Bill Summary for Bill Number HB09-1001

Date: 03/11/2009

Final
BILL SUMMARY for HB09-1001

SENATE COMMITTEE ON BUSINESS, LABOR AND TECHNOLOGY

Votes: View-->	Action Taken:
Moved prepared Amendment L.035 (Attachment B). Th Moved to refer House Bill 09-1001, as amended, to	Pass Without Objection PASS

03:00 PM -- House Bill 09-1001

Senator Heath presented House Bill 09-1001. The bill provides an income tax credit to firms that create jobs in Colorado. If the jobs are created within an enhanced rural enterprise zone, firms must create at least five jobs and retain them for one year. If the jobs are not being created within an enhanced rural enterprise zone, at least 20 jobs must be created and retained for one year. In order to qualify for the credit, the jobs must bring wages of at least 110 percent of the average wage of the county in which the new jobs are located. Senator Heath distributed prepared Amendment L.035 (Attachment B). Senator Heath discussed his reasons for sponsoring the bill. He stated that the fiscal note does not take job creation into account. He discussed the requirements that need to be met in order to qualify for the income tax credit. He argued that large employers needed to be supported in order to help smaller employers.

03:08 PM

Senator Mitchell discussed Senator Heath's statement that the fiscal note does not account for jobs that are created. Senator Heath explained that the tax credit would only applies to jobs that would not have arisen if not for the legislation. Discussion continued between Senator Mitchell and Senator Heath.

The following individuals testified regarding the bill:

03:13 PM -- Don Elliman, representing the Governor's Office of Economic Development and International Trade, testified in favor of the bill. He stated that the key to the bill is that it limits eligibility for the tax credit to employers who create jobs that would not have been created were it not for the tax credit.

03:17 PM

Mr. Elliman responded to a question from Senator Foster regarding whether the tax credit would have helped with a specific past negotiation. Mr. Elliman noted that the tax credit stops if the employer leaves the state or cuts the jobs. Senator Mitchell made comments regarding extending the tax credit to small businesses. Senator Mitchell also discussed jobs that were created spontaneously rather than as a result of the legislation. Mr. Elliman said that jobs that would have been created regardless of the bill should not be eligible for the tax credit. Discussion continued between Mr. Elliman and Senator Mitchell. Mr. Elliman added that employers who create a minimum of five jobs in rural areas would include some small businesses.

03:24 PM

Senator Veiga stated that she was pleased to see the targeted direction of the bill. Senator Mitchell made additional comments concerning the limited resources available to the state to offer a tax credit. Discussion continued between Senator Veiga and Mr. Elliman.

03:27 PM -- Clarke Becker, representing the Economic Development Council of Colorado, testified in favor of the bill. He discussed the Colorado Economic Leadership Coalition.

03:31 PM -- Tom Clark, representing the Metro Denver Economic Development Corporation, the Metro Denver Chamber of Commerce, and the Colorado Competitive Council (C3), testified in favor of the bill. He discussed the incentives that had been available in the past. He discussed business that Colorado had lost to Chicago, where a tax incentive similar to the one prescribed by the bill exists.

03:37 PM

Mr. Clark responded to questions from Senator Mitchell concerning projected job growth for Colorado. Mr. Clark stated that the crucial concern of the bill was "primary employment," and was directed at employers whose market would be unaffected if it were to locate in a different state. Discussion continued between Mr. Clark and Senator Mitchell. Mr. Clark stated that providing tax credits to companies who do not create new wealth is not economic development.

03:45 PM

Senator Scheffel discussed concerns that the bill would only benefit larger companies. He also addressed the bill's fiscal note. Senator Foster sought clarification regarding the number of jobs that must be created in order to be eligible for the tax credit.

03:47 PM -- Sheryle Hutter, representing the Colorado Developmental Disabilities Council, testified regarding the bill. She stated that the council has a neutral position on the bill and discussed concerns that the bill will not help members of the disabled community. She addressed the possibility of including small businesses in the bill. Senator Foster asked if there were existing tax credits to encourage employers to hire individuals with disabilities, and Ms. Hutter stated that proposed credits that had been put on hold as a result of the budget crisis.

03:49 PM -- Phil Horwitz, representing the Department of Revenue, testified regarding the bill. He addressed Senator Mitchell's comments concerning the government's oversight role and discussed the requirement that limits eligibility for the tax credit to employers who create jobs that would not have been created were it not for the tax credit.

03:52 PM

Senator Heath made closing remarks and discussed the amendment.


BILL:	HB09-1001
TIME:	03:52:38 PM
MOVED:	Heath
MOTION:	Moved prepared Amendment L.035 (Attachment B). 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:	HB09-1001
TIME:	03:52:48 PM
MOVED:	Heath
MOTION:	Moved to refer House Bill 09-1001, as amended, to the Committee on Appropriations. 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

03:54 PM

The committee adjourned.