Colorado Legislative Council Staff



TABOR Refund Impact

General Fund and Cash Fund Revenue and General Fund Expenditure Impact

Local Government Expenditure Impact

Drafting Number:

Prime Sponsor(s):

LLS 98-943

Rep. Schauer

Sen. Alexander


Bill Status:

Fiscal Analyst:

April 20, 1998

House Business Affairs

Will Meyer (866-4976)



Summary of Legislation

            The provisions of this bill would specify that any unconscionable method, act, or practice in the conduct of any trade or commerce violates the provisions of the “Unfair Practices Act”. The bill would authorize the Department of Law to enforce the provisions of the act through civil enforcement mechanisms and would specify the violations of these provisions would constitute a misdemeanor. The bill also would set forth the circumstances to be considered by a court in determining whether a method, act, or practice is unconscionable. The bill would become effective upon signature of the Governor, and would apply to acts occurring or committed on or after that date.


FY 1998/99

FY 1999/2000

State Revenues

General Fund

Cash Fund

Potential Fine and Civil Penalty Revenues

Potential Civil Penalty Revenues

State Expenditures

General Fund

Other Fund



FTE Position Change

2.5 FTE

2.5 FTE

Local Government Impact — Potential Costs to County Jails.

State Revenues

            By making the provisions of the bill a part of the “Unfair Practices Act”, it would make violations of its provisions subject to civil penalties (including treble damages), as well as a misdemeanor. The bill defines trade or commerce to mean the advertising, offering for sale, selling, leasing, renting, collecting debts arising out of the sale of lease of, or distributing, goods or services, either to or from locations within the state of Colorado, or directly or indirectly affecting the people of this state. This provision could potentially impact Cash Fund and General Fund revenues to the state since civil damages awarded the Attorney General are deposited to both Cash Funds and the General Fund, while all fine revenues are deposited into the state General Fund. The revenues from civil penalties are conditional on future violations of the statutory provisions and the success of the state’s prosecution. The impact to the General Fund is expected to be minimal. The revenue impacts to the state cannot be quantified at this time. The penalty for the misdemeanor is identified below:



County Jail


$100 to $1,000

0 months to 6 months

TABOR Refund Impact

            Section 20 of Article X of the Colorado Constitution, limits the maximum annual percentage increase in state fiscal year spending. Once total state revenue from all sources that are not specifically excluded from fiscal year spending exceeds these limits for the fiscal year, the state constitution requires that the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Based on the current Legislative Council economic forecast, it is projected that the state will be in a TABOR refund position during each of the next five fiscal years. Any increase or decrease in state revenue from changes in fees, fines, licenses, or other revenue sources will affect the amount of the state revenue to be refunded.

State Expenditures

            Under the provisions of the “Unfair Practices Act” (UPA), the Department of Law would be responsible to respond to any complaints filed under the “unconscionable method, act or practice” provisions of the bill. The provisions of the UPA are narrowly defined in current statute. The department has indicated that the provisions of this bill would redefine the UPA in a much broader way. The department anticipates that it would receive complaints arising from disputes between businesses, as well as individuals. The UPA requires the Attorney General to investigate, pursue, and prosecute where appropriate, complaints filed with their office. The Business Regulation Unit in the Department of Law would require an additional 2.5 FTE consisting of 1.0 FTE Criminal Investigator, 1.0 FTE Assistant Attorney General I, and 0.5 FTE Paralegal I costing an estimated $144,979 in FY 1998/99 and $132,079 in FY 1999/2000.



FY 1998-99

FY 1999-2000

Department of Law -

  Personal Services: 2.5 FTE



  Operating Expenses



   Non-recurring Expenses



Total Expenses




Expenditures Not Included

            Pursuant to the Joint Budget Committee’s budget policies, the following expenditures have not been included in this fiscal note:


               health and life insurance costs;

               short-term disability costs;

               inflationary cost factors;

               leased space; and

               indirect costs.

Local Government Impact

            The bill may impact expenditures at the county level. As noted above under the State Revenues section, because courts have the discretion of imposing a fine or a sentence to the county jail in misdemeanor cases, it is difficult to determine the impact of the bill’s provisions since no data is available to indicate whether judges are more likely to impose a fine or a county jail sentence. According to a 1993 report from the State Auditor’s Office, the average daily cost to house an offender in a county jail is $54. Consequently, the cost to the counties to house an offender convicted of a class 2 misdemeanor would range from $4,860 to $19,710 per incarceration.

Spending Authority

            This fiscal note implies that the Department of Law would require an appropriation of $144,979 General Fund and 2.5 FTE in FY 1998/99.

Departments Contacted

            Judicial Branch           Law