Sales tax simplification, increase in personal property tax exemption highlight accomplishments for small business
From the 2019-2020 session
Stopped Paid Family Leave Mandate
NFIB Colorado and its coalition partners blocked efforts to impose a one-size-fits-all law on small businesses by requiring them, regardless of employee size, to provide up to 12 weeks paid leave to employees. It would have included employers who already offer the benefit. As a result of coalition efforts, the bill was amended to a study to be addressed during the summer interim.
Won Law on Juvenile Enterprises
NFIB helped lead the efforts to prohibit local governments from requiring business licenses from children operating lemon aid stands or similar type enterprises during a limited number of days and as long as they did not interfere with other local businesses. The bill was brought as a result of two young children being cited by local police for operating a lemon aid stand in front of their house.
Secured Tax-Simplification Law
NFIB and its coalition partners successfully pushed for passage of Senate Bill 19-006, which requires the Office of Information Technology to conduct a sourcing method for the development of an electronic sales and use tax simplification system and include the input of stakeholders regarding the scope of work. The bill also requires the Department of Revenue to establish the implementation of the system. This legislation will lead to the simplification of Colorado’s complicated sales and use tax collection and remittance process.
From the 2017-2018 session
Won Sales Tax Simplification
House Bill 18-1022 requires the Department of Revenue to issue requests for information (RFI) for electronic sales and use tax simplification systems that state and local governments could choose to use for administrative simplification. Having more than 740 taxing authorities in Colorado puts the state in the top five most complicated for collection and remittance processes in the United States. The RFI requests information regarding a single point of collection for sales and use tax and adoption of uniform definitions of what is taxed. HB 1022 passed both Houses with only one No vote.
Secured Continuation of the Cost Benefit Analysis (CBA) Requirement
House Bill 18-1237 requires a CBA be completed by the Department of Regulatory Agencies at the request of any person when a proposed regulation might have a financial impact on business. Also requires an annual report of the number of CBAs requested and performed. A CBA assures any regulation implantation is both efficient and cost-effective.
Stopped Premium Increases on Health Insurance
A Senate committee killed House Bill 1392, which would have used a reinsurance pool to stabilize a health insurance market that some believe is a detriment to those in rural Colorado. It is not an unknown fact that health insurance rates are higher in rural parts of the state. This is due to the use of geographical rating used in the determination of premiums. While the need to stabilize and make the health insurance market more affordable is obvious, the solution is not to raise everyone else’s rates to subsidize select areas of the State. HB 1392 would have placed an assessment on every fully- and self-insured plan issued in Colorado. NFIB has committed to those on both sides of this issue to work together in developing a possible solution.
Boosted Personal Property Tax Exemption
Because of negotiations to get a transportation funding bill passed, Colorado small-business owners ended up with a Christmas-in-May gift of an increased tax exemption. Business owners will now be allowed a statewide tax credit that will refund personal property taxes paid by businesses to local governments on the first $18,000 worth of equipment that they own. The amount of the current exemption is $7,300.
Won Sales and Use Tax Reform
NFIB lobbied extensively for the passage of House Bill 1216, which creates a task force to study streamlining the myriad sales and use taxes in the state. Colorado is in the top four states in the country known for having the most complicated and inefficient sales tax collection and remittance process. Currently, Colorado maintains over 700 taxing districts. The Sales and Use Tax Simplification Task Force, which will be comprised of business owners from both small and large business organizations, legislative members, and state and local sales and use tax experts, along with local municipal and county governments., will examine issues such as uniform definitions of taxable items and a single point of collect and remittance of sales and use taxes collected by state, local, and home-rule governments.
Secured Clarification of Dispute Resolution Process
NFIB pushed for passage of Senate Bill 112, which clarified the General Assembly’s intent when it enacted a dispute resolution process in 1985 to address a situation when a taxpayer paid sales and use tax to one local government when it should have instead paid that disputed amount to a different local government. A recent court case applied the statute of limitations to this dispute resolution process, resulting in the taxpayer having to pay the disputed amount twice to two different local governments.
Preserved an Employer’s Right to Know
For the second session in a row, NFIB/Colorado defeated an attempt to prohibit an employer from inquiring about an applicant’s criminal history on the initial employment application. House Bill 1305 would have delayed the hiring process for small-business owners because they would have had to wait until an official job interview or a job offer to inquire about an applicant’s criminal history. Popularly called ‘Ban the Box’ bills, NFIB pointed out in this guest editorial sent to the Colorado media that these well-intended efforts to help ex-convicts wind up harming more people than they help.
Defeated State-Run Retirement Plans
House Bill 1290, which was vigorously opposed by NFIB/Colorado, would have invited state government into the business of managing retirement plans of private employees. Under the proposed legislation, which passed the House but died in the Senate, all businesses would be required to make a state-run retirement plan available to employees unless they already offered one, and employees would be automatically enrolled in the program unless they opted out. In addition to pointing out the abundant and private ways for everyone to save retirement, NFIB/Colorado pressed the point that HB 1290 would have created new fiduciary liabilities for small businesses.
From the 2015-2016 session.
Won Due Process for Small Businesses Facing State Audits
NFIB lobbied extensively for the successful passage of Senate Bill 16-036, which allows small-business owners to have access to due process when appealing a sales tax audit opinion by the Department of Revenue. Currently, should one desire to appeal an audit decision to the district court level, there is a requirement in which the total amount of the DOR’s audit decision including penalties and interest be deposited in escrow with the director of the Department of Revenue, or a bond be posted for twice the amount owed to DOR. SB 036 would remove all the requirements of deposit for appeal at the district court level. The effect of SB 036 will be that businesses will no longer be forced into settlements pertaining to a sales tax audit because the business owner cannot afford to post the amount owed upfront or the expense to post a bond for twice the amount owed. Senate Bill 036 passed both houses of the Legislature unanimously.
