Valley Floor War Reaches Final Phase...On Paper: Telluride CO Watch, 10/4/07

More Oral Arguing, More Legal Wrangling to Follow

By Douglas McDaniel

With two briefs now plopped down on the dais of the Colorado State Supreme Court, one from the San Miguel Valley Corporation and the other, the town’s official response, the two sides in the battle for ownership of the Valley Floor are now lined up, in an abstract paperwork scene of battle, before a court of black-robed Supremes in a big building in Denver that will determine the fate of Telluride for the 21st century.

Especially if the SMVC can argue successfully to erase the 20th century, that is, the portion of that time that included a home-rule community’s ability to acquire land by eminent domain (a duration, by the way, as long and as old as the State of Colorado itself). Filed in tandem, the two briefs are a Tao of two kinds of language. One, the town’s answer, is stolid, bolted to the State Constitution. The other, the SMVC’s opening salvo in its appeal of the town’s condemnation of the 570-acre Valley Floor, is a swirling fisticuff of broadly collected cases, chunks of highly researched rulings from past condemnation battles, all drilling to reverse a hundred years of eminent domain law in the state.

When delving into the two briefs consisting of a total of more than 80-something pages, a layman might be tempted to start first by looking at the pictures. The town’s answer includes an appendix. Those exhibits include but are not limited to aerial photographs, maps, scenic photos, including one of the box canyon vista from the Valley Floor with a full moon above. It’s a $50-million-plus shot.

Also included is the entire Town of Telluride ordinance No. 1174, a five-year-old document signed by then-Mayor John Steel. In 2002 it authorized the town to acquire adjacent terrain. The ordinance states the town has “duly determined that it is of critical importance that it acquire through eminent domain for public park purposes the south side of the Valley Floor.”

Another exhibit included is a map of the SMVC’s Alternative B development scenario, which calls for more than 300 dwelling units between the San Miguel and the Spur, a stylized matrix of intense luxury development and, yes, some affordable housing: a worst-case scenario, still, from the town’s point of view.

In the broadest sense, the legal battle lines stake out the principle of a property owner’s right to maximize the return on his investment versus the principle of a community’s right to plan its development.

State vs. Local Interest?
The answer brief to the SMVC’s opening salvo, co-written by Faegre & Benson’s staff and signed by Telluride’s condemnation attorney Leslie Fields, argues for a status quo in constitutional law, and criticizes the state legislature’s use of the “Telluride Amendment” to thwart this particular condemnation.

The amendment was lobbied for and paid for by landowner Neal Blue, owner and CEO of General Atomics, a vast international collection of endeavors in the nuclear industry, who is appealing the condemnation of his 570-acre parcel knowing that, even if he loses, he stands to make $50 million-plus, the amount the town raised to pay for the Valley Floor through bonding and donations. Nevertheless, basing his arguments as a battle for the rights of the individual property rights, the San Diego-based conservative is willing to gamble one-fifth of such proceeds in legal fees to make his case for property rights.

On Aug. 15, SMVC filed its opening brief with the Supreme Court, claiming the town lacked the authority for condemnation to start with, and thus extended the state’s conflicting laws on eminent domain beyond what was originally intended.

“Despite the years-long uncertainty about whether the Town could actually afford to pay for the taking, Respondents were prevented from developing or selling their property, and prevented from making absolute their recently adjudicated water rights,” the brief states.

Categorizing the summary of its own arguments, Telluride’s response states the following: “Article XX is a broad constitutional grant to home rule municipalities the power of eminent domain, which authorizes condemnation outside municipal boundaries for any lawful, public, local, and municipal purpose, including open space, parks and recreation uses at issue.”

Pointing at the so-called Telluride amendment, “because Subsection 4 purports to prohibit Telluride’s lawful exercise of its Article XX eminent domain powers and to rewrite portions of Article XX,” the trial court, San Miguel County District Court Judge Charles Greenacre, “correctly rules the statute unconstitutional.”

“The extraterritorial power to condemn for local and municipal purposes,” the brief argues, “having been granted by the Constitution a century ago, cannot be taken away by the legislature.”

SMVC’s Case
Much of the SMVC’s appeal reviews the history of the long conflict between the Town of Telluride and SMVC, with one of the main targets of contention regarding Article XX of the Colorado State Constitution. From SMVC’s point of view, there’s a grey area, a situation where mileage, as in the extent to which a town may take land, may vary.

In the summary of the argument, the filing states: “When a home rule municipality exercises authority outside of its territorial boundaries, the action necessarily involves a matter of mixed state and local concern. In those circumstances, the authority of the home rule municipality to act is subject to preemption by a conflicting statute unless Article XX expressly grants such power.”

SMVC argues no such power or circumstance exists in the town’s effort to obtain the Valley Floor through eminent domain.

“Authority for home rule towns to condemn extra-territorially for open space is found nowhere within Article XX. Yet, the trial court inferred just such authority.”

SMVC thus challenges the original ruling by Greenacre to allow the condemnation effort to proceed: “Absent an express grant of constitutional authority, in matters of statewide or mixed state and local concern, the ordinances of home rule municipalities cannot stand in the face of inconsistent state statutes,” the SMVC brief argues. “Here, there is no Article XX authority, either express or implied, for this taking. Even assuming, however, that authority could be found, it is certainly not an express grant. It was therefore essential that the trial court address whether the matter or extraterritorial condemnation for parks and open space was one of purely local and municipal, statewide or mixed state and local concern.

“Had it done so, the court would have determined it to be, at a minimum, a matter of mixed state and local concern. Consequently, because the Town’s condemnation ordinance conflicts with the Statute, the ordinance is preempted.”

While it will no doubt require the state’s Supreme Court judges some time to wade through the myriad – and sometimes quite murky – arguments listed in the growing collections of briefs, one thing is clear: According to the SMVC, “the trial court’s order should be reversed, and the condemnation dismissed.”

The Colorado Supreme Court will decide on the appeal of the condemnation of the 570-acre Valley Floor filed by the San Miguel Valley Corporation this fall and going into the winter.

So far, only the sparring has begun. According to Town Attorney Kevin Geiger, it’s conceivable the case will continue on into late spring or even summer.

Telluride CO Watch: http://www.telluridewatch.com