HOME RULE
The Schechter Maxim: Economics change faster than Perceptions
And Perceptions change faster than Politics. Jonathon Schechter
Part I. “Where facts are few; experts are many.” Donald R. Gauman
Last year, a series of articles on Home Rule in Colorado appeared over the course of several weeks. It was an excellent series, and while it was being carried, there were other news articles dealing with Home Rule. Given that extensive local coverage, I was surprised when recently, the Sun asked locals what they thought of Home Rule and not one knew anything about it. Now, a petition is out for starting the Home Rule process, but it appears there is still a great deal of information people need to get to make an informed decision on this important step, and I thought I could contribute to that effort.
Home Rule originated with court cases, which might be described by conservatives now as asserted by activist judges. Justice Dillon wrote an opinion (1865), which in essence says that local governments only have so much power and authority as the state government delegates. The case was based on a much earlier ruling that local governments are “creatures of the state”. Judge Cooley, in another case (1871) went on to say that in interpreting delegation of authority, local municipalities may receive a liberal interpretation of that authority and counties conservative interpretation – hence “home rule”. “Dillon’s Rule” is still the predominant generally accepted standard for legislative interpretation with 39 states adhering to its precept. Home Rule as a concept based on Judge Cooley’s opinion starts with enabling provisions in a state’s constitution (Article XX) in Colorado. The process to establish home rule is by statute (C.R.S. 31-1-203 & 31-4-100/200), and implementation is by charter.
a. “Seek first to understand then to be understood.” Stephen R. Covey
If you think about this from a 19th century perspective, it makes a lot of sense. Municipalities had the people, and unincorporated areas had property. Therefore, the court rulings simply give people the benefit of the doubt, while protecting the property interests that predominant in rural areas. Although mining and industrial interests got a lot out of the Colorado Constitution, Denver made sure there was a provision allowing local governments from remaining “creatures of the state”. One has to think mining and industrialists like General Palmer saw benefits in “home rule” since they carved counties of their own out of larger counties, and created their own municipalities to develop apart from the mining camps (think Teller County carved out of El Paso County, and Silvercliffe created apart from Westcliffe).
The Chicago World’s Fair in 1893 introduced the “beautiful cities” movement, which was brought back to Colorado by Governor Evans, and embraced by a group of Denver realtors led by Robert Speer. Unfortunately, beauty costs a lot of money, and grants of authority from the state for municipalities to raise money are not based on the most needy, but on minimal needs applicable to most communities. Speer needed more authority to raise money for his “City Beautiful”, and he was able to get that authority by creating home rule for the City and County of Denver in 1902. Speer became mayor in 1904 for three terms. Denver remained the lone Home Rule in Colorado until the State delegated its authority over land use decisions to local communities in 1972, and adopted so-called “1041 powers” to regulate 21 statewide concerns.
b. “You don’t have to be a weatherman to know which way the wind is blowing.” Bob Dylan
Beginning in the early 1960’s, Colorado experienced a boom in real estate development - mainly by subdividing rural lands. By passing sweeping legislation to give local control over land use issues to local communities, the State got rid of an expensive, hot political potato. The State also provided more authority for home rule to help local communities pay the tab. More development means the need for services, which drives the need for more and better funding sources to pay for regulating the development and paying for the services.
Part II. “Good judgment comes from experience. Experience comes from bad judgment.” Barry LePatner
It was not long after the unprecedented shift away from land use decisions being made at the State level that communities started taking advantage of the enabling legislation for expanded home rule options. Of course, it was the mountain resort communities that first recognized advantages to home rule. First, mountain communities are relatively isolated anyway, which gives rise to a more independent attitude. Second, mountain communities were under the most pressure for growth and needed the means to meet this demand – hence the mantra “growth pays its own way”. Third, resort communities provide services for far more people than just its residents. Tourists, second homeowners, and seasonal employees create further needs for services and infrastructure than the average community. Finally, the mountain resort communities were attracting young professionals that did not want to be subjected to the whims of local politics, and home rule options included the means to change from political appointments and management to career professionals. Resort communities actually use the stable work environment as a marketing tool to attract a better quality employee, and indications are such employees will stay longer and be more committed to doing a good job.
a. “It has been my experience that folks with no vices have very few virtues.” Abraham Lincoln
Since that initial surge in growth, it was also these same communities that suffered the biggest reversals in fortune in the 1980’s. The downturn in development brought its own set of costs and challenges, and it was the home rule communities that were most capable of adapting to those changes and meeting those challenges. Having the ability to pay professional staffs knowledgeable about and able to take advantage of successful approaches to a changing economic climate paid off. I was in Crested Butte at the time. There, we had to cap building permits one year, and within two years, we were financing tap fees just to keep new construction going. We used that downturn to chip & seal the streets, develop a comprehensive drainage plan, and extend or parks system by moving the State and County shops out of town. While this was not everything we did to confront a changing economy, there is no doubt that it was the local authority, coupled with the ability to expand local revenue sources that provided the means to respond appropriately.
