Date: 03/19/2014

Final
BILL SUMMARY for HB14-1305

HOUSE COMMITTEE ON FINANCE

Votes: View--> Action Taken:
Adopt amendment L.001 (Attachment E). The motion p
Adopt amendment L.002 (Attachment F). The motion f
Refer House Bill 14-1305, as amended, to the Commi		Pass Without Objection
FAIL
PASS



04:45 PM -- HB14-1305

Representatives Sonnenberg and McCann came to the table to present House Bill 14-1305. They explained that the bill allows a renewable energy company with Enterprise Zone Investment Tax Credits (ITC) to annually elect to receive a refund of the credit. The amount of the refund is equal to 85 cents for every one dollar of ITC credit. The refund for any company is capped at $2.5 million per tax year. If the company does elect to receive a refund, they are required to sign a one-time affidavit with the Colorado Economic Development Commission stating the company's intent to make further renewable investments within five years.


04:52 PM

Representative Sonnenberg stated that the bill does not create a new tax credit or expand an existing one, but in fact creates a saving for the state, and spoke to the fiscal impact of the bill. He responded to questions on how renewable energy companies with Enterprise Zone Investment Tax Credits can elect to receive a refund of the credit under the bill at a reduced rate, how companies may carry the tax credit forward, and the nature of reinvestments that qualifying and participating companies must make under the bill. Committee discussion ensued.


05:05 PM

The bill sponsors responded to questions on the requirement in the bill for participating companies to state that they intend to reinvest in Colorado and which companies qualify for the tax credit refund.


05:09 PM

Esther van Mourik, Office of Legislative Legal Services, came to the table to speak to the definitions of renewable energy laid out in statute that relate to the bill and the Renewable Portfolio Standard.

05:13 PM

Louis Pino, Legislative Council Staff, came to the table to respond to questions on the fiscal note for the bill, whether companies can still receive the ITC, and whether companies other than renewable energy companies might qualify for the credit.


05:18 PM

The bill sponsors responded to questions on other types of companies that could qualify for the credit. Committee discussion on how companies might utilize the tax credit refund ensued.

05:24 PM -- Kevin Gildea and Kerry Hattevik, representing Next Era Energy Resources, spoke in favor of the bill. Ms. Hattevik outlined the reasons that Next Era supports the bill and stated that the bill will allow the company to do more business in Colorado. She responded to questions on the Colorado tax code. Mr. Gildea responded to a question on the tax benefits received by companies like Next Era and the tax return that it must complete. The two witnesses responded to a question on whether Next Era can guarantee that any tax credit refunds received in Colorado can be guaranteed to be invested back into Colorado. Committee questioning and discussion ensued.

05:41 PM -- Anna Giovinetto, representing RES Americas, and Tom Darin, representing the American Wind Energy Association, spoke in favor of the bill. Ms. Giovinetto stated that the credit refund will allow RES Americas to reinvest in Colorado and more quickly monetize the ITC. Mr. Darin stated that Colorado is a very favorable environment for the development of different forms of renewable energy, and that the bill will advance this fact. The witnesses responded to questions on the size of the incentive of the credit refund, and the competitiveness of Colorado as a state in which to develop renewables.

05:52 PM -- Jeff Kraft, representing the Office of Economic Development and International Trade (OEDIT), came to the table and stated that OEDIT is neutral on the bill. Mr. Kraft raised some concerns that the office has with the bill, including the removal of the tax credit cap, the up-front monetization of the tax credit, and the precedent that the bill might set for tax policy in the state.


05:59 PM

Ms. van Mourik came to the table to speak to the ITC cap, how a taxpayer gets their carry-forward under current statute and the bill, and how the bill changes the ITC to a refundable credit. Committee discussion ensued.


06:10 PM

Mr. Kraft responded to questions on who will benefit most from the ITC refund, and the monetization of existing ITC credits. Committee discussion and questioning ensued.


06:18 PM

Carol Hedges, representing the Colorado Fiscal Institute, spoke against the bill. She stated that the problem with the bill is that it fundamentally changes the administration of the Enterprise Tax Zone Credit, making it an exception to the way that the state normally handles tax credits. She responded to questions on the tax liability of companies that qualify for the ITC.


06:27 PM

Representative DelGrosso moved Amendment L.001 (Attachment E) and the bill sponsors explained that it cuts the fiscal impact of the bill in half.

14HseFin0319AttachE.pdf14HseFin0319AttachE.pdf
BILL:HB14-1305
TIME: 06:27:06 PM
MOVED:DelGrosso
MOTION:Adopt amendment L.001 (Attachment E). The motion passed without objection.
SECONDED:Melton
VOTE
Becker
DelGrosso
Foote
Joshi
Kagan
Melton
Pabon
Priola
Saine
Swalm
Wilson
Labuda
Court
YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


06:27 PM

Representative Priola moved and explained Amendment L.002 (Attachment F). He stated that the amendment firms up the language surrounding the affidavit that a company must reinvest the refund of the ITC in Colorado.

14HseFin0319AttachF.pdf14HseFin0319AttachF.pdf
BILL:HB14-1305
TIME: 06:27:56 PM
MOVED:Priola
MOTION:Adopt amendment L.002 (Attachment F). The motion failed on a vote of 6-7.
SECONDED:Melton
VOTE
Becker
Yes
DelGrosso
No
Foote
Yes
Joshi
Yes
Kagan
No
Melton
Yes
Pabon
No
Priola
Yes
Saine
No
Swalm
No
Wilson
Yes
Labuda
No
Court
No
YES: 6 NO: 7 EXC: 0 ABS: 0 FINAL ACTION: FAIL


06:30 PM

The bill sponsors made their closing comments on the bill and the committee discussed the merits of the bill.
BILL:HB14-1305
TIME: 06:40:10 PM
MOVED:DelGrosso
MOTION:Refer House Bill 14-1305, as amended, to the Committee on Appropriations. The motion passed on a vote of 7-6.
SECONDED:Pabon
VOTE
Becker
No
DelGrosso
Yes
Foote
No
Joshi
Yes
Kagan
No
Melton
Yes
Pabon
Yes
Priola
Yes
Saine
No
Swalm
Yes
Wilson
Yes
Labuda
No
Court
No
YES: 7 NO: 6 EXC: 0 ABS: 0 FINAL ACTION: PASS