Dan Pilcher

CACI Senior Vice President

& Chief Operating Officer

Phone: 303.866.9600

E-Mail: dpilcher@cochamber.com

Friday, March 20, 2009

House Sends UI Lock-Out Bill to the Senate as Business & Labor Gird for Round Two

HB-1170, the Unemployment Insurance (UI) lock-out bill, cleared the House this week and has gone to the Senate.  The House gave preliminary approval by voice vote on Second Reading on Tuesday following spirited debate, followed by the final—and recorded vote—on Third Reading on Thursday.

One lone Democrat—Representative Jim Riesberg of Greeley—joined the minority Republicans in voting against the bill on Third Reading.

Rep. Jim Riesberg (D-Greeley)

CACI regards the Third Reading vote as a KEY VOTE, which means that it will be an important factor when CACI analyzes an incumbent’s voting record to decide next year whether or not to endorse the incumbent for re-election and then provide financial support from CACI’s political action committees.

As of this morning, the bill had not been yet assigned to a Senate Committee.

CACI continues to lobby against the bill, which was sponsored in the House by Representative Edward Casso (D-Commerce City).  The Senate sponsor is Senator Lois Tochtrop (D-Thornton).  The bill’s primary advocate is the United Food and Commercial Workers (UFCW) Union Local Number Seven.

The bill was not amended on Second Reading and, thus, the amendments that were added to the introduced bill last week by the House Business Affairs and Labor Committee remain.  Committee Chair Joe Rice (D-Littleton) sponsored an amendment that aims to deny UI benefits when one union initiates a “whipsaw” strike against one employer of a multi-employer bargaining unit.  But the amendment also would grant UI benefits to the workers if the employer launched the lockout.  Another amendment delays the effective date until 2010 so that the bill, if it becomes law, will not affect the May contract negotiations between Safeway and King Soopers, on the one hand, and the UFCW Local Seven, on the other.

CACI has opposed similar bills in past sessions because CACI believes that UI benefits should be administered according to the purpose of the UI system, which is an employer-funded but government-administered system.  To defeat the bill, CACI continues to work with other business organizations including the following CACI members: Colorado Retail Council, Rocky Mountain Food Industry Association, Associated General Contractors and Associated Builders and Contractors.

SB-37, a Bill to Change Amount Employers Pay to Two Workers’ Compensation Funds, Passes Senate Appropriations Committee

This morning, the Senate Appropriations Committee endorsed SB-37, which is sponsored by Senator Mike Kopp (R-Littleton).  The bill now goes to the Senate Floor for Second Reading.

As introduced, SB-37 would have ended the tax surcharge that employers have paid on their workers’ compensation insurance premiums to two workers’ compensation funds: the Subsequent Injury Fund and the Major Medical Insurance Fund.  These funds insure employers against liability for personal injury or death to their workers.

Governor Ritter proposed taking $96 million from these two funds to help balance the state’s budget for this and the next fiscal years. In 2002, the legislature raided the funds to help balance the state budget following the 2001 recession.

The Senate Veterans and Military Affairs Committee, however, had unanimously adopted a “strike below” amendment to terminate the requirement that the funds be actuarially sound and instead operate on a “cash in, cash out,” basis so that the funds can pay next year’s payments to injured workers.  This would reduce the amount of the tax surcharge that businesses pay to the funds.

This week, CACI President Chuck Berry sent a letter to each member of the Senate Appropriations Committee, asking them to approve the bill:

On behalf of the Board of Directors and the members of the Colorado Association of Commerce & Industry (CACI), I want to express our support for Senate Bill 37, “Concerning the Funding for Certain Workers’ Compensation Funds.”  This is an important bill for Colorado employers, and CACI encourages your support of this legislation.

Employers are currently required to pay a workers’ compensation insurance premium surcharge.  That revenue is deposited in the Major Medical Insurance Fund and the Subsequent Injury Fund to pay for benefits to individuals who are injured or disabled on the job.  As these employer dollars accumulate, the General Assembly unfortunately has come to rely on these two funds as one way to help balance the state budget in times of declining revenues.  Consequently, employers have paid three times the amount owed for injured workers’ claims based on the continued transfers of these funds to the General Fund. 

As amended by the Senate State Affairs Committee, the bill now provides that the amount of the surcharge tax will be determined on an annual basis by the Colorado Department of Labor and Employment (CDLE).  The bill allows the CDLE Executive Director to anticipate the amount of the claims so that the revenue from the surcharge will be closely equal to the amount of the benefits paid.   

CACI supports this bill because it implements a fair and deliberative approach in using the employer surcharge revenue for its special purpose intent: to help those who are injured or disabled on the job.  The bill ensures that employer dollars will only be used for the payment of these claims, and it avoids the accumulation and potential transfer of those dollars to the General Fund to be used for other purposes.  On behalf of Colorado employers, we ask for your support of this important legislation.

Loren Furman, CACI Vice President of Governmental Affairs, spoke in support of the original version of SB-37 before the Senate Veterans and Military Affairs Committee.

Senate Committee Votes Unanimously to Kill HB-1193, the Truckers’ Bill

Yesterday, the Senate Transportation Committee voted unanimously to kill HB-1193, which had been advocated by the Colorado Motor Carrier Association, which last year unsuccessfully pushed a similar bill.  HB-1193 would ostensibly have prohibited “the shifting of financial responsibility for negligence in motor carrier agreements,” according to the bill’s title.

The bill was sponsored by Representative Buffie McFadyen (D-Pueblo West), who chairs the House Transportation and Energy Committee.  The Senate sponsor was Senator Lois Tochtrop (D-Thornton).  

