2013 legislative preview

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HBA preps to oppose two possible bills

It’s hard to know yet exactly what the Legislature will discuss this session that might engage the Colorado Springs Housing and Building Association. But William Mutch, HBA director of government affairs and public policy, sees some issues that the organization will oppose.

Construction defects: In 2008, the Goodyear v. Holmes ruling by the Colorado Supreme Court found that homeowners were only entitled to interest reimbursement for money they spent to fix a construction defect from the point at which the defect was repaired or the property was replaced.

In 2009, SB246 would have changed the law so homeowners could receive interest payments from the time they purchased the home. Legislators dropped the bill.

Mutch said HBA would oppose it, if the bill comes up again, because it would create much greater hardship and expense for builders, especially those working in the multi-family housing space. The market for building condominiums is soft in Colorado Springs, but Mutch said it’s a hot-button issue in the Denver and Boulder areas, where there is demand for multi-family properties near public transit.

“You always hope you don’t see something,” Mutch said. “But there is already discussion about this.”

Oil and gas setbacks: The current residential setback from an active gas or oil well is about 200 feet. But there is a push to increase it to 1,000 feet, which could come up in the Legislature.

“That would put a lot of land out of reach for real estate development,” Mutch said.

While drilling, it’s unlikely residential developers would get that close anyway. But once a well is capped and active, it has a much smaller footprint and is relatively unobtrusive, Mutch said.

“Our position has been about 350 feet,” he said.

— Amanda H. Miller

Real estate leaders watching sensitive issues

The real estate industry is prepared to be on the defensive during the 2013 legislative session.

“Last year we were keen on trying to pass bills,” said Clarissa Arellano, Pikes Peak Association of Realtors government affairs director. “But any time you have one-party control, whether it’s Republicans or Democrats, you will have to fight more things.”

She said she’s not sure yet what will come up, but she’s monitoring several issues.

On-bill financing: Arellano said some legislators have discussed requiring lenders to get and include monthly utility costs in their mortgage equations.

“We don’t think that’s appropriate,” Arellano said. “If someone wants to find out the cost of utilities before they buy, that should be up to them.”

Tax on services: Arellano said adding taxes to services like those of attorneys and doctors would not do anyone any favors, and PPAR would oppose any such legislation.

Transfer tax: Some mountain communities have 1- to 2-percent real estate transfer taxes designed to fund cultural investment in communities with a high percentage of vacation-home owners. Arellano said the PPAR would oppose any legislation opening doors for other communities to impose transfer taxes because it would increase the burden on sellers and buyers.

“It’s hard to think about having to come to the table with another couple thousand dollars to pay a tax,” Arellano said.

Rent control: Legislators have discussed allowing communities to require developers to include a certain percentage of affordable income-restricted rentals in projects. Communities like Boulder have tried previously to bring up such bills, but Arellano said the legislation wouldn’t make as much sense in Colorado Springs and the PPAR would oppose it.

“We’ve had pretty good sessions the last couple years,” Arellano said. “And we’re optimistic a lot of the bills we’re preparing to fight won’t come up. We’ll just have to see.”

— Amanda H. Miller

Lawmakers will take on health care policy

Health care policy will take a central role in the General Assembly this year, as Colorado attempts to make its laws match federal regulations under the Patient Protection and Affordable Care Act, popularly known as ObamaCare.

The state’s Division of Insurance has created a spreadsheet of urgent items that must be addressed for Colorado’s insurance laws to comply with new federal mandates going into effect in 2014.

The big one: The state currently allows underwriting in the individual market, and starting next year the ACA says everyone gets covered, regardless of condition.

“This is going to be a big bill, sort of an omnibus bill, addressing all the changes that need to be made by 2014,” said DeDe DePercin, executive director of the Colorado Consumer Health Initiative. “They’re working to get everyone on board — insurance companies, consumers, brokers, hospitals — so it’s not very controversial. But it is going to be one of those technical, wonky bills.”

