, referendum and
recall, and the continuing authority of the General Assembly or
the people of Colorado to modify the statutory or constitutional
authority of Colorado's municipalities;
NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF
THE TOWN OF AVON, COLORADO, that the Colorado General Assembly
should act as quickly as possible to adopt H.B. 1134 in order to
protect local governments and their taxpayers from expensive
antitrust litigation and liability for local licensing and
regulatory activity and that the Town support efforts of the
Colorado Municipal League in this regard.
INTRODUCED, READ, PASSED, AND ADOPTED at a regular
meeting of the Town Council of the Town of Avon, Colorado, held
on February 12, 1985.
TOWN OF AVON, COLORADO
Allan R. Nottingh , Mayor
tri.cia J. Do e, Town C rk
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LOCAL GOVE T ANTITRUST LIABILITY
HOUSE BILL 1134
The League solicits your help in urging the passage of H.B. 1134 by the
Colorado General Assembly. On September 25, 1984, the federal Local
Government Antitrust Act of 1984 became effective. The Act grants an
exemption from damages to local governments from federal antitrust laws.
It is widely believed that this federal legislation has solved antitrust
liability problems for local governments in Colorado. Unfortunately, that
is not the case.
Local governments remain liable under the federal antitrust laws for
injunctive actions (where the relief requested is not damages, but rather a
court order prohibiting the local government from doing something, i.e.,
approving a rezoning request). In addition, attorney's fees may still be
requested in connection with these injunction actions. In past years, most
antitrust cases were filed in federal court. With the recent federal
amendments,- however, it becomes much more attractive to file under the
state antitrust act, which has not been changed. While the state act does
not allow for triple damages, single damages and attorney's fees alone can
be significant. For example, the City of Boulder reportedly incurred a
quarter-million dollars in costs merely in defending the Community
Communications lawsuit.
In cooperation with Colorado Counties, Inc., the Colorado Municipal League
has drafted legislation to expand upon the immunity granted local
governments by the recent federal amendment and to amend the state
antitrust law to eliminate damage claims under that statute.
Representative Richard Mutzebaugh and Senator Ralph Cole have agreed to
sponsor the measure. The bill has been introduced in the House as H.B.
1134.
House Bill 1134 does two things:
1. Complete immunity from any antitrust action, federal or state, and
whether for damages or merely for injunction, is provided to local
governments when they engage in regulatory and licensing
activities. This would include matters such as land use, zoning,
and franchising. That immunity does not extend to non-governmental
activities.
2. The bill amends the state antiturst act at § 6-4-108, to conform to
the changes made in the federal statute, by eliminating actions
against local governments for damages, costs, interest on costs and
attorney's fees. Significantly, as with the federal amendments,
;;injunctive actions are preserved under the state act.
Despite the recent federal legislation, local governments continue to- be
subject to significant antitrust liability, particularly fore their
regulatory and licensing activities. We urge that you make your support of
H:B. 1134 actively known by adopting the enclosed resolution of support and
sending it to your- senators. and representatives in the Colorado General
Assembly (with a'copy to Jerry Dahl at the League office).
0 First Regular Session •
LDO NO. 85 0455/1 Fifty-fifth General Assembly HOUSE BILL NO.
STATE OF COLORADO 1134
State Affairs
BY REPRESENTATIVES Mutzebaugh, Allison, and Wright;
also SENATORS Cole and Glass.
A BILL FOR AN ACT
1 CONCERNING EXEMPTION OF LOCAL GOVERNMENTS FROM LIABILITY UNDER
2 ANTITRUST LAWS.
Bill Summary
(Note: This summary applies to this bill as introduced
and does not necessaril reflect any amendments whicT
subsequently ado ted.
Provides that units of local government and their
officials, agents, and employees are exempt from liability
under antitrust laws when exercising powers granted to such
governments by law. Requires local governments to file copies
of regulatory measures with the division of local government.
Authorizes the collection of a fee by such division for its
services. Creates the antitrust regulatory measures cash fund
as a depository for such fees.
