House Committee on Economic and Business Development (02/16/2012)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON ECONOMIC AND BUSINESS DEVELOPMENT

Date:	02/16/2012	ATTENDANCE

Time:	01:33 PM to 05:05 PM	Balmer	X
		Holbert	X
Place:	HCR 0112	Miklosi	*
		Priola	X
This Meeting was called to order by		Singer	X
	Representative Liston	Soper	X
		Swerdfeger	X
This Report was prepared by		Szabo	X
	Christie Lee	Tyler	X
		Williams A.	X
		Wilson	X
		Swalm	X
		Liston	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
HB12-1286 HB12-1286 HB12-1133 HB12-1217		Amended, Referred to Finance Amended, Referred to Finance Committee Vote - Final Action Failed Referred to the Committee of the Whole

01:34 PM -- House Bill 12-1286

Representatives Massey and Ferrandino, prime sponsors, presented House Bill 12-1286. Effective July 1, 2012, the bill moves the Colorado Office of Film, Television, and Media (OFTM) from the Creative Industries Division to the Colorado Office of Economic Development and International Trade (OEDIT). The bill makes the following changes to the existing film incentive program:

the maximum incentive payment per employee or contractor is reduced from $3 million to $1 million. The payment may be used by a production company to pay the wages or salaries of employees or contractors who participate in production activities;
creates a loan guarantee program that allows the OFTM, with approval from the Colorado Economic Development Commission, to enter into contracts with production companies to guarantee loans obtained for purposes of financing production activities, up to 20 percent of the entire production budget;
allows the OFTM to charge a loan guarantee facility fee; and states that any loan guarantee made through the program shall not constitute or become an indebtedness, a debt, or liability of the state, nor shall the loan guarantee the giving, pledging, or loaning of the full faith and credit of the state;
increases the amount of the performance-based incentive for film production in Colorado from 10 percent to 20 percent of the total amount of the production company's qualified local expenditures;
in order to qualify for a performance-based incentive, increases the percentage of the workforce that must be comprised of Colorado residents from 25 percent to 50 percent;

creates the Colorado Office of Film, Television, and Media Operational Account Cash Fund in the State Treasury to consist of moneys appropriated to the fund by the General Assembly, moneys transferred from the Creative Industries Cash Fund, and any gifts, grants, or donations from private or public sources;
states that money in the fund must be used for both the operation of the OFTM, for performance-based incentives for film production in Colorado, and for the loan guarantee program; and
appropriates $3.0 million General Fund for FY 2012-13 to the OFTM for allocation to the fund.

01:44 PM

Committee members asked some questions of the sponsors who deferred to the upcoming witnesses, including the film commissioner.

01:48 PM -- Ali Mickelson, representing the Colorado Fiscal Policy Institute, testified against the bill. She talked about similar film tax credits in other states that have been repealed due to lack of return. Ms. Mickelson talked about alternative programs that could be funded that have guaranteed returns such as child care. Representative Singer talked about the performance-based approach in the bill and whether the states she mentioned are similarly set up.

01:56 PM -- Matt Gianneschi, representing the Department of Higher Education, testified in support of the bill. He talked about the various film study programs throughout the state and the struggle of retaining those students in Colorado following graduation. Representative Swalm asked whether he is willing to fund the program out of his department.

02:04 PM -- Donald Zuckerman, Director of the Colorado Office of Film, Television, and Media, testified in support of the bill. He talked about his experience as a film maker and producer. Mr. Zuckerman talked about the reasoning behind the specific types of films that were targeted in the bill. Representative Tyler asked some questions regarding the various areas of the state.

02:18 PM -- Jim Berger, Sonny Hutchison, Duke Hartman and John Hardy, representing High Noon Entertainment, testified in support of the bill. They showed a slide show of some of the company's shows, including Cake Boss and Food Network Challenge. Mr. Berger talked about the various jobs in the film industry and the salaries. The panel responded to questions from the committee regarding the average number of employees that are hired in connection to a show and the amount of money spent in the area where filming takes place.

02:40 PM -- Bill Myers, representing himself as the former CEO of STARZ Network, testified in support of the bill. He talked about the important role incentives play in the decision of companies to film in certain areas. Representative Wilson asked for Mr. Myers' input on the percentages outlined in the bill.

02:50 PM -- Micki Hackenberger, representing Motion Picture Association of America and the Entertainment Software Association (ESA), testified in support of the bill and distributed a letter from Axiom Strategies, Inc. (Attachment A). She talked about the ESA and the video game industry.

02:55 PM -- Daniel Junge, representing himself as an independent film maker, testified in support of the bill. He talked about his experience in the film industry in Colorado and the expanding film programs throughout the state.

02:59 PM -- Frederic Lahey, representing the Colorado Film School, testified in support of the bill. He talked about the College Opportunity Fund in Colorado.

03:05 PM -- Max Greenwald, representing himself, a high school student who makes documentaries, testified in support of the bill. He talked about his accomplishments as a documentary film maker. Mr. Greenwald stated he would like to stay and make films in Colorado.

03:09 PM -- Mary Medley, representing the Certified Public Accountant Association, testified in support of the bill and discussed amendment L.002 that was distributed to the committee (Attachment B).

03:11 PM

The committee was shown a short montage of movies that have been filmed in Colorado.

03:16 PM -- Adam Swegden and Blake Tally, film students, testified in support of the bill.


