Senate Committee on Business, Labor and Technology (04/22/2009)

Final
STAFF SUMMARY OF MEETING

SENATE COMMITTEE ON BUSINESS, LABOR AND TECHNOLOGY

Date:	04/22/2009	ATTENDANCE

Time:	01:52 PM to 05:25 PM	Foster	X
		Harvey	X
Place:	SCR 354	Mitchell	*
		Scheffel	X
This Meeting was called to order by		Tochtrop	X
	Senator Veiga	Heath	X
		Veiga	X
This Report was prepared by
	Hillary Smith
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
HB09-1202 HB09-1310 SB09-285		Amended, Referred to Appropriations Referred to Appropriations Amended, Referred to the Committee of the Whole

01:52 PM -- House Bill 09-1202

Senator Foster presented House Bill 09-1202, concerning mortuary science registration. The bill creates a registration program for funeral establishments and crematories in the Division of Registrations in the Department of Regulatory Agencies (DORA). Funeral establishments and crematories are required to register annually with the department and provide specific information concerning the services they offer. The bill identifies the scope of lawful practice for crematories and prohibits either cremation or other funeral services to be performed by an establishment unless it is registered.

The term "mortuary science practitioner" is added to current law to refer to persons who direct funeral services and persons who embalm, cremate, or otherwise prepare for the final disposition of dead human bodies. The bill specifies the educational and professional requirements for mortuary science practitioners and cremationists and extends title protection to them.

Each registered funeral establishment must appoint an individual as its designee. The designee is required to verify that each employee at its facility is in compliance with the requirements for using these titles. The designee must maintain employee records of the evidence demonstrating compliance. Any establishment offering funeral goods or services must inform potential clients that complaints may be lodged with the DORA.

Violations of the bill are an unclassified misdemeanor. The DORA is given authority to establish fees, deny or revoke a registration, investigate complaints, take disciplinary action, and motion the court to impose civil penalties of up to $1,000 per violation. Senator Foster explained her reasons for sponsoring the bill. She said that Colorado is the only state without a registry of funeral homes. She discussed religious traditions concerning burial practices and distributed prepared Amendment L.006 (Attachment A).

02:02 PM

Senator Foster explained Amendment L.006 and responded to questions from the committee.

The following individuals testified regarding the bill:

02:08 PM -- Steffani Blackstock, Director of the Colorado Funeral Directors Association (CFDA), testified in favor of the bill. Ms. Blackstock addressed previous committee questions. She stated that no entity currently exists to handle consumer complaints, and gave examples of possible complaints. She noted that the CFDA doesn't have the authority to investigate complaints. Ms. Blackstock responded to questions from Senator Mitchell concerning whether the department would promulgate regulations to address the complaints she had described. Ms. Blackstock discussed a DORA sunrise report from 2007 regarding funeral homes.

02:16 PM

Senator Tochtrop spoke about language in current statutes concerning unlawful acts for funeral directors and embalmers. Discussion continued between Ms. Blackstone and Senator Tochtrop. Senator Scheffel asked for clarification regarding the penalties for violations of the bill.

02:20 PM -- Karen Van Vuuren, founder and Executive Director of Natural Transitions, a Boulder non-profit that provides funeral services, testified in opposition to the bill. She described her organization and its mission to educate funeral consumers. She explained that a growing number of people have an interest in alternative funeral services, such as home funerals, that may be more meaningful, cost-effective, and environmentally friendly. Senator Tochtrop noted that Senator Foster had indicated that the bill would not affect organizations like Natural Transitions. Ms. Van Vuuren replied that Natural Transitions does carry out some of the functions of a funeral director, and therefore her organization is in a "grey area" under the bill. She described language that the organization would like added to the bill, and explained that the DORA sunrise report of 2007 indicated no widespread abuse in the funeral service industry. She requested that the bill be tabled or amended to include explicit language preserving the right of the consumer to choose among available services.

02:28 PM

Senator Foster and Ms. Van Vuuren discussed whether Natural Transitions would fall under the bill's definition of "funeral director" and "established funeral facility." Senator Tochtrop and Ms. Van Vuuren discussed the possibility of a second reading amendment containing language similar to what Ms. Van Vuuren had described. Senator Heath made additional comments.

