In this Capitol Report:
- Legislature Adjourns 2014 Session
- Legislature Sends “Wage-Claim” Bill to Governor
- CACI-Backed Data-Center Tax Bill Dies in Senate “Kill” Committee
- CACI-Supported Compromise Workers’ Comp Bill Headed for Governor’s Desk
- News Media Coverage
- The Colorado Manufacturing Initiative’s Perspective: the 2014 Legislative Session
- House Vote On R&D Tax Credit Has NAM Support
- Senate Committee Shrinks Budget for Proposed National Manufacturing Innovation Network in Half and the Number of Hubs by Two-Thirds
- Business and Schools Unite to Fight Patent Troll Legislation
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State Policy News
Legislature Adjourns 2014 Session
Yesterday, the Second Regular Session of the 69th Colorado General Assembly came to a close.
Early next week, CACI will issue a summary of the session, which will include CACI’s assessment of the session, plus a listing of the major bills that were on the CACI legislative agenda.
This issue of CACI’s The Colorado Capitol Report contains updates on the fate of several bills that were in play until Tuesday, the day before the end of the session:
- SB-5, the wage-claim bill;
- HB-1389, the bill backed by a high-tech business coalition to grant a sales-and-use tax exemption for information-technology equipment used in new and refurbished “qualified data centers;” and
- HB-1383, the compromise workers’ compensation bill that expands an injured workers’ choice of physicians.
For more on the end of the session, read:
“Colorado Legislature closes by passing urban-renewal, disaster, cannabis co-op bills,” by Ed Sealover, The Denver Business Journal, May 8th.
“Colorado legislature concludes its session,” by Anthony Cotton and Kurtis Lee, The Denver Post, May 8th.
“Telecom reform, ride-sharing app rules emerge from Colorado Legislature,” by Greg Avery, The Denver Business Journal, May 7th.
“Colorado State Sen. Cheri Jahn reflects on 2014 session: Bills blocked and a few passed,” by Ed Sealover, The Denver Business Journal, May 7th.
Legislature Sends “Wage-Claim” Bill to Governor
On Tuesday, the Senate concurred with House amendments to SB-5, which sends the bill to the desk of Governor John Hickenlooper for his signature. CACI is neutral on the bill.
In the 2012 and 2013 legislative sessions, CACI opposed earlier versions of the measure that sought to recover wages for workers from “bad apple” companies that had folded up shop. The primary proponents of the bills during the three legislative sessions have been the Colorado chapter of 9to5, the National Association of Working Women and the Colorado Plaintiff Employment Lawyers Association.
The bill’s prime sponsor is Representative Jonathan Singer (D-Longmont) and the Senate sponsor is Senator Jessie Ulibarri (D-Commerce City).
The decades-old Colorado Civil Wage Claim Act provides remedies for a worker or former worker who claims that an employer or former employer owes wages to that individual. The fiscal note states that the CDLE receives about 4,000 complaints annually about wage disputes. The CDLE can investigate such an assertion and determine penalties that the employee can only recover in court. In other words, the CDLE’s Labor Division cannot recover the penalties for the employees.
Loren Furman, CACI Senior Vice President, State and Federal Governmental Relations, and Larry Hudson, CACI contract lobbyist, worked with the sponsors and other stakeholders over many months to address CACI’s concerns with the early versions of the measure. Joining Loren and Larry in this effort was Dan Block, Attorney at Law, Robinson Waters & O’Dorisio, P.C., a CACI member.
The Senate Judiciary Committee heavily amended the bill to direct unresolved claims by workers over wages, benefits and vacation pay to the Colorado Department of Labor and Employment (CDLE), which will then investigate and could issue orders for employers to pay workers and could cite the employers. In short, SB-5 will provide the CDLE with enforcement powers to investigate and levy penalties.
