Date: 04/29/2015

Final
BILL SUMMARY for HB15-1388

HOUSE COMMITTEE ON FINANCE

Votes: View--> Action Taken:
Adopt amendment L.002 (Attachment K). The motion p
Refer House Bill 15-1388, as amended, to the Commi		Pass Without Objection
PASS



03:02 PM -- HB15-1388

Representatives Pabon and Rankin, co-prime sponsors, introduced House Bill 15-1388. The bill creates the Securitizing Contributions for Retirement Earnings Act (act). The act permits the Colorado Housing and Finance Authority (CHFA) to issue bonds for the Colorado Public Employees' Retirement System (PERA) School and State retirement plan divisions. Prior to the issuance of any bonds, the Governor and the State Treasurer must validate the bonds, by filing for a judicial examination and receiving a non-appealable determination that the issuance of bonds will not violate the Colorado Constitution. The Governor and the State Treasurer must also conclude that issuing the bonds will permit the State and School retirement plan divisions to reduce the unfunded actuarially accrued liability sooner than if the bonds were not issued. The Attorney General and the Office of the State Controller are also required to make certain certifications prior to the issuance of bonds. Representative Pabon noted that the PERA board voted to support this bill. Representative Pabon also distributed two handouts (Attachment F and Attachment G, respectively). Representative Rankin discussed the benefits of and potential issues with the bill. Representative Pabon stated that even if the bill passes, there is no guarantee that the state will issue bonds. He noted that this bill is the beginning of the bond process.

15HouseFin0429AttachF.pdf15HouseFin0429AttachF.pdf 15HouseFin0429AttachG.pdf15HouseFin0429AttachG.pdf

03:23 PM

Committee discussion ensued regarding the bond process, judicial advisory opinions, Amortization Equalization Distributions, Supplemental Amortization Equalization Disbursements, and specific provisions of the bill.

03:28 PM -- State Treasurer Walker Stapleton, representing the Colorado Department of the Treasury, testified in support of the bill. Treasurer Stapleton noted the bill is not an approval of a bond issuance, but an approval of a structure to pursue future bond issuances. Committee discussion ensued with Treasurer Stapleton regarding risk, the structure of the potential deal, and governmental oversight.

03:49 PM -- Mr. Jon Forbes, representing the Colorado Department of the Treasury, came to the table to answer committee questions. Committee discussion ensued.

03:56 PM -- Mr. Henry Sobanet, representing the Colorado Governor's Office of State Planning and Budgeting, testified in support of the bill. He distributed a handout (Attachment H). He discussed the legalities, risks, and benefits of the bill. In response to a committee questions, he discussed why the bill's stakeholders decided to act now instead of waiting for reports regarding Senate Bill 10-001.

15HouseFin0429AttachH.pdf15HouseFin0429AttachH.pdf

04:17 PM -- Ms. Kelly Brough, representing the Denver Metro Chamber of Commerce, testified in support of the bill. She distributed a written copy of her testimony (Attachment J).

15HouseFin0429AttachJ.pdf15HouseFin0429AttachJ.pdf

04:20 PM -- Mr. Scott Murphy, representing Littleton Public Schools, the Colorado Association of School Executives, and the Colorado Association of School Boards, testified in support of the bill. He discussed the benefits of the bill.

04:30 PM -- Ms. Lynea Hansen, representing the Colorado Commission for Retirement Security, testified in support of the bill. She discussed how the bill benefits PERA employees and retirees.

04:34 PM -- Mr. Tom Boasberg, representing Denver Public Schools, testified in support of the bill. He spoke about the share paid into PERA by Denver Public Schools and about a possible amendment. Superintendent Boasberg and Representative Pabon addressed questions from the committee about the involvement of public school officials in the bill drafting process. Superintendent Boasberg provided additional information about the contribution rate paid into PERA by Denver Public Schools as compared to other public school districts.

04:48 PM -- Ms. Carol Hedges, representing the Colorado Fiscal Institute, testified in opposition to the bill. She discussed the risks associated with the bill. She noted the bill hampers future legislatures from making spending decisions.

04:55 PM -- Mr. Gregory Smith, representing PERA, testified in support of the bill. He noted that PERA's Board of Directors supports the bill. He distributed a packet of information to the committee and discussed the various documents (Attachment I). He stated that PERA believes that this bill benefits PERA members. He also noted that PERA will have exclusive purview over the funds when they are in trust, but the State Treasurer has some input.

15HouseFin0429AttachI.pdf15HouseFin0429AttachI.pdf

05:15 PM

Committee discussion with Mr. Smith continued.
BILL:HB15-1388
TIME: 05:35:30 PM
MOVED:Pabon
MOTION:Adopt amendment L.002 (Attachment K). The motion passed without objection.
15HouseFin0429AttachK.pdf15HouseFin0429AttachK.pdf
SECONDED:Garnett
VOTE
Becker K.
Conti
Garnett
Kagan
Pabon
Priola
Roupe
Van Winkle
Wilson
Foote
Court
YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:HB15-1388
TIME: 05:46:01 PM
MOVED:Pabon
MOTION:Refer House Bill 15-1388, as amended, to the Committee of the Whole. The motion passed on a vote of 10-1.
SECONDED:Kagan
VOTE
Becker K.
Yes
Conti
Yes
Garnett
Yes
Kagan
Yes
Pabon
Yes
Priola
Yes
Roupe
Yes
Van Winkle
No
Wilson
Yes
Foote
Yes
Court
Yes
Final YES: 10 NO: 1 EXC: 0 ABS: 0 FINAL ACTION: PASS