02:32 PM -- Christopher Allsopp, representing himself, testified in opposition to the bill. He described his experiences working with Natural Transitions after the death of his wife. He stated that he hopes that the bill will not restrict work like Ms. Van Vuuren's.

02:34 PM -- Bart Windrum, representing himself, testified in opposition to the bill. He described books he had written relating to funeral services. He expressed his concern that the bill will affect an individual's wishes concerning end-of-life care and the desire to die peacefully. He stated that he supports what Senator Foster has done with the bill, but requested that members consider the legislation as it addresses individuals' rights.

02:39 PM -- Patricia Ward, representing Natural Transitions, distributed printed copies of her testimony to the committee in lieu of testifying (Attachment B).

02:40 PM -- Denise Henasey, representing Prairie Wilderness Cemeteries, testified in opposition to the bill and distributed suggested language for an amendment (Attachment C). She noted that most opponents of the bill are not opposed to registration, but feel that the bill may be doing more than simply providing title protection, as some supporters argue. She suggested that the actions of many alternative organizations may fall under the bill's definition of "funeral director." Senator Foster commented on Ms. Henasey's testimony.

02:42 PM -- Lynn Walton, representing herself, distributed printed copies of her testimony to the committee in lieu of testifying (Attachment D).

02:43 PM -- Demetri Rombocos, President of the Shrine of Remembrance Funeral Home, testified in opposition to the bill on behalf of himself. He described definitions in current law and in the language of the bill pertaining to funeral directors and said that, according to his interpretation, the staff of Natural Transitions would be considered funeral directors. He believes that the bill will eliminate discounted and independent competition, including non-profit funeral service providers, and may prevent churches from hiring funeral coordinators. Mr. Rombocos said that he has no objection to registration, but feels that the fees provided for in the bill are excessive. He noted that Colorado funeral homes already file annually with over a dozen government agencies, and are not operating "off the radar." He added that nothing in Colorado has occurred to provoke this legislation, and argued that the bill will limit competition and consumer options, create staffing burdens, increase costs, and will not address actual problems in the funeral service industry.

02:51 PM -- Chuck Bowman, representing the CFDA, testified in favor of the bill. He stated that there is no inspection process for Colorado funeral homes and no place for consumers to register complaints. He described violations that have occurred in funeral homes in Colorado, and said that the bill will ensure that proper standards are enforced and that the consumer is protected. He addressed the issue of "title protection." Mr. Bowman expressed concerns about the health issues surrounding home funerals. He responded to questions from Senator Heath concerning the education requirements provided in the bill.

02:56 PM -- Elvin Caldwell, representing Caldwell-Kirk Mortuary and the CFDA, testified in favor of the bill. He described his experience as an independent funeral service provider. He stated that CFDA would prefer that the bill went even further, but it is a step in the right direction towards providing consumer protections. Mr. Caldwell discussed violations that would be prevented by the provisions of the bill.

03:00 PM -- Angie Kinnaird Linn, representing DORA, came to the table to answer questions. She responded to questions from Senator Heath regarding the necessity of the bill. She discussed the 2007 DORA sunrise report, and explained that the report had indicated that there may be a role for regulation in providing a forum for complaints. Ms. Kinnaird Linn responded to follow-up questions from Senator Heath and Senator Scheffel.

03:04 PM

Senator Foster provided closing remarks. She addressed previous questions from the committee. She stated that people are very vulnerable when a loved one has died, and expressed her concerns about "home cremation." She added that the industry has not supported this bill every year, but it supports it this year.


BILL:	HB09-1202
TIME:	03:08:27 PM
MOVED:	Foster
MOTION:	Moved prepared Amendment L.006 (Attachment A). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell
	Scheffel
	Tochtrop
	Heath
	Veiga

Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection

03:04 PM

Prior to the vote, Senator Heath spoke about a proposed second reading amendment. The committee discussed possible language for the amendment suggested by Natural Transitions, and Senator Tochtrop expressed her commitment to offer the amendment.


