May 13, 2014 05:39 PM UTC

Colorado PERA Crosses Paths with Supreme Court Justice Hood, Sobanet and Dubofsky.

• 2 Comments
• by: PolDancer

While working for the most politically active agency in Colorado state government, Colorado PERA administrators must balance scores of political relationships, and divide hundreds of thousands of Colorado PERA trust fund dollars each year among hired Colorado PERA lobbyists.  These PERA lobbyists seek to effect the political goals of the Colorado PERA Board of Trustees, and they pursue amendments to Colorado PERA governing statutes desired by the Board.

In recent years, as I have monitored the activities of Colorado PERA officials, and conducted research to support Colorado PERA contractual public pension rights, I have been continually astounded at the intricacy of PERA's web of political, legal, judicial, public relations, and lobbying relationships.  The network of PERA agency relationships surrounding the machination, marketing, enactment, legal defense, and appellate strategy supporting the 2010 Colorado PERA "COLA-taking" legislation (SB10-001) was particularly extensive.

In my opinion, Colorado PERA retirees (who are currently defending their contractual public pension rights in court) should make a point to learn the total expenditure of PERA trust funds, or other PERA system assets, that the PERA Board has directed to lobbyists in the last two decades. These lobbyists should be identified, and the direction given to the lobbyists by PERA trustees and administrators examined.  I would be interested to learn how Colorado PERA's lobbying expenditures compare to such expenditures by all other Colorado state agencies, and peer U.S. public pension systems.  I know that many public pension systems in the United States do not lobby the elected officials who oversee their systems.  Colorado PERA's lobbying program raises obvious ethical and public policy questions.

In 2009, Colorado's Legislative Leadership (likely at the prompting of PERA officials and self-interested parties) decided to "outsource" the entire PERA pension "reform" discussion to the PERA Board.  I suspect the involvement of Colorado PERA's lobbyists in placing this "outsourcing" language into (an unrelated) bill at the conclusion of the 2009 legislative session.  Is the Colorado Legislature unique among state legislatures in having delegated its public pension policy-making authority to an external agency, and consequently the various stakeholders with influence over that agency?  How many state legislatures have abdicated their public pension policy-making authority to a state pension agency?  In 2009, a list of dozens of PERA pension "reform" options was prepared by PERA officials and self-interested parties.  This list of "reform" options was ostensibly given fair consideration by the Colorado PERA Board.  However, it appears that the bulk of the "consideration" was conducted behind closed doors, and notably, only a few of the dozens of "reform" options considered entailed payment of accrued debts by the parties legally obligated to pay the debts.

In 2009, Colorado's Legislative Leadership outsourced one of the decade's most important and consequential public policy debates facing the Colorado General Assembly.  Legislative Leadership outsourced this public policy decision to Colorado's politically active state agency, Colorado PERA.  Having announced their preconceived policy outcome at the General Assembly, Colorado PERA's hired lobbyists resisted any alteration of their introduced legislation.

Allowing legislative policy to be dictated from outside was a colossal mistake on the part of Colorado's Legislative Leadership.  By outsourcing the debate, Colorado's Legislative Leadership ensured that the members of the Legislature would cast votes with limited knowledge of public pension contractual rights, and that prospective pension reform options under consideration in other state legislatures (including the prospective reduction of the pension multiplier) would receive no serious consideration.  The objective was to take the assets of pensioners.

Outsourcing the PERA "reform" debate ensured that past PERA Board investment mistakes that harmed the trust funds would remain hidden, that past PERA Board policies to "cap" the PERA pension system's funded level at a 90 percent funding ratio would never come to light, and that the state's history of PERA pension underfunding (failure to pay the pension ARC) would receive no scrutiny.

Recall that during the Colorado Senate's debate of SB10-001, Senator Lundberg described this outsourcing of legislative authority as "a deal cut before this body met."  The development of PERA-related legislation by those elected officials who are statutorily charged to oversee the Colorado PERA pension system (rather than through a process shrouded in secrecy) would have resulted in a better policy outcome in 2010.

