House Committee on Business Affairs and Labor (02/09/2010)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON BUSINESS AFFAIRS AND LABOR

Date:	02/09/2010	ATTENDANCE

Time:	09:50 AM to 12:45 PM	Balmer	X
		Bradford	X
Place:	HCR 0112	Casso	X
		Kerr A.	X
This Meeting was called to order by		Liston	X
	Representative Rice	Middleton	X
		Priola	X
This Report was prepared by		Soper	X
	Christie Lee	Stephens	X
		Gagliardi	X
		Rice	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
HB10-1174 HB10-1114 HB10-1231 HB10-1247		Postponed Indefinitely Amended, Referred to Appropriations Referred to the Committee of the Whole Referred to the Committee of the Whole

09:50 AM -- House Bill 10-1174

Representative Frangas, prime sponsor, presented House Bill 1174 concerning an increase in state revenues from the oil and gas severance tax to be used to promote jobs in the state, and, in connection therewith, temporarily halving the amount of the credit based on property taxes paid allowed against the tax on the severance of oil and gas; requiring the Department of Education to distribute 90 percent of the additional tax revenue to public schools for teacher retention; and requiring the Colorado Economic Development Commission to use ten percent of the additional tax revenue to increase the availability of credit to small businesses in Colorado. Under current law, oil and natural gas severance taxpayers can claim a tax credit of 87.5 percent of the local property taxes they pay on the value of their oil and gas production. This bill temporarily reduces the amount of the credit by half for tax years commencing after January 1, 2011, and before January 1, 2013.

The additional severance tax revenue generated by the reduction in the credit will be allocated:

90 percent to a newly-created Teacher Retention Cash Fund; and
10 percent to a newly-created Small Business Credit Cash Fund.

The money credited to the Teacher Retention Cash Fund is required to be appropriated to the Department of Education for teacher retention. The money is required to be distributed to school districts and the Charter School Institute based on student enrollment across the state.

The money in the Small Business Credit Cash Fund is required to be appropriated to the Colorado Economic Development Commission to increase the availability of credit to small businesses through the Colorado Credit Reserve Program. This program is administered by the Colorado Housing and Finance Authority.

09:52 AM

Representative Frangas distributed Amendments L.001 and L.002 (Attachments A and B respectfully). Representative Rice commented on the bill and asked the sponsor some questions.

10:00 AM -- Aron Diaz, representing the Associated Governments of Northwest Colorado, testified against the bill. Mr. Diaz said he realizes that education is struggling, but education's problems are rooted in various constitutional measures and the School Finance Act. He responded to questions from the committee regarding the impact the bill will have on individual property owners and statistics about the industry.

10:07 AM -- Virginia Love, representing the Colorado Competitive Council, testified against the bill. She said they are against the bill for the same reasons they were against Amendment 58. Ms. Love stated that all the other tax increases proposed this session will affect the oil and gas industry as well. She addressed earlier questions regarding the impact the bill would have on individual property owner royalties. Representative Liston asked Ms. Love to further explain her comments on Amendment 58. Ms. Love responded to additional questions.

10:13 AM -- Donnah Moody, representing the Colorado Association of Commerce and Industry, testified against the bill. She said they are against the bill for many of the same reasons as the previous witnesses. Representative A. Kerr asked how the current severance tax revenues are distributed.

10:17 AM -- Stan Dempsey, representing the Colorado Petroleum Association and the Colorado Oil and Gas Association, testified against the bill. Mr. Dempsey talked about the impact the bill will have on the industry especially in counties that have a higher number of taxing districts. He responded to earlier questions from the committee regarding a study from the Fraser Institute. A discussion about the report ensued. Mr. Dempsey also explained how the severance tax receipts are distributed stating that half goes to local government and the other half goes to the Department of Natural Resources. Mr. Dempsey also talked about Amendment 58. Representative Middleton pointed out that the Fraser Institute has only completed the survey for three years and asked Mr. Dempsey to explain the factors that could be responsible for Colorado's drop in rank. Mr. Dempsey responded. Representative Gagliardi asked Mr. Dempsey to provide the number of oil and gas permits that have been pulled over the last few years.

10:41 AM -- Debra Anderson, representing National Association of Royalty Owners (NARO), testified against the bill.

10:48 AM -- Mary Lou Brophy, representing NARO, testified against the bill. She talked about the recent struggles in the industry and how it has impacted her and other owners. Representative Bradford asked some questions regarding the average income for one stripper well.

10:56 AM -- Neil Ray, President NARO, testified against the bill. He talked about the production in various areas around Colorado. Representative Liston asked why Mr. Ray has moved from Colorado to other states.

11:02 AM -- Ed DeCecco, Office of Legislative Legal Services and drafter of the bill, responded to questions from the committee about the amendments.


