Date: 02/25/2013

Final
BILL SUMMARY for HB13-1197

HOUSE COMMITTEE ON STATE, VETERANS, & MILITARY AFFAIRS

Votes: View--> Action Taken:
Postpone House Bill 13-1197 indefinitely. The moti
Refer House Bill 13-1197 to the Committee of the W		PASS
FAIL



01:34 PM -- House Bill 13-1197

The committee was called to order. A quorum was present. Representative Lawrence, prime sponsor, presented House Bill 13-1197, concerning the prohibition of certain debt collection activities by the Department of Personnel and Administration. Representative Lawrence explained the effect of the bill, and discussed its merits.


01:39 PM

The following persons testified regarding House Bill 13-1197:

01:39 PM -- Ms. Michelle Keller, representing the Cunningham Fire Protection District, testified in opposition to the bill. Ms. Keller discussed the district's debt collection arrangements with the Central Collection Services Section (CCS) within the Department of Personnel and Administration (DPA), and explained the benefits of using this service. Ms. Keller responded to questions regarding the Cunningham Fire Protection District, and the reasons the district uses CCS as opposed to a private-sector debt collection service. Discussion ensued regarding the effectiveness of CCS's services, and the amount of debt written off by the district. Ms. Keller responded to questions regarding the options available to the district for debt collection services.

01:47 PM -- Mr. Jack Wylie, representing DPA, testified in opposition to House Bill 13-1197. Mr. Wylie discussed the debt collection services performed by CCS, which is under the authority of DPA, and explained the benefits state agencies realize in using these services. He noted that CCS is not intended as a private-sector competitor. Mr. Wylie responded to questions regarding the ability of certain government entities to contract with private-sector debt collectors, and certain tools available to CCS for debt collection not available to the private sector. Discussion ensued regarding the fiscal impact of the bill. Mr. Wylie responded to questions regarding how DPA markets its debt collection services to special districts.

01:53 PM -- Mr. Tom Romola, representing the Associated Collection Agencies of Colorado, testified in support of the bill. Mr. Romola discussed the establishment of CCS, and objected to the ability of CCS to contract with special districts. Mr. Romola discussed the advantages that CCS has over the private sector, and the surcharge that CCS adds when collecting debts. Mr. Romola compared the quality of services provided by CCS and the private sector. Mr. Romola discussed the percentage of Colorado political subdivisions contracting with CCS, and again spoke against the state competing with the private sector. Mr. Romola responded to questions regarding the quality of service provided by CCS in comparison to the private sector, and his organization's position on legislation that passed in 2006 allowing CCS to contract with special districts.

02:03 PM -- Mr. Michael Horstmann, representing Agency of Credit Control, testified in support of House Bill 13-1197. Mr. Horstmann compared the quality of the services provided by CCS and the private sector, and discussed the competitive advantages that CCS enjoys. He spoke against the public sector competing against the private sector. Mr. Horstmann responded to questions regarding the surcharge levied by CCS on debtors, and the ability of the private sector to charge the surcharge. Mr. Horstmann discussed the amount of money his organization charges for its services, and the number of contracts lost by the private sector to CCS. Mr. Horstmann responded to questions regarding the ability of the private sector to compete with government in the area of debt collection services. Mr. Horstmann responded to questions regarding the databases available to private-sector debt collectors to assist in conducting their business.

02:11 PM -- Mr. Tony Gagliardi, representing the National Federation of Independent Business, testified in support of House Bill 13-1197. Mr. Gagliardi discussed his organization's opposition to the public sector competing against the private sector, and discussed the competitive advantages enjoyed by government when it competes with the private sector. Mr. Gagliardi discussed solicitation of contracts by CCS, and the disparity in the rules that CCS must observe in comparison with the private sector.

02:15 PM -- Mr. Jeff Busch, representing the Colorado-Wyoming Association of Collection Agencies, testified in support to the bill. Mr. Busch compared debt collection recovery rates of the private sector and CCS, and the unfair playing field faced by private-sector debt collectors when competing with government debt collectors, particularly in the area of cost overhead. Mr. Bush responded to questions regarding the number of contracts that have been lost by the private sector to CCS. Discussion ensued regarding CCS's debt collection practices. Mr. Bush responded to questions regarding the benefits provided by private-sector debt collectors to their clients that CCS does not.

02:25 PM -- Mr. Greg Mechem, representing CCS, testified in opposition to the bill. Mr. Mechem provided clarification regarding the number of special districts with which CCS has contracted, and the surcharge levied by CCS. Mr. Mechem responded to questions regarding the types of debts collected by CCS, and the ability of special districts to contract with the private sector for debt collection services. Mr. Mechem responded to questions regarding the level of the surcharge levied by CCS. Mr. Mechem provided input regarding legal representation provided to CCS. Discussion returned to the fees charged by CCS.


02:32 PM

No amendments were offered to House Bill 13-1197. Representative Lawrence provided closing remarks in support of the bill. Discussion ensued regarding the merits of the legislation, and the relative level of fees charged by CCS and the private sector.
BILL:HB13-1197
TIME: 02:41:29 PM
MOVED:Dore
MOTION:Refer House Bill 13-1197 to the Committee of the Whole. The motion failed on a vote of 3-6.
SECONDED:Humphrey
VOTE
Dore
Yes
Foote
No
Humphrey
Yes
Labuda
No
Melton
No
Moreno
Yes
Nordberg
Excused
Scott
Excused
Williams
No
Salazar
No
Ryden
No
YES: 3 NO: 6 EXC: 2 ABS: 0 FINAL ACTION: FAIL


BILL:HB13-1197
TIME: 02:42:32 PM
MOVED:Labuda
MOTION:Postpone House Bill 13-1197 indefinitely. The motion passed on a vote of 7-2.
SECONDED:Williams
VOTE
Dore
No
Foote
Yes
Humphrey
No
Labuda
Yes
Melton
Yes
Moreno
Yes
Nordberg
Excused
Scott
Excused
Williams
Yes
Salazar
Yes
Ryden
Yes
Final YES: 7 NO: 2 EXC: 2 ABS: 0 FINAL ACTION: PASS