Below, I present a portion of the most significant relationships surrounding the enactment of SB10-001 that have come to light in recent years.  My hope is that shining a light on these relationships and the process that resulted in the enactment of SB10-001 will ultimately benefit public policy-making at the Colorado Legislature.

THE SOBANET/SB10-001 CONNECTION:

Henry Sobanet, Governor Hickenlooper's Budget Director, was "intimately involved" in crafting SB10-001, the 2010 Colorado PERA "COLA-taking" legislation.  Henry Sobanet has also worked as a "consultant," and a "policy advisor" for the business group "Colorado Concern."

From the Colorado Association of School Boards:

"Sobanet also served under former Gov. Bill Owens and was intimately involved in the crafting of SB 10-001, the bill passed in 2010 to shore up PERA."

http://www.casb.org/event/casb-annual-convention/saturday-sessions

THE SOBANET/COLORADO CONCERN CONNECTION:

The business organization Colorado Concern lobbied in support of SB10-001 at the Legislature in 2010.  Henry Sobanet is a former "consultant" for Colorado Concern.

Hickenlooper Budget Director Henry Sobanet's employment history includes:
"- Consultant: Colorado Concern
– Economic and Policy Advisor: Colorado Concern
– Director: Colorado Office of State Planning and Budgeting."

Link:
http://www.zoominfo.com/p/Henry-Sobanet/58878975

From State Bill News in 2011:

"Henry Sobanet, now president of Colorado Strategies LLC, a private consulting firm that specializes in economics, Colorado budget issues, legislative affairs and strategic management, is joining the governor’s office as budget director.

Sobanet also consults for a pro-business advocacy group, Colorado Concern."

http://statebillnews.com/2011/01/sobanet-returning-to-state-government-as-hickenloopers-budget-chief/

THE COLORADO CONCERN/SB10-001 CONNECTION:

The Colorado Secretary of State’s Directory of Lobbyists by Bill for SB10-001 includes the following two Colorado Concern lobbyists listed as supporting SB10-001:

Peter Kirchhof – Colorado Concern – supporting
Janice Sinden – Colorado Concern – supporting – (http://www.coloradoconcern.com/, Colorado Concern is a business organization.  Janice Sinden is now Denver Mayor Hancock's Chief of Staff.)

Link:
http://www.sos.state.co.us/lobby/SubjectSearchResults.do?&cmd=passgo&pi1=1

THE SOBANET/GOV. BILL OWENS/GOV. JOHN HICKENLOOPER CONNECTION:

From Governor Hickenlooper's website:

"Gov. John Hickenlooper named Henry Sobanet to return as Director of the Office of State Planning & Budgeting in 2011.  In this role, Sobanet is responsible for the budget forecasting of the State’s revenue and budget planning."

(There is no mention of Henry Sobanet's Colorado Concern consulting services on this page of the Governor's website.)

http://www.colorado.gov/cs/Satellite/GovHickenlooper/CBON/1251588314689

From cbslocal.com:

"The Democrat also appointed Henry Sobanet to be director of the Governor’s Office of State Planning and Budgeting.  Sobanet also served as GOP Gov. Bill Owens’ budget director."

(My comment: Recall that it was Governor Bill Owens who championed the Colorado PERA service credit "fire sale" a dozen years ago, costing the Colorado PERA pension system billions of dollars.)

http://denver.cbslocal.com/2011/01/04/hickenlooper-appoints-another-cabinet-member/

From the Denver Post:

"Gov.-elect John Hickenlooper today named a Republican and one of the most experienced hands in state fiscal issues to head his Office of State Planning and Budgeting."

"Hickenlooper, a Democrat, named Henry Sobanet, formerly a budget director for Republican Gov. Bill Owens, to do the same job for him."

"Sobanet worked for the Office of State Planning Budgeting as deputy director from 1999 to 2004, when former Owens appointed him as director."

http://blogs.denverpost.com/thespot/2011/01/04/hickenlooper-names-former-owens-budget-director-henry-sobanet-to-same-job/20061/

(My comment: Henry Sobanet was Governor Owen's Deputy Budget Director in 2000 when Governor Owen's Colorado PERA pension "fire sale" legislation was adopted.  It would be interesting to hear Henry Sobanet's perspectives and recollections regarding the Bill Owens "fire sale.")