BILL:	HB10-1174
TIME:	11:02:35 AM
MOVED:	Rice
MOTION:	Moved amendment L.001 (Attachment A). The motion passed without objection.
SECONDED:	Gagliardi
		VOTE
	Balmer
	Bradford
	Casso
	Kerr A.
	Liston
	Middleton
	Priola
	Soper
	Stephens
	Gagliardi
	Rice
Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection

11:05 AM

Committee members commented on Amendment L.002.


BILL:	HB10-1174
TIME:	11:05:00 AM
MOVED:	Rice
MOTION:	Moved amendment L.002 (Attachment B). The motion passed 6-5.
SECONDED:	Kerr A.
		VOTE
	Balmer	No
	Bradford	No
	Casso	Yes
	Kerr A.	Yes
	Liston	No
	Middleton	Yes
	Priola	No
	Soper	Yes
	Stephens	No
	Gagliardi	Yes
	Rice	Yes
Not Final YES: 6 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS

11:11 AM

Representative Frangas gave some closing comments on the bill. Representative A. Kerr commented on the importance of funding education and expressed his concerns with the bill, including the fact that it is a temporary fix to the problem. He said they need to find a stable source of funding. Representative Soper commented on the bill and mentioned the fact that Amendment 58 was voted down in Colorado.


BILL:	HB10-1174
TIME:	11:17:18 AM
MOVED:	Bradford
MOTION:	Moved to postpone House Bill 10-1174 indefinitely. The motion passed 9-2.
SECONDED:	Balmer
		VOTE
	Balmer	Yes
	Bradford	Yes
	Casso	No
	Kerr A.	Yes
	Liston	Yes
	Middleton	Yes
	Priola	Yes
	Soper	Yes
	Stephens	Yes
	Gagliardi	No
	Rice	Yes
Final YES: 9 NO: 2 EXC: 0 ABS: 0 FINAL ACTION: PASS

11:18 AM -- House Bill 10-1114

Representative Liston, prime sponsor, presented House Bill 1114 concerning the registration of agents of persons in the business of transmitting money. Under current law, money transmitters are required to be licensed but their agents are not. The amendment requires the registration of money transmitter agents and sets the procedures and requirements for registration, including providing information submitted to the banking board and the signing of a statement affirming knowledge of money laundering laws.

Under penalty of a Class 2 misdemeanor for a first offense and a Class 1 misdemeanor for a second or subsequent offense, a licensed money transmitter is prohibited from knowingly employing an agent who has been convicted of certain offenses, or employing anyone under 18 years of age to perform money transmission services. Access to information sent to the banking board is open to law enforcement officers acting within the scope and course of their official duties.

Representative Liston distributed a handout (Attachment C).

11:23 AM -- Detective Adrian Vasquez, representing the Drug Enforcement Agency, testified in support of the bill. He talked about the use of money transmitters in criminal activities, including drug dealing and laundering money to other countries. Detective Vasquez explained the limits detectives have when investigating transmitters and how this bill came about.

11:27 AM -- Sarah McCaslin, a Colorado Springs Police Officer on the DEA Task Force, testified in support of the bill. She discussed a number of undercover operations on money transmitters. She explained that most stores will have a number of phones, one for each company, as shown in the handout Representative Liston distributed.

11:36 AM -- Pam Johnson, a Colorado Springs Police Officer on the DEA Task Force, testified in support of the bill. She walked the committee through the bill and explained what problem each provision is attempting to address, including removing current barriers the Division of Banking has with sharing information with law enforcement. Representative Bradford asked about the age requirement for the agents under the bill. Detective Johnson explained that under the law, a juvenile is under the age of 18 and an adult is 18 or over so that is what they went with age 18. Representative Balmer asked how it works in a retail store and talked about the fact that many stores hire 16- to 18-year-old employees working in these establishments. Representative Liston explained the reasons behind using the age 18 and explained that most stores currently do not allow employees under the age of 18 to transmit money. A discussion regarding the age requirement ensued.

11:54 AM -- Jim Schrant, resident agent in charge of the DEA, testified on the bill. He talked about a number of investigations that have found that drug cartels are using Colorado transmitters to get drug proceeds from the United States to Mexico. Mr. Schrant addressed the age issue that was discussed earlier.

11:58 AM -- Albert Villasueo, representing the DEA, testified in support of the bill. He said the issue is not exclusive to Colorado Springs, they have seen the same practice in his area.

12:01 PM -- Fred Joseph, acting state Banking Commissioner, Colorado Division of Banking, testified in support of the bill.

12:04 PM -- Tom Hill, representing the County Sheriffs of Colorado, testified in support of the bill.

12:05 PM -- Greg Romberg, representing the Colorado Press Association and the Colorado Broadcasters Association, expressed a concern with the language on page five that states that certain information would not be open to the public.

12:07 PM -- Chris Howes, representing the Colorado Retail Council, testified on the bill. He addressed the age requirement issue that was discussed earlier. Mr. Howes said in most cases minors are supervised by an adult and so there should be an adult there to take care of it already. Another discussion regarding age requirements ensued.

