What is Home Rule and why should I care?
In a nutshell, the state Constitution was amended in 1902, 1912, and 1970 to allow cities and towns to become self-governing entities rather than requiring oversight by the state – that is the essence of being Home Rule. In the absence of home rule a city or town is known as a “statutory” city or town. State statutes dictate the operation and governance of statutory cities or towns. Home rule cities and towns are governed by a Charter created by and for the people of their city or town.
Is Home Rule good for Salida?
I’ll give you an economist’s answer…it depends. On the one hand there are some potentially positive aspects of home rule:
There are some aspects of home rule that would allow for decisions to be made more efficiently, with potentially less waste at no additional cost to city citizens. For example, when local sales taxes are collected by the Department of Revenue as is required for statutory cities like Salida, there is a one- to two-month delay between collection of those taxes from local vendors and reporting of the results and submitting funds back to the city. In the interim the state earns the interest on those funds (which is not too significant now with the low interest rates we’ve seen in recent years, but can be thousand of dollars per year when interest rates are in more normal historical ranges).
Perhaps less obvious is the difficulty in planning (like setting budget) when there is a significant lag in knowing how the local economy is doing. For example we typically don’t know the economic benefit of a large event in the city like FIBArk, a cycling event, or Art Walk until one to two months after the event has occurred. Home Rule municipalities are allowed (but not required) to self-collect taxes so economic performance is understood sooner and the city, rather than the state earns the interest on those funds.
Local control of local issues
Home rule places power to make decisions for items that are uniquely local in nature to local citizens and decision-makers. And that power, through the Charter, can be amended as changing needs warrant by a vote of the people, whereas citizens of statutory cities have little ability (I’ll go out on a limb and say no ability) to modify the state statutes that they are governed by.
One example of local control is the ability of the citizens to adopt differential tax rates. Home rule could allow what many cities across the country allow – a lower tax on groceries for example. Statutory cities do not have that option. But here, TABOR comes into play as well. Even if the city were to adopt Home Rule and propose to lower sales taxes on groceries, it would have to go to a public vote.
Arbitrary requirements in state statutes
You might recall the controversy surrounding the “2B” ballot measure a few years ago. In 2008 city voters approved a $4.83 tax (adjusted down to $2.50 by council) on a hotel room. Or was it? A room tax or lodging tax is a very common thing in cities/towns that have economies reliant on tourism. It turns out that what voters approved isn’t a tax on a hotel room but a tax on the owner of a hotel for every room that they rent out, i.e., it is a tax on the occupation of hotel/motel/hostel/vacation rental operator.
This kind of awkward language was required because of Salida’s status as a statutory city. Even though the outcome is exactly the same as if it were a tax on the room – that is $2.50 per room per night – the fact that it is called a lodgers tax (an Occupational Lodgers Tax really) implies that it is imposed on a profession rather than the nightly rental of a room. And that is what caused much of the controversy. As a home rule municipality, a simple tax on a room could have been implemented if approved by the voters.
Cities and towns that have adopted home rule seem to be satisfied with it.
There are close to 100 Home Rule municipalities in Colorado. More than 90% of the residents of Colorado live in home rule cities. Given that any Home Rule municipality can go back to being statutory at any time with a simple vote of the people, it is reassuring that no Home Rule municipality in Colorado has ever chosen to do so.
Taxes. What about taxes – everyone tells me that taxes will go up?
Both home rule and statutory cities must follow TABOR. Voters must approve all tax changes. Home rule municipalities have no additional power to tax.
And on the other hand there are some potentially negative aspects of home rule:
Statutory rules have served Salida reasonably well for more than 130 years. While home rule may offer some significant advantages, it is not likely to change the daily life of a typical resident. Our future will likely be bright whether we adopt home rule or not. The city will continue to function and the sky will remain above our heads.
Home rule is not free
While there is no reason to believe that home rule itself will make running government more costly, the process of moving to home rule – elections, voting machines, materials, legal fees, etc. is estimated to cost $30-$32k. If the city were to move to self-collection of taxes (not a requirement of home rule, but an option) we can expect to spend $10k to $25k upfront (legal fees associated with the ordinance to establish self-collection, training, software, vendor education and forms, etc.) and approximately $65k to $75k per year for additional salary and software costs. However, most municipalities that self-collect report that sales tax receipts increase due to the local oversight. For example, Salida’s 2011 sales tax revenue was nearly $3.7 million. A 1% increase amounts to $37,000 while a 5% increase would be more than $180,000 in revenue.