Denver Post editorial page editor Vince Carroll in the (July 31, 2013) Denver Post: "The administration of Gov. Bill Owens, in a major blunder, lobbied for the (Colorado PERA) fire sale as a shortsighted way to encourage early retirement . . ."

http://www.denverpost.com/carroll/ci_23762597/carroll-secret-rep-mike-coffmans-pera-pension)

From: "The PERA Fire Sale, the Gift that Keeps on Taking."

"Gov. Bill Owens, then in the early part of his first term, wanted to streamline government and bring new employees into the state work force.  In 2000, with his encouragement – some say pressure – PERA cut the already-low price of purchasing extra years by 14 percent, to 15.5 percent of salary."

"Owens said he doesn’t recall the specifics of what was said to PERA, but 'I thought it was valuable to have the flexibility to get new employees into some of the positions in the state bureaucracy.'”

" . . . we’ll be living with the cost of selling long-term debts cheaply for a long time to come.  At this point, it’s almost impossible to tell how much of PERA’s long-term debt obligation comes from this sale; I can’t find aggregate numbers in the CAFR, and the charts above show only the price paid, not the goods sold, but it certainly warrants further investigation."

http://watchdogwire.com/colorado/2013/08/01/the-pera-fire-sale-the-gift-that-keeps-on-taking/)

(My comment: Undeniably, it would be unjust to force Colorado PERA pensioners, who have met the statutory requirements to receive their pension COLA benefits, to pay for this egregious public policy error championed by former Governor Bill Owens.)

THE HICKENLOOPER/JUSTICE HOOD CONNECTION (appointed to the Colorado Supreme Court):

Denver Post:

"Gov. John Hickenlooper on Friday announced his appointment of Denver District Court Judge William Hood III as the 103rd Colorado Supreme Court justice."

"Hood will fill the vacancy created next year when Supreme Court Chief Justice Michael Bender retires.  Bender, who will step down Jan. 7, has served on the Supreme Court since 1997 and as chief since 2010."

"Hood, 50, has been a Denver District Court judge since 2007.  Prior to becoming a judge, Hood practiced at the private firm Isaacson Rosenbaum.  He also served as a prosecutor for the 18th Judicial District Attorney's office."

http://www.denverpost.com/breakingnews/ci_24389795/hickenlooper-appoints-new-colorado-supreme-court-justice

From ColoradoPols.com:

"Hickenlooper was under some natural pressure to appoint a Democrat to replace the liberal Bender with a similar-minded justice — particularly after his last appointment to fill a vacant seat; in 2011, Hickenlooper chose Jefferson County Republican Brian Boatright to replace the retiring Alex Martinez, a decision that did not sit well with Democrats.  Martinez had been a liberal voice on the Colorado Supreme Court, and replacing him with the conservative Boatright may have ultimately been the difference in the Lobato education lawsuit.  Selecting Hood, a registered Democrat, keeps the court's political affiliations about the same: 3 liberals (Hood, Nancy Rice, Gregory Hobbs), 3 conservatives (Allison Eid, Nathan Coates,and Boatright), and 1 "Unaffiliated" (Monica Marquez).

http://coloradopols.com/diary/51002/hickenlooper-appoints-new-supreme-court-judge

THE JUSTICE WILLIAM HOOD/GOVERNOR BILL RITTER CONNECTION (appointed to the 2nd Judicial District Court):

"Ritter Appoints William W. Hood to Denver District Court Bench" Thursday, April 19, 2007.

"Gov. Bill Ritter today announced the appointment of William W. Hood of Denver to the 2nd Judicial District in Denver."

http://www.coadvocatesforum.org/news/article.139986-RITTER_APPOINTS_WILLIAM_W_HOOD_TO_DENVER_DISTRICT_COURT_BENCH

From CTBC:

"Hood's history as a Democrat [sic] party contributor – he maxed out to Bill Ritter's 2006 campaign, contributed to the Democrat House Majority Fund, and others – is notable."