12:14 PM -- Geoff Blue, representing the Colorado Attorney General's Office, testified in support of the bill. He said they have not set a position on the age. Representative Balmer asked a question about the age requirement. Representative Rice asked Mr. Blue to get back to the committee with the Attorney General's stance on the age requirement. Representative A. Kerr asked a question about the committee assignment.


BILL:	HB10-1114
TIME:	12:20:42 PM
MOVED:	Liston
MOTION:	Moved amendment L.001 (Attachment D). The motion passed without objection.
SECONDED:	Balmer
		VOTE
	Balmer
	Bradford
	Casso
	Kerr A.
	Liston
	Middleton
	Priola
	Soper
	Stephens
	Gagliardi
	Rice
Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	HB10-1114
TIME:	12:21:26 PM
MOVED:	Kerr A.
MOTION:	Move to amend Amendment L.001 to strike lines 28 through 30 on page 3. The motion failed 9-2.
SECONDED:	Middleton
		VOTE
	Balmer	No
	Bradford	No
	Casso	No
	Kerr A.	Yes
	Liston	No
	Middleton	Yes
	Priola	No
	Soper	No
	Stephens	No
	Gagliardi	No
	Rice	No
Not Final YES: 2 NO: 9 EXC: 0 ABS: 0 FINAL ACTION: FAIL


BILL:	HB10-1114
TIME:	12:28:18 PM
MOVED:	Liston
MOTION:	Moved to refer House Bill 10-1114, as amended, to the Committee on Appropriations. The motion passed 10-1.
SECONDED:	Bradford
		VOTE
	Balmer	Yes
	Bradford	Yes
	Casso	Yes
	Kerr A.	No
	Liston	Yes
	Middleton	Yes
	Priola	Yes
	Soper	Yes
	Stephens	Yes
	Gagliardi	Yes
	Rice	Yes
Final YES: 10 NO: 1 EXC: 0 ABS: 0 FINAL ACTION: PASS

12:29 PM -- House Bill 10-1231

Representative Sonnenberg, prime sponsor, presented House Bill 10-1231 concerning the regulation of conveyances. This bill makes modifications to the Elevator and Escalator Certification Act. Specifically, this bill does the following:

exempts stairway chair lifts from regulation;
requires that contractors from other states carry the same insurance coverage as contractors certified in this state;
requires a contractor to report dangerous conditions to either the state administrator or a local jurisdiction, as appropriate;
requires that newly installed or altered conveyances be inspected and approved prior to operation; and
authorizes the continued use of private residence conveyances installed prior to 2008 in buildings that are not a single family residence.

12:30 PM

Representative Sonnenberg talked about the issues rural areas are having getting inspectors to come out and inspect elevators. Representative Rice clarified the issues the bill is attempting to address. The bill also exempts stair lifts. Representative Soper asked about liability and whether the bill would exempt organizations from liability.

12:33 PM -- Mahesh Albuquerque, representing the Colorado Department of Labor and Employment, testified in support of the bill. He talked about the Elevator and Escalator Act of 2008 and the residential exceptions and explained the provisions in the bill. Representative Soper asked a question.

12:38 PM -- Andy Karsian, representing Colorado Counties Inc., testified in support of the bill.

12:40 PM

Representative Sonnenberg addressed an earlier question from Representative Soper.


BILL:	HB10-1231
TIME:	12:41:23 PM
MOVED:	Gagliardi
MOTION:	Moved to refer House Bill 10-1231 to the Committee of the Whole. The motion passed 10-0.
SECONDED:	Middleton
		VOTE
	Balmer	Excused
	Bradford	Yes
	Casso	Yes
	Kerr A.	Yes
	Liston	Yes
	Middleton	Yes
	Priola	Yes
	Soper	Yes
	Stephens	Yes
	Gagliardi	Yes
	Rice	Yes
Final YES: 10 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

12:42 PM -- House Bill 10-1247

Representative Gagliardi, prime sponsor, presented House Bill 10-1247 concerning the continuation of the Workers' Compensation Classification Appeals Board. This bill continues the Workers' Compensation Classification Appeals Board until July 1, 2021, as recommended by the 2009 Sunset Review.


BILL:	HB10-1247
TIME:	12:44:25 PM
MOVED:	Gagliardi
MOTION:	Moved to refer House Bill 10-1247 to the Committee of the Whole. The motion passed 10-0.
SECONDED:	Priola
		VOTE
	Balmer	Excused
	Bradford	Yes
	Casso	Yes
	Kerr A.	Yes
	Liston	Yes
	Middleton	Yes
	Priola	Yes
	Soper	Yes
	Stephens	Yes
	Gagliardi	Yes
	Rice	Yes
Final YES: 10 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

12:45 PM

Representative Rice explained the committee's schedule for tomorrow and the committee adjourned.