Colorado Capitol Report

List of New Controversial Legislation Grows While the Economy Suffers


List of New Controversial Legislation Grows While the Economy Suffers

When the Colorado General Assembly reconvenes on May 26th for three weeks, the economic impacts of the COVID-19 pandemic will be a prevailing issue for lawmakers as they debate the hundreds of bills left on the legislative calendar as well as passage of the State’s budget which has taken the Joint Budget Committee several weeks to address a $3.3 billion budget shortfall.  The pandemic has created a monumental economic crisis for businesses reinforced by a study conducted by the State’s Office of Economic Development & International Trade.

Despite these economic conditions, the Colorado Chamber continues to learn of new and controversial legislation to be introduced when the General Assembly reconvenes.  Some of these bills create new mandates, fees or costly programs for employers who are trying to re-open their operations and re-hire employees.  Details regarding these proposed bills are provided below:

Creation of a Workers Compensation Presumption

Bill Sponsor:  Senator Robert Rodriguez (D – Denver)

  • Shifts the legal burden of proof onto the employer for worker compensation claims associated with COVID-19 made by employees working for essential businesses;
  • Applies to any employee that works for an essential business including: construction; retail; medical providers; first responders; corrections; food processing and agricultural; nursing homes; utility services; airlines; residential care facilities; pharmacists; and public transportation;
  • If a worker claims workers compensation because they believe they contracted COVID-19 at the workplace, the employer must prove otherwise through clear and convincing evidence if an employer chooses to dispute the claim;
  • Under current law, the burden is on the employee to prove that they were hurt on the job in order to receive workers compensation;
  • Under current law, workers compensation currently covers COVID-19 claims.

Impact to Colorado Employers:  Workers Compensation premium rates may increase for all employers.  Cost estimates have ranged from a $60 million to $2.2 billion impact to Colorado’s workers compensation system based on legislation introduced in other states.

Creation of Health Insurance Fee:

Bill Sponsors:  Senator Dominic Moreno (D-Commerce City); Representative Chris Kennedy (D – Jefferson)

  • Creates a 3% premium tax on health insurance carriers to offset costs for people who purchase individual health insurance products;
  • Creates a Colorado Health Insurance Affordability Enterprise to collect the new tax from health insurance companies and use the funds for the purposes outlined below:
    • To fund the continuation of the Colorado Reinsurance Program adopted in the 2019 legislative Session and that has been funded in part by hospitals and State dollars;
    • To cover premium subsidies for individuals who do not qualify for Medicaid, CHIP or Advanced Premium Tax Credits.
    • To pay for the administrative expenses associated with operating the Enterprise.

Impact to Employers:  The tax collected would be shifted to the small and large group insurance markets which are funded by employers, thereby increasing health insurance costs for employers without reaping any of the benefits associated with the tax.

Employer Requirement of Paid Sick Leave:

Bill Sponsors:  Senators Steve Fenberg (D-Boulder) & Jeff Bridges (D-Arapahoe)

  • Creates a new paid sick leave law requiring all Colorado employers to provide paid sick leave to their employees;
  • Allows for leave to roll-over but an employee cannot accumulate more than maximum leave allowed;
  • The leave is not required to be paid out to an employee if that employee separates from the job;
  • The leave must be earned by an employee and accrual of leave is one hour for every 30 hours worked;
  • Allows for leave to attend to family members or those with a family relationship;
  • Employers that offer the same or more generous sick leave policy would be exempted;
  • Creates a private right of action.

Impact to Colorado Employers:  Employers without a current paid sick leave policy will be required to provide paid sick leave benefits based on the requirements in the legislation.  Those with an existing paid sick leave policy will be required to make changes to their current policy based on the requirements in the legislation.

Whistleblower Protections for Employees:

Bill Sponsor:  Representative Leslie Herod (D – Denver)

  • Applies to all Colorado employers including those who hire independent contractors for 75% or more of their workforce;
  • Prohibits employer from discriminating against a worker who raises concerns about the employer’s public safety practices if worker believes there’s a violation of federal, state or local public health safety guidelines;
  • Prohibits employer from requiring an employee from signing a contract/agreement regarding disclosure of information on an employer’s health & safety guidelines;
  • Prohibits employer from discriminating against a worker who wears their own protective equipment (mask, faceguard, gloves) if equipment is at a higher level than what is provided by an employer;
  • Prohibits employer from discriminating against a worker for opposing any employment practice they believe is unlawful under the above provisions or for testifying against an employer in an investigation, hearing, etc..;
  • if there is a claim that an employer discriminated against an employee who engaged in testimony or actions against the employer, the bill creates a presumption that the employer’s actions were discriminatory or retaliatory and must be rebutted by clear & convincing evidence.

Impact to Employers:

Allows workers to file a civil lawsuit directly against an employer instead of pursuing relief through an administrative process.  This could generate additional litigation costs for employers.

Other Potential Cost Increases for Employers:

  • Unemployment Insurance (UI) premiums are anticipated to increase beginning January 1, 2021 based on the millions of UI claims made by workers due to businesses being required to shut down or operate at smaller capacities during the COVID-19 pandemic in response to the Governor’s Stay at Home Order;
  • In addition to Unemployment Insurance premium increases, a UI insolvency surcharge will be placed on employers beginning January 1, 2021 due to the anticipated insolvency of the UI fund;
  • Lawmakers have also discussed removing or suspending tax credits or tax exemptions that have helped businesses reduce their operational costs or expenses.