Current law for small-group insurance includes smoking and tobacco use provisions in direct conflict with federal requirements, the Division of Insurance says. That needs to change.

“Right now, the feds aren’t really going after states that are complying, but whose statutes don’t match federal law,” DePercin said. “That’s going to change soon, and we need to be in compliance.”

Another big change: Colorado law says parents can keep students on their insurance plans up until age 25. Federal law says the limit is 26, and the child doesn’t have to be a student.

“So, many of these changes, insurance companies are already complying with,” DePercin said. “But we need to have it codified.”

This is the year to do it, she says, and there’s pent-up demand from the Division of Insurance.

“They’ve been working on this for a long time, but it’s not been the right time to introduce it,” she said. “With the change in the Legislature, the power change, now is the right time.”

Legislators also must create laws to enable the Colorado Health Benefits Exchange to start taking applications in October. The big one will be the financing mechanism. Under Senate Bill 200, the exchanges — essentially virtual markets that allow insurance companies to compete for newly eligible consumers — must be self-funded by the time federal money runs out.

There are options to pay for it — advertising, user fees and possible licenses to other states that haven’t yet set up their exchanges.

But exchange organizers want to use money from Cover Colorado, the state’s high-risk insurance plan. That plan, which will be unnecessary in 2014, is funded by a surcharge on insurance premiums and money from the state’s unclaimed property fund. The group hopes to use some of that money in the first years of the exchange.

Finally, Gov. John Hickenlooper expanded Medicaid to 133 percent of the federal poverty level (for example, a family of four making around $30,000). Although the governor promised no General Fund money would be used — even after the federal government stops paying for it — many issues are unclear.

“This is bound to be controversial,” DePercin said.

— Amy Gillentine

Regional Business Alliance focuses on workforce, enterprise zones and marijuana

Making sure the Legislature does no harm to local, small and existing businesses — that’s the key priority for the Colorado Springs Regional Business Alliance.

“That’s pretty broad,” said CEO Joe Raso. “But it’s also important. We’re going to be watching to make sure there aren’t any bills that will make it more costly or more cumbersome to do business in Colorado.”

The Business Alliance, in the process of hiring a lobbyist in Denver, is also watching to see what laws pass related to recreational marijuana. The alliance came out against Amendment 64, which passed with convincing statewide support in November and was approved by a mere 10 votes in El Paso County.

“We are concerned about the perception about the state,” he said. “We’re concerned about what it means for businesses and the workforce. We’re going to keep a close eye on the bills that come from the task force.”

Gov. John Hickenlooper created a task force to make recommendations on how to monitor and control recreational marijuana, how to educate children against using it and whether to restrict use to state residents only.

Otherwise, the Business Alliance has concerns about changes restricting enterprise zone designation, and about workforce development.

“We want to make sure that businesses are getting the well-educated, affordable workforce they need. In the past, they’ve focused on the supply side, working with K-12 education. We need to focus on the demand side, and make sure we’re educating the workforce that’s actually needed,” Raso said. “And we want to make sure the enterprise tax credits stay in place, that changes don’t damage where we are right now.”

Transportation funding also makes the list of the CSRBA’s priorities, he said.

“We’re doing a lot to help ourselves,” he said, “and paying for it out of our own pockets through PPRTA (Pikes Peak Regional Transportation Authority). We’re paying millions ourselves. We need to make sure we’re getting our share of the state transportation funds for things like the interchanges at I-25 and Cimarron, and I-25 and Fillmore.”

While he doesn’t anticipate bills about the state’s aerospace and defense industries, Raso said the group plans to continue promoting the industries as beneficial to the entire state — not just Colorado Springs.

“These really are state assets,” he said. “And we need to see a willingness for the state to work with us as we approach Congress and the DoD and others — we need to make sure everyone understands what’s at stake.”

— Amy Gillentine