Senate Committee on Business, Labor and Technology (03/25/2009)

Final
STAFF SUMMARY OF MEETING

SENATE COMMITTEE ON BUSINESS, LABOR AND TECHNOLOGY

Date:	03/25/2009	ATTENDANCE

Time:	01:31 PM to 03:18 PM	Foster	X
		Harvey	*
Place:	SCR 354	Mitchell	E
		Scheffel	*
This Meeting was called to order by		Tochtrop	X
	Senator Veiga	Heath	X
		Veiga	X
This Report was prepared by
	Hillary Smith
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
SB09-247 SB09-248		Amended, Referred to Appropriations Amended, Referred to the Committee of the Whole

01:32 PM -- Senate Bill 09-247

Senator Tochtrop presented Senate Bill 09-247. The bill expands the availability of unemployment insurance (UI) benefits to certain unemployed individuals and enables the state to receive and expend funds from the federal "American Recovery and Reinvestment Act of 2009." Eligibility for benefits is expanded to include individuals who leave a job for certain compelling family reasons including:

to accompany a spouse whose employment location has changed;
to care for a family member who is ill or disabled; and
domestic abuse.

These expanded benefits are to be charged to the UI Trust Fund and not affect an employer's premium.

Another component of the bill allows an unemployed individual to designate an alternative base period in order to qualify for benefits. Finally, $15 million in enhanced UI benefits will be available to claimants participating in an approved training program for the following three fiscal years.

The Division of Employment and Training in the Department of Labor and Employment is responsible for implementing the bill, adopting rules, developing and improving outreach efforts, and submitting an annual report to the General Assembly on the status of the enhanced UI benefits program and resulting outcomes.

Senator Tochtrop distributed prepared Amendment L.001 (Attachment A) and explained the bill.

The following individuals testified regarding the bill:

01:36 PM -- Virginia Love, representing the Colorado Competitive Council (C3), testified in opposition to the bill as introduced. She stated that C3 supports expanded access to UI benefits, but the bill needs to be pared down in order to be feasible. She spoke about the solvency of the UI Trust Fund and the taxes that are paid by employers into the fund. Ms. Love suggested language that C3 would like to see added to the bill. She discussed language in the bill that does not match language in the federal act. Ms. Love also requested that the training program section of the bill be trimmed, as it goes beyond the requirements of the federal stimulus package. She said that training programs are laudable, but the training program in the bill is not affordable. She added that C3 supports the concept of the bill, but feels that UI Trust Fund moneys need to be spent more prudently.

01:42 PM

Ms. Love responded to questions from Senator Harvey regarding the solvency of the UI Trust Fund. Discussion continued between Senator Harvey and Ms. Love regarding how the requirements of the bill compare to the requirements set forth by the federal stimulus package.

01:45 PM -- Tony Gagliardi, representing the National Federation of Independent Businesses (NFIB), testified regarding the bill. He discussed the NFIB's concerns with the bill and stated that the NFIB would like to try to work out the differences. He discussed the language of the bill and stated that some of its requirements are broad and complicated.

01:51 PM -- Rich Jones, representing the Bell Policy Center, testified in favor of the bill. He distributed a handout to the committee (Attachment B). He discussed the alternative base period. He stated that the bill would help those who need benefits the most, such as low-wage workers, and noted that low-wage workers are more likely to spend benefits immediately. Senator Harvey stated that the federal stimulus money will be a one-time infusion, whereas the bill will make changes in statutes that will have long-term effects. He asked Mr. Jones to discuss the bill's long-term effect on the UI Trust Fund and the future of UI benefits. Mr. Jones stated that the Bell Policy Center would support the bill regardless of whether it was tied to federal funding. Mr. Jones discussed the fiscal note and past legislation concerning an alternative base period. He stated that the fiscal note does not reflect the changes in employer rates.

01:59 PM

Senator Veiga asked Senator Tochtrop to address language in the amendment concerning a repeal of a section of the bill upon the exhaustion of federal funds. Senator Tochtrop stated that a witness from the Colorado Department of Labor and Employment would be able to answer her question.

02:00 PM -- Phil Hayes, representing the Colorado American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), testified in favor of the bill. He discussed the federal stimulus package and the need to modernize Colorado statutes pertaining to UI benefits. He stated that the expansions made by the bill will not be large, but will help individuals needing access to benefits.

02:03 PM -- Linda Meric, representing 9 to 5 National Association of Working Women, testified in favor of the bill. She discussed her organization and stated that women who earn low wages are sometimes left out of the UI benefits system, even though their employers have been paying taxes into the fund on their behalf. She discussed the current economic climate and stated that UI benefits should be available to all workers who lose their jobs through no fault of their own. Ms. Meric added that increased access to UI benefits will prevent foreclosures, keep people from needing welfare, and will serve as a form of economic stimulus. She discussed the provisions of the bill and noted that it will update portions of the Colorado statutes to be consistent with the requirements of the federal stimulus package.

02:07 PM

Ms. Meric responded to questions from Senator Foster concerning existing Colorado law pertaining to UI benefits.

02:09 PM -- Kathy White, representing the Colorado Fiscal Policy Institute, testified in favor of the bill. She stated that the bill makes small changes that will result in an immediate increase in federal funding. She discussed the purpose and importance of the UI benefits system. She spoke about research that indicated that one dollar of UI benefits creates $1.64 of economic activity. Ms. White distributed a copy of her testimony and a graphic illustrating the economic benefits of various stimulus provisions to the members of the committee (Attachment C).