CACI Contract Lobbyist Larry Hudson testified Before the Committee against the bill, and following is an edited summary of his remarks:

Several CACI members have raised concerns about this bill specifically as it would relate to both access and shipping agreements.  These members have shipping agreements that contain a broad range of indemnity provisions that were either negotiated between the parties or whose terms were clearly understood when entering the contracts.

The provisions range from narrow indemnification clauses to broad indemnification based on each party's negligence under the scope and performance of the contract.  These companies believe that they need to continue to be free to tailor these indemnity provisions to the purposes of their contracts.  HB-1193 would restrict businesses in general--and several CACI members in particular--from agreeing on certain indemnity provisions as regards the negligence of the contracting parties.

Finally, HB-1193 would place the Colorado on a "slippery slope" with the State Government interfering with the rights of businesses to determine, through mutual negotiation and understanding, what can and cannot be contained in certain contracts.

Loren Furman, CACI Vice President of Governmental Affairs, spoke against the bill before the House Judiciary Committee, saying that CACI opposed HB-1193 because the bill would dictate how businesses should contract with each other, thus creating a precedent for other contracts and indemnity agreements to be nullified.

Opponents, besides CACI, included the Colorado Retail Council and the Colorado Petroleum Association, both of which are CACI members, as well as other business organizations.

CACI-Opposed SB-159, Increasing the Age to 30 for Dependents Health-Care Coverage, Dies in House Committee

By a ten-to-one vote, the House Business Affairs and Labor Committee voted at the sponsors’ request Wednesday to kill SB-159, which would have required that health-insurance carriers increase the age for dependent coverage to age 30 from the present 25 for a worker’s unmarried dependent children even if they are not students.

The only Democrat to vote against killing the bill was Representative John Soper (D-Thornton).

CACI Contract Lobbyist Donnah Moody testified against the bill, saying CACI “strongly opposed” the bill because it would increase costs for employers and have other negative consequences for the business community.  In addition, the Fiscal Note for the bill estimated that the cost to state government for its workers who would choose to put their dependents under their health-insurance coverage was pegged at $3.7 million.  Consequently, Donnah said, the cost for the private sector could be substantial.

SB-159 was approved by the Senate on a 21-to-12 party-line Third Reading vote.  The bill was sponsored by Senator Paula Sandoval (D-Denver).

In the House, the bill was co-sponsored by Representative Anne McGihon (D-Denver) and Representative Debbie Benefield (D-Arvada).  This week, Representative McGihon announced that she’s resigning from her legislative seat, effective March 27th, because her new employer will require her to often be away from Colorado.

In opposing the bill, CACI and CACI-members Anthem Blue Cross Blue Shield, Rocky Mountain Health Plans, Cigna HealthCare and the Colorado Association of Health Plans were part of a larger coalition of businesses and business organizations that also included the Colorado Municipal League, which represents cities and opposed the proposal.  The business lobbyists argued that healthy young people can obtain affordable health-care insurance.  Those with pre-existing conditions, if they were covered under this bill, would have skewed the pool of insured, which would have increased premium costs to employers and their workers.

CACI has historically opposed bills that would mandate additional coverage on employer-provided health-care benefits because it drives up the cost of the insurance premiums for both companies and workers. 

Proposal to Use Hospital Fees to Leverage Federal Dollars and Provide Health Insurance for 100,000 Coloradans Heads to the House Floor

This morning, the House Appropriations Committee amended HB-1293, the “Colorado Healthcare Affordability Act,” and sent it to the House Floor for Second Reading.

Governor’s Bill Ritter’s proposal, HB-1293, would impose $600 million in fees on hospitals that could be used to obtain matching Federal funds to provide health-insurance to 100,000 residents.

CACI President Chuck Berry sent a letter to Governor Ritter about the bill, asking for “clear assurances . . . that the provider fee proposal will not add to the cost shift to Colorado businesses.”

The House co-sponsors are Representative Jim Riesberg (D-Greeley) and Representative Mark Ferrandino (D-Denver).  The bill was heard last Friday by the House Health and Human Services Committee, which approved it.  For news coverage of the bill, visit:

http://www.denverpost.com/legislature/ci_11909922

http://www.denverpost.com/editorials/ci_11900599

Bill to Create the “Colorado Health Care Authority” to Develop a Single-Payer Health-Care System Clears First House Committee

HB-1273 was approved late Wednesday on a party-line vote by the House Business Affairs and Labor Committee following a lengthy hearing.  The bill is sponsored by Representative John Kefalas (D-Fort Collins) and co-sponsored by 15 fellow House Democrats.  The next stop for the bill is the House Appropriations Committee.

Democratic Governor Bill Ritter, however, opposes the bill, according to Joan Henneberry, Executive Director of the Colorado Department of Health Care Policy and Financing, who spoke to the Committee.

HB-1273 would create the “Colorado Health Care Authority” with the power to develop a state government health-care system and administer and pay for health-care services.  The bill is called “The Colorado Guaranteed Health Care Act” and seeks “to establish the principle of universal health care coverage.”  This bill would be the first building-block in creating a government-run “single-payer” health-care system, the most well-known to Americans being the Canadian system. 

CACI strongly opposes the bill.  For more on the bill, click on:

http://www.denverpost.com/search/ci_11945054

http://www.denverpost.com/search/ci_11942369

Information on Legislation . . .

CACI members with questions about legislation that CACI opposes or supports should contact Chuck Berry, CACI President, at 303.866.9652 or e-mail him at cberry@COchamber.com

Questions pertaining to health-care bills should be directed to Ralph Pollock, Chair of the CACI HealthCare Council, at 303.866.9657 or via e-mail at ralph@apaccess.com