"Interesting that the Denver Post failed to uncover and/or report on this salient fact."

http://www.clearthebenchcolorado.org/20 … t-justice/

From CTBC:

"Prior to being appointed to the Denver District Court in 2007, Hood was a long-time contributor to Democrat [sic] candidates and causes: hosting events for Bill Ritter’s campaign and contributing the maximum amount ($1,000) in 2006, contributing to the State Democratic Party House Campaign Fund, and supporting Steve Bernard’s failed campaign for District Attorney in 2004."

"Hood also has close ties to Democrat [sic] Party attorney (and frequent Colorado Supreme Court litigator) Mark Grueskin, dating from their time as colleagues in the politically connected (and politically active) Isaacson Rosenbaum P.C. law firm – associations that may have been related to his removal from the 2011 Congressional redistricting lawsuits, before the case was reassigned to Denver District Court Chief Judge Robert Hyatt . . ."

http://www.clearthebenchcolorado.org/2013/10/26/governor-Hickenlooper-picks-democrat-contributor-hood-as-new-colorado-supreme-court-justice/

Denver Post:

"The notion of partisan 'pay to play' for judicial appointments is disturbing, irrespective of party. The fact that Hood maxed out to Ritter's campaign before being appointed by Ritter to the bench certainly calls his objectivity into question, wouldn't one think?"

http://neighbors.denverpost.com/viewtopic.php?p=3202155

February 23, 2010, Governor Bill Ritter signs SB10-001, the "COLA-taking" legislation currently pending before the Colorado Supreme Court.  Link to SB10-001:

http://www.leg.state.co.us/clics/clics2010a/csl.nsf/fsbillcont3/DD3F57C1B220E34A872576A80029E75E?Open&file=001_enr.pdf

THE JUSTICE WILLIAM HOOD/MARK GRUESKIN CONNECTION:

Justice William Hood's work at Isaacson Rosenbaum:

"Before moving to the bench, Judge Hood was a shareholder at Isaacson Rosenbaum P.C., where he did both civil and criminal trial work."

http://www.law.du.edu/index.php/profile/judge-will-hood

"Hood, 50, has been a Denver District Court judge since 2007.  Prior to becoming a judge, Hood practiced at the private firm Isaacson Rosenbaum."

http://www.denverpost.com/breakingnews/ci_24389795/hickenlooper-appoints-new-colorado-supreme-court-justice

Colorado Statesman on Isaacson Rosenbaum's work for Colorado PERA:

"Both the state and PERA filed motions in May asking the court to dismiss six of the eight claims contained in the plaintiffs’ case.  The state is represented by the Attorney General’s office; PERA’s lead attorneys are Mark Grueskin and Edward Ramey of Isaacson Rosenbaum, PC."

http://coloradostatesman.com/content/991958-ruling-pera-bill-expected-shortly

"Among those representing PERA are two well-known Denver governmental affairs lawyers, Mark Grueskin and Edward Ramey of the Isaacson Rosenbaum firm."

http://www.ednewscolorado.org/2010/05/13/pera-responds-to-retiree-lawsuit/comment-page-1

Colorado Statesman:

Mark Grueskin served as "local counsel to the 2008 Democratic National Convention Committee."
 

Grueskin:

" . . . for a dozen years of political litigation that I can think of and I can’t imagine that we would want to do it any other way."

"I walked my first precinct when I was 10 years old.  Wally Stealey sent me in Colorado Springs."

"So I was active in politics, literally, I mean for years before my bar mitzvah, and then after college I managed Frank’s primary campaign down in Pueblo."

"Took it and worked there and it was Akin Gump, Bob Strauss’ law office. [Strauss served as the chairman of the Democratic National Committee between 1972 and 1977 . . ."

"And you know, I worked at Akin, Gump for three years and then came back to Colorado and worked on [Gov. Richard] Lamm’s re-election campaign and was his lobbyist and did the Carlos Lucero campaign in ‘84, because I still had this campaign management thing."