BILL:	HB12-1286
TIME:	03:19:45 PM
MOVED:	Liston
MOTION:	Moved to adopt amendment L.002 (Attachment B). The motion passed without objection.
SECONDED:	Williams A.
		VOTE
	Balmer
	Holbert
	Miklosi
	Priola
	Singer
	Soper
	Swerdfeger
	Szabo
	Tyler
	Williams A.
	Wilson
	Swalm
	Liston

YES: 0 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	HB12-1286
TIME:	03:22:58 PM
MOVED:	Wilson
MOTION:	Moved to refer House Bill 12-1286, as amended, to the Committee on Finance. The motion passed on a vote of 9-3.
SECONDED:	Williams A.
		VOTE
	Balmer	Excused
	Holbert	No
	Miklosi	Yes
	Priola	Yes
	Singer	Yes
	Soper	Yes
	Swerdfeger	Yes
	Szabo	No
	Tyler	Yes
	Williams A.	Yes
	Wilson	Yes
	Swalm	No
	Liston	Yes

YES: 9 NO: 3 EXC: 1 ABS: 0 FINAL ACTION: PASS

03:36 PM -- House Bill 12-1133

Representatives Lee and Hullinghorst, prime sponsors, presented House Bill 12-1133. The bill creates an economic gardening pilot program within the Governor's Office of Economic Development and International Trade (OEDIT). This program provides strategic technical assistance to stage-two emerging companies using advanced software and science concepts. The pilot program ends on September 1, 2020. Under this bill, OEDIT will select no more than seven experienced contractors to create partnerships. The supervisor of each partnership will select regional companies to participate in the pilot program. Each of the regions will have an equal number of company participants, with a maximum of seven.

Under this bill, each company selected will receive:

free or low-cost assistance with marketing, accounting and legal services;
free or low-cost market research; and
assistance with peer networking.

On or before February 1, 2013, and each year thereafter through the life of the program, OEDIT will report to the legislature describing the pilot program's status.

03:43 PM

Representative Williams asked about some of the components of the program, such as whether the program will teach entrepreneurs to retool during tough economic times. Representative Swalm asked about the 0.5 FTE in the fiscal note.

03:57 PM -- Chris Gibbons, Director of Business/Industry Affairs for the City of Littleton, testified in favor of the bill. He explained that economic gardening was developed in Littleton and gave some background on the economic gardening model. Mr. Gibbons addressed earlier questions from the committee. Mr. Gibbons distributed some handouts (Attachment C). Elizabeth Schwartz, representing ADA Environmental Solutions, Inc. in Littleton, also testified in favor of the bill.

04:20 PM

The sponsors gave some closing remarks.


BILL:	HB12-1133
TIME:	04:28:15 PM
MOVED:	Liston
MOTION:	Moved to refer House Bill 12-1133 to the Committee on Finance. The motion failed on a vote of 5-6.
SECONDED:	Swalm
		VOTE
	Balmer	Excused
	Holbert	No
	Miklosi	Absent
	Priola	No
	Singer	Yes
	Soper	Yes
	Swerdfeger	No
	Szabo	No
	Tyler	Yes
	Williams A.	Yes
	Wilson	Yes
	Swalm	No
	Liston	No

YES: 5 NO: 6 EXC: 1 ABS: 1 FINAL ACTION: FAIL


BILL:	HB12-1133
TIME:	04:29:03 PM
MOVED:	Swalm
MOTION:	Moved to postpone House Bill 12-1133 indefinitely. The motion failed on a 6-6 vote.
SECONDED:	Holbert
		VOTE
	Balmer	Excused
	Holbert	Yes
	Miklosi	No
	Priola	Yes
	Singer	No
	Soper	No
	Swerdfeger	Yes
	Szabo	Yes
	Tyler	No
	Williams A.	No
	Wilson	No
	Swalm	Yes
	Liston	Yes

YES: 6 NO: 6 EXC: 1 ABS: 0 FINAL ACTION: TIE

04:30 PM -- House Bill 12-1217

Representative Tyler, prime sponsor, presented House Bill 12-1217. Under current law, boilers and other pressure vessels regulated by the Division of Oil and Public Safety (DOPS) in the Department of Labor and Employment must be inspected periodically by a state inspector employed by the DOPS. This bill permits owners and users of such boilers to conduct self-inspections in lieu of state inspection by obtaining certification as an owner-user inspection organization.

Owner-user inspectors who are qualified to perform boiler inspections on behalf of owner-user inspection organizations are either commissioned by the National Board of Boiler and Pressure Vessel Inspectors (NBBI) following an examination or are certified by meeting certain requirements of the American Petroleum Institute.

Owner-user inspection organizations must apply to the DOPS for approval and registration. Following registration, an organization must maintain a list of boilers subject to inspection, conduct regular inspections, complete and retain all inspection records, notify the DOPS when a boiler fails to meet safety standards, and transmit an annual statement to the DOPS.

04:36 PM -- Mahesh Albuquerque and Steve Nelson, Colorado Department of Labor and Employment, Division of Oil and Public Safety, testified in favor of the bill. Mr. Albuquerque gave some background on the division and responded to questions from the committee.

04:57 PM -- Victor Colaleo, representing Suncor Energy, testified in favor of the bill.

05:02 PM -- Mike Webb, representing Xcel Energy, testified in support of the bill.


BILL:	HB12-1217
TIME:	05:03:12 PM
MOVED:	Tyler
MOTION:	Moved to refer House Bill 12-1217 to the Committee of the Whole. The motion passed on a vote of 11-0.
SECONDED:	Wilson
		VOTE
	Balmer	Excused
	Holbert	Yes
	Miklosi	Excused
	Priola	Yes
	Singer	Yes
	Soper	Yes
	Swerdfeger	Yes
	Szabo	Yes
	Tyler	Yes
	Williams A.	Yes
	Wilson	Yes
	Swalm	Yes
	Liston	Yes

YES: 11 NO: 0 EXC: 2 ABS: 0 FINAL ACTION: PASS

05:05 PM

The committee adjourned.