Cantina Grill, JV, et. al, v. City and County of Denver, 2012COA154 (September 13, 2012)

One theory about the fall of the French monarchy is that its taxation system was inefficient.  In this case, Denver assessed taxes on concessionaires in DIA. DIA, as a city entity, is exempt from ad valorem (property) taxes. However, private possessory interests in property located on exempt property may nonetheless be taxed. Case law defines a possessory interest as taxable if: 1) revenues are provided by private sources, 2) owner can exclude others, and 3) ownership lasts long enough for a private benefit. According to the court of appeals here, the Colorado Constitution imposes the tax, but the methodology for assessing taxes on possessory interests is statutory. Here, the court rejected the concessionaires’ constitutional challenge to the statute and the court held that the concessionaires had a taxable possessory interest. Accordingly, the concessionaires were taxed.


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