The 1980’s also ushered in a technology revolution. Business equipment and systems started becoming much more complicated. Those communities with professional offices responded, but statutory communities without the funding and with elected officials uncomfortable with change failed to react. State and federal requirements for funding, which were free-flowing in the 1960’s and 70’s dried up, replaced by a much more competitive, results oriented, approach. Those without the expertise to make the required applications, to meet the match requirements, and sustain the reporting requirements for results started losing out.
Clean water laws, clean air laws, OSHA, EPA, etc. started having a costly impact on local communities, and only those communities with the professional staffs and revenue were able to keep up with new standards and requirements. I remember being in Cripple Creek in the 1970’s when the mayor papered the wall with violation notices from the State for unsafe drinking water. The City’s reservoirs were built in its hey-day before WWI, and wood pipe still pre-dominated. It was only after the City became a gambling Mecca that it was able to get a new water and sewer system, and those improvements only came with big changes in City government. The Town of Pagosa Springs has been able to meet its needs for a new town hall and community center space after becoming home rule, but the need for a new courthouse, justice center and minimally good roads go unfunded at the County level.
b. “It ain’t what they call you, it’s what you answer to.” W.C. Fields
I was the first administrator for the City of Red Lodge, MT after it adopted a city charter that gave it expanded powers, which allowed it to start collecting a “resort tax” - statutory municipalities were precluded from implementing such a tax. The ability to come up with matching money for grants, and the revenue to pay loans allowed the City to start working on a mirade of backlogged infrastructure projects.
Some would say making needed infrastructure improvements raises property values, and it does, but enhancing infrastructure really brings property values in line with the quality of life citizens have a right to expect. For instance, Red Lodge was able to bring back period lighting for downtown, create a trails system, bring water and sewer to a new hospital, and much more, all as a result of the community taking control of its own destiny and assuming responsibility for the future. One project still in the works, improves water pressure throughout the City and provides more and better placement for fire hydrants, which lowers home insurance costs, adds better protection for historic properties at the heart of the City’s economy, and makes it possible for the City to rely on a volunteer fire department rather than a more costly full-time fire force.
c. “Management is doing things right; leadership is doing the right thing.” Peter F. Drucker
My experience in Red Lodge also illustrates how home rule powers (Montana is not a home rule state, but has enabling legislation that allows “charter powers”) can be used to respond to a crisis. Just prior to Memorial Day 2005, while crews were trying to clear the Beartooth Pass, a huge deluge wiped out the road in 13 separate places. Beartooth Pass connects Red Lodge to Yellowstone National Park so its opening is at the heart of the summer tourist economy, which accounts for about 43% of gross tourism revenues. The community was jarred to its core by a natural disaster no one was prepared for and had no way of foreseeing. Fortunately, the City was able to immediately adapt its revenue sources to the crisis, and through significant efforts to develop working relationships at the local, State and federal levels, leverage that revenue four times.
A revitalization plan for the downtown was implemented, a Main Street program was started, the City became a Preserve America community with new grant opportunities, and the City worked with the chamber to develop an entirely new marketing plan based on Red Lodge as a destination rather than simply being a gateway community to Yellowstone. In June 2005, resort tax revenues were down over 40%, but by the end of the year revenue had improved to the point the City was down only 17%. The community received a State award for its collaborative efforts on behalf of Montana tourism, and today, resort tax revenues are climbing again.
Part III. “It is difficult to get a man to understand something when his job depends on not understanding it.” Upton Sinclair
The Sonoran Institute and the American Farmland Trust have been doing community assessments for years now. These assessments evaluate the cost of services in rural communities across the west, including some right here in Colorado. Out of more than one hundred assessments, the results are striking - urbanization of unincorporated areas causes the government entity to spend more in services than it takes as revenue to pay for those services. In only one instance was the local community collecting more in taxes then it was expending in services. Archuleta County has not had such a study done, but one would expect it to fall in with the majority and expend more than it takes in.