02:15 PM

Ms. White responded to questions from Senator Scheffel regarding the long-term impact the bill may have on the UI Trust Fund. Ms. White discussed the fiscal note. She stated that the provisions of Colorado statutes are already very close to those of the federal stimulus bill, so the bill will not be very burdensome to implement. She discussed existing Colorado law concerning UI benefits. Ms. White noted that Colorado will receive all of the federal stimulus money at once, and will have at least 12 years to pay it out. Discussion continued between Ms. White and Senator Scheffel. Ms. White addressed the need for an alternate base period and noted that the lag period for wage-reporting is no longer necessary due to the increase of computerized data systems. Discussion continued concerning studies that support the additional changes made by the bill. Ms. White added that the number of individuals who are expected to use the expanded UI benefits will be relatively small, but that the benefits will be very important. She noted that increased benefits for compelling family reasons would not be counted against employers or employees.

02:25 PM

Discussion continued between Senator Harvey and Ms. White concerning data that would predict take-up rates for expanded benefits.

02:31 PM -- Gary Estenson, representing the Colorado Department of Labor and Employment, testified regarding the bill. He introduced other staff members from the department and addressed the testimony of previous witnesses. He noted that any changes made to the language of the bill would have to be examined by someone to ensure that the bill continues to meet federal requirements. Mr. Estenson discussed states that have decided to forgo federal stimulus moneys rather than change their laws. He indicated that most of the states that have not changed their laws have none of the federal requirements already in place, unlike Colorado. He stated that Colorado already has most of the federal requirements in place, with the exception of the alternate base period. He discussed data pertaining to the take-up rate if an alternate base period were implemented. He noted that job training is a proven method of getting people off UI benefits.

02:37 PM

Senator Tochtrop asked Mr. Estenson to explain the language of prepared Amendment L.001. Discussion continued among Mr. Estenson and the members of the committee regarding the requirements of the federal stimulus bill and the choices available to states wishing to receive stimulus moneys.

02:45 PM

Mr. Estenson responded to questions from Senator Foster regarding the administration of job training moneys. He noted that the bill does not add a training benefit, but rather adds additional UI benefits for workers that have already qualified to receive them. Mr. Estenson responded to questions from Senator Heath concerning the effect the bill may have on small businesses. Mr. Estenson discussed the fiscal note of the bill and stated that the stimulus moneys will probably last for a long time.

02:53 PM

Senator Tochtrop provided closing remarks.


BILL:	SB09-247
TIME:	02:53:28 PM
MOVED:	Tochtrop
MOTION:	Moved prepared Amendment L.001 (Attachment A). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell	Excused
	Scheffel
	Tochtrop
	Heath
	Veiga

Not Final YES: 0 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: Pass Without Objection

02:53 PM

Senators Harvey, Scheffel, and Heath discussed their votes.


BILL:	SB09-247
TIME:	02:53:35 PM
MOVED:	Tochtrop
MOTION:	Moved to refer Senate Bill 09-247, as amended, to the Committee on Appropriations. The motion passed on a 5-1 roll call vote, with one member excused.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	No
	Mitchell	Excused
	Scheffel	Yes
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 5 NO: 1 EXC: 1 ABS: 0 FINAL ACTION: PASS

02:56 PM -- Senate Bill 09-248

Senator Heath presented Senate Bill 09-248. The bill allows a contractor to provide a letter of credit in lieu of the other forms of surety on public works contracts and limits the surety to one-half of the amount payable in each calendar year. Senator Heath explained the bill and stated that its purpose was to save the state money. He distributed prepared Amendment L.001 (Attachment D) and explained the changes it makes to the bill.

The following individuals testified regarding the bill:

03:01 PM -- Marla Lien, representing the Regional Transportation District (RTD), testified in favor of the bill. She discussed an upcoming partnership RTD will be entering into and its relationship to the FasTracks Program. She spoke about the changes made by the bill and by the amendment.

03:05 PM -- Jeffrey Strassner, representing Marsh & McLennan, an insurance provider, testified in favor of the bill.

03:08 PM -- Lee Kemp, representing RTD, testified in favor of the bill. He stated that the bill will help with the public-private partnership for the Gold Line and East Corridor. He responded to questions from Senator Tochtrop and Senator Harvey regarding projects to which the bill applies.

03:11 PM -- Nick Broyles, representing the National Association of Surety Bond Producers, testified regarding the bill. He discussed current law pertaining to surety bonds. He stated that regardless of whether the bond is required at the 50 or 100 percent level, the contractor still has to pay based on 100 percent of the contract price, so the surety bond practice does not save any money. He said there is no reason not to afford the taxpayers the additional protection of the 100 percent bond, with the exception of "mega-projects."

03:15 PM

Senator Heath provided closing remarks.


BILL:	SB09-248
TIME:	03:16:21 PM
MOVED:	Heath
MOTION:	Moved prepared Amendment L.001 (Attachment D). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell	Excused
	Scheffel
	Tochtrop
	Heath
	Veiga

Not Final YES: 0 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	SB09-248
TIME:	03:17:37 PM
MOVED:	Heath
MOTION:	Moved to refer Senate Bill 09-248, as amended, to the Committee of the Whole with a recommendation that it be placed on the consent calendar. The motion passed on a 6-0 roll call vote, with one member excused.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	Yes
	Mitchell	Excused
	Scheffel	Yes
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 6 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

03:18 PM

The committee adjourned.