3- Be it enacted the General Assembly of the State of Colorado:
4 SECTION 1. Title 29, Colorado Revised Statutes, 1977
5 Repl. Vol., as amended, is amended BY THE ADDITION OF A NEW
6 ARTICLE to read:
7
ARTICLE 15
8 Local Governments - Exemption from Antitrust Laws
9 29-15-101. Legislative declaration. The state of
10 Colorado has long recognized the essential role of units of
Capital letters indicate new material to be added to existing statute.
Dashes through the words indicate deletions from existing statute.
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1 local government in regulatory and licensing activities. The
2 Colorado constitution and statutes have charged and authorized
3 local governments to undertake such activities to protect the
4 public health, safety, and welfare. To enable local
5 governments to accomplish these important public purposes, the
6 general assembly hereby determines that local governments
7 should be exempt from any antitrust law, including the
8 provisions of article 4 of title 6, C.R.S., when carrying out
9 their regulatory and licensing activities. Therefore, the
10 general assembly hereby finds and declares that it is the
11 policy of this state that local governments shall be immune
12 from liability whenever local governments or their officials,
13 agents, or employees displace competition by licensing and
14 regulatory activity pursuant to the powers and authorities
15 granted to them in the constitution and statutes of this
16 state.
17 29-15-102. Definition. As used in this article, unless
18 the context otherwise requires:
19 (1) "Local government" means a government as defined in
20 section 29-1-602.
21 29-15-103. Exemption. Whenever any local government
22 acts to displace competition by licensing and regulatory
23 activity pursuant to the powers and authorities granted to
24 local governments in article XX of the Colorado constitution,
25 and in articles 18, 46, 47, 48, 48.5, and 51 of title 12,
26 C.R.S.; articles 65.1 and 67 of title 24, C.R.S.; part 2 of
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1 article 15 of title 25,,C.R.S.;this title and titles 30, 31,
2% '32,.-.-and 33, C.R.S.; articles 1 to 48, 85, and 93 of title 37,
3 C.R.S.; and any other statutory or constitutional provision
4 enabling regulatory or licensing activity by local
5 governments, such local government and its officials, agents,
6 .and employees shall partake of the exemption and immunity of
7 the state of Colorado from any antitrust law.
8 29-15-104. Local discretion. When acting to displace
9`-' competition by ;regulatory and. licensing activities as
10 authorized by the state constitution-or statutes, each local
.11 government shall, proceed according to the judgment of'its
12 governing body, authorized boards, commissions, or officers,
13 or electors as to the type and degree., of regulatory-,or
14 licensing activity deemed to be in the best interests of its
15
citizens.
16
29-15-105. State supervision - fil.ing of regulatory
17
measures - fees. (1) Sufficient,state.supervision of local
18
government regulatory and licensing activities shall be
19.
provided by the availability of judicial review, the
20
availability of the initiative and referendum, the
21
availability of election and recall,, the -authority of the
22
general assembly to enact and amend statutes, the authority of
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the people of Colorado to amend the state constitution, and
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the continuing administrative structure 'and ,quasi-judicial
25
procedures available by statute, charter, ordinance, or
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resolution to implement and review- regulatory and licensing
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1 activities of local governments.
2 (2) (a) To further insure an effective state ability to
3 supervise local government regulatory and ' licensing
4 activities, a copy of each such measure' of 'general
5 applicability enacted by a ,local government shall' be filed
6 with the division of local government in the department of
7 local affairs not later than thirty days after the effective
8 date 'of''the measure or after the effective date of this
9 article,, whichever is later. The provisions of section
10 29-2-110 shall govern the timing and methods of filing
11 required by this subsection (2). Failure to file a copy of a
12 regulatory 'or licensing measure shall not effect the validity
13 of the measure.
14 (b)' The director of the 'division of local government
15 shall establish fees sufficient to cover the actual and
16 reasonable costs of compliance with this subsection (2). Such
17 fees shall be credited to the antitrust 'regulatory measures
18, cash fund, created in'section 29-15-106.
19 29-15-106. Fee adjustments - antitrust regulatory
20 measures cash fund - created. (1) The director of the
21 division of the local government shall propose, as part of the
,22 division's annual budget request, an adjustment in the amount
23 of the fee which the division of local government is
24 authorized by section 29-15-105 (2) (b) to collect. The
25 budget request and the adjusted fees for the division of local
26 government shall reflect direct and indirect costs.