Loren, summarizing CACI’s work on the proposal, testified on January 22nd before the Senate Judiciary Committee, and here is an edited version of her prepared remarks:
During the last two legislative sessions, CACI and its business allies strongly opposed the wage-theft bills because of an impasse on three critical issues:
- Definition of employer;
- Pierce the “corporate veil” by suing officers and directors individually if the business filed for bankruptcy; and
- Removal of balance of award of attorneys’ fees for the prevailing party, which is in current statute.
Because the amended SB-5 no longer includes these three areas of impasse, the proponents and sponsors and the business community have made a lot of progress. The amended version contains the following:
- Employers will be required to mail a check for wages to the last known address of the worker or former worker according to the employer’s records.
- If employee has filed a claim in small-claims court and, if the employer has paid the amount owed within 14 days of the filing of the claim, then the claim is dismissed.
- Provides investigation process and administrative actions and rulemaking by the CDLE.
- Allows for an appeals process.
The bill’s final fiscal note states that SB-5 will cost about $461,000 and require 4.4 “full-time equivalent” (FTE) staff positions for fiscal year 2014-2015, which begins July 1st, and cost about $656,000 and require seven FTEs for the following fiscal year, 2015-2016.
For news media coverage of the bill, read:
“Colorado wage theft bill receives final legislative approval,” by Ed Sealover, The Denver Business Journal, May 6th.
“Opposition to Colorado wage-dispute bill eases after legislative overhaul,” by Aldo Svaldi, The Denver Post, January 22nd.
CACI members who have questions about SB-5 should contact Loren Furman, CACI Senior Vice President, State and Federal Relations, at 303.866.9642.
CACI-Backed Data-Center Tax Bill Dies in Senate “Kill” Committee
On Tuesday, the Senate State, Veterans and Military Affairs Committee killed with a bipartisan 3-2 vote HB-1389, the bill backed by a high-tech business coalition that would have granted a sales-and-use tax exemption for information technology equipment used in new and refurbished “qualified data centers.”
Republican Senator Ted Harvey (Highlands Ranch) joined Democrats Senators Irene Aguilar (Denver) and Matt Jones (Louisville) to kill the bill. The Committee Chair, Senator Jessie Ulibarri (D-Commerce City), and Republican Senator Bernie Herpin (Pueblo) voted for the bill.
A business coalition, to which CACI belonged as well as the following seven CACI members, advocated the bill:
- Black Hills Corporation
- Colorado Springs Regional Business Alliance
- Colorado Technology Association
- IBM Corporation
- Niobrara Data Center and Energy Park
- Xcel Energy
Senate President Morgan Carroll (D-Aurora) on Monday assigned the House bill to four Senate committees for hearings on Tuesday, a very unusual move that was apparently intended to provide an insurmountable hurdle for the bill on the day before the session ended.
The bill was first amended and approved Tuesday by the Senate Business and Labor Committee. Had the bill next been passed by the Senate State, Veterans and Military Affairs Committee, it would have gone to the Senate Finance Committee and the Senate Appropriations Committee.
Known by its shorthand label, the “Senate State Affairs Committee,” the Committee’s majority members are traditionally handpicked by the Senate President because they represents “safe” districts and can thus make unpopular decisions to kill bills that the chamber’s leadership opposes. The same principle applies to the House State, Veterans and Military Affairs Committee.
On Monday, the House approved HB-1389 with a bipartisan vote of 48-17 on final, Third Reading, which sent the measure to the Senate.
HB-1389 was sponsored in the House by House Assistant Majority Leader Dan Pabon (D-Denver) and House Minority Leader Brian DelGrosso (R-Loveland). The Senate sponsor was Senator Mark Scheffel (R-Parker).
For news media coverage of this bill, read:
“Colorado Senate kills late-session bill to create tax break for data centers,” by Ed Sealover, The Denver Business Journal, May 6th.
“Tax break for data-center equipment introduced in legislature,” by Ed Sealover, The Denver Business Journal, April 25th.
For more information on HB-1389, contact Loren Furman, CACI Senior Vice President, State and Federal Relations at 303.866.9642.
