| CBA members,
The historically “purple” state of Colorado no longer exists. Following the General Election in November 2022, we experienced a historic wave of blue. That blue wave has now completed its legislative session bold policy agenda.
Throughout the session we witnessed a conflict between the progressive agenda and moderate legislators. Legislators emphasized advocacy groups over businesses and organizations that create jobs and generate economic wealth for the state. There was a rallying cry from legislators that “we are here to do the people’s work,” in complete isolation of the impact to business, industry, and future economic development. For example, in one hearing a legislator concluded her remarks with, we must listen to business and the opposition, then we must move forward and do the peoples’ work.
With respect to policy and law, the legislature prioritized renters over property owners with one legislator exclaiming, “we have not done enough for renters.” The legislature shifted liability from the consumer to the business and responsibility from the employee to the employer.
For banking-specific legislation, the Colorado Bankers Association continues its success at defeating or significantly amending harmful bank specific legislation. Early in the session, we defeated two ESG bills targeting the financial services industry. After four years of protracted negotiations with the Secretary of State’s office on notary rules, we were successful in adding interpreter language to the statutes authorizing the use of impartial interpreters during the notarial act.
A consumer lending bill intended to target out-of-state state-chartered banks, fintechs, and payday lenders was introduced late in the session. The bill had strong support from the Office of Attorney General. The bill also required Colorado to opt-out of DIDMCA. Congress authorized the Depositary Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) to establish parity between national and state-chartered banks by allowing state banks to export any interest rate lawful in their home or host state to other states, even if the usury cap in the other states is lower, as national banks are authorized to export interest rates under Section 85 of the National Bank Act. DIDMCA allows the states to opt out. Until HB23-1229, the only state to opt-out has been Iowa. We amended the consumer lending legislation to remove two sections of the bill regarding consumer loans with interest rates over 12%. These two sections would have had a detrimental impact for all banks, state-chartered as well as national banks. The DIDMCA opt-out remained in the bill and the proponents were never interested in considering eliminating the DIDMCA opt-out. The bill was further amended to remove credit cards from the DIDMCA opt-out clause.
In collaboration with the business coalition, we were successful in amending legislation that would have been harmful to business. HB23-1192 proposed significant changes to the Colorado Consumer Protection Act (CCPA) which would have increased the likelihood of frivolous litigation and make it easier for consumers to sue businesses under CCPA. During the Senate Judiciary Hearing a trial lawyer testified if the bill passed as written, he would make enough money to send his grandchildren and great-grandchildren to college. CBA issued a Call to Action on this bill. The Call to Action was effective! After the bill languished for weeks on the Senate Judiciary calendar for action, Section 1 of the bill addressing CCPA was amended out of the bill.
A second anti-business bill was defeated in the last week of the session; HB23-1078 Dependent Unemployment Benefits was defeated during Senate committee hearing. This bill proposed to provide a $35 per week benefit per minor child to persons receiving unemployment benefits. CBA testified in opposition to this bill in the House and Senate. The state’s Unemployment Insurance Trust Fund (UITF) is insolvent. During the pandemic the Trust Fund incurred $1 billion in debt from the influx of workers losing jobs. Last year, SB22-234 restored $600 million to the UITF. The fund does not receive support from the state budget; every employer pays into the UITF for workers that lose employment through no fault of their own. This is not the time to consider new programs or to implement additional burdens on the Trust Fund. The defeat of this bill is a win for business.
The most progressive agenda items we worked with the business community to oppose were numerous bills providing a bold and brash set of rights to renters with a total disregard for property owners. The legislation included rent control, evictions allowed only with just cause including at the end of the rental contract, and new terms and rights for renters in rental agreements. Fortunately, rent control was defeated in senate committee and just cause eviction died because it ran out of time on the legislative calendar. SB23-184 Rights of Tenants received significant media attention while making its way through the process. As introduced, the bill was not workable or reasonable. We worked with a larger coalition to achieve amendments to make the bill better, but the advocates were only willing to compromise so far. Whereas the industry standard for income calculation to rent is 3x the income to rent; the bill only requires a 2x income threshold. A property owner can request 2 months security deposit but no more. Finally, working with Colorado Housing Finance Authority (CHFA), renters will have to comply with state and federal housing laws for Low Income Tax Credit housing. This bill is indicative of the work we did all session trying to take unreasonable legislation, seeking compromise to make it more workable for business.
Interestingly, legislators couched the renter rights agenda as part of the affordable housing legislative plan. There were several good affordable housing bills that CBA supported. HB1189 provides an employer tax credit for assistance to employees for making a home purchase and HB1184 provides a property tax exemption for property acquired by nonprofit housing providers. SB1, the first bill of the session, mandates that unused state-owned real property can be used to develop housing projects in the Public-Private Collaboration Unit in the Department of Personnel and Administration.
There were two significant employee bills this session, pay equity and workplace harassment. We opposed both pieces of legislation. Pay Equity was first introduced in 2019 and the business community requested changes to the law to make implementation less confusing. Debate on this bill was long and heated. The bill sponsors were unwilling to compromise or to consider amendments they felt undermined their goals for the legislation. In the Senate floor debate, one sponsor admitted we heard business concerns, we chose not to listen to their recommendations. The pay equity bill provides minimal relief for business while requiring additional reporting and documentation requirements. Last legislative session, rumors abound regarding a workplace harassment bill. The bill never materialized. This year the legislation lived up to its rumored reputation. This legislation lowers the threshold for workplace harassment. The legislation provides a new definition of harassment that does not include severe or pervasive to constitute discriminatory or unfair practice. To protect employers, when determining harassment, courts would consider the totality of circumstance including whether there was a power imbalance between the alleged victim and alleged accused and whether the act involved use of slurs, humiliation, or stereotypes about protected classes. The bill states that petty slights, minor annoyances, and lack of manners do not constitute harassment. |