For just about a century, Pagosa Springs and Archuleta County operated as the State’s fathers anticipated. People lived in town and the property in the surrounding unincorporated areas of the County was utilized for the economic benefit of the people in town. In the 1970’s, this community starting seeing land subdivided, but it was not until the 1980’s that the influx of people building in the outlying areas started affecting the local economy. Although the Town’s population has increased steadily during the last few decades, the rural population has accelerated to very high levels making it difficult for the County to keep up in providing services – services never contemplated it would have to provide.
a. “Money can’t buy you happiness, but it does bring you a more pleasant form of misery.” Spike Milligan
The Town has used a common strategy to maximize revenue, while mitigating its obligations to provide services; it annexed commercial development and left residential development and the roads serving both under the jurisdiction of the County. This magnified and aggravated a bad situation for County officials.
b. “Consistency is a paste jewel that only cheap men cherish.” William Allen White
The County tried to have it both ways in meeting the need and demand for services. It spun off some responsibilities by creating special districts to take on the extraordinary costs associated with enhancing and servicing this growth. Archuleta County kept down taxes and did not expand its revenue sources to keep pace with changing technologies, a crumbling infrastructure, inadequate facilities, and the service obligations imposed on it by the federal government, the State and its own residents. In 2006, despite no new revenue sources, the County was obliged to substantially increase staffing levels to keep pace with the demand for services, and those increases were across the board. A reckoning was bound to come so long as cost of services goes up and revenue remains static, but they were and remain consistent.
A crucial element that staved off a financial crisis was the benevolence Town leadership, which agreed to share sales tax revenue with the County. This arrangement should have allowed the County time to develop it’s own revenue sources, but instead, it was used to sandbag the fiscal dikes holding back the surging costs for services. The County never took advantage of the window of opportunity. Many of the staff increases the County made in late 2005 and early 2006 were reversed in the financial crisis of 2007.
Now the County has a huge backlog of infrastructure projects that need attention and needs to find solutions that will allow it to complete those projects in a fiscally responsible manner. Time is not on the County’s side; with the Town experiencing financial reversals, one has to wonder how long they can continue to share revenue with the County, and rising construction costs will continue to making budgeting for the County a challenge under the best of circumstances.
c. “Leadership is the capacity to translate vision into reality.” Warren G. Bennis
Government, unlike business, does not have as its mission to make a profit, its mission is to provide services that protect and enhance the health, safety and general welfare of its citizens. Unlike business, government services are mandated in most cases, or it has assumed obligations that cannot be reversed. A government really has only two choices to balance revenue and expenses – raise revenue or reduce services. The options it has to carry out these choices are also very limited - statutory entities having the fewest options, and that is the present predicament.
Home rule entities simply have more options to address fiscal constraints on local governments. A statutory county like Archuleta County is trying to address twentieth century issues with nineteenth century tools. The Town is addressing twenty-first century issues with twentieth century tools. What we need to be looking at is a plan to address twenty-first century issues with twenty-first century tools.
d. “It is not because things are difficult that we do not dare; it is because we do not dare that they are difficult.” Seneca
It is not my intent to provide the ultimate solution, but to suggest some elements that would provide direction in that regard.
1. Combine Town and County services. Although there were preliminary discussions on various services that could be adapted to become joint obligations, the best and most tangible step in that direction took place when various local entities joined to fund and operate county-wide dispatch services. It has been my experience that health and safety operations are generally where cooperation between and among local entities start. With only one town in the county, most if not all services have the potential for joint funding and operation, but what is needed is a plan and a timeline to move in that direction. Service workers are under a great deal of financial pressure right now so how do we make sure employees can get to work and still afford to live here?
2. Commit to a Three Mile Plan that combines Transportation, Utilities and Annexation. The State has mandated a tool many other communities in the State are finding indispensable in dealing with good growth management; the Three Mile Plan. There are plenty of models out there, plenty of past experiences to take advantage of, and plenty of support to local governments for such efforts at the State level. Does it really make sense to expand the Town’s planning area to Blue Sky Ranch?
3. Develop a Community Strategic Plan. This community needs to come together on a number of issues that have been following independent tracks for decades to make sure costs are mitigated, objectives and goals find mutually acceptability, and due consideration is given to economic realities in the twenty-first century. Downtown is struggling, and this community needs to come together on a plan to revitalize it or re-position it for the future. The west-end commercial area is principally single use relying heavily on the automobile – how do we revitalize it or re-position it for continued vitality in the twenty-first century?
4. Share Information. The County is moving toward updating its computer systems, but until there is an appropriate level of technology and the people capable of dealing with the responsibilities of local government, gaps gaffs, and duplication of services that cost time and money. The community needs to come to grips with just how it preserves a certain level of political accountability, while making sure professional staffing takes on the highly technical aspects required of local government today. Good people deserve good personnel policies that are followed tactfully and with respectful professionalism – not by nefarious one-sided attacks. How can you expect to keep good people if you drive off good people?
“When you come to a fork in the road – take it.” Yogi Berra
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