NOTE: The governor signed this measure on 6/10/2016.
      
      
      SENATE BILL 16-165
      
      
      BY SENATOR(S) Grantham, Cooke, Heath, Lundberg, Neville T., Scott,
      Woods;
      also REPRESENTATIVE(S) Young, Conti, Kagan, Ryden, Windholz.
      
      
      Concerning the requirements for an insurance company to be
           deemed to maintain a home office or regional home office in
           this state for purposes of the tax on insurance premiums
           collected by the insurance company.
      
      
      Be it enacted by the General Assembly of the State of Colorado:
      
           SECTION 1.  In Colorado Revised Statutes, 10-3-209, amend (1)
      (b) as follows:
      
           10-3-209.  Tax on premiums collected - exemptions - penalties.
      (1) (b) (I)  The rate of tax shall be as follows:
      
           (A)  For companies not exempted or charged a different rate of tax
      by another provision of this section, the rate of tax on the gross amount
      shall be:
      
           Premiums collected or
           contracted for during:             Rate of tax:
      
           1996                          2.20%
           1997                          2.15%
           1998                          2.10%
           1999                          2.05%
           2000 and thereafter                2.00% 
      
           (B)  For companies maintaining a home office or a regional home
      office in this state, the rate of tax on the gross amount shall be one percent.
      
           (II) (A)  For purposes of this paragraph (b), any office in this state
      shall be company is deemed a company's to maintain a home office or
      regional home office in this state if such office company either:
      
           (A)  Substantially performs substantially in this state the
      following functions, or substantially equivalent functions, for the
      company in for each state in which the company is licensed, or in for
      three or more of such states: Actuarial, medical, legal, approval or rejection
      of applications, issuance of policies, information and service, advertising
      and publications, public relations, hiring, testing, and training of sales and
      service forces; or
      
           (B)  Maintains significant direct insurance operations in
      this state that are supported by functional operations which are
      both necessary for and pertinent to a line or lines of business
      written by the company in this state.
      
           (B) (III)  Any company desiring to qualify an office in this state as
      a home or regional home office shall make application for qualification to
      the commissioner on forms prescribed by the commissioner and shall
      submit proof that it is operating a home or a regional home office in this
      state. Applications for companies that were not approved in the immediate
      preceding year shall be received by the commissioner by December 31 of
      the year immediately preceding the year for which the application for
      qualification is being made. Applications for companies that were approved
      in the immediate preceding year shall be received by the commissioner by
      March 1 of the year for which qualification is being made. Applications for
      companies that were approved in the immediate preceding year received
      through March 31 shall pay a late charge of one hundred dollars per day for
      each day after March 1 that any such application is received by the
      commissioner. Applications received after March 31 shall be denied. The
      provisions of subsection (2) of this section shall not apply to companies
      maintaining a home office or regional home office in this state.
      
           (III)  The commissioner may consider for approval applications of
      companies that maintain significant direct insurance operations in Colorado
      and perform operational functions, for a line or lines of business written,
      substantially equivalent to those enumerated in subparagraph (II) of this
      paragraph (b).
      
           SECTION 2.  Act subject to petition - effective date -
      applicability. (1)  This act takes effect January 1, 2017; except that, if a
      referendum petition is filed pursuant to section 1 (3) of article V of the state
      constitution against this act or an item, section, or part of this act within the
      ninety-day period after final adjournment of the general assembly, then the
      act, item, section, or part will not take effect unless approved by the people
      at the general election to be held in November 2016 and, in such case, will
      take effect on January 1, 2017, or on the date of the official declaration of
      the vote thereon by the governor, whichever is later.
      
           (2)  This act applies to applications or renewal applications for home
      office or regional home office approval filed with the division of insurance
      on or after the applicable effective date of this act.
      
      
      
      
      ____________________________  ____________________________
      Bill L. Cadman                Dickey Lee Hullinghorst
      PRESIDENT OF                     SPEAKER OF THE HOUSE
      THE SENATE                         OF REPRESENTATIVES
      
      
      
      
      
      
      ____________________________  ____________________________
      Effie Ameen                            Marilyn Eddins
      SECRETARY OF                 CHIEF CLERK OF THE HOUSE
      THE SENATE                         OF REPRESENTATIVES
      
      
      
      
                  APPROVED________________________________________
      
      
      
      
      
                                    _________________________________________
                                    John W. Hickenlooper
                                    GOVERNOR OF THE STATE OF COLORADO