Senate Committee on Business, Labor and Technology (03/11/2009)

Final
STAFF SUMMARY OF MEETING

SENATE COMMITTEE ON BUSINESS, LABOR AND TECHNOLOGY

Date:	03/11/2009	ATTENDANCE

Time:	01:35 PM to 03:54 PM	Foster	X
		Harvey	X
Place:	SCR 354	Mitchell	X
		Scheffel	X
This Meeting was called to order by		Tochtrop	*
	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:
HB09-1053 SB09-243 HB09-1001		Referred to the Committee of the Whole Amended, Referred to Appropriations Amended, Referred to Appropriations

01:35 PM -- House Bill 09-1053

Senator Romer presented House Bill 09-1053. The bill repeals the "Colorado Foreign Capital Depository Act," which regulates how a financial institution can conduct business in Colorado as a foreign capital depository (FCD). In addition, the bill replaces the executive officer of an industrial bank on the banking board with the executive officer of a licensed money transmitter. Senator Romer stated that a witness from the Division of Banking would explain the bill.

The following individual testified regarding the bill:

01:36 PM -- Fred Joseph, the Acting State Bank Commissioner and the current State Securities Commissioner at the Colorado Division of Banking within the Department of Regulatory Agencies (DORA), testified in favor of the bill. Mr. Joseph explained the bill.

01:44 PM

Mr. Joseph and Senator Romer responded to Senator Harvey's request for information about FCDs in Colorado.


BILL:	HB09-1053
TIME:	01:47:03 PM
MOVED:	Harvey
MOTION:	Moved to refer House Bill 09-1053 to the Committee of the Whole. 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

01:47 PM -- Senate Bill 09-243

Senator Boyd presented Senate Bill 09-243. The bill makes changes to workers' compensation insurance benefit procedures. The fee schedule for payment of benefits is extended to services delivered after any final order, final admission, or full or partial settlement of a claim. When determining the maximum amount of temporary and permanent partial disability payments a claimant is eligible to receive, the claimant's mental impairment rating must be combined with the physical impairment rating. Finally, payment for health care services is authorized for claims that are found to be compensable after initially being denied. Senator Boyd distributed prepared Amendment L.001 (Attachment A).

The following individuals testified:

01:53 PM -- James Buck and John Berry, representing the Workers' Compensation Coalition, testified in opposition to the bill. Mr. Buck discussed current procedures pertaining to workers' compensation insurance benefits. He stated that medical impairment claims are the easiest claims to falsify and are difficult to prove. He noted that, in general, there are fewer mental health claims now than in the past. He discussed the changes made by the bill, and predicted that mental health claims would rise if the bill were to pass. He said that increased mental health claims would increase litigation needs and would therefore increase costs.

02:03 PM

Senator Foster discussed her experience with workers' compensation claimants. She stated that mental impairment is harder to measure than physical impairment and that mental illnesses should be treated with caution and respect. Mr. Buck clarified that he was not opposed to treatment for deserving claimants, but added that the present law does not deny benefits to those who are entitled to them.

02:07 PM

Senator Veiga discussed the current law pertaining to mental impairment claims. Mr. Buck stated that the current law recognized the inherent problems in quantifying and validating mental health claims. Discussion continued between Senator Veiga and Mr. Buck. Senator Harvey made additional comments regarding mental health claimants who are denied the ability to receive additional benefits. He asked Mr. Buck to suggest an alternative procedure to rate claimants who have multiple impairments. Mr. Buck explained the current procedure for determining workers' compensation benefits. Discussion continued between Senator Harvey and Mr. Buck. Mr. Buck said that the workers' compensation system is not necessarily a fair system, and suggested that a better way to fix the system would be to extend the time period in which mental health claimants are provided.

02:20 PM

Senator Veiga discussed the argument that the bill would result in an increase in mental impairment claims. Buck agreed that a legitimate injury would be a prerequisite for any type of rating, but reiterated that mental health impairments are harder to quantify. Mr. Buck stated that true mental impairment claims have always been in the system, but the bill may result in increased mental impairment claims that would not otherwise have been reported. Senator Foster described mental health impairments that can be treated and evaluated.

