DENVER — Cortez attorney Bob Slough tried to convince the state’s highest court Monday that counties do have the right to tax companies that do business on public lands.

Arguing two cases before the Colorado Supreme Court, Slough said that a hastily passed state law that reversed a 1995 court decision affirming counties’ right to tax such businesses is unconstitutional and should be struck down.

Slough argued that because such companies operate their business on public lands under a sort of lease agreement — called possessory interest — and the high court has already ruled that leases are considered "real property," taxing those interests is just as legal.

"There’s no getting around that issue of real property," Slough said. "It’s a mystery to me how this can’t be considered real property."

Slough’s opponents, however, said those interests have never been subject to taxation in the history of the state and there’s no reason to do so now.

The cases marks the fourth time the issue has come before the court. It stems from a 1993 case involving Montezuma County’s decision to tax the Mesa Verde Co., now ARAMARK, which provides concessions at the historic site. After years of litigation, the seven justices upheld the county’s right to tax companies that similarly operate on public lands.

As a result, however, the Colorado Legislature approved a law in 1995 banning the practice, but 17 counties — including Montezuma — continued to tax the companies. The Colorado Court of Appeals upheld the new law last year.

The Legislature approved the law as a result of pressure from concessionaires, ski resort owners and others who operate businesses in or on publicly owned property for fear the court ruling would raise their taxes.

The issue heard Monday by the high court, which could take months before releasing its opinion, involves two separate cases — one involving Vail Associates, Inc., and Eagle County, and the other involving seven counties, including Montezuma, and the Colorado State Board of Equalization. Slough argued on behalf of the counties.

"This is squarely and simply an exemption issue," said Slough, representing six counties, including Montezuma, Eagle, Grand, Routt, Summit and Pitkin.

But Vail Associates attorney James Butler said the issue isn’t one of a legislative attempt to protect a single industry, but a conscious decision not to impose the tax.

While counties can and do assess property taxes on improvements made on public lands, such as structures or ski lifts, agreements to operate on those lands has never been taxed partly because the Colorado Constitution expressly exempts all public lands from state taxation.

Possessory interests are no different, Butler said.