House Committee on Finance (02/12/2014)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON FINANCE

Date:	02/12/2014	ATTENDANCE

Time:	03:04 PM to 04:49 PM	Becker	X
		DelGrosso	X
Place:	LSB A	Foote	X
		Joshi	X
This Meeting was called to order by		Kagan	X
	Representative Court	Melton	X
		Pabon	*
This Report was prepared by		Priola	*
	Matt Kiszka	Saine	*
		Swalm	X
		Wilson	X
		Labuda	X
		Court	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
HB14-1072 HB14-1163 HB14-1107 HB14-1142		Laid Over Referred to the Committee of the Whole Amended, Referred to the Committee of the Whole Referred to the Committee of the Whole -

03:04 PM -- HB14-1072

Representative Court, Chair, called the meeting to order and announced that House Bill 14-1072 will be laid over to a later meeting.

03:05 PM -- HB14-1163

Representative Hullinghorst, Majority Leader, came to the table to present House Bill 14-1163, which she explained limits the amount of the Enterprise Zone (EZ) Credit that may be claimed after tax year 2014 to $750,000 per tax year. She added that this year's bill clarifies language from House Bill 13-1142, reaffirming the original intention of the cap on the EZ Credit. The Majority Leader responded to questions on the rationale behind the bill. Committee discussion ensued.

03:14 PM

The Majority Leader responded to questions on whether an exemption from the tax cap might benefit the poorest communities in Colorado, and spoke to a request for clarity on the EZ Credit.

03:17 PM -- Jeff Kraft, representing the Office of Economic Development and International Trade, spoke in support of the bill. Mr. Kraft stated that the bill is a technical fix, clarifies the language in HB13-1142, and is not a policy change. Mr. Kraft answered questions on whether the EZ Credit brings jobs to Colorado.


BILL:	HB14-1163
TIME:	03:20:42 PM
MOVED:	Becker
MOTION:	Refer House Bill 14-1163 to the Committee of the Whole. The motion passed on a vote of 7-5, with 1 member excused.
SECONDED:	Pabon
		VOTE
	Becker	Yes
	DelGrosso	No
	Foote	Yes
	Joshi	No
	Kagan	Yes
	Melton	Yes
	Pabon	Yes
	Priola	No
	Saine	Excused
	Swalm	No
	Wilson	No
	Labuda	Yes
	Court	Yes

YES: 7 NO: 5 EXC: 1 ABS: 0 FINAL ACTION: PASS

03:25 PM -- HB14-1107

Representative Tyler came to the table to present House Bill 14-1107, which he stated authorizes the Department of Revenue (DOR) to offer electronic notices to taxpayers as an alternative to mailed notices. The DOR must implement the option for electronic notices in a manner that ensures to the greatest degree reasonably possible that the taxpayer will receive the notice. The DOR's record that a taxpayer viewed a notice electronically is proof of receipt. Representative Tyler responded to questions on what constitutes notice of receipt, procedures that the bill will create within the DOR, the genesis of the bill, and the potential savings that could result from the bill.

03:32 PM -- John Vecchiarelli, representing the DOR, spoke in support of the bill. He spoke to the savings that will result when the DOR is no longer using the postal service as frequently, and the actions that the DOR will take to prepare for the implementation of electronic notices to taxpayers. Mr. Vecchiarelli responded to questions surrounding staff capabilities in accommodating the changes of the bill without adding resources.

03:35 PM -- Mary Medley, representing the Colorado Society of Certified Public Accountants, came to the table to speak to the bill, stating that the society had raised its concerns to the DOR on how to best protect against fraud in regards to electronic tax notices, and that the DOR had assured them it would handle this issue appropriately.

03:36 PM -- Loren Furman, representing the Colorado Association of Commerce and Industry (CACI), spoke to the bill, addressing the issue of electronic e-mail bouncebacks, and stated that the DOR had addressed the CACI's concerns.

03:37 PM

Representative Tyler introduced Amendment L.001 (Attachment A) to the committee and explained its purpose.