Westfall:

"But subject matter expertise in election law, Mark has no peer."

http://www.coloradostatesman.com/content/994377-grueskin-westfall-colorado%3Fs-top-election-attorneys

Justice William Hood:

"Prior to becoming a judge, Hood was in private practice at Isaacson Rosenbaum P.C., where he was a shareholder from 2005-2007 and of counsel in the litigation department from 2003-2005."

http://kdvr.com/2013/10/25/hickenlooper-will-name-william-hood-to-colo-supreme-court/

(My comment: Apparently, in 2006, Isaacson Rosenbaum represented Colorado PERA while Justice Hood was a shareholder.)

"Colorado PERA files motion challenging (2006) ballot initiative."
"The motion was filed on behalf of attorneys Mark G. Greuskin and Edward T. Ramey of the Denver Law Firm Isaacson Rosenbaum, P.C."

https://www.copera.org/pdf/NewsReleases/2006/Initiative.pdf

From Law Week online:

"Redistricting Judge, Dem Lawyer Worked At Same Firm."

"Asked about a possible conflict between himself and the judge (Hood), Grueskin said, 'Even before you get to the issue that he and I were formerly colleagues, he may have a docket that’s full.'"
"Grueskin explained that the redistricting case must be decided well before the Feb. 7 caucuses, and 'typically there will be some reallocation if necessary because not every judge’s docket would accommodate that.'”

http://www.lawweekonline.com/2011/05/redistricting-judge-dem-lawyer-worked-at-same-firm/

From clearthebenchcolorado:

"However, the case may not remain with Judge Hood, due to his past association (working together at the same law firm) with Democratic attorney Mark Grueskin, as also reported by Law Week online: Denver District Judge William Hood, who was randomly assigned to hear Colorado congressional redistricting lawsuits filed Tuesday by Republicans and Democrats, once was a law-firm colleague of the lead attorney for the Democratic side."

"Before his appointment to the Denver bench in 2007, Hood worked at Isaacson Rosenbaum, the firm that until recently employed Democratic Party lawyer Mark Grueskin."

http://www.clearthebenchcolorado.org/tag/colorado-judiciary-project/page/2/
 

Isaacson Rosenbaum's (2011) closure:

"Venerable 50-year-old Denver law firm Isaacson Rosenbaum will wind up operations and close at the end of June, people familiar with the situation today told Law Week Colorado."

"The firm, which lists 23 shareholders and five associates on its website, was a victim of the 2008 economic downturn, a heavy emphasis in real estate law and an expensive office lease at the recently renovated 1005 17th St."  "It wasn’t immediately known where all of its top attorneys would land."  "Ramey and Lawrence joined Heizer Paul Grueskin, and Corrada is moving to Lapin & Lapin."

http://www.lawweekonline.com/2011/06/breaking-isaacson-rosenbaum-will-close-at-months-end/

THE MARK GRUESKIN/SB10-001 CONNECTION:

We see that Mark Grueskin has represented the State of Colorado in the public pension lawsuit, Justus v. State.  From page 7 of the "STATE DEFENDANTS’ MOTION TO DISMISS PLAINTIFFS’ FIRST AMENDED CLASS ACTION COMPLAINT."

"Mark G. Grueskin
Ed Ramey
Isaacson Rosenbaum P.C.
1001 17th Street, # 1800
Denver, CO 80202"

Link:
http://saveperacola.files.wordpress.com/2011/04/2010-05-10-state-defendants_-motion-to-dismiss-plaintiffs_-first-amended-class-action-complaint.pdf

THE MARK GRUESKIN/JEAN DUBOFSKY/SB10-001 CONNECTION:

“ . . . Matt Arnold appeared on the Your Show television program [moderated by Adam Schrager,] debating former Colorado Supreme Court justice Jean Dubofsky [my note, author of the 2009 Colorado PERA "COLA-taking" legal opinion] representing the 'Colorado Judiciary Project" (a legal-establishment special-interest group formed by Dubofsky and Democratic state party attorney Mark Grueskin.)

