Mile High Greyhound Park, Inc. v. Colorado Racing Commission

Judge JONES

dissenting.

I respectfully dissent from the majority opinion. I believe the Colorado Racing Commission (Commission) exceeded its statutory authority, as provided in § 12-60-501(2)(a) and (4), C.R.S.1999, by placing the burden of the cost of installing and maintaining a surveillance system on plaintiffs, Mile High Greyhound Park, Inc. and Racing Associates of Colorado, Ltd. I, therefore, would reverse and remand this cause for, inter alia, entry of a declaratory judgment establishing that the portion of the Commission's rule requiring race tracks, including plaintiffs, to pay for installation and maintenance of the subject surveillance systems was contrary to the Commission's enabling statute concerning the licensing and regulating of pari-mutuel wagering at race tracks.

That statute provides, in pertinent part, as follows:

[T]he commission shall, at its own expense, regulate the operations of pari-mutuel machines and equipment, the operations of all money rooms, accounting rooms, and sellers' and cashiers windows, and the weighing of jockeys and of greyhounds. ...

Section 12-60-501(2)(a), C.R.8.1999.

The related statute provides:
The commission shall, at its own expense, specifically regulate the operation of instate simulcast facilities of pari-mutuel machines and equipment, the operation of all money and accounting facilities, and the operation of sellers' and cashiers windows. ... For such purposes, the commission, at its own expense, and in addition to other employees, shall employ the competent personnel necessary to supervise the wagering through in-state simulcast facilities....

Section 12-60-510(4), C.R.8.1999.

All parties to this appeal conceded during oral arguments that the applicable statutes are clear and unambiguous.

It is plain that certain costs for building and maintaining facilities must be borne by the race tracks, including plaintiffs here. The statutes mandate that, concerning "places where ... race meets are held" and "all kennels and stables housing racing ani-*355mais[,]" the Commission "shall require all such places to be constructed, maintained, and operated in accordance with the laws of this state and the rules of the commission." Section 12-60-501(1)(a) & (b), C.R.S.1999.

The entire statutory scheme, read in pari materia, therefore, requires the race tracks to incur the costs of construction, maintenance, and operation of the facilities needed to conduct horse and dog races, while the Commission must pay to regulate wagering at such facilities.

Plaintiffs have the burden of establishing the invalidity of agency rules because such rules are presumed to be valid. Wine & Spirits Wholesalers of Colorado, Inc. v. Colorado Department of Revenue, 919 P.2d 894 (Colo.App.1996). Great deference must be given to an agency's construction of its own governing statute. Amax, Inc. v. Colorado Water Quality Control Commission, 790 P.2d 879 (Colo.App.1989). However, such agency discretion, and the concomitant deference, are not absolute, for agencies are bound "to comply strictly with their enabling statutes." They may not legislate beyond the charge given them in the statutes authorizing them to act. Adams v. Colorado Department of Social Services, 824 P.2d 83, 86 (Colo.App.1991). Thus, courts have a duty "to invalidate administrative - regulations which conflict with the design of [an enabling] statute." Cartwright v. State Board of Accountancy, 796 P.2d 51, 53 (Colo.App.1990).

I.

First, I believe that the Commission violated the language and intent of §§ 12-60-501(2)(a) and (4) by its requirement that plaintiffs incur the costs for the video surveillance system. I further believe that the record reflects that such costs cannot appropriately be found to be designated for construction, maintenance, and operation of racing facilities. Rather, the record demonstrates that such costs are closely tied to the regulation of wagering. Any such costs are to be the expense of the Commission. Section 12-60-501(2)(a) & (4), C.R.S.1999.

Personnel of the Commission and of the Division of Racing Events of the Colorado Department of Revenue (Division) conceded that the video surveillance system was for the purpose of allowing them to "strengthen [their] regulatory oversight," to foster "maximum regulatory oversight," and to "assist in fulfilling [their] regulatory oversight." The system would "monitor transactions between teller and patron in the mutuel areas (lines, windows, money rooms)."

Most telling of all, the Commission and Division made clear that the video surveillance system would enable them to use fewer "investigative personnel," which they concede they provide to the racing venues for regulation purposes, and whom they must provide at their own expense.

A judicial finding that a system of video surveillance must be provided at plaintiffs' expense to reduce, in large measure, the number of personnel the Commission and Division require, at their own expense, to carry out their statutory duties of regulation, cannot be correct as a matter of law under any definition of "regulation." All the more so is this true because § 12-60-5010@)(a) & (4) specifically deal with the monitoring of pari-mutuel wagering machines and facilities.

I also conclude that, in imposing the requirement of payment on plaintiffs, the Commission has failed to give effect to all parts of its enabling statutes. Its construction of the statutes would eliminate any rational distinction between "regulation" and the burdens that may be imposed on racing venues. See Gorman v. Tucker, 961 P.2d 1126 (Colo.1998).

IL

Secondly, I believe the court gave inappropriate deference to the Commission's rules and, thus, allowed the commission to exceed its statutory authority and to act arbitrarily.

The enabling statute is plain in its expression that the Commission must, at its own expense, regulate cashiers' and sellers' windows. Such is precisely what the record shows the video surveillance system is to do, even to the point of the system alleviating the need for some Commission personnel *356who would otherwise provide such surveillance at the Commission's expense.

Thus, here, the Commission's construction of the statute was not entitled to the court's deference. See ABC Disposal Services v. Fortier, 809 P.2d 1071 (Colo.App.1990) (because the construction of statues is a question of law, court not bound by agency decision that misconstrues or misapplies the law, when statute is clear in its meaning).

The trial court's findings ignore undisputed evidence that the surveillance system is in the nature of regulation, including such evidence provided candidly by the Commission and the Division. The record is replete with evidence of how the system will expand and strengthen the Commission's "regulatory oversight" in pursuance of its "fulfilling its regulatory responsibilities."

Thus, as a matter of law, the findings of fact and conclusions of law are not supported by the record, and the court has allowed the Commission to exceed its statutory authority and to act arbitrarily.

For these reasons, I would vacate the judgment and remand the cause for entry of a declaratory judgment in favor of plaintiffs and against the Commission and for further proceedings.