02:25 PM

Senator Scheffel asked for clarification on the limits applicable to impairment claims. Mr. Buck explained the range of ratings for physical and mental impairments.

02:28 PM

Mr. Berry discussed past legislation concerning mental impairment benefits. He discussed language in the bill that would change the existing standard for medical treatment. He added that he had been authorized to state that Tony Gagliardi, the Colorado State Director for the National Federation of Independent Businesses, was opposed to the bill. Senator Tochtrop, Mr. Berry, and Senator Boyd discussed language in Amendment L.001 that addressed one of Mr. Berry's concerns.

02:32 PM -- Bob Summers, the Director of the Division of Workers' Compensation within the Colorado Department of Labor and Employment, testified regarding the bill. He stated that the division is neutral on the bill and offered to answer questions. He described concerns regarding certain sections of the bill.

02:35 PM -- Janet Frickey, representing the Workers' Compensation Education Association (WCEA), testified in favor of the bill. She discussed her experience on the Medical Care Accreditation Board. She stated that the type of case that would be addressed by the bill is very limited in scope. She discussed the training a doctor is required to complete in order to provide an impairment rating.

02:40 PM -- Dan O'Neil, representing Pinnacol Insurance, testified in favor of the bill. He stated that the number of claimants who would be affected would be small, and added that such claimants would be helped by the bill. Mr. O'Neil responded to Senator Harvey's request to address Mr. Berry's concerns regarding the language of the bill. He also responded to a question from Senator Scheffel concerning whether the bill would increase the number of impairment claims. Discussion continued between Mr. O'Neil, Senator Scheffel, and Senator Harvey regarding increased premium costs.

02:43 PM -- Doug Kotarek, representing the Colorado Self-Insurers' Association, testified in favor of the bill.

02:45 PM -- John Sbarbaro, representing the WCEA, testified in favor of the bill. He stated that the bill was fundamentally fair.

02:48 PM -- Robert Ferm, representing the American Insurance Association and the National Council on Compensation Insurance (NCCI), testified regarding the bill. He discussed pricing information that the NCCI would soon make available.

02:50 PM -- Paula Rhoads, representing herself, testified regarding the bill. She discussed her experience as the victim of a traumatic brain injury suffered while on the job. She stated that she would be in favor of any legislation that would help individuals in a situation similar to her own.

02:55 PM -- Sheryle Hutter, representing herself, testified in favor of the bill.

02:56 PM

Senator Boyd provided closing remarks. Senator Heath made additional comments.


BILL:	SB09-243
TIME:	02:57:07 PM
MOVED:	Tochtrop
MOTION:	Moved prepared Amendment L.001 (Attachment A). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell
	Scheffel
	Tochtrop
	Heath
	Veiga

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

02:57 PM

Senator Mitchell and Senator Scheffel discussed their positions on the bill.


BILL:	SB09-243
TIME:	02:57:49 PM
MOVED:	Tochtrop
MOTION:	Moved to refer Senate Bill 09-243, as amended, to the Committee on Appropriations. The motion passed on a 4-3 roll call vote.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	No
	Mitchell	No
	Scheffel	No
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 4 NO: 3 EXC: 0 ABS: 0 FINAL ACTION: PASS

03:00 PM -- House Bill 09-1001

Senator Heath presented House Bill 09-1001. The bill provides an income tax credit to firms that create jobs in Colorado. If the jobs are created within an enhanced rural enterprise zone, firms must create at least five jobs and retain them for one year. If the jobs are not being created within an enhanced rural enterprise zone, at least 20 jobs must be created and retained for one year. In order to qualify for the credit, the jobs must bring wages of at least 110 percent of the average wage of the county in which the new jobs are located. Senator Heath distributed prepared Amendment L.035 (Attachment B). Senator Heath discussed his reasons for sponsoring the bill. He stated that the fiscal note does not take job creation into account. He discussed the requirements that need to be met in order to qualify for the income tax credit. He argued that large employers needed to be supported in order to help smaller employers.

