Talk about a great 25th gaming anniversary present, at least in the legal arena.
In a ruling that didn’t pose any great surprises and further reaffirms the uphill battle Gilpin County and Black Hawk face in trying to snag more gambling tax dollars at the expense of other jurisdictions, the Colorado Court of Appeals has clearly sided with Cripple Creek and Teller County in a lengthy legal battle.
Only now, the fight may be entering its final weeks. Unless an appeal is filed by the end of October, and the case is further reviewed by the Colorado Supreme Court, the fight is over. Gilpin and Black Hawk will have exhausted all of their legal claims and their only hope of success involves changing the current gambling law by hitting the political trenches big-time. And even that is a risky bet, based on the stance taken by lawmakers in the last few years.
The latest legal development is a good scenario for Teller County and Cripple Creek, which could have lost more than $2.5 million a year collectively, if the court ruled against them. It also gives the gaming town more legal stability as it celebrates 25 years of limited stakes gaming next week. Local government officials always had this case hovering over their heads as they tried to craft annual budgets.
For about five years, Gilpin County and Black Hawk officials have contended that their entities should receive a larger portion of the gaming tax pie due to the fact that the lion’s share of casino taxes are derived from the larger gambling establishments in Black Hawk. In many ways, they want the state to use the same formula that it relies on since approving a subsequent amendment, calling for such new games as roulette and craps.
However, the original gambling law, approved in 1991, views gaming revenue as the adjusted gross proceeds generated in the three casino towns. Under this formula, casinos are taxed based on their winnings through a graduated tax system. Gilpin and Black Hawk officials, though, have referred to such as system as unconstitutional, saying they should get more of the bucks since their establishments are taxed at a higher rate.
In a lengthy 25-page ruling made on Sept. 15 by the Court of Appeals by a 3-0 verdict, they reached the same conclusion that other courts have rendered: Gilpin’s claim that it should receive more gambling tax dollars due to its interpretation of “gaming revenues” has been previously decided on.
And in essence, the court has relayed the same message to Black Hawk and Gilpin County: “You lost the fight, so get over it.” Moreover, the court judges accused these entities of trying to go through “the back door” in attempting to get the original verdict overturned. Mainly, the court supported previous rulings and maintained it didn’t have the power to overturn these decisions.
The only semi-negative development for Teller in this case is that it didn’t win its claim for legal fees due to what local officials described as a lack of “substantial justification.” This claim, which was only filed by Teller County, dealt with efforts of Black Hawk and Gilpin to file repeated appeals based on the same erroneous arguments.
Last week, Teller County Attorney Paul Hurcomb described the ruling as “good news” for Teller County. “It is a good result,” said Hurcomb.
He indicated that Gilpin and Black Hawk still have one final legal chance to seek additional recourse, but he indicated that this is a long-shot. They can take their claims before the Colorado Supreme Court, but this body accepts only a small percentage of cases. And according to Hurcomb, this case would hardly qualify as one it would consider.
“I don’t see anything unique in this case,” said Hurcomb.
However, county leaders expect Gilpin and Black Hawk official to file an appeal at the Supreme Court level. This would have to be done by Oct. 27.
Even if they do, local officials are confident that Teller and Cripple Creek will still prevail in this fight.
“They have already had four bites at the apple,” said Hurcomb.
Gilpin and Black Hawk have lost repeated bids to change the current gaming revenue allocation system by taking their case before the gaming commission staff, the gaming commissioners, the district court in Denver and the state high court. In each case, it lost. And in the last few verdicts, judges have lashed out at Gilpin for pursuing ridiculous and inconsistent arguments.