The Charter Commission could draft a charter that would not serve the needs of the citizens. This possibility exists, but citizens get to vote to adopt or reject it
As others have noted, it is possible to create a Home Rule Charter that exactly duplicates how the city operates today but codifies it into the Charter rather than state statutes. This is probably a good starting point. From there, figure out what works and what doesn’t and what might work a bit better with minor adjustment and write it into the Charter.
Home rule election process: Two elections, three questions
On Sept 18, 2012, City Council set in motion the process to investigate home rule. Council set the first of two elections to be held Jan.15, 2013. In that first election two questions will be asked of voters: First, shall the City of Salida form a Charter Commission to create a Home Rule Charter and second, which eleven citizens of the city serve as Commission members?
If the answer to the first question, Shall the city form a Charter Commission is “No,” then the issue is over and Home Rule is rejected. If the answer to the question is “Yes,” then the eleven citizens receiving the most votes will become the Charter Commission.
The Charter Commission will then have 30-180 days to create a Charter. All meetings of the Charter Commission must be open to the public. The City of Salida will provide resources requested by the Charter Commission including meeting space, materials and access to legal advice. When the Charter Commission is ready, they will present their proposed charter to the city. The city will have a reading of the Charter and publish the Charter in the Mountain Mail. The City Council will then call for an election to approve or reject the Charter within 30-185 days. At this point that election is projected to take place late summer 2013.
If voters approve the Charter, then Salida becomes a Home Rule city and the Charter is adopted. The charter would then replace state statutes in the areas the Charter specifically addresses. If voters reject the Charter, the Charter Commission will reconvene to rewrite the Charter following the rules and timelines above. If the Charter is rejected a second time, the home rule issue dies and the Charter Committee is dissolved.
So you’ve elected to investigate Home Rule and have elected a Charter Commission
What goes into the Charter?
The Charter is primarily a limiting document. Its goal is to state the basic structure and operational procedures of city government affairs. In areas where the charter is silent, state statutes apply. You can find many examples of home rule charters on the City of Salida website.
There are a few required elements of a charter: Prefatory synopsis, provisions regarding ordinances, and provisions regarding citizen-driven efforts.
The prefatory synopsis is essentially an executive summary of the Charter. Some charters have highlighted the differences between their city’s Charter and operation as a statutory city. Some have included the philosophy and guiding principles of the charter commission.
Continuing, Amending, or Repealing existing ordinances. The Charter lays out whether existing city ordinances will be continued (adopted as previously used as a statutory city), amended (with amendments stated in Charter), or repealed (either stated in Charter or directed to be done on adoption of home rule).
Initiative, Referendum and Recall Procedures. The Charter must spell out how citizen-initiated procedures are carried out.
In addition to Charter provisions that are specifically required, there are many other additions that the Charter Commission may wish to include:
Form of government.
Salida’s existing form of government is called a “weak mayor” system (no offense to Don or are many previous mayors!), but it could be changed if citizens desired to a strong mayor, council-manager, or other form.
Elected officials. How officials are elected, including length of terms, by ward or at large, etc.
Election procedures – adopting existing state election code, make minor changes, alter election dates, etc.
Ordinances and Resolutions – procedures to adopting each and notification requirements
Legal and Judicial (how city legal representation selected, etc.)
Budget (adopting, priorities, local preference, restrictions, etc.)
Operation of enterprise funds
And many more…
My take on home rule
I have attempted to provide a relatively brief and balanced synopsis of the home rule process. I am a member of City Council and I have participated in investigations into home rule in the past. Because of that, I know some citizens will think that I am biased.
My question is this: If there is a way for the governance of the city to be carried out in a more efficient manner that meets the needs of city residents and can adapt as those needs change, isn’t it worth investigating?
So, yes, I am biased. My bias is that I believe that democracy works. I firmly believe that a Commission of 11 thoughtful residents elected at large by Salida voters can create a Charter that serves us better today and in the future than a set of stagnant state statutes largely written in the early in the 1900s when Colorado was a significantly different place than it is today.
Some citizens have voiced the concern that they don’t trust city government and reject home rule based on that. I would point out that everything that the city does now is done under the statutory authority granted by the state. Ironically, home rule would potentially give those concerned about the actions of city government a means of addressing those actions.
I believe we should give the Charter Commission a chance to show us that there might be something better for Salida. If we like the Charter that they draft, fantastic! If not we move on a put an issue that has been discussed across the city for decades to rest.
If you find any evidence that Home Rule has not served any Colorado municipality well, please either post that information here for all to see or send it to me and I will ensure that it appears among other home rule documents on the city website.