BILL:	HB09-1202
TIME:	03:08:51 PM
MOVED:	Foster
MOTION:	Moved to refer House Bill 09-1202, as amended, to the Committee on Appropriations. The motion passed on a 4-3 roll call vote.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	No
	Mitchell	No
	Scheffel	No
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 4 NO: 3 EXC: 0 ABS: 0 FINAL ACTION: PASS

03:10 PM -- House Bill 09-1310

Senator Heath presented House Bill 09-1310. The bill allows any person to file a written complaint with the Division of Employment and Training in the Colorado Department of Labor and Employment (CDLE) alleging an employer is misclassifying an employee as an independent contractor. The division director may investigate complaints and is required to focus on the most egregious complaints or those acts undertaken to gain a competitive advantage or to avoid the payment of taxes. Upon finding a violation, the director is required to order the employer to pay back taxes owed plus interest. For cases where misclassification was made with willful disregard of the law, the director is authorized to impose a fine, and upon a second or subsequent violation, prohibit an employer from contracting with the state for up to two years.

The bill allows an employer to request, for a fee, a nonbinding advisory opinion from the director as to how an individual employee should be classified. The department is required to conduct a statewide study on the issue of employee misclassification and report those findings in combination with information on complaint investigations to the General Assembly within two years. Senator Heath explained the bill, and Senator Scheffel distributed prepared Amendments L.011, L.012, and L.013 (Attachments E through G, respectively).

The following individuals testified regarding the bill:

03:15 PM -- Dennis Creese, representing the International Union of Painters and Allied Trades, testified in favor of the bill. He described the effect the bill will have on employers, the revenue stream, and workers. Mr. Creese enumerated reasons why the committee should support the bill.

03:18 PM -- Misty Hageman, representing Expert Floor Covering, testified in favor of the bill. She described the types of disadvantages her company faces when competing against companies that use independent contractors. She explained that her company pays benefits and taxes for its employees and cannot compete with bidders who have no other costs outside of wages. Ms. Hageman expressed her hope that the committee viewed a vote for the bill as a "pro-business" vote, protecting businesses that are following the law. She noted that, currently, there is no way to complain if a company has concerns about competitors that use independent contractors.

03:24 PM

Ms. Hageman responded to questions from Senator Harvey concerning what percentage of her company's work contracts are government contracts. Responding to a suggestion from Senator Harvey that government entities verify that employees are classified according to statute, Senator Heath clarified that the bill is aimed at more than government contracts. Senator Veiga added that without an enforcement method, determining whether someone is an independent contractor would not achieve anything. Discussion continued between Senator Heath and Senator Harvey.

03:28 PM

Senator Mitchell expressed his concern that there is no evidence that employee misclassification is an extensive problem requiring greater enforcement. He described a constituent complaint that CDLE may be operating on an agenda rather than as a response to a problem. Discussion continued.

03:32 PM -- Wayne Covillo, representing Gary Leimer, Inc., testified in favor of the bill. He stated that the bill will level the playing field.

03:33 PM -- Don Reeg, representing Tri-Star Masonry, Inc., testified in favor of the bill. He described the disadvantages his business faced when competing against other businesses that do not claim their employees. He responded to questions from Senator Mitchell.

03:35 PM -- Vicki Smith, Director of Unemployment Insurance Integrity, representing the CDLE, testified in favor of the bill. She described the tax auditing unit of the CDLE's Unemployment Insurance program, and stated that the unit currently audits approximately two percent of Colorado employers annually. She explained that many employers have expressed concerns about misclassified employees, and the CDLE wants to study the situation and formalize the reclassification process that currently exists. Ms. Smith stated that the bill will formalize the process for receiving and investigating complaints. She noted that the CDLE does not seek to discourage legitimate independent contractors. She addressed changes that had been made to the bill. Ms. Smith responded to questions from Senator Mitchell clarifying that random audits and specific responses to complaints are already possible, though the bill will clarify the process. Ms. Smith responded to questions from Senator Scheffel.

03:41 PM -- Buck Bailey, representing himself, testified in opposition to the bill. He described his professional background and stated that he is currently an independent contractor. He suggested that the bill revisits conversations that have already been had. Mr. Bailey added that there is no such thing as a level playing field. Mr. Bailey addressed Ms. Smith's testimony regarding the CDLE's existing ability to audit employers and expressed his concern that the bill will force everyone to become employees. He stated that he had a right to be an independent contractor and recommended that the definition of an independent contractor be standardized to make the law easier to follow.

03:50 PM -- Larry Hudson, representing the Colorado Association of Commerce and Industry (CACI), testified regarding the bill. He described his organization and their concerns with the bill. He discussed changes that had been made to the bill and described changes that CACI would support.