SB 204 Additional Resources to Protect Air Quality:

Bill Sponsors: Senator Steve Fenberg (D-Boulder); Representatives Dominique Jackson (D-Aurora) & Yadira Caraveo (D-Thornton)

  • Increases emission fees in the Stationary Source Fund;
  • Eliminates the statutory cap on those fees;
  • Establishes the Air Quality Enterprise in CDPHE to conduct air quality modeling, monitoring, assessment, data analysis, and research, and provide its data to fee payers and state regulators;
  • Authorizes the enterprise’s board to establish fees to pay for its operations;
  • Proponents have indicated they intend to increase the current emission fees to 15% for FY 2020-21 and delay the enterprise fees until FY 2021-22.

Impact to Employers: Fee increase in the current economic environment. This 15% fee increase is on top of a 25% increase in 2018. In addition, the fees to fund the enterprise are likely to be the same or very similar to the current fees.

Creation of a Perfluoroalkyl and Polyfluoroalkyl (PFAS) Contamination Response Enterprise:

Bill Sponsors: Senators Steve Fenberg (D-Boulder) & Pete Lee (D-Colorado Springs)

  • Enterprise will have the power to:
    • Distribute grants for certain PFAS-related purposes;
    • Administer a takeback program and purchase and dispose of materials that contain PFAS; and
    • Provide technical assistance in locating and studying PFAS to communities, stakeholders and regulatory boards and commissions;
  • Enterprise will fund its operations by charging fees to airports, airport hangars and Colorado manufacturers, distributors and first purchasers of fuel.

Impact to Employers: Fee increase in the current economic environment.

Creation of a Waters of the State Protection Program:

  • Create a Waters of the State Protection Program in CDHPHE in response to the federal Waters of the United States (WOTUS) rule.
  • Gives the Water Quality Control Commission (WQCC) the ability to use federal regulations and guidance in effect prior to April 2020;
  • Gives WQCC the authority to establish fees to cover the direct and indirect costs of the program.

Impact to Employers: Fee increase and increased regulation in the current economic environment.

When Colorado General Assembly returns next week to fill the state budget shortfall and address other pending bills, they should keep in mind that the business community can’t afford costly new mandates, fees, or programs in the middle of this economic crisis.

Please contact Loren Furman at [email protected] or at 303-866-9642 with any questions regarding these proposed bills.


New Study Highlights Economic Impact of COVID-19; Lawmakers Should Be Mindful of Business Hardships

A study conducted by the Colorado Office of Economic Development and International Trade reveals some troubling data on the economic impact of COVID-19 on the business community. The survey of about 2,400 businesses across the state found that the majority of Colorado companies project that they will suffer revenue reductions of 25% or more in 2020.

As the Denver Business Journal reports:

More than half of all Colorado businesses expect revenue to be down at least 25% from projections at the beginning of this year — a sign of how wide and deep the coronavirus is striking, according to a new survey of nearly 2,400 companies statewide.

Nearly half of the 2,382 respondents said their revenue is down by more than 50% since the outbreak of the virus in mid-March, with only 10% saying they had seen no reduction at all. And while a majority of businesses (52%) said they do not anticipate layoffs in the next six months, a full 25% of companies expect to lay off or have laid off 30% or more of their employees — including 51% of all leisure and hospitality businesses surveyed and 37% of firms in shopping and retail.

When Colorado General Assembly returns next week to fill the state budget shortfall and address other pending bills, they should keep in mind that the business community can’t afford costly new mandates, fees, or programs in the middle of this economic crisis.

To view the full survey, click here.


A Conversation with Senator Gardner

U.S. Senator Cory Gardner

Last week, Senator Gardner joined the Colorado Chamber on a Zoom call to get feedback from the business community on federal COVID-19 relief and answer questions.

The Senator covered topics ranging from the CARES Act and future stimulus bills, employer liability protection, transportation funding and more.

Click here to watch a recap of the meeting!


Draft Legislation To be Introduced Changing Gallagher Amendment

The Colorado General Assembly plans to reconvene on May 26th for a limited period of time. Leadership in both chambers has conveyed that controversial bills or bills with a fiscal impact may not make it to the finish line,. However, Colorado Chamber staff is hearing of new legislation to be introduced that will change the current Gallagher Amendment. Details regarding this draft Concurrent Resolution are as follows:

  • The draft Concurrent Resolution repeals the Gallagher Amendment so that the General Assembly will no longer be required to establish the residential assessment rate based on the formula expressed in the Gallagher Amendment;
  • It repeals the reference to the residential rate of 21%, which last applied in 1986, prior to the first adjustment required by the Gallagher Amendment;
  • It repeals the 29% assessment rate that applies for all nonresidential property, excluding mines and lands or leaseholds producing oil or gas.
  • This Concurrent Resolution would require a 2/3rdsvote of approval of the members of the Legislature in both the House and Senate.

Since this Concurrent Resolution is still in draft form, staff is not recommending a Tax Council position yet. However, we will make a recommendation once the bill is formally introduced. In the meantime we recommend reviewing and providing feedback to Loren Furman at [email protected] so that we can react quickly with a Council position.


House Leadership Releases Legislative Committee Schedule

The Colorado General Assembly will reconvene on May 26th, and today, the House leadership released information regarding the process they will be using to address the hundreds of bills remaining on the legislative calendar.  We’ve provided here an overview of the process prepared by the House Majority Leadership members as well as the list of bills that each committee plans to hear for the upcoming week.

Please contact Loren Furman at [email protected] or at 303-866-9642 with any questions.