CACI-Supported Compromise Workers’ Comp Bill Headed for Governor’s Desk
On Monday, on a final, Third Reading vote of 19-16, the Senate approved, HB-1383, the compromise workers’ compensation bill that expands an injured workers’ choice of physicians.
Republican Senator Cheri Jahn (Wheat Ridge) joined the 18 majority-party Democrats to pass the measure.
The House measure was not amended in the Senate, which sends the bill to the desk of Governor John Hickenlooper. The House passed the bill by a 37-27 margin on April 24th.
The bill’s driving force and chief House sponsor is Representative Angela Williams (D-Denver). The Senate sponsors are Senators Jessie Ulibarri (D-Commerce City) and Lois Tochtrop (D-Thornton).
Loren Furman, CACI Senior Vice President, State and Federal Relations, testified for the bill before the House Business, Labor, Economic and Workforce Development Committee on April 22nd. Here is an edited version of Loren’s prepared remarks, which provides the historical and political context for the bill and CACI’s support:
This probably surprises you since our organizations have often been on the opposite side of this type of legislation, but here’s why. We learned last year–nearly nine months ago –that the AFL-CIO wanted to pursue a change to the current workers’ compensation system.
In response, CACI, along with the Metro Denver Chamber of Commerce and the Colorado Competitive Council, Denver Metro Chamber, convened the “Workers Compensation Employer Coalition” to make sure the business community had a coordinated voice on this issue.
The Coalition met several times over the last few months. It started with about ten members and has since grown to more than 35 companies and business groups. We reviewed various versions of draft bills, most containing language that raised concerns by the Coalition and that potentially increased costs for employers, which was a non-starter for our Coalition.
Then we started talking about the concept that you have in front of you now, HB-1383. This bill increases physician choice for workers but makes sure that the identification of those doctors remains within the authority of the employer.
It also improves the rural exemption that is in current statute so that there are more protections for our rural employers who may not have a lot of choice in doctors.
As I mentioned, increased costs were a non-starter for us. The National Council on Compensation Insurance (NCCI) prepared a cost analysis of the bill stating that there is a negligible impact to employers.
Also, Pinnacol Assurance, the workers’ compensation insurer for many employers across the state, has stated there is also a minimal impact to employers.
Based on this data, a super-majority of the Coalition has now determined that they are neutral or supportive of the bill. Even though it has been a long and excruciating process, the process has helped us and many employers get to a good place on this bill.
We believe it maintains the good workers comp system we have in place, while still giving workers an increased choice in doctors, which is why we support the bill.
For more on this bill, read:
“”Labor, business unite over workers’ comp bill,” by Peter Marcus, The Colorado Statesman, May 5th.
“Workers’ comp reform bill moves on to Colorado Senate,” by Ed Sealover, The Denver Business Journal, April 24th.
“Workers’ Compensation Legislation Introduced in Final Days of Session,” The CACI Colorado Capitol Report, April 18th.
“Worker’s comp bill arrives in Legislature—in much-compromised form,” by Ed Sealover, The Denver Business Journal, April 17th.
For more information on HB-1383, contact Loren Furman, CACI Senior Vice President, State and Federal Relations, at 303.866.9642.
News Media Coverage
Below is recent news-media coverage of business, political, policy and governmental issues of interest to CACI:
“A ballot proposal targeting Colorado’s oil and gas industry is withdrawn,” by Cathy Proctor, The Denver Business Journal, May 7th.
“School funding package wrapped up with a bow on final day,” by Todd Engdahl, Chalkbeat Colorado, May 7th.
“Construction-defects reform bill gets first approval, then runs out of time,” by Ed Sealover, The Denver Business Journal, May 6th.
“At last, a business personal property tax break is headed to governor,” by Ed Sealover, The Denver Business Journal, May 6th.
“Colorado lawmakers give up on push for more local control of oil and gas; a special session is possible,” by Ed Sealover, The Denver Business Journal, May 5th.
“Construction-defects legislation introduced,” by Peter Marcus, The Colorado Statesman, May 5th.