03:56 PM

Senator Mitchell commented on CACI's testimony. He asked for clarification from Senator Heath about the provisions of the bill concerning "advisory opinions." Discussion continued between Senator Heath and Senator Mitchell.

03:59 PM -- Greg Fulton, representing the Colorado Motor Carriers Association (CMCA), testified regarding the bill. He discussed the role of independent contractors in the trucking industry and stated that high taxes create a poor business environment for trucking. Mr. Fulton described changes that would make the CMCA more comfortable with the bill. He suggested that it was inappropriate that the enforcement mechanism of the bill begins prior to the completion of a study on the issue of employee misclassification, and noted that amendments had been offered that may address some of CMCA's concerns.

04:08 PM

Senator Heath responded to Mr. Fulton's testimony, explaining that he was not trying to redraft the law pertaining to independent contractors. Senator Heath stated that complaints are currently allowed, but the bill will formalize the process and provide for a study of the problem. Senator Heath said that he will not support the amendments Senator Scheffel had offered. Mr. Fulton responded to Senator Heath's comments.

04:13 PM -- Ted Textor, representing the Teamsters, testified in favor of the bill. He distributed a packet of materials to the committee that illustrated the impact of employee misclassification on communities and on states (Attachment H). He discussed the costs to the state due to employee misclassification.

04:21 PM -- Ernest Adame, representing bricklayers, testified in favor of the bill. He distributed four handouts to the members of the committee (Attachments I through L). Mr. Adame responded to questions from Senator Mitchell.

04:27 PM -- Ralph Lufen, representing the Rocky Mountain Chapter of the National Electrical Contractors Association, testified in favor of the bill. He responded to questions from Senator Mitchell.

04:29 PM -- Jeff Clayton, representing the CDLE, came to the table to respond to Senator Mitchell's concerns. He described an amendment that had been added to the introduced bill removing the requirement for an Office of Employee Classification and the need for any new full time employees. Mr. Clayton responded to questions from Senator Foster pertaining to the effect of the Senator Scheffel's amendments. The committee recessed briefly.

04:40 PM

The committee reconvened. Senator Scheffel described his concerns with the bill and discussed prepared Amendment L.011. Prior to the vote, Senator Heath commented on the amendment and expressed his concerns that it did not fall under the title of the bill. After committee discussion, Senator Veiga allowed a vote to be taken.


BILL:	HB09-1310
TIME:	04:43:13 PM
MOVED:	Scheffel
MOTION:	Moved prepared Amendment L.011 (Attachment E). The motion failed on a 3-4 roll call vote.
SECONDED:
		VOTE
	Foster	No
	Harvey	Yes
	Mitchell	Yes
	Scheffel	Yes
	Tochtrop	No
	Heath	No
	Veiga	No

Not Final YES: 3 NO: 4 EXC: 0 ABS: 0 FINAL ACTION: FAIL

04:44 PM

Senator Scheffel explained prepared Amendment L.012. Senator Heath explained his objections to the amendment, and Senator Scheffel responded to his concerns. Senator Veiga explained her vote.


BILL:	HB09-1310
TIME:	04:48:58 PM
MOVED:	Scheffel
MOTION:	Moved prepared Amendment L.012 (Attachment F). The motion failed on a 3-4 roll call vote.
SECONDED:
		VOTE
	Foster	No
	Harvey	Yes
	Mitchell	Yes
	Scheffel	Yes
	Tochtrop	No
	Heath	No
	Veiga	No

Not Final YES: 3 NO: 4 EXC: 0 ABS: 0 FINAL ACTION: FAIL

04:49 PM

Senator Scheffel explained prepared Amendment L.013. Senator Heath expressed his concerns about the amendment. Senator Foster suggested that the amendment didn't seem to change anything substantial. Discussion continued among the members of the committee regarding the effect of the amendment and the subjectiveness of the term "competitive advantage."


