First Regular Session Sixty-eighth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 11-0186.01 Esther van Mourik HOUSE BILL 11-1147 HOUSE SPONSORSHIP Tyler, SENATE SPONSORSHIP (None), House Committees Senate Committees Economic and Business Development A BILL FOR AN ACT Concerning business development in the state. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) Section 1 of the bill creates the short title "Joint Opportunities for Business Support (JOBS) Act". Section 2 of the bill: Requires the Colorado office of economic development (office) to establish a technical assistance program whereby the office contracts with entities to provide eligible businesses with technical assistance that includes, but is not limited to: Access to free or affordable assistance with marketing, accounting, legal services, or other consulting services; Access to free or affordable information services and consulting services, including information on markets, customers, and competitors, such as business databases, geographic information systems, and search engine marketing; and Development of business connections, including interaction and exchange among business owners and resource providers, such as trade associations, think tanks, academic institutions, business roundtables, peer-to-peer learning sessions, and mentoring programs. Requires the office to establish a self-employment assistance program to support unemployment insurance recipients by encouraging them to start their own business by providing grants and opportunities for training and business support services. Section 3 of the bill reduces the enterprise zone income tax credit available for investment in certain property from 3% of the total qualified investment to 2.7%. Section 4 of the bill reduces the enterprise zone income tax credit available for each new business facility employee from $500 per new employee to $450 per new employee. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Short title. This act shall be known and may be cited as the "Joint Opportunities for Business Support (JOBS) Act". SECTION 2. Part 1 of article 48.5 of title 24, Colorado Revised Statutes, is amended BY THE ADDITION OF THE FOLLOWING NEW SECTIONS to read: 24-48.5-113. Technical assistance program - creation - technical assistance program cash fund - creation - gifts, grants, and donations - legislative declaration - definitions. (1) The general assembly hereby finds and declares that the purpose of the technical assistance program is to stimulate investment in Colorado's economy by providing technical assistance for expanding businesses in the state. (2) As used in this section, unless the context otherwise requires: (a) "Eligible business" means a for-profit, privately held business that: (I) Employs at least six persons but not more than fifty persons; (II) Has maintained its principal place of business in the state for at least the previous two years; and (III) Generates at least seven hundred fifty thousand dollars but not more than twenty-five million dollars in annual gross revenues. (b) "Office" means the Colorado office of economic development created in section 24-48.5-101. (c) "Technical assistance program" or "program" means the technical assistance program established in subsection (3) of this section. (3) (a) The office shall develop a technical assistance program and shall contract with one or more entities to administer the program under this section. (b) The office shall award each contract in accordance with the competitive sealed best value bidding requirements, as specified in section 24-103-202.3, to an entity that: (I) Demonstrates the ability to implement the program statewide; (II) Has an outreach plan; and (III) Is able to provide: (A) Business counseling services; (B) Access to technology and information; (C) Marketing services and advice; (D) Business management support; and (E) Other similar services. (c) In selecting an entity, the office shall also consider whether the entity will qualify for matching funds to provide the technical assistance. (4) A contracted entity administering the program shall provide technical assistance for eligible businesses that includes, but is not limited to: (a) Access to free or affordable assistance with marketing, accounting, legal services, or other similar consulting services; (b) Development of business connections, including interaction and exchange among business owners and resource providers, such as trade associations, think tanks, academic institutions, business roundtables, peer-to-peer learning sessions, and mentoring programs; and (c) Access to free or affordable information services, including information on markets, customers, and competitors, such as business databases, geographic information systems, and search engine marketing. (5) A contracted entity administering the program shall select eligible businesses to receive assistance in more than one industry cluster and, to the maximum extent practicable, shall choose eligible businesses that are geographically distributed throughout the state or are in partnership with businesses that are geographically distributed throughout the state. (6) (a) An eligible business receiving assistance under the program shall enter into an agreement with the contracted entity administering the program to establish the eligible business' commitment to participate in the program. The agreement shall require, at a minimum, that the eligible business: (I) Attend a minimum number of meetings with the contracted entity administering the program; (II) Report job-creation data in the manner