While the 2013 session of Colorado’s Legislature offered a share of both victories and defeats, the sentiment among the state’s business community is that overall, it was a loss.
On one hand lawmakers approved several pro-business bills, including legislation to provide startup incentives, expand Medicaid and protect the small-business health care market.
But on the other hand, they passed laws that give workers greater opportunity for taking unpaid leave and greater freedom to sue their employers through a bill known as the “sue your boss” legislation.
Tony Gagliardi, director of the state chapter of the National Federation of Independent Business, did not mince words when summing up the session.
“I said earlier that I didn’t think this could be as bad as the last session of the Ritter administration,” he said, referring to former Gov. Bill Ritter (2007-2010). “I was wrong.”
Gagliardi said the bill that dealt the biggest blow to business was HB 1336, the sue-your-boss legislation, which erased limits on employee lawsuits. Previously, businesses with fewer than 15 employees were exempt from paying for punitive and compensatory damages. The sue-your-boss bill removed the cap completely.
And that, Gagliardi said, doesn’t bode well for job creation efforts.
“It really puts a target on employers’ backs,” he said. “I represent 7,500 small businesses, and some of them are saying they don’t even want to deal with employees anymore. These kinds of bills are really putting a damper on hiring.”
Lawmakers passed another bill, HB 1222, known as the family leave act, which allows workers to take 24 weeks of unpaid leave, 12 under the federal Family Leave Act and 12 under the state act.
And while it’s rare that workers can afford to take that much unpaid time off, businesses in such a situation would be required not only to give employees the time off but also to keep the positions open and pay for benefits during the leave.
“It was very short-sighted,” he said.
There were, however, some bright spots.
The stop-loss insurance program, which resets caps on reinsurance from $15,000 to $20,000 and collects more data about which companies are using stop-loss insurance, was a good idea, Gagliardi said.
Stop-loss insurance allows companies to pay for employees’ health care costs up to a certain level. After that, stop-loss insurance kicks in. The new law raises the limits, and creates a data source about how much money is being used in the program.
“We need more information about insurance alternatives,” he said. “And while we would have preferred the caps stay at $15,000, the $20,000 is a far cry from the $30,000 initially asked for.”
Consumer advocates at the Colorado Consumer Health Initiative supported the bill, saying it would stabilize the small-group market. The bill bans discrimination based on pre-existing conditions and can’t charge employers more for certain workers who access health care more often.
“It really modernizes stop-loss insurance,” said Serena Woods, director of strategic engagement at CCHI. “And that’s very important for small businesses.”
Woods also said that more Coloradans have access to health care now, thanks to bills that expanded Medicaid to 150,000 more people and aligned state law with the Affordable Care Act to allow parents to keep children on insurance plans longer.
While Woods and Gagliardi were quick to offer their analysis, local reaction is harder to come by. The Colorado Springs Regional Business Alliance postponed comment until finishing its “report card,” which tracked bills it supported. The report card is expected in about two weeks.
However, as the session began, Alliance President/CEO Joe Raso said newly hired lobbyists intended to push a bill that sought to lower the amount of incentives offered under enterprise zone tax credits. Lawmakers passed a bill that did just that.
Enterprise zones were created to encourage business development in economically distressed areas, but audits of the program found widespread problems — including cases in which companies filed for more than $75 million in tax credits in 2010, but hired very few employees.
The law changed the cap to $750,000 in tax credits a business could receive for making improvements inside the zone. The change will save the state an estimated $6.6 million in its first year and $12.7 million the year after that, analysts say.
The Colorado Association of Commerce and Industry, which promotes itself as the state’s Chamber of Commerce, said it successfully managed to amend many bills, including the Family Leave Act, to make them more friendly for businesses. It lobbied against — and won — a bill that would allow employers to check credit histories of prospective hires and kept a series of oil-and-gas industry bills from being approved late in the session.
For its part, CACI blames the lawmakers’ acrimony on the number of controversial non-business bills — gun control, civil unions, election reform and marijuana.
Whatever the reason might be, Gagliardi said the bottom line was the same.
“The message is clear,” he said. “Businesses lost this session.”