House Committee on Finance (02/17/2006)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON FINANCE

Date:	02/17/2006	ATTENDANCE

Time:	12:28 PM to 02:53 PM	Benefield	X
		Cloer	X
Place:	HCR 0107	Crane	X
		Frangas	X
This Meeting was called to order by		Garcia	X
	Representative Vigil	Harvey	X
		Jahn	X
This Report was prepared by		Kerr	X
	Ron Kirk	Marshall	X
		Massey	X
		McCluskey	X
		Judd	X
		Vigil	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
HB06-1209 HB06-1312 HB06-1161 HB06-1307		Amended, Laid Over Referred to Appropriations Referred to Appropriations Referred to Appropriations

12:28 PM -- House Bill 06-1209 - Concerning the Continuation of the Special Olympics Checkoff

Representative Witwer, prime sponsor, explained that the Colorado Special Olympics Fund provides funding for athletic programs for Colorado children and adults with developmental disabilities. Fund money is used to purchase sports equipment, uniforms, and transportation services. Donations also fund training expenses and year-round event competitions. Representative Witwer closed by saying that House Bill 06-1209 extends the period that state income tax returns will include a voluntary contribution designation benefitting the Colorado Special Olympics Fund from tax year 2006 through tax year 2008.

The following persons testified:

12:32 PM -- Ms. Claire Simmons, Colorado Special Olympics, testified in support of the legislation and commented on the uses for the money donated to the program.

12:36 PM -- Ms. Erin Holloway, Colorado Special Olympics, testified in support of the legislation and commented on the number of ways that Colorado Special Olympics has helped her. Mr. Holloway said that money from donations has changed her life for the better by allowing her to exercise, make friends, and be more trusting of people. Ms. Holloway closed by saying that Colorado Special Olympics has enabled her to live an independent life.

Representative Witwer distributed amendment L.001 (Attachment A) and explained that it adds a repealer provision and makes a technical name change. The amendment was adopted by the committee and Representative Vigil, Chairman, laid over the bill to February 22 for action only.


BILL:	HB06-1209
TIME:	12:43:40 PM
MOVED:	Cloer
MOTION:	Moved amendment L.001 (the amendment adds a repealer provision and makes a technical name change). The motion passed without objection by those members present. Representative Vigil, Chairman, laid over House Bill 06-1209, as amended, to be heard on Wednesday February 22, 2006, for action only.
SECONDED:	McCluskey
		VOTE
	Benefield
	Cloer
	Crane
	Frangas
	Garcia
	Harvey
	Jahn
	Kerr
	Marshall
	Massey
	McCluskey
	Judd
	Vigil
Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection

12:46 PM -- House Bill 06-1312 - Concerning Private Letter Rulings by the Colorado Department of Revenue

Representative Vigil said that the bill authorizes the Department of Revenue to issue informational letters and private letter rulings to taxpayers upon written request. These letters and rulings would help taxpayers determine the tax treatment and potential tax liability of a transaction before it takes place. The department would have to issue a letter or ruling within 90 days of a request, but a request may be declined as long as the taxpayer is notified within 30 days. Representative Vigil said the department must set rules for issuing letters or rulings, including terms and conditions under which a ruling is binding. All informational letters and private letter rulings would remain confidential. The bill directs the executive director of the department to set a reasonable fee for the direct and indirect costs of issuing the private letter rulings. After a brief committee discussion, Representative Judd, Chairman, asked a spokesperson from the Colorado Department of Revenue to respond to committee questions.

The following persons testified:

12:48 PM -- Mr. Bruce Nelson, Colorado Department of Revenue, began by discussing a number of concerns the department has about current law. State law does not allow the department to issue a binding private letter ruling that would clarify how the department would treat a given transaction or circumstance for taxing purposes. Mr. Nelson discussed department issues that pertain to rulings such as the variation in cost and the complexity of issues that effect the department's cost of providing private letter rulings.

The committee discussed the department's cost for administering private letter rulings and moved to the privacy issues that are tied to making a ruling public. At this time, amendment L.001 was distributed to the committee (Attachment B). Mr. Nelson spoke to the amendment and said that it would give the Executive Director of the department the ability to make information in the ruling public. The committee continued to discuss privacy issues and Mr. Nelson commented that certain company- or individual-specific information would not be publically released with other information contained in the ruling.

01:10 PM -- Mr.Chuck Berry, Colorado Association of Commerce and Industry, testified in support of the bill and commented on the legislation. Colorado should not be one of the few states that cannot issue a binding private letter ruling. Mr. Berry closed by talking about the issues tied to private letter rulings that would allow Colorado to be more competitive.

01:14 PM -- Mr. Alan Poe, Chairman for the Tax Council of the Colorado Association of Commerce and Industry, testified in support of the legislation. Mr. Poe commented that the binding issue under House Bill 06-1312 needs to be resolved. When businesses engage in certain transactions that are not directly addressed by state law, the business needs to know how certain transactions are treated for taxing purposes. Mr. Poe closed by saying that binding private letter rulings will benefit the department, taxpayers, and businesses.

The committee discussed the number of private letter rulings that would be allowed under the legislation and the department's cost to comply with the legislation. Mr. Nelson commented that the department would solicit input from taxpayers on the new-policy change.