03:08 PM

Senator Mitchell discussed Senator Heath's statement that the fiscal note does not account for jobs that are created. Senator Heath explained that the tax credit would only applies to jobs that would not have arisen if not for the legislation. Discussion continued between Senator Mitchell and Senator Heath.

The following individuals testified regarding the bill:

03:13 PM -- Don Elliman, representing the Governor's Office of Economic Development and International Trade, testified in favor of the bill. He stated that the key to the bill is that it limits eligibility for the tax credit to employers who create jobs that would not have been created were it not for the tax credit.

03:17 PM

Mr. Elliman responded to a question from Senator Foster regarding whether the tax credit would have helped with a specific past negotiation. Mr. Elliman noted that the tax credit stops if the employer leaves the state or cuts the jobs. Senator Mitchell made comments regarding extending the tax credit to small businesses. Senator Mitchell also discussed jobs that were created spontaneously rather than as a result of the legislation. Mr. Elliman said that jobs that would have been created regardless of the bill should not be eligible for the tax credit. Discussion continued between Mr. Elliman and Senator Mitchell. Mr. Elliman added that employers who create a minimum of five jobs in rural areas would include some small businesses.

03:24 PM

Senator Veiga stated that she was pleased to see the targeted direction of the bill. Senator Mitchell made additional comments concerning the limited resources available to the state to offer a tax credit. Discussion continued between Senator Veiga and Mr. Elliman.

03:27 PM -- Clarke Becker, representing the Economic Development Council of Colorado, testified in favor of the bill. He discussed the Colorado Economic Leadership Coalition.

03:31 PM -- Tom Clark, representing the Metro Denver Economic Development Corporation, the Metro Denver Chamber of Commerce, and the Colorado Competitive Council (C3), testified in favor of the bill. He discussed the incentives that had been available in the past. He discussed business that Colorado had lost to Chicago, where a tax incentive similar to the one prescribed by the bill exists.

03:37 PM

Mr. Clark responded to questions from Senator Mitchell concerning projected job growth for Colorado. Mr. Clark stated that the crucial concern of the bill was "primary employment," and was directed at employers whose market would be unaffected if it were to locate in a different state. Discussion continued between Mr. Clark and Senator Mitchell. Mr. Clark stated that providing tax credits to companies who do not create new wealth is not economic development.

03:45 PM

Senator Scheffel discussed concerns that the bill would only benefit larger companies. He also addressed the bill's fiscal note. Senator Foster sought clarification regarding the number of jobs that must be created in order to be eligible for the tax credit.

03:47 PM -- Sheryle Hutter, representing the Colorado Developmental Disabilities Council, testified regarding the bill. She stated that the council has a neutral position on the bill and discussed concerns that the bill will not help members of the disabled community. She addressed the possibility of including small businesses in the bill. Senator Foster asked if there were existing tax credits to encourage employers to hire individuals with disabilities, and Ms. Hutter stated that proposed credits that had been put on hold as a result of the budget crisis.

03:49 PM -- Phil Horwitz, representing the Department of Revenue, testified regarding the bill. He addressed Senator Mitchell's comments concerning the government's oversight role and discussed the requirement that limits eligibility for the tax credit to employers who create jobs that would not have been created were it not for the tax credit.

03:52 PM

Senator Heath made closing remarks and discussed the amendment.


BILL:	HB09-1001
TIME:	03:52:38 PM
MOVED:	Heath
MOTION:	Moved prepared Amendment L.035 (Attachment B). The motion passed without objection.
SECONDED:
		VOTE
	Foster
	Harvey
	Mitchell
	Scheffel
	Tochtrop
	Heath
	Veiga

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


BILL:	HB09-1001
TIME:	03:52:48 PM
MOVED:	Heath
MOTION:	Moved to refer House Bill 09-1001, as amended, to the Committee on Appropriations. The motion passed on a 7-0 roll call vote.
SECONDED:
		VOTE
	Foster	Yes
	Harvey	Yes
	Mitchell	Yes
	Scheffel	Yes
	Tochtrop	Yes
	Heath	Yes
	Veiga	Yes

Final YES: 7 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: PASS

03:54 PM

The committee adjourned.