prescribed by the contracted entity administering the program; and (III) Provide financial data in the manner prescribed by the contracted entity administering the program. (b) The office or the contracted entity administering the program may prescribe additional reporting requirements in the agreement that the office or the contracted entity deem necessary to track the progress of the eligible business and to monitor the eligible business' implementation of the assistance. (c) The contracted entity shall report information received from the eligible business to the office every six months. (7) A contracted entity administering the program is authorized to promote the general business interests or industrial interests of the state. (8) The office shall review the progress of a contracted entity administering the program at least once every six months and shall determine whether the contracted entity is meeting its contractual obligations for administering the program. The office may terminate and rebid a contract if the contracted entity does not meet its contractual obligations. (9) On January 15, 2012, and each January 15 thereafter, the office shall submit a report to the governor, the president of the senate, and the speaker of the house of representatives that describes in detail the progress of the program. The report shall include, at a minimum, the number of businesses receiving assistance, the number of full-time equivalent jobs created as a result of the assistance, if any, the amount of wages paid to employees in the newly created jobs, and the locations and types of economic activity undertaken by the businesses. (10) The office shall develop procedures for the administration of this section. (11) There is hereby created in the state treasury the technical assistance program cash fund to provide for the direct and indirect costs associated with the implementation of this section. The fund shall consist of any moneys appropriated by the general assembly to the fund and may also include gifts, grants, and donations obtained directly by the office pursuant to this section. The office is authorized to seek and accept gifts, grants, or donations from private or public sources for the purposes of this section. All moneys received by the office through gifts, grants, or donations shall be transmitted to the state treasurer, who shall credit the same to the fund. The moneys in the fund shall be continuously appropriated for the direct and indirect costs associated with the implementation of this section. Any moneys in the fund not expended for the purposes of this section may be invested by the state treasurer as provided by law. All interest and income derived from the investment and deposit of moneys in the fund shall be credited to the fund. Any unexpended and unencumbered moneys remaining in the fund at the end of a fiscal year shall remain in the fund and shall not be credited or transferred to the general fund or another fund. 24-48.5-114. Self-employment assistance program - creation - self-employment assistance program cash fund - creation - gifts, grants, and donations - legislative declaration - definitions. (1) The general assembly hereby finds and declares that the purpose of the self-employment assistance program is to support unemployment insurance recipients by encouraging them to start their own business by providing opportunities for training and business support services. (2) As used in this section, unless the context otherwise requires: (a) "Office" means the Colorado office of economic development created in section 24-48.5-101. (b) "Self-employment assistance activities" means activities approved by the office in which an individual participates for the purpose of establishing a business and becoming self employed. "Self-employment assistance activities" include, but are not limited to, entrepreneurial training, business counseling, and technical assistance. (c) "Self-employment assistance program" or "program" means the program established in subsection (3) of this section. (3) (a) The office shall develop a self-employment assistance program in collaboration with the department of labor and employment created in section 24-1-121, the Colorado work force investment program created in part 2 of article 71 of title 8, C.R.S., institutions of higher education in Colorado as defined in section 23-3.1-102 (5), C.R.S., and the state work force development council created in section 24-46.3-101. The program shall be a voluntary program through which the office shall pay a self-employment assistance grant to participating individuals willing to enter into self-employment assistance activities who satisfy the eligibility requirements established by the office. The grant shall not exceed two thousand five hundred dollars for each eligible individual and shall specify that the individual use the grant according to requirements set by the office related to developing the individual's business. (b) An individual eligible to participate in the self-employment assistance program must be considered unemployed in accordance with section 8-73-107, C.R.S. (c) The program shall require that the individual eligible to participate provide, at a minimum, the planned cash flow information for the business as well as a business plan. (4) The office shall develop procedures for the administration of this section. (5) There is hereby created in the state treasury the self-employment assistance program cash fund to provide for the direct and indirect costs associated with the implementation of this section. The fund shall consist of any