01:19 PM -- Mr. Greg Romberg, Colorado Press Association, testified in support of the amendment and distributed a copy of a private letter ruling by the Internal Revenue Service (Attachment C). It is a good policy to make additional information available to businesses to inform taxpayers on how transactions are treated for taxing purposes. Mr. Romberg closed by saying that department rulings should not be shielded from public view and must be uniform. Mr. Romberg urged the committee to support amendment L.001.

The committee engaged in a discussion regarding the impact of amendment L.001 in terms of information that would be made public from a private letter ruling. The committee asked the fiscal analyst, Mr. Chris Ward, to respond to committee questions regarding the department's cost for complying with the bill.

01:42 PM -- Mr. Chris Ward, Legislative Council Staff, responded to committee questions and discussed fees that would be assessed by the department to cover its cost for complying with the bill. After a brief committee discussion, the bill was placed on the table for action.


BILL:	HB06-1312
TIME:	01:49:29 PM
MOVED:	Vigil
MOTION:	Refer House Bill 06-1312 to the Committee on Appropriations. The motion passed on a 12-0-1 vote.
SECONDED:	Cloer
		VOTE
	Benefield	Yes
	Cloer	Yes
	Crane	Excused
	Frangas	Yes
	Garcia	Yes
	Harvey	Yes
	Jahn	Yes
	Kerr	Yes
	Marshall	Yes
	Massey	Yes
	McCluskey	Yes
	Judd	Yes
	Vigil	Yes
Final YES: 12 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

01:52 PM -- House Bill 06-1161 - Concerning the Regulation of Mortgage Brokers

Representatives Vigil and Massey, prime sponsors, explained the provisions in the bill. Representative Vigil said that House Bill 06-1161 establishes the regulatory requirements for mortgage brokers. The bill defines the responsibilities and requirements of both the Department of Regulatory Agencies (DORA), and the Division of Real Estate and Mortgage Brokers. It also creates the Mortgage Broker Registration Cash Fund to collect fee revenue. By January 1, 2007, mortgage brokers are required to register with the Division of Real Estate.

Representative Massey said that the benefits in the bill outweigh the costs and asked the committee to support the legislation. After a brief committee discussion, the bill was placed on the table for action.


BILL:	HB06-1161
TIME:	02:11:55 PM
MOVED:	Vigil
MOTION:	Refer House Bill 06-1161 to the Committee on Appropriations. The motion passed on a 12-0-1 vote.
SECONDED:	Massey
		VOTE
	Benefield	Yes
	Cloer	Yes
	Crane	Yes
	Frangas	Yes
	Garcia	Yes
	Harvey	Excused
	Jahn	Yes
	Kerr	Yes
	Marshall	Yes
	Massey	Yes
	McCluskey	Yes
	Judd	Yes
	Vigil	Yes
Final YES: 12 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

02:15 PM -- House Bill 06-1307 - Concerning State Government Accountability

Representative Vigil, prime sponsor explained that House Bill 06-1307 creates the 18-member State Government Accountability Task Force and requires it to:

● identify primary goals of state government;
● establish success measures to be used by all state agencies to measure the government's progress toward these goals. No more than five measures shall be established for each goal. The measures are required to be outcome based, not relate to the size or organization of state government or government processes;
● impose minimal data collection requirements;
● submit a final report to the General Assembly and the Governor by April 1, 2007; and
● consult with the State Auditor to ensure the development of appropriate success measures.

The committee and Representative Vigil engaged in a discussion about measuring state agency goals and setting bench marks for agency progress milestones. After a brief committee discussion, the bill was placed on the table for action.


BILL:	HB06-1307
TIME:	02:41:21 PM
MOVED:	Garcia
MOTION:	Moved a conceptual amendment that would change the composition of the task force to make it more accountable to citizens and the legislature. After a brief committee discussion, the amendment was withdrawn.
SECONDED:	Marshall
		VOTE
	Benefield
	Cloer
	Crane
	Frangas
	Garcia
	Harvey
	Jahn
	Kerr
	Marshall
	Massey
	McCluskey
	Judd
	Vigil
Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: TIE


BILL:	HB06-1307
TIME:	02:46:31 PM
MOVED:	Cloer
MOTION:	Moved to amend House Bill 06-1307, by striking line 1 on page 2 (enacting clause). Representative Judd, Chairman, ruled the motion out of order.
SECONDED:
		VOTE
	Benefield
	Cloer
	Crane
	Frangas
	Garcia
	Harvey
	Jahn
	Kerr
	Marshall
	Massey
	McCluskey
	Judd
	Vigil
Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: TIE


BILL:	HB06-1307
TIME:	02:52:14 PM
MOVED:	Vigil
MOTION:	Refer House Bill 06-1307 to the Committee on Appropriations. The motion passed on a 8-5-0 vote.
SECONDED:	Benefield
		VOTE
	Benefield	Yes
	Cloer	No
	Crane	No
	Frangas	Yes
	Garcia	Yes
	Harvey	No
	Jahn	Yes
	Kerr	No
	Marshall	Yes
	Massey	Yes
	McCluskey	No
	Judd	Yes
	Vigil	Yes
Final YES: 8 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS

02:53 PM

Adjourn.