14HseFin0212AttachA.pdf


BILL:	HB14-1107
TIME:	03:38:40 PM
MOVED:	Court
MOTION:	Adopt amendment L.001 (Attachment A). The motion passed without objection, with 1 member excused.
SECONDED:	Priola
		VOTE
	Becker
	DelGrosso
	Foote
	Joshi
	Kagan
	Melton
	Pabon
	Priola
	Saine	Excused
	Swalm
	Wilson
	Labuda
	Court

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


BILL:	HB14-1107
TIME:	03:39:42 PM
MOVED:	Priola
MOTION:	Refer House Bill 14-1107, as amended, to the Committee of the Whole. The motion passed on a vote of 12-0, with 1 member excused.
SECONDED:	Kagan
		VOTE
	Becker	Yes
	DelGrosso	Yes
	Foote	Yes
	Joshi	Yes
	Kagan	Yes
	Melton	Yes
	Pabon	Yes
	Priola	Yes
	Saine	Excused
	Swalm	Yes
	Wilson	Yes
	Labuda	Yes
	Court	Yes

YES: 12 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

03:41 PM -- HB14-1142

Representative DelGrosso came to the table to present House Bill 14-1142. He explained that the bill prohibits the Colorado Lottery Commission from allowing the sale of lottery tickets by any means other than in person at a licensed lottery sales agent's physical place of business. The bill specifically bars the Lottery Commission from approving lottery sales through the Internet or other electronic devices. He added that the bill supports local brick and mortar stores. Representative DelGrosso responded to a question on which entities could potentially sell tickets online, the specific purpose of the bill, the Department of Justice determination that led to the genesis of the bill, how much revenue goes to a retailer from lottery ticket sales, and the potential risks of fraud in online ticket sales.

03:54 PM -- Jason Hopfer, representing Circle K and 7-11 Stores, came to the table to speak in favor of the bill. He detailed the amount of revenue that lottery ticket sales currently bring to Circle K and 7-11 Stores. He responded to questions on what online sales could mean to brick and mortar stores, and which states have implemented online lottery ticket sales.

04:00 PM -- Jeanne McEvoy, representing the Colorado Licensed Beverage Association, spoke in support of the bill. She told the committee that online sales of different products have historically had a large impact on brick and mortar sales, and that she feels the bill would protect small businesses in Colorado.

04:02 PM -- Micki Hackenberger, representing the Isle of Capri Casino, spoke in favor of the bill. She stated that the casino is concerned with the potential of the Colorado Lottery to sell lottery tickets online, and said that she believes online purchases of scratch tickets would emulate the usage of a slot machine, which is prohibited in all but three areas of the state. Ms. Hackenberger responded to questions on Colorado gaming laws, her comment that online scratch ticket sales could emulate the usage of a slot machine, and a request for clarity on the Isle of Capri's position on online gambling in general.

04:08 PM -- Gloria Schoch, representing First Data Corporation, spoke against the bill. She stated that First Data does not support a prohibition on the online sales of lottery tickets, and spoke to the user verification safeguards that can be put in place with technologies such as those offered by First Data. She responded to questions on the technologies provided by First Data, and the risk of data breaches. Committee discussion ensued.

04:14 PM -- Laura Solano, Colorado Lottery Director, representing the Department of Revenue, spoke against the bill. She provided a background on the Colorado Lottery and the task it is charged with, and summarized the proceeds that have come from lottery ticket sales. Ms. Solano responded to questions on the Colorado Lottery. Ms. Solano stated that the Department of Revenue has not yet begun considerations of how to facilitate online lottery ticket sales. She responded to questions on the demographics of lottery ticket purchasers. Committee discussion ensued.

04:28 PM

The committee discussed the state constitution and the legality of online gaming in Colorado. Director Solano responded to a question on whether the DOR has conducted feasibility studies on online gaming.

04:34 PM -- Saskia Young, representing the Department of Revenue, came to the table to respond to a question on whether the Governor's Office has a stance on the bill.

04:36 PM

The committee discussed the potential impacts of the bill, the different parties it might affect, and the overall impact the bill could have on the state.


BILL:	HB14-1142
TIME:	04:48:04 PM
MOVED:	DelGrosso
MOTION:	Refer House Bill 14-1142 to the Committee of the Whole. The motion passed on a vote of 10-3.
SECONDED:	Swalm
		VOTE
	Becker	Yes
	DelGrosso	Yes
	Foote	No
	Joshi	Yes
	Kagan	Yes
	Melton	Yes
	Pabon	No
	Priola	Yes
	Saine	Yes
	Swalm	Yes
	Wilson	Yes
	Labuda	No
	Court	Yes

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

04:49 PM

The committee adjourned.