http://www.clearthebenchcolorado.org/tag/devils-advocate/

Attorney Jean Dubofsky, at the request of Colorado PERA, provided PERA with a legal opinion arguing that the Colorado Legislature could legally take Colorado PERA retiree pension COLA benefits: “at request of PERA (Public Employees Retirement Association) in 2009, provided legal opinion that general assembly could repeal automatic 3% cost-of-living adjustment for retirees without violating their vested rights;"

http://lawweb.colorado.edu/files/vitae/dubofsky%20.pdf

December 17, 2009

Colorado PERA General Counsel Greg Smith – “We have obtained outside counsel’s opinion on this issue.”

http://www.kentlambert.com/Files/PERA_JBC_Hearing_Responses-12-16-2009_Final.pdf

In a deposition Jean Dubofsky submitted to Colorado PUC she notes that she is the author of a legal opinion addressing the legality of reducing the PERA COLA benefit, October 18, 2010:

“My most recent legislative experience (within the past two years) is  . . . a legal opinion addressing the constitutionality of reducing the cost-of-living increase for PERA recipients.”

(To access this document, paste “Colorado PUC E-filing system PERA legal opinion Jean Dubofsky” into Google.)

From page 6 of the "STATE DEFENDANTS’ REPLY IN SUPPORT OF MOTION TO DISMISS FIRST AMENDED CLASS ACTION COMPLAINT," in the case, Justus v. State:

"Jean E. Dubofsky, Esq.
Jean E. Dubofsky, P.C.
1000 Rosehill Drive
Boulder, CO 80303"

"Mark G. Grueskin
Ed Ramey
Isaacson Rosenbaum P.C.
1001 17th Street, # 1800
Denver, CO 80202"

http://saveperacola.files.wordpress.com/2011/04/2010-06-23-state-defs-reply-in-support-of-motion-to-dismiss1.pdf

THE JUSTICE DUBOFSKY/JUSTICE MARQUEZ CONNECTION:

As we have seen, our undeniably talented Colorado Supreme Court Justice Monica Marquez has worked for the defense in the Colorado PERA retiree lawsuit, Justus v. State.  Attorney Jean Dubofsky, author of the Colorado PERA "COLA-taking" legal opinion: "I worked on" the case, Justus v. State, with Colorado Supreme Court Justice Monica Marquez.  The author of the Colorado PERA "COLA-taking" legal opinion wrote a letter of recommendation for Monica Marquez to serve on Colorado Supreme Court: “In particular, I’ve worked on several cases where she provided superb briefing, argument and/or advice for the Attorney General’s office, including . . . the current challenge to the amendments to PERA (Justus v. State), the government’s pension system.”

“ . . . and Ms. Marquez would bring to the court sophistication about the numerous cases that involve, for example, TABOR, ballot titles, election issues, voter-initiated constitutional amendments, property tax, public pensions, labor law, and regulations issued by a wide variety of state agencies.”

“Sincerely, Jean E. Dubofsky.”

http://www.scrib.com/doc/36638245/Letter-for-Monica-Marquez-by-Jean-Dubofsky

(My comment: Why did former Justice Dubofsky write in this letter that Justice Marquez would "bring sophistication" to the Colorado Supreme Court on public pension litigation?  Given Justice Marquez' involvement [representing a defendant] in ongoing Colorado PERA litigation, Dubofsky must have been referring to future public pension litigation involving public pension claims unrelated to the current Colorado PERA litigation.)

As we have observed earlier, Justice Monica Marquez's name appears on the PERA Defendant's Motion to Dismiss submitted to the Denver District Court on May 10, 2010:

Page 29 of the "PERA DEFENDANTS’ MOTION TO DISMISS FIRST AMENDED
CLASS ACTION COMPLAINT":

"John W. Suthers
Monica Marquez
Maurice G. Knaizer
William V. Allen
Megan Paris Rundlet
Attorney General’s Office
State of Colorado
1525 Sherman St. 7th Floor
Denver, CO 80203

http://saveperacola.files.wordpress.com/2011/04/2010-05-10-pera-defendants_-motion-to-dismiss-first-amended.pdf

Attorney Monica Marquez (soon to be a Colorado Supreme Court Justice) advises Colorado PERA on March 19, 2010:

https://www.copera.org/pdf/Board/Minutes/2010/Minutes3-19-10.pdf

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