Date: 02/19/2014

Final
BILL SUMMARY for HB14-1094

HOUSE COMMITTEE ON FINANCE

Votes: View--> Action Taken:
Adopt amendment L.011 (Attachment J) The motion pa
Adopt amendment L.012 (Attachment I) The motion fa
Refer House Bill 14-1094, as amended, to the Commi		PASS
FAIL
PASS



03:44 PM -- HB14-1094

Representative Pabon introduced House Bill 14-1094. He stated that it creates a "sales tax holiday" on the first weekend in August for five consecutive years, beginning in the first August after a fiscal year in which the March revenue forecast indicates that General Fund revenue exceeds $8.5 billion. Representative Pabon spoke to how the bill would benefit children and parents in the state, why a sales tax holiday is needed, and highlighted the impact of similar tax holidays in other states. He told the committee that the tax holiday would apply to any school supply with a sales price not exceeding $50 and any article of clothing with a sales price not exceeding $75. He responded to questions on how the tax holiday will affect state education funding, the potential for an economic gain in the state through the sales tax holiday, and which items will be exempt from the sales tax holiday.


03:59 PM

Representative Pabon read a letter from one of his constituents to the committee (Attachment F), and responded to questions on the school supply items that children in Colorado must provide themselves, whether there are penalties for children and their parents that do not take part in the purchase of school supplies, and what the percentage is of overall school supplies that are estimated to be purchased outside the proposed sales tax holiday.

14HseFin0219AttachF.pdf14HseFin0219AttachF.pdf

04:08 PM -- Larson Silbaugh, Legislative Council Staff, came to the table to address a question on the assumptions of the fiscal note for increased sales during the proposed sales tax holiday, and the estimated sales that will ensue outside the month of August. Committee discussion ensued. Representative Pabon responded to a question on the timing of the sales and use tax holiday.

04:13 PM -- Chris Howes, president, representing the Colorado Retail Council, spoke in favor of the bill. Mr. Howes stated that the Colorado Retail Council believes the fiscal note is incorrect and that the bill will actually lead to a revenue gain for the state. Mr. Howes provided some letters from numerous industry stakeholders in support of the bill (Attachment G). Mr. Howes showed the committee a brief video on the benefits of back-to-school sales and use tax holidays in other states. Mr. Howes responded to questions, and the committee discussed the overall fiscal impact of the bill upon the state.

14HseFin0219AttachG.pdf14HseFin0219AttachG.pdf

04:28 PM -- Bill Cisney, representing himself, spoke in favor of the bill. He stated that he sees the bill as a token gesture to illustrate that the state still believes in subsidized education. Mr. Cisney responded to a question on the amount of the discount that the sales tax exemption would provide and whether it would be enough of an incentive to parents in the state. Committee discussion ensued.

04:34 PM -- Eileen McCarron, representing herself, spoke in favor of the bill. She stated that, as a teacher, the sales tax holiday would have been very helpful for her in providing supplies for her students.

04:38 PM -- Deborah Kaller and Michael McGuire spoke in favor of the bill, representing themselves. Ms. Kaller noted that she and her husband, Mr. McGuire, are both volunteers in K-12 schools in Colorado, and believe that the bill would greatly benefit families in Colorado. Mr. McGuire added some observations that he had made volunteering in local schools of the lack of supplies available to students. Ms. Kaller and Mr. McGuire responded to questions.


04:46 PM

The committee discussed how the bill will increase the affordability of school supplies.

04:47 PM -- George Awuor, representing the Bell Policy Center, spoke against the bill. He stated that sales tax holidays are not good tax policy, and distributed a summary letter to the committee (Attachment H). Mr. Awuor highlighted sales tax holidays that have been repealed in other states.

14HseFin0219AttachH.pdf14HseFin0219AttachH.pdf

04:51 PM -- Ali Mickelson, representing the Colorado Fiscal Institute (CFI), spoke against the bill. Ms. Mickelson testified that there are studies which have been performed by CFI that show that sales tax holidays are bad tax policy. She added that tax holidays provide little economic benefit, and reduce a state's ability to fund its programs. Ms. Mickelson responded to a question on why states that currently have sales tax holidays are keeping them in state law if they are not of benefit to the state.


04:54 PM

Representative Priola moved Amendment L.012 (Attachment I) and explained that it changes the eligibility period of the sales and use tax holiday. Committee discussion ensued.

14HseFin0219AttachI.pdf14HseFin0219AttachI.pdf
BILL:HB14-1094
TIME: 04:58:53 PM
MOVED:Priola
MOTION:Adopt amendment L.012 (Attachment I) The motion failed on a vote of 4-8, with 1 member excused.
SECONDED:Joshi
VOTE
Becker
No
DelGrosso
Excused
Foote
No
Joshi
Yes
Kagan
No
Melton
No
Pabon
No
Priola
Yes
Saine
Yes
Swalm
Yes
Wilson
No
Labuda
No
Court
No
YES: 4 NO: 8 EXC: 1 ABS: 0 FINAL ACTION: FAIL


05:03 PM

Representative Pabon moved Amendment L.011 (Attachment J) and described it to the committee. Committee discussion ensued.

14HseFin0219AttachJ.pdf14HseFin0219AttachJ.pdf
BILL:HB14-1094
TIME: 05:06:31 PM
MOVED:Pabon
MOTION:Adopt amendment L.011 (Attachment J) The motion passed on a vote of 11-1, with 1 member excused.
SECONDED:Melton
VOTE
Becker
Yes
DelGrosso
Excused
Foote
Yes
Joshi
Yes
Kagan
Yes
Melton
Yes
Pabon
Yes
Priola
No
Saine
Yes
Swalm
Yes
Wilson
Yes
Labuda
Yes
Court
Yes
YES: 11 NO: 1 EXC: 1 ABS: 0 FINAL ACTION: PASS


05:08 PM

Representative Pabon made his closing comments and the committee discussed the merits of the bill.
BILL:HB14-1094
TIME: 05:12:05 PM
MOVED:Pabon
MOTION:Refer House Bill 14-1094, as amended, to the Committee on Appropriations. The motion passed on a vote of 11-1, with 1 member excused.
SECONDED:Priola
VOTE
Becker
Yes
DelGrosso
Excused
Foote
No
Joshi
Yes
Kagan
Yes
Melton
Yes
Pabon
Yes
Priola
Yes
Saine
Yes
Swalm
Yes
Wilson
Yes
Labuda
Yes
Court
Yes
YES: 11 NO: 1 EXC: 1 ABS: 0 FINAL ACTION: PASS