Bill Summary for Bill Number HB14-1014

Date: 03/19/2014

Final
BILL SUMMARY for HB14-1014

HOUSE COMMITTEE ON FINANCE

Votes: View-->	Action Taken:
The motion passed without objection. Adopt amendment L.004 (Attachment H). The motion p Refer House Bill 14-1014, as amended, to the Commi	Pass Without Objection PASS

06:41 PM -- HB14-1014

The committee went into a brief recess.

06:46 PM

Representatives DelGrosso and Kraft-Tharp came to the table to present House Bill 14-1014. They stated that, beginning with tax year 2014, HB14-1014 modifies the job growth incentive tax credit (JGITC) in the following ways:

extends the period for which an employer may receive credits from 60 months (five years) to 96 months (eight years);

lowers the requirement that wages for jobs generating the credit be at least 110 percent of the average wage in the county within which the jobs are created to 100 percent of the county's average wage; and

alters the burden of proof that the credit was instrumental to the creation of said jobs; rather than stating that without the credit the jobs would likely not have been located in Colorado, the bill requires employers to state that without the credit the probability of locating the jobs in Colorado would be reduced.

They also spoke to the fiscal impact of the bill and how the state will be able to afford the modification of the tax credit. They responded to questions on the main intent of the bill and the changes it makes to the JGITC.

06:59 PM -- Carol Hedges, representing the Colorado Fiscal Institute, and Joshua Catalano, representing himself, spoke against the bill. Mr. Catalano spoke to the fiscal implications of the bill, stated that he believes the program would be economically harmful should the bill pass, and said that there is no evidence from other states that such programs are effective. Ms. Hedges stated that the existing tax credit does not incentivize companies to come to Colorado as it is not significant enough to effect the behavior of a business. She added that the removal of the requirement within the JGITC that a company state that without the credit the jobs would likely not have been located in Colorado (the "but-for" requirement) weakens the credit even further and its ability to pay for itself. Ms. Hedges responded to questions on the removal of the "but-for" aspect of the JGITC, and the fiscal note for the bill going out to FY 2027-28. Mr. Catalano responded to a request for his suggestion of alternative legislation to HB14-1014.

07:16 PM -- Patrick Boyle, representing the Colorado Competitive Council, Pam Reichert, representing the Metro Denver Economic Development Corporation, and Clif Harald, representing the Boulder Economic Council, spoke in favor of the bill. Ms. Reichert stated that the JGITC allows the state to hold on to companies that come to the state, that Colorado has seen an increase in companies opening their headquarters here, and that the lowering of wage requirements for the credit will be significant for rural Colorado. Mr. Harald stated that the JGITC program has been critical to the growth of the economy in Boulder, and spoke to the benefits that he believed local industry would see under the passage of the bill. Mr. Boyle said that the program is worthwhile because it requires job creation and does not provide companies with money without a return on investment.

07:26 PM -- Ken Lund and Michelle Hadwiger, representing the Office of Economic Development and International Trade (OEDIT), spoke in support of the bill. An illustration of the return on investment to Colorado from the JGITC (Attachment G) was distributed to the committee. Mr. Lund spoke to the successes of the program and stated that it was important to the state. Ms. Hadwiger outlined how OEDIT has administered the JGITC program since its inception in 2009. Mr. Lund walked the committee through illustrations of the JGITC provided in OEDIT's Attachment G. The witnesses responded to questions on how often the credit is used by existing companies versus companies newly moving to Colorado and whether the JGITC helps rural Colorado and the chronically unemployed.

14HseFin0319AttachG.pdf

07:43 PM

Representative DelGrosso spoke to the changes made by Amendment L.004 (Attachment H), which he stated cleans up the bill language.

14HseFin0319AttachH.pdf

BILL: HB14-1014

TIME: 07:43:15 PM

MOVED: DelGrosso

MOTION: Adopt amendment L.004 (Attachment H). The motion passed without objection.

SECONDED: Wilson

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

07:45 PM

The bill sponsors made their closing comments

BILL: HB14-1014

TIME: 07:48:27 PM

MOVED: DelGrosso

MOTION: Refer House Bill 14-1014, as amended, to the Committee on Appropriations. The motion passed on a vote of 10-3.

SECONDED: Becker

VOTE

Becker
Yes

DelGrosso
Yes

Foote
Yes

Joshi
No

Kagan
Yes

Melton
Yes

Pabon
Yes

Priola
Yes

Saine
No

Swalm
Yes

Wilson
Yes

Labuda
No

Court
Yes

YES: 10 NO: 3 EXC: 0 ABS: 0 FINAL ACTION: PASS

07:52 PM

The committee was adjourned.


BILL:	HB14-1014
TIME:	07:43:15 PM
MOVED:	DelGrosso
MOTION:	Adopt amendment L.004 (Attachment H). The motion passed without objection.
SECONDED:	Wilson
		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