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(2) Based upon the appropriation made by the general
assembly and subject to the approval of the executive director
of the department of local affairs, the division of local
government shall adjust its fees so that the revenue generated
from said fees approximates its direct and indirect costs.
Such fees shall remain in effect for the fiscal year for which
the budget request applies. All fees collected by the
division of local government shall be transmitted to the state
treasurer, who shall credit the same to the antitrust
regulatory measures cash fund, which fund is hereby created.
All moneys credited to the antitrust regulatory measures cash
fund and all interest earned thereon shall be subject to
appropriation by the general assembly to be used as provided
in this section and shall not be deposited in or transferred
to the general fund of this state or any other fund.
(3) Beginning July 1, 1986, and each July 1 thereafter,
whenever moneys appropriated to the division of local
government for its activities for the prior fiscal year are
unexpended, said moneys shall be made a part of the
appropriation to the division of local government for the next
fiscal year, and such amount shall not be raised from fees
collected by the division of local government. If a
supplemental appropriation is made to the division of local
government for its activities, the fees of the division of
local government, when adjusted for the fiscal year next
following that in which the supplemental appropriation was
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1 made, shall be adjusted by an additional amount which is
2 sufficient to compensate for such supplemental appropriation.
3 Moneys appropriated to the division of local government in the
4 annual general appropriation act shall be designated as cash
5 funds and shall not exceed the amount anticipated to be raised
6 from fees collected by the division of local government.
7 29-15-107. Scope of article. The antitrust exemption
8 from liability provided in this article shall be in addition
9 to, and shall not be construed to limit, any local government
10 exemption or immunity from antitrust liability which might
11 otherwise exist and shall neither increase nor restrict the
12 regulatory and licensing authority of local governments.
13 29-15-108. Applicability to public utilities. This
14 article applies only to the exemption and immunity of local
15 governments from antitrust liability. Except for the grant of
16 antitrust immunity, nothing in this article shall be construed
17 to interfere with, restrict, limit, or otherwise infringe upon
18 the rights, obligations, duties, and powers granted by law to
19 public utilities to furnish, establish, maintain, or expand
20 facilities or services to public utility customers.
21
29-15-109.
Prior regulatory and
licensing
activities.
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All regulatory
and licensing measures
previously
adopted and
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in effect on the
effective date of this
article
that have
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been taken by
local governments under
the state
constitution
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and statutes are confirmed as being
consisten
t with the
26 purpose and intent of this article and are to have the same
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1 exemption and immunity as''that provided in section 29-15-103.
2 SECTION 2. 6-4-108, Colorado Revised Statutes, is
3 amended to read:
4 6-4-108. Damages. Any person, corporation,
5 copartnership, trustee, or association shall also be liable to
6 any person transacting or doing business in this state for any
7 damages he may sustain by reason of the doing of anything
8 declared unlawful in this article. NO DAMAGES, INTEREST ON
9 DAMAGES, COSTS, OR ATTORNEY FEES MAY BE RECOVERED UNDER THIS
10 ARTICLE FROM ANY LOCAL GOVERNMENT, AS DEFINED IN SECTION
11 . 29-1-602, C.R.S., OR ANY OFFICIAL, AGENT, OR EMPLOYEE,THEREOF
12 ACTING IN AN OFFICIAL,CAPACITY, OR IN ANY CLAIM AGAINST' A
13 PERSON, CORPORATION, COPARTNERSHIP, TRUSTEE, OR ASSOCIATION
14 BASED ON ANY OFFICIAL ACTION DIRECTED BY A LOCAL GOVERNMENT,
15 '':OR OFFICIAL, AGENT, OR EMPLOYEE THEREOF ACTING IN AN OFFICIAL
16 CAPACITY.
17 SECTION 3. Safety clause. The general assembly. hereby
18 finds, determines, and, declares that this act is necessary
19 for the immediate preservation of the public peace, health,
20 and safety.
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1134
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TO: The Honorable Mayor and Town Council
FROM: William D. James, Town Manager
DATE: February 6, 1985
SUBJECT: House Bill 1134 - Local Government Antitrust Liability
Please find attached information regarding House Bill 1134.
The information attached is self explanatory.
I would recommend that the Council pass the attached resolution
in support of this Bill.