Bill Summary for Bill Number SB09-234

Date: 04/28/2009

Final
BILL SUMMARY for SB09-234

HOUSE COMMITTEE ON BUSINESS AFFAIRS AND LABOR

Votes: View-->	Action Taken:
Moved to refer Senate Bill 09-234 to the Committee	PASS

12:10 PM -- Senate Bill 09-234

Representative Rice, prime sponsor, presented Senate Bill 09-234 concerning direction to the Economic Development Commission to develop recommendations for the General Assembly regarding enterprise zones. This bill, recommended by the Joint Select Committee on Job Creation and Economic Growth, directs the Economic Development Commission with assistance from the Colorado Office of Economic Development and International Trade to submit a report to the General Assembly that:

recommends criteria for the creation of a statewide enterprise zone;
evaluates whether to expand the boundaries of existing enterprise zones; and
determines whether state income tax credits under the program should be modified.

The commission is required to submit its report to the General Assembly on or before March 31, 2010 via electronic mail.

Background. Enterprise zones were established to provide incentives and tax credits for private enterprise to expand and for new businesses to locate in economically distressed areas of the state. State law limits the number of enterprise zones in the state to 16. Within these enterprise zones, there are 31 counties designated as enhanced rural enterprise zones.

The total population residing within an enterprise zone boundary cannot exceed 80,000 people in urban areas and 100,000 in rural areas. In addition, an area has to meet a specified criteria that measures economic distress based on unemployment rates, per capita income, and population growth. Enhanced rural enterprise zones offer increased financial incentives for businesses that create new jobs in certain areas of the state. These enhanced zones are located in a county or counties already in a standard enterprise zone that meet more strict criteria than set forth for standard zones.

The program offers nine state income tax credits that encourage specific economic development activity. These tax credits are used throughout the state as an economic development tool to attract, retain, and grow new jobs in the areas most impacted by high unemployment and low per capita income growth.

Recommendations under SB 09-234. This bill requires the commission to evaluate the above criteria and make recommendations on creating a new statewide enterprise zone. The commission shall consider:

the costs and benefits of creating a new statewide enterprise zone;
economic development incentives that may be offered; and
the industries or economic sectors that would benefit from a statewide enterprise zone and locate a business in Colorado.

This bill also requires the commission to consider whether to expand or modify the boundaries of existing enterprise zones based on modifications to the geographic and economic criteria listed above. The commission is also required to consider:

expanding the nine state income tax credits to more effectively target businesses in the state in order to stimulate the economy;
narrowing the credits if they are not utilized by businesses; and
ways to mitigate the revenue impacts for changes recommended by the commission.

12:16 PM

Representative Gagliardi asked for clarification that the bill is looking at a potentialcreation of a statewide enterprise zone. She also asked about the make-up of the commission and the current existing enterprise zones.


BILL:	SB09-234
TIME:	12:20:36 PM
MOVED:	Rice
MOTION:	Moved to refer Senate Bill 09-234 to the Committee of the Whole. The motion passed 10-0.
SECONDED:	Ryden
		VOTE
	Balmer	Yes
	Bradford	Yes
	Gagliardi	Yes
	Liston	Yes
	Priola	Yes
	Ryden	Yes
	Scanlan	Yes
	Soper	Yes
	Stephens	Excused
	Casso	Yes
	Rice	Yes

Final YES: 10 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS