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Who’s got the best approach to create jobs in Colorado?

Source: Denver Business Journal

Statehouse Democrats and Republicans are both pushing so-called “jobs bills” this legislative session, but the two parties take fundamentally different approaches to the issue.

Business groups wonder how many jobs will actually be created by legislation still under consideration.

House Democrats define “jobs bills” broadly as those that help foster economic development, connect people to jobs or let companies create jobs. These jobs bills primarily look to get more people in employment, reducing the number of unemployed people in the country. However, with these new job opportunities, many businesses have enhanced their recruitment process to ensure they’re only bringing safe employees into their existing workforce. This can be done through multiple interviews and even some drug tests. Employers have been known to use a reagent test kit before now to make sure their staff don’t have any drug addictions that could cause problems in the future.

House Speaker Mark Ferrandino, D-Denver, points to measures his caucus is sponsoring, from grant programs for advanced-industry companies to limits on job applicants who can be subject to credit checks by employers. He said those and other bills will lead to more people getting jobs. This is great news for those with bad credit wondering How to Build Credit, and, fortunately, more and more solutions to this problem are emerging as this is enabling more people to improve their financial health and giving them the ability to apply for loans with providers such as

House Republicans define it more narrowly. Republicans argue that removing regulatory or tax burdens that keep businesses from hiring are the only true jobs bills. Few such measures are moving through the Democratic-majority Legislature this year, they said. Some Republicans also claim bills offering money or aid to companies in certain industries exemplify government overstepping its role in the economy.

Business leaders say that only a few 2013 measures would help companies add employees in the near term, and that businesses will suffer from proposals that increase costly regulation – especially in the oil and gas industry. Job gains from legislation aiding growing, advanced industries could be offset by jobs losses in other industries from increased fines and lawsuits, they warn.

“We are reaching a point of serious concern about the overall cost of doing business,” said Kelly Brough, president/CEO of the Denver Metro Chamber of Commerce. “Collectively, all of these additional regulations on business can have a negative impact.”

Ferrandino began the session by saying his first priority would be to create jobs. House Democrats roared out of the gate with a five-bill package of job-creation measures, including House Bill 1001, a bipartisan bill to create a $12.5 million grant program for advanced industries, such as bioscience and aerospace, that the House has passed.

Other proposals, including one to increase funding for the Small Business Development Centers (SBDC) program and another to create a state economic gardening program, are likely to come to the House floor for debate in early April.

The overall focus of these bills is to give businesses resources that will help them prosper, such as an increase in worker-training funding, or financial aid for companies looking to begin or increase exporting, Ferrandino said.

The state government has a role to play in determining where obstacles to business success exist and how it can help remove them, he said.

“It’s not just about creating jobs. It’s about connecting people with jobs. It’s about supporting economic development,” Ferrandino said. “The Republicans think that the only jobs bills are tax cuts … We think there’s a balance.”

Republicans focus elsewhere

Republicans have focused on cutting regulations and taxes. Tony Gagliardi, National Federation of Independent Business state director, calls that the best thing government can do: Get out of the way and give employers enough confidence in a stable environment to start hiring again.

But three GOP attempts at reducing regulations or letting businesses comment on prospective new regulations died quickly. And four general reductions to business personal property taxes – bills Ferrandino said would “gut education” – died in Democratic-majority committees.

Some Republicans also question whether the government would dictate business preferences in many Democratic bills by allocating funds to certain industries or companies over others.

For example, Rep. Brian DelGrosso, R-Loveland, said that legislation to set aside money for SBDCs, economic gardening and exporting aid all would be paid for by taking away money from other businesses under a proposal to impose caps on investment tax credits in enterprise zones. Those caps primarily would affect the largest natural-resources and utility companies in the state.

“So, we’re going after big businesses to fund some of these smaller businesses? It’s almost like we’re getting into a redistribution of wealth,” said DelGrosso, who operates three Domino’s Pizza franchises. “You need these high-paying jobs to support those smaller businesses.”

Business groups are split on whether industry-targeted grants and small-business aid are the proper role of government. Gagliardi opposes any effort of government “picking winners and losers.”

But Deborah Obermeyer, president/CEO of the Metro North Chamber of Commerce, said her group supports bills such as HB 1001 if targeting certain growing industries will produce a return on investment that aids the economy. And when the economy is being successfully aided, it will have a positive impact on every business and individual for the foreseeable future. None more so for the people who are looking to make some worthwhile investments through the likes of day trading, where they can invest in stocks and funds. They will have a better return on investment if the economy is striding forward instead of behind, and these bills can help to do this too.

What business leaders say won’t work

Business leaders do agree on some things when it comes to the role of the Legislature in creating jobs this year.

First, any bill increasing regulations on companies isn’t a “jobs bill,” but is more likely to cost workers jobs as companies spend money on compliance rather than labor.

While Ferrandino hailed the credit-check limitations in Senate Bill 18 as a way to create jobs for people whose bad credit histories have kept them from finding work, several business leaders laughed at that suggestion.

“It’s not a jobs bill by any means,” Brough said. “It doesn’t change the overall number of Coloradans that we can put to work.”

Also, business leaders say the package of oil and gas regulations that Democrats began introducing in the past two weeks could curtail one of the state’s fastest-growing industries.

Among those regulations: raising property taxes on drillers to increase frequency of inspections, and raising fees on oil companies to pay for impacts on cites and counties housing drilling sites.

Ferrandino said such regulations are necessary not only to protect air quality and public health, but also to protect other industries – such as tourism and agriculture – that rely on the environment.

But Loren Furman, senior vice president of state and federal relations for the Colorado Association of Commerce and Industry, said that increased costs and regulations could slow investment in Colorado and move it to other states – and that would cost jobs.

Some business leaders also gave legislators credit for one “jobs bill” that neither Democrats or Republicans are touting as such – Senate Bill 200, which would expand Medicaid eligibility to adults making 133 percent of federal poverty level, which is $15,282 or less.

Both Brough and Metro North officials cited a Colorado Health Foundation report that said adding 275,000 state residents to Medicaid rolls could create 22,388 new jobs and create $4.4 billion in economic impact by 2026.

But overall, business leaders say, it’ll be hard to find many new jobs coming from the 2013 legislative session.

“I wish we had a crystal ball,” said Troy Whitmore, chairman of the Metro North chamber’s business and government affairs committee. “Obviously the health care one is a big slew of jobs. But the others are a little more incremental in nature.”

Added Furman, “It’s been difficult to pinpoint any bills that are actually creating jobs.”

Ed Sealover covers government, health care, tourism, airlines and hospitality for the Denver Business Journal and writes for the “Capitol Business” blog. Phone: 303-803-9229.