Colorado Capitol Report

The Colorado General Assembly concluded this week after a challenging legislative session for the business community. In the legislature’s final days, several last-minute deals and changes were made to key business bills. Most significantly, SB 176, the litigious workplace harassment bill, was killed in committee in a major victory for Colorado businesses. Several other bills went through a series of changes before final passage this week – see all the details below:

Senate Bill 176: Workplace Harassment Bill Killed in Committee

SB 176 was a major priority of the Colorado Chamber this session, which would have overhauled the way Colorado handles harassment cases in the public and private sectors. The bill would have changed the definition of harassment to remove the “severe and pervasive” standard, included independent contractors and caregivers, made it easier to file a claim against employers, and created excessive punitive fines.

After aggressive outreach to the House Judiciary Committee by Colorado Chamber members and other business groups, SB 176 was killed in a 9-2 vote in committee. This significant move is a major victory for the Colorado business community, and the Colorado Chamber lobby team raised a number of concerns about the broad definitions and untested legal standards set in the bill. After compelling testimony in last week’s hearing, the sponsor’s attempted a strike-below amendment to the bill today, but were unsuccessful.

Read more in the Denver Business Journal.

Senate Bill 200 & House Bill 1266: Greenhouse Gas Roadmap Gets New Life in Last-Minute Amendment

SB 200 was the environmental justice legislation that looked as if it was dead earlier in the session. The bill imposed aggressive caps on greenhouse gas emissions and gave the state’s environmental regulators broad control over virtually any entity that generates greenhouse gas. Due to the broad authority given to an unelected commission, Gov. Polis threatened to veto the bill early on and the Colorado Chamber opposed it.

After some last-minute negotiations between Democrats, the sponsors, and the governor’s office, SB 200 was given new life as an amendment to HB 1266 in the final days of session, giving stakeholders and business groups very little time to respond or provide feedback.

Some changes were made from the original bill – most significantly, the codification of the Greenhouse Gas Roadmap only applies to the electric, industrial, and manufacturing sectors (the bill excludes buildings and transportation). HB 1266 accelerates the target reductions for the industrial and manufacturing sectors substantially, moving the baseline of 2005 emission rates to 2015 emission rates, excluding oil and gas, with the same reduction goal of 20% by 2030. Additionally, it accelerates the reduction targets for oil and gas to 36% by 2025 and 60% by 2030 – a substantial increase from the Greenhouse Gas Roadmap. The new version also gives the Air Quality Control Commission (AQCC) more authority to rewrite energy plans for entities who are not meeting the targets or making sufficient progress – as defined by the AQCC

HB 1232: The Public Option Headed to Governor’s Desk

While the Colorado Chamber still opposed the final version of the bill due to fundamental cost-shifting concerns, it did see some improvement in the legislative process from its original form.

Most notably, the original bill required health care plans to drop premiums by 20% by 2024, while the final bill lowered that to 15%. The original bill also required mandatory participation for doctors, hospitals, and health care plans. The final bill removed penalties for doctors who did not comply with the mandatory participation requirement and loosened the enforcement provisions for hospitals by removing the loss of licensure provision.

The bill was finalized in House concurrence with the Senate amendments. It will now head to Governor Polis for signature.

Senate Bill 175: Prescription Drug Affordability Review Board Passes with House Concurrence

SB 175 this week was finalized with House concurrence with Senate amendments and is headed to the Governor for signature.

The bill creates a new Prescription Drug Affordability Review Board that sets price caps for certain prescription drugs in Colorado that meet the eligibility requirements outlined in the bill. The bill makes it illegal to purchase or reimburse a prescription drug at a cost that exceeds the upper payment limit or price cap established by Board. The bill was changed significantly throughout the legislative process, with 26 amendments in the Senate and 5 amendments on the House Floor.

Notable changes include sunsetting the program after 5 years, setting a limit of 12 drugs to be reviewed by the board annually, and requiring that the Board report annually to the Legislature about the drugs they have chosen and whether the manufacturer will continue to make the drugs available in Colorado, in addition to a rationale provided by the manufacturer.   Amendments to the bill also changed which drugs the board is allowed to consider and how they are allowed to consider them – for example, the Board now must consider a drug’s orphan status and drugs that have a greater impact on public health. The eligibility threshold has also changed from drugs that have increased by $3,000 to drugs that has increased by 10% in the 12 months prior.

House Bill 1311 & 1312: House Concurs with Senate Amendments

The two major business tax reform bills that passed the Senate last week were concurred with in the House this week. The bills eliminate a series of tax exemptions while raising the exemption cap for business personal property taxes to $50,000. Significant improvements made to the bill in the legislative process include:

• The reinstatement of the 3 of 6 combined reporting rule
• Slowing the restrictions on the regional home office exemptions
• Eliminating the “highest and best use” language for commercial or residential property assessments
• Providing more clarity and defining terms in the bill, including “mainframe computer access,” “photocopying,” and “packing and crating”
• Allowing agriculturally zoned land to continue to be eligible for Colorado capital gains tax breaks
• Increasing the cap on 529 educational tax deductions in the bill
• Adjusting certain provisions of the bill for inflation

The bill is now heading to the Governor for signature.