Colorado Capitol Report

In this Capitol Report:

• Governor Signs CACI-Initiated, Aerospace Tax-Incentive Bill
• News Media Coverage
• U.S. Labor Department Announces $53 Million in Grants to Expand Workforce Development
• You’re Invited: June 9th CACI Federal Affairs Congressional Staff Luncheon

Governor Signs CACI-Initiated, Aerospace Tax-Incentive Bill

Far left, DigitalGlobe’s Brent Wilson looks over the shoulder of CACI’s Loren Furman as she shakes hands with Governor John Hickenlooper after he signed HB-1178 into law. Standing, between the Governor and Loren, is Senator Kevin Grantham, a prime sponsor of the bill. To the far right is House Speaker Mark Ferrandino, also a prime sponsor of the measure.

On Tuesday morning in Colorado Springs, Governor Hickenlooper signed into law HB-1178, the CACI-initiated bill that grants a state sales-and-use tax exemption to qualified space equipment stored in Colorado.

The Governor signed the bill at the International Space Symposium, which was being held at the BroAdmoor Hotel, a CACI member.  Standing beside the Governor were Loren Furman, CACI Senior Vice President, State and Federal Relations, and two of the bill’s four prime sponsors: House Speaker Mark Ferrandino (D-Denver) and Senator Kevin Grantham (R-Canon City).  The other two prime sponsors, House Minority Leader Brian DelGrosso (R-Loveland) and Senator Mary Hodge (D-Brighton), could not attend the bill-signing ceremony.

Brent Wilson, Tax Director for DigitalGlobe, Inc., also attended.  The bill’s genesis lies with CACI member DigitalGlobe, Inc., which contacted CACI and expressed its concern that application of the State sales-and-use tax to space equipment stored in Colorado before it is launched into space presented the company with a competitive disadvantage.

HB-1178 provides an exemption to the sales-and-use tax for qualified space equipment stored within the state.  The qualified property includes space vehicles and components, equipment to be placed in a space vehicle and fuel for space flight.  The bill’s fiscal note says that the State will lose $74,327 in the current fiscal year ending June 30^th and $77,895 in the following fiscal year.

Speaker Ferrandino told the House Finance Committee in February that the fiscal note to the bill “is very nominal” and that the bill will “help create jobs” and “help grow a growing industry.”  He termed the bill “very narrowly worded” effort to try to incentivize the space industry and that the economic impact could be “huge.”

The reason that the fiscal note is so low is because aerospace companies are either building and storing their space flight equipment in other states instead or shipping the equipment out of the Colorado to avoid the State sales-and-use tax.

Minority Leader DelGrosso told the House Finance Committee in that Colorado needs the measure “to become more competitive” with other states that have already taken this step, such as Florida, Texas and California.  Local governments in Colorado also can decide whether or not to extend their sales-and-use tax exemption to the space industry, he added.

The bill gained a large measure of bipartisan support in both the House and the Senate.

For example, of the four House and Senate Committees that heard the bill, only one legislator voted against the bill.  The Senate Finance Committee approved the bill on a 4-1 vote, with only Republican Senator Owen Hill (Colorado Springs) voting against the measure.

Senator Hill’s vote against the bill broke HB-1178’s remarkable record of three unanimous committee votes:

• House Finance Committee,
• House Appropriations Committee, and
• Senate Appropriations Committee.

When the House passed HB-1178 on recorded, final, Third Reading on April 9^th, only six Republican Representatives voted against the bill.  Voting for the bill were 58 Republicans and Democrats.  The six Republican Representatives who voted against the bill were Perry Buck (Windsor), Justin Everett (Littleton), Stephen Humphrey (Windsor), Dan Nordberg (Colorado Springs) Lori Saine (Firestone) and Jared Wright (Fruita).  Representative Frank McNulty (R-Highlands Ranch) was excused.

When the Senate gave the bill final approval, only four Republican senators voted against the bill: David Balmer (Centennial), Randy Baumgardner (Cowdrey), Kevin Lundberg (Berthoud) and Vicki Marble (Fort Collins).  Senator Hill voted for the bill, however, on the final vote.

CACI assembled a coalition of aerospace companies, business organizations and state and local economic development entities to support HB-1178, including DigitalGlobe and the following CACI members:

• Ball Aerospace
• The Boeing Company
• Colorado Springs Regional Business Alliance
• Denver South Economic Development Partnership
• Lockheed Martin Space Systems Company
• Sierra Nevada Corporation

Testifying before the House and Senate Finance Committees in support of the bill were the following CACI members:

• Brent Wilson, Tax Director, DigitalGlobe, which is a CACI Aluminum Partner; and
• Christie Lee, Government Relations Analyst Lockheed Martin Space Systems Company, which is a CACI Gold Partner.

Loren testified before the House Finance Committee.  For more on this bill and the signing ceremony, read:

“Colorado space industry tax break signed into law,” by Greg Avery, The Denver Business Journal, May 20^th.

“Gov. Hickenlooper to Sign Bill to Bolster Aerospace Industry Growth in Colorado,” PR Newswire, May 19^th.

“House Committee Gives Unanimous OK to Space-Equipment Tax-Incentive Bill, The Colorado Capitol Report, February 14^th.

“Colorado spacecraft tax break gets stratospheric support,” by Ed Sealover, The Denver Business Journal, February 14^th.

For more information on HB-1178, contact Loren at 303.866.9642.

News Media Coverage

Below is recent news-media coverage of business, political, policy and governmental issues of interest to CACI:

“Hickenlooper, oil industry executives, consider sparer local control plan,” by Mark Jaffe, The Denver Post, May 22^nd.

“Hickenlooper offers new proposal on local control of oil and gas drilling,” by Ed Sealover, The Denver Business Journal, May 22^nd.

“Differences forgotten for now, finance bills become law,” by Todd Engdahl, Chalkbeat Colorado, May 21^st.

“Hickenlooper sings job-creation tax credit expansion,” by Ed Sealover, The Denver Business Journal, May 16^th.

“Guv: Veto requests like starts in the sky,” by Peter Marcus, The Colorado Statesman, May 16^th.

“HUMMERS: Faux poker game at Capitol brings down the house,” by Peter Marcus, The Colorado Statesman, May 9^th.

U.S. Labor Department Announces $53 Million in Grants to Expand Workforce Development

The U.S. Labor Department’s Workforce Innovation Fund will be releasing grants to streamline funding sources, to implement best practices in workforce training, scale training programs and test first-time training programs in the workforce.  This is the second round of grants.  The first round distributed $147 million for 26 grants in July 2012, in addition to $24 million for two “Pay for Success” grants in October 2013.

You’re Invited: June 9th CACI Federal Affairs Congressional Staff Luncheon

Please join CACI on June 9^th for a small group dialog between CACI members and key Colorado staffers for U.S. Senator Mark Udall and U.S. Senator Michael Bennet.  The luncheon will be held at Carestream Health, 2000 Howard Smith Avenue West, Windsor CO 80550.

Find out what the Colorado Congressional delegation is doing to help Colorado businesses, ask questions about Federal issues and influence Federal policy.  The agenda includes a tour of the Carestream Health facility.

Agenda

• Welcome: Robert Lovelace, Polyester Manager, Carestream Health
• Guest Speaker: Brandon Rattiner, Denver Area Regional Director for Senator Udall
• Guest Speaker: Monisha Merchant, Senior Advisor for Business Affairs for Senator Bennet

For information, contact Leah Curtsinger, CACI State and Federal Policy Representative, at 303.866.9641.