New legislation affecting nonprofit organizations in Colorado

By Lisa Cirincione
JVA Communications Senior Resource Development Associate/Researcher

Mark Turner, Manager of Public Policy at the Colorado Nonprofit Association, discussed new laws on June 15, 2009, at the Association’s office that nonprofits should be aware of and the implications of those laws on how nonprofits need to operate.

cnaThe Colorado Nonprofit Association does a great deal of advocacy work on behalf of nonprofit organizations; it represents 1,300 members throughout Colorado. It focuses on issues that have a substantial impact on the nonprofit sector, but it does not look at specific issue areas because of the breadth of members’ fields.

The Association strives to engage nonprofits and educate them about legislation and regulations. During the legislative session, the Association hosts monthly meetings at the state capital to inform the public about the issues that it is working on. Members also have access to professional development programs related to public policy, and the Association maintains a tracking sheet of bills that will be of interest to nonprofit organizations. This was a very busy legislative session with many positive changes.

The Colorado Legislature cut the state budget in 2008–09 by $600 million and cut an additional $800 million for 2009–10. However, the shortfall will continue and the Legislature projects that an additional $150 million to $300 million will need to be cut from next year’s budget. On June 22, the next revenue forecast will further define how much will need to be cut from next year’s budget. 2010 will be a critical year because Referendum C expires and the state will return to the TABOR limits.The primary bills that passed with the Association’s support included:

•    House Bill (HB) 09–1088 Certify Nonprofits as Local Public Procurement Units — Allows any 501(c)(3) nonprofit that receives government funding (local, state or federal) to contract with vendors to sell in volume. Rules related to the process for nonprofits to participate in this program will be developed this summer.
•    HB 09–1248 Business Entities Regulation — Creates requirements about how nonprofits can act without a board meeting. Previously, no action could go forward without a vote (yes or no) or affirmative abstention by every board member. HB 09–1089 changed this requirement. Now, if a board member does not vote by a set deadline, it would be noted as an abstention and the action could go forward if it received the requisite number of votes. This change went into effect in May 2009.
•    HB 09–1293 Medicaid Hospital Provider Fee — Allows the state to charge hospitals that provide Medicaid services a fee that can be used toward the federal government’s required match. It increased income eligibility limits for Medicaid and CHP.
•    HB 09–1064 Poverty Task Force — Creates a five-year legislative committee to assess policies on economic opportunity and reduce poverty, and creates a comprehensive plan to cut poverty in half by 2019. Subcommittees of stakeholders that work directly with low-income Coloradans will work with the task force.
•    HB 09–1012 Incentives Wellness and Prevention Programs — Allows insurance companies to offer incentives for voluntary participation in wellness/prevention programs. Incentives can include discounts/rebates and lower co-payments/deductible/coinsurance amounts.
•    Senate Joint Resolution (SJR) 09–044 Interim Commission Study Fiscal Stability — Creates an interim commission to study ways to promote the state’s fiscal stability. The commission will study higher education, transportation, health-care access, K–12 education, state assets and a rainy day fund. The strategic plan will be complete by November 2009.
The Association did not take a position on the following bills that became law during the last legislative session:
•    Senate Bill (SB) 09–228 Flexibility to Use State Revenue — Allows the General Fund appropriation limit to grow by 5 percent, if personal income grew more than 5 percent. It will take effect the first year that the 5 percent limit is reached. The money will be spent as follows: 2 percent toward transportation; .5 percent for capital construction (first two years, then 1 percent the last two years) and .5 percent toward the General Fund reserve. The transfers are repealed after five years. It is possible that this legislation will be litigated.
•    HB 09–1265 Property Tax Interest Abatement — Extends the time period in which local governments can pay back property taxes that nonprofits were charged and paid erroneously. It also limits the interest that government must refund nonprofits to up to two years. This bill became effective June 1, 2009.
•    SB 09–275 Eliminate State Sales Tax Vendor Fee — Removes the ability of any business that collects sales tax for the state to keep 3 1/3 percent of its sales tax receipts for its administrative costs. The fee may be restored in 2011 if the budget forecast improves. This became effective May 18, 2009.
•    HB 09–1349 Continue Health Care after Employment — Provides a tax credit to health insurance providers that  provide COBRA coverage to individuals who have been laid off between September 1, 2008 ,and February 16, 2009. The state legislation extends the federal law to employers with 20 or fewer employees.
•    SB 09–067 Colorado Credit Reserve Program — Offers $2.5 million in matching funds to encourage bank loans to small business that might not qualify for loans using normal bank standards.
•    SB 09–234 Enterprise Zone Recommendations — Funds a study by the Economic Development Commission to make recommendations by 2010 about geographic areas that should be listed as Enterprise Zones.
•    HB 09–1057 Parental Leave Academic Activities — Requires employers with 50 or more employees to allow parents to take up to six hours/month and up to 18 hours/year of unpaid leave (or allow time to make up hours missed) to attend academic activities of