Discounts at a price

15 years have passed since city lost suit over Wal-Mart vote

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It was 15 years ago this month that the lengthy debate about Wal-Mart's bid to open a store in Steamboat Springs stopped just short of reaching the Colorado Supreme Court.

Wal-Mart officials, employees and customers celebrated the opening of the store in Central Park Plaza on Sept. 30, 1992. But the bigger event occurred 19 months earlier, when the Colorado Supreme Court refused to hear an appeal by the city of Steamboat Springs, effectively ending the city's lawsuit. The Colorado Supreme Court let stand an appeals court ruling that, in turn, led to a special municipal election here. The results of the election ultimately decided the fate of the Wal-Mart store.

The two Steamboat attorneys who waged the legal contest are pretty much in agreement today about the points of law involved in the case.

"I thought I was right," Tony Lettunich said. "But looking back, good for Judge Fullerton and good for the court of appeals. They made the right decision."

Lettunich was on the losing side of the legal argument. However, the unpredictable events that led to the opening of the Wal-Mart store mean picking winners and losers in the case is tricky.

Lettunich's client was the city of Steamboat Springs, not Wal-Mart. And the city wasn't preoccupied with Wal-Mart. Instead, Lettunich said, city officials wanted to preserve local government's authority over issues they thought they should decide.

Attorney Rich Tremaine prevailed in the legal contest on behalf of a group called Citizens for Quality Growth. However, after winning the court case and gaining the public referendum they wanted so badly, his clients ultimately lost the bigger fight.

"We were fighting over whether it was a proper issue to go to the voters," Tremaine said.

Voters get the last word

The irony is that the citizens group that forced the election was seeking to stop the arrival of Wal-Mart at Central Park Plaza. But the electorate had other ideas. On June 12, 1991, the voters of Steamboat, by a 12 percent margin, voted in favor of directing the city to issue a permit for the 55,000-square-foot store.

Wal-Mart, which twice had announced it was abandoning the Steamboat market, quickly returned to the scene.

Before it was over, the lively public debate about Wal-Mart consumed seven years and involved more twists and turns than the Green River's course through the canyons of Dinosaur National Monument.

The Wal-Mart saga can be traced to spring 1985, when a developer -- Carrington Colorado -- applied for a city permit to build the Steamboat Crossings shopping center on the west side of U.S. Highway 40 at Pine Grove Road. In April 1986, the City Council granted a permit for 84,000 square feet of retail space with City Market as the anchor tenant.

But later that spring, City Market officials announced they would relocate to the nearby Central Park Plaza shopping center instead.

Carrington Colorado fought

back with the announcement that it had reached an agreement for a Wal-Mart store and filed for a revised permit with the city that would boost the total square footage to 89,000 square feet. The City Council unanimously denied the revised permit in December 1986.

Harassed and humiliated

The developers were not happy. In January 1987, Patricia Sandefur, Walter Carrington and Wal-Mart filed a joint lawsuit against the city and the City Council seeking $2 million in damages plus an additional $1 million for every year that passed until the issue was resolved.

Sandefur and Carrington circulated petitions asking for a citywide vote on the permit application, but the city clerk rejected the petitions. The City Council not only upheld the clerk's ruling, but it filed a countersuit against Wal-Mart declaring they were "harassed, humiliated and intimidated by the defendants."

Sandefur's group asked the District Court to rule on the sufficiency of the petitions, but before anything transpired, the lawsuits were dropped. In November 1987, Wal-Mart officials announced they were abandoning their pursuit of a store here.

The giant discounter's absence from the scene lasted seven months until June 1988, when company officials announced plans to build a 55,000-square-foot store in Central Park Plaza next to City Market.

This time around, the City Council voted 4-2 in favor of Wal-Mart's plans (with one member stepping down, and the late councilwoman Rita Valentine and former councilwoman Paula Cooper Black dissenting). The October hearing on the matter lasted two nights, and the hearing room overflowed with members of the public. Some residents even poked their heads through open windows in the Steamboat Springs Community Center, where the hearing was held.

Not everyone was opposed to Wal-Mart. Many argued they needed more affordable shopping for goods they couldn't readily find in Steamboat.

But many did oppose Wal-Mart. In November of that year, a woman named Mary Ellen Rubley (who has since moved) formed a committee called Citizens for Quality Growth, which circulated petitions asking the City Council to reconsider its vote or refer the matter to the voters.

Citizens for Quality Growth filed a suit in District Court against the city, seeking to force a public referendum.

In April 1989, visiting Judge Robert Fullerton sided with Rubley's group and directed the city to hold an election about Wal-Mart's fate in Steamboat.

But less than a week later, Wal-Mart officials said they no longer wanted to be part of an issue that was so clearly dividing the community.

Point of law

The case had attracted the attention of municipalities across the state, and the city of Steamboat wanted the point of law resolved. The matter was back in court in August, and Fullerton rejected the appeal.

Lettunich was contracted by the city to handle the case. Tremaine, who had moved to Steamboat from Fairfax County, Va., months earlier, didn't want to take the case. He had a practice in Virginia that specialized in land-use policy issues in suburban Washington, D.C. His intent had been to put that chapter of his career behind him.

"I can remember that I took the paper before we decided to move here," Tremaine recalled. "I read about City Council's approval of Wal-Mart and said to my wife, Judy, 'Thank goodness that has already been settled!'"

However, the fact that Tremaine arrived on the scene with no conflicts made him a marked man. He was persuaded to represent Citizens for Quality Growth.

Lettunich, who would become Steamboat's city attorney, said Rubley's group based its case on a valid point of law, but he was convinced it was being misapplied.

Colorado statutes allow residents to seek a referendum in cases that involve a zone change, he said. But the Wal-Mart development application did not involve a zone change.

The two attorneys presented their cases to the Appeals Court, but Lettunich quickly deduced from the stern questioning he received from the bench, that it wasn't going to be his day.

The Appeals Court agreed with Fullerton that Steamboat's zoning code was so vague and sloppy that the issuance of the permit for Wal-Mart was "tantamount" to a rezoning. Lettunich said he thought the Appeals Court viewed it as a fairness issue. Thus, the demand for a referendum was upheld.

Backed by the Colorado Municipal League and the Colorado Homebuilders, the city pressed on, but it was a lost cause.

The vote took place with unintended consequences for Citizens for Quality Growth -- residents voted in favor of Wal-Mart.

Fifteen years later, the community continues to debate the appropriateness of big-box retailers and nationally branded stores here.

Tremaine said it's a positive sign that Steamboat is home to enough independent retailers that the debate continues.

"It means that our business owners are bright and resourceful enough to compete in a small market with a Wal-Mart," Tremaine said.

And the question remains: Do the two litigants shop at the discount store?

"I think I was there on the very first day," Lettunich said. "I'm in there once a week."

And Tremaine?

"I don't shop there," he said. "My wife does. That's just the way it is."

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