BILL:	HB09-1310
TIME:	04:51:53 PM
MOVED:	Scheffel
MOTION:	Moved prepared Amendment L.013 (Attachment G). The motion failed on a 3-4 roll call vote.
SECONDED:
		VOTE
	Foster	No
	Harvey	Yes
	Mitchell	Yes
	Scheffel	Yes
	Tochtrop	No
	Heath	No
	Veiga	No

Not Final YES: 3 NO: 4 EXC: 0 ABS: 0 FINAL ACTION: FAIL


BILL:	HB09-1310
TIME:	04:59:13 PM
MOVED:	Heath
MOTION:	Moved to refer House Bill 09-1310 to the Committee on Appropriations. The motion passed on a 5-2 roll call vote.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	Yes
	Mitchell	No
	Scheffel	No
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 5 NO: 2 EXC: 0 ABS: 0 FINAL ACTION: PASS

05:00 PM -- Senate Bill 09-285

Senator Heath presented Senate Bill 09-285. The bill is recommended by the Joint Select Committee on Job Creation and Economic Growth. It makes changes to House Bill 09-1319, which permits students in grades 9 through 12 to enroll in courses at institutions of higher education and apply earned credits toward the requirements for both high school graduation and a post-secondary degree. Senate Bill 09-285 includes the following provisions:

clarifies that concurrent credits may be earned in career and technical education courses;
permits students to apply credits toward either an academic degree or a career and technical

certificate; and

adds representatives of career and technical program providers to the concurrent enrollment

advisory board.

School districts and Boards of Cooperative Educational Services (BOCES) that are approved as a career and technical education program provider cannot include concurrently enrolled students for the purpose of calculating state aid for career and technical education that the district or BOCES receives under current law. The bill takes effect upon the enactment of House Bill 09-1319.

Senator Heath explained the bill and stated that it is a companion bill to House Bill 09-1319. Responding to questions from Senator Harvey regarding why the bill was necessary, Senator Heath said that the bill expands and formulates programs that may not exist in all counties. Senator Heath responded to further questions from Senator Harvey regarding the fiscal impact of the bill. He distributed prepared Amendments L.002, L.004, and L.006 (Attachments M through O, respectively).

The following individuals testified regarding the bill:

05:06 PM -- Matt Gianneschi, representing the Governor's Office, testified in favor of the bill. He stated that the legislation comes from the recommendations of the P-20 Council. He addressed Senator Harvey's comments concerning post-secondary enrollment options. Mr. Gianneschi and Senator Harvey discussed funding sources for the program. Responding to a question from Senator Harvey concerning the eligibility of illegal aliens for concurrent enrollment options, Mr. Gianneschi referred to a formal opinion written by Attorney General John Suthers (Attachment P).

05:11 PM -- Geri Anderson, representing the Colorado Community College System, testified in favor of the bill. She responded to suggestions from Senator Foster concerning ways to market technical or vocational education tracks. Other members of the committee shared additional comments regarding technical career programs.

05:16 PM -- Dean Stecklein, representing Pickens Technical College and area technical colleges, testified in favor of the bill.

05:19 PM -- Darrell Green, representing Pickens Technical College and the Colorado Association of Career and Technical Education (CACTE), testified in favor of the bill. He gave examples of concurrent enrollment options.

05:21 PM -- Dan Lucero, representing the CACTE, testified in favor of the bill. He addressed Senator Foster's comments regarding popular perceptions of career and technical education. He stated that the bill will help advance career and technical education as viable options.

05:23 PM

Senator Heath explained the reasons why the bill was not combined with House Bill 09-1319. He described prepared Amendments L.002, L.004, and L.006. He stated that they ensure that the bill coincides with House Bill 09-1319.


BILL:	SB09-285
TIME:	05:24:36 PM
MOVED:	Heath
MOTION:	Moved prepared Amendment L.002 (Attachment M). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell
	Scheffel
	Tochtrop
	Heath
	Veiga

Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	SB09-285
TIME:	05:24:49 PM
MOVED:	Heath
MOTION:	Moved prepared Amendment L.004 (Attachment N). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell
	Scheffel
	Tochtrop
	Heath
	Veiga

Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	SB09-285
TIME:	05:24:58 PM
MOVED:	Heath
MOTION:	Moved prepared Amendment L.006 (Attachment O). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell
	Scheffel
	Tochtrop
	Heath
	Veiga

Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	SB09-285
TIME:	05:25:06 PM
MOVED:	Heath
MOTION:	Moved to refer Senate Bill 09-285, as amended, to the Committee of the Whole. The motion passed on a 7-0 roll call vote.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	Yes
	Mitchell	Yes
	Scheffel	Yes
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 7 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: PASS

05:25 PM

The committee adjourned.