“Anadarko, Noble Energy talk about what happened to local control bill,” by Cathy Proctor, The Denver Business Journal, May 5th.
“Outgoing GOP lawmakers share memories,” by Peter Marcus, The Colorado Statesman, April 13th.
“Termed-out Democrats discuss their legacies,” by Peter Marcus, The Colorado Statesman, April 13th.
Colorado Manufacturing Initiative
The Colorado Manufacturing Initiative’s Perspective: the 2014 Legislative Session
The 2014 legislative session turned out better than many in the manufacturing community had expected. A trio of bills, two of which passed, targeted the state’s advanced industries as defined by the Colorado Office of Economic Development and International Trade: advanced manufacturing, aerospace, bioscience, electronics, energy/natural resources, information technology and infrastructure engineering.
- HB-1011 is a bipartisan bill that increases funding for the advanced industries export acceleration grant program passed and is awaiting Governor John Hickenlooper’s signature.
- HB-1012 is a bipartisan bill that offers tax credits for “angel investments” in qualifying small businesses passed and is awaiting the Governor’s signature.
- HB-1013 would have reimbursed businesses within the advanced industries for a portion of the cost of hiring interns and apprentices. The bill died on concerns that it would take too much money from the grant program established by HB-1011 as funding for both came from the same source.
Federal Policy Issues
House Vote On R&D Tax Credit Has NAM Support
McClatchy (5/6, Lightman, Subscription Publication) reports that the House of Representatives is set to vote today to permanently extend the research-and-development tax credit. The permanent extension would cost the Federal Government $155.5 billion over the next ten years.
Despite political bickering between the two parties, the R&D tax credit has bipartisan support as well as the support of businesses and trade organizations, according to McClatchy. Christina Crooks, director of tax policy for the National Association of Manufacturers (NAM), said, “We’re hoping it gets extended on a permanent basis this time” because manufacturers use the tax credit the most and it will help create jobs. Crooks also noted, “Making the R&D credit permanent would get rid of the uncertainty” that occurs when the credit lapses, and that “international competitors aren’t standing by!”
The Hill (5/7) reports in its “Ballot Box” blog that President Obama has said he will veto the R&D tax credit bill if it should reach his desk. The Administration has said that extending the tax credit would be “fiscally irresponsible” as the bill contains no offsets in spending. The Hill also notes that NAM sent a letter to House members on Tuesday urging them to pass the tax extension.
Politico Morning Tax writes that NAM and other business groups sent letters in support of extending the R&D tax credit. NAM’s Aric Newhouse wrote in the letter, “A strong and permanent R&D incentive will allow the United States to remain competitive in the global race for R&D investment dollars and a leader in global innovation.”
Senate Committee Shrinks Budget for Proposed National Manufacturing Innovation Network in Half and the Number of Hubs by Two-Thirds
Manufacturing & Technology News (4/18, McCormack) reports that the once ambitious National Network for Manufacturing Innovation (NNMI), which was described as being a $2.4 billion program by President Obama in his most recent Congressional budget request, has become far more modest in scope.
The Senate Commerce, Science and Transportation Committee approved an amended version of the legislation (S-1468) authorizing the program at $300 million over ten years. It is half the amount of $600 million that was in the original bill, the Revitalize American Manufacturing and Innovation Act of 2013, sponsored by Sens. Sherrod Brown (D-Ohio) and Roy Blunt (R-Mo.).
The amended bill makes it impossible for the Obama Administration to create the 45 manufacturing innovation hubs that it says are needed. The bill caps the number of centers funded during any one year at 15.
Business and Schools Unite to Fight Patent Troll Legislation
Last week CACI joined 83 other businesses and business alliance groups, as well as 115 technical schools, colleges and universities in a letter to the Chair and Ranking Member of the Senate Judiciary Committee, urging due diligence as they craft a bill addressing legitimate patent protections and the threats of abusive patent litigation. The groups on this letter have worked closely with patent reform bill sponsors to craft responsible language which still allows for innovation, while protecting true innovators and the “bedrock of our economy.”