moneys appropriated by the general assembly to the fund and may also include gifts, grants, and donations obtained directly by the office pursuant to this section. The office is authorized to seek and accept gifts, grants, or donations from private or public sources for the purposes of this section. All moneys received by the office through gifts, grants, or donations shall be transmitted to the state treasurer, who shall credit the same to the fund. The moneys in the fund shall be continuously appropriated for the direct and indirect costs associated with the implementation of this section. Any moneys in the fund not expended for the purposes of this section may be invested by the state treasurer as provided by law. All interest and income derived from the investment and deposit of moneys in the fund shall be credited to the fund. Any unexpended and unencumbered moneys remaining in the fund at the end of a fiscal year shall remain in the fund and shall not be credited or transferred to the general fund or another fund. 24-48.5-115. Marketing efforts to promote technical assistance program and self-employment assistance program. On or before January 1, 2012, the Colorado office of economic development shall contract with a Colorado company in accordance with the competitive sealed best value bidding requirements, as specified in section 24-103-202.3, to initiate marketing efforts in collaboration with existing economic development organizations in the state to market the availability of the technical assistance program created in section 24-48.5-113 and the self-employment assistance program created in section 24-48.5-114 to all eligible businesses in the state. SECTION 3. 39-30-104 (1) (a), Colorado Revised Statutes, is amended to read: 39-30-104. Credit against tax - investment in certain property - repeal. (1) (a) (I) In lieu of any credit allowable under section 39-22-507.5, there shall be allowed to any person as a credit against the tax imposed by article 22 of this title, for income tax years commencing on or after January 1, 1986, but before January 1, 2012, an amount equal to the total of three percent of the total qualified investment, as determined under section 46 (c) (2) of the federal "Internal Revenue Code of 1986", as amended, in such taxable year in qualified property as defined in section 48 of the internal revenue code to the extent that such investment is in property that is used solely and exclusively in an enterprise zone for at least one year. The references in this subsection (1) to sections 46 (c) (2) and 48 of the internal revenue code mean sections 46 (c) (2) and 48 of the internal revenue code as they existed immediately prior to the enactment of the federal "Revenue Reconciliation Act of 1990". (II) In lieu of any credit allowable under section 39-22-507.5, there shall be allowed to any person as a credit against the tax imposed by article 22 of this title, for income tax years commencing on or after January 1, 2012, an amount equal to the total of two and seven-tenths percent of the total qualified investment, as determined under section 46 (c) (2) of the federal "Internal Revenue Code of 1986", as amended, in such taxable year in qualified property as defined in section 48 of the internal revenue code to the extent that such investment is in property that is used solely and exclusively in an enterprise zone for at least one year. The references in this subsection (1) to sections 46 (c) (2) and 48 of the internal revenue code mean sections 46 (c) (2) and 48 of the internal revenue code as they existed immediately prior to the enactment of the federal "Revenue Reconciliation Act of 1990". SECTION 4. 39-30-105 (1) (a) (I), Colorado Revised Statutes, is amended to read: 39-30-105. Credit for new business facility employees - definitions. (1) (a) (I) (A) For any income tax year commencing on or after January 1, 1993, but before January 1, 2012, any taxpayer who establishes a new business facility in an enterprise zone shall be allowed a credit against the income tax imposed by article 22 of this title in an amount equal to five hundred dollars per income tax year for each new business facility employee, pursuant to subsection (6) of this section, who is working within the zone, prorated according to the number of months the employee was employed by the taxpayer during the income tax year. An employee whose primary duties consist of operating a commercial motor vehicle with a commercial driver's license shall be deemed to be working one hundred percent within the zone if the employee spends no more than five percent of his or her total time at any facility of the employer other than the facility within the zone. (B) For any income tax year commencing on or after January 1, 2012, any taxpayer who establishes a new business facility in an enterprise zone shall be allowed a credit against the income tax imposed by article 22 of this title in an amount equal to four hundred fifty dollars per income tax year for each new business facility employee, pursuant to subsection (6) of this section, who is working within the zone, prorated according to the number of months the employee was employed by the taxpayer during the income tax year. An employee whose primary duties consist of operating a commercial motor vehicle with a commercial driver's license shall be deemed to be working one hundred percent within the zone if the employee spends no more than five percent of his or her total time at any facility of the employer other than the facility within the zone. SECTION 5. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.