Ski resorts that lease federal land will have to continue paying taxes on those leases, said the state Supreme Court in a recent ruling. But the big losers may be Denver's professional football and baseball owners.
Routt County and six other Colorado counties had refused to comply with a 1996 state law that gave tax exemptions to ski areas and other entities with long-term leases, permits or contracts to operate on public land. The counties claimed the law was unconstitutional.
Ski companies such as the Steamboat Ski and Resort Corp., however, liked the statute and used it as the basis for protesting their tax bills since 1996. But they kept on paying. In Routt County, the ski corp.'s payment amounted to about $62,000 a year.
"We've been paying the tax right along," said Chris Diamond, president of the ski corp.
"The attitude was if we didn't have to pay the tax, it would be frosting" if the court ruled against the counties and required the taxes to be paid back.
Although the federal land that Steamboat's slopes are on is not owned by ski corp., the lease is considered valuable and can be assessed for what are called "possessory interest" taxes, the Supreme Court ruled.
Ski resorts have been paying the tax since 1975, but it was the professional sports team owners in Denver who lobbied to get the 1996 law passed, said Larry Kallenberger, executive director of Colorado Counties Inc.
CCI is the lobbying group that represents the interests of county officials across the state.
"It really was an example of the rich and powerful forcing their way into violating the (state) Constitution, and even talking the Legislature into trying to change the Constitution," Kallenberger said.
The Supreme Court ruled that the 1996 tax exemption law was illegal because it changed what the Colorado Constitution said was or was not taxable. Only a vote of the people can change the constitution.
Kallenberger said Denver Broncos owner Pat Bowlen was prominent in getting the 1996 law passed because he didn't want to have to pay taxes on his lease of the publicly-owned Invesco Field at Mile High.
"The Broncos are on public land, the Rockies (baseball team) are on public land and they don't pay taxes," Kallenberger said.
However, Kallenberger said the Nuggets basketball team and the Avalanche hockey team pay taxes because they built their own stadiums and paid for their land.
"Why should they pay taxes, and the Broncos and Rockies not pay?" asked Kallenberger. "When they pay less or nothing, the rest of us pay to make up for it."
Denver County assessor Jerry Ogden said the ruling could mean the leases at Invesco Field and Coor's Field will be taxed.
"The way the law reads is that any private business conducted for financial gain on an otherwise exempt property like government land, can be assessed," Ogden said. "Certainly the sports facilities and Denver International Airport would have the greatest impact."
He said businesses who lease space at DIA also could be subject to taxation.
Another big flaw stated by the supreme court, said that the 1996 tax exemption law exempted some "possessory interests," like ski resorts, but not mineral and oil leases on public land.