Secured Closer Scrutiny of Big Business Tax Breaks
NFIB supported the passage of Senate Bill 203, directing the Office of the State Auditor to conduct evaluations of all state tax expenditures that are tax-related provisions where tax revenue is reduced. Examples are deductions, exemptions, credits for job creation, or special tax rates for certain types of industries. It is imperative the more than $4 billion dollars of state revenues being used for these tax exemptions and credits be measured for their effectiveness. If businesses receiving preferential treatment are indeed creating the jobs that warrant it, then let’s continue them. But we don’t know that until we find out. The majority of small-business owners who create almost all the new jobs in Colorado receive no tax breaks. Big businesses and large corporations are the almost exclusive beneficiaries of them.
Killed Hospital Provider Fee Shift
In 2016, NFIB/Colorado conducted a member survey asking if the Hospital Provider Fee should be moved out from under the requirements of TABOR for the purpose of using collected funds for other purposes, such as transportation and education. More than 64 percent of those responding opposed making any changes to the program. Hospital provider fees are used to increase reimbursement to hospitals for providing care under the state medical assistance program. NFIB targeted the Senate Finance Committee for the thrust of its lobbying efforts and succeeded in persuading lawmakers to kill the fee-shift idea. The hospital provider fee program will remain subject to the rules and requirements of TABOR.
Defeated Ban the Box
Stopping the passage of House Bill 1388 was another key victory for NFIB/Colorado. HB 1388 would have prohibited any employer from making an inquiry about a job candidate’s arrests or criminal convictions until the candidate has been offered an interview or a conditional offer of employment—popularly called ‘Ban The Box.’ In a 2014 survey, NFIB members rejected this idea by 90 percent. HB 1388 would also have required employers to maintain the application for a period of nine months after its submission to the employer. This requirement would have been contrary to many federal laws that apply to retention of applications and resumes under Title VII, the Americans with Disabilities Act, and the Age Discrimination in Employment Act (ADEA).
Eliminated State Work Status Form
NFIB worked with Rep. Brian DelGrosso, an NFIB-member, small-business owner, to successfully pass House Bill 1114, which removes the requirement for employers in the state to file an Affirmation of Legal Work Status form with the Colorado Division of Labor and Employment after completing and filing an I-9 form with the federal government. All the affirmation form does is prove to the state that you filed the required form with the feds. The state form was an absolute waste of time for all parties involved, being as it was an exact duplicate of questions asked on the Federal I-9 form.
Defeated Four Minimum-Wage Bills
NFIB/Colorado succeeded in reminding legislators that the minimum wage is an entry-level wage, earned primarily by teens and young adults starting out on their work lives, and that increasing it only eliminates opportunities to enter the workforce. Of the four, House Concurrent Resolution 1001 was the most threatening of passage. It would have raised the state’s minimum-wage rate to $9.50 in 2017, to $10.50 in 2018, to $11.50 in 2019, to $12.50 in 2020, and in 2021 would have adjusted all future rates to rises in the Consumer Price Index. Thanks to NFIB’s extensive lobbying, the issue is dead for the year.
Stopped Paid Sick Leave Mandate
House Bill 1258 would have created a family and medical leave insurance program to have been run by the state and financed by a percentage of an employee’s salary to be determined by the state at a future date. This unworkable program would have required employers to collect premiums from all employees and forward them to the state treasurer. This legislation would have been an unfunded mandate on small business owners. This legislation is different in it only applies to leave under Colorado’s FMLA. This is not to be confused with Paid Sick Leave. HB 1258 did not make it out of its house origin.
Killed Union-Stuffed Pay Equity Commission
Five years ago, the Legislature created a Pay Equity Commission to come up with a voluntary best-practices criteria for businesses to align the salaries of their employees. As NFIB warned at the time, no bureaucracy can resist the temptation to stray from its original purpose and to stuff itself with like-minded commissioners, and the Pay Equity Commission proved no different, becoming a hive of big labor and big government supporters who started threatening businesses with adopt-our-recommendations-or-else policies. The law creating the Pay Equity Commission is set to expire this year. NFIB lobbied hard to let it die a justifiable death. A bill to allow it to continue without a future sunset clause was defeated.
Require Audit of the Colorado Health Exchange
NFIB supported and assisted with the passage of SB 019 which required the State Auditor’s office to conduct a full audit of the Colorado Health Exchange. Due to lower enrollments and high operational cost the Exchange has exhausted almost all Federal grant money. Health Exchange personnel have been reluctant to submit to a full financial audit and appeared to mislead legislators they had successfully passed several audits by the Federal Government. It was found these Federal audits were mostly self-reporting audits. NFIB felt in order to maintain the integrity and confidence in the Exchange a full audit must be completed. The bill passed with bipartisan support in both Houses and was signed by the Governor.
Financial Disclosures on Ballot measures
NFIB ,as part of a statewide coalition, passed HB 1057 which will require citizens signing a petition to place a ballot proposal on the Ballot for voter approval be given a financial disclosure prepared by legislative council indicating the fiscal impact to the State of Colorado should the measure pass. Often the financial impact to Colorado is not known until the measure has been passed and implemented. Often the business community will share an unfair level of the financial burden. This will assist the citizen signing the petition in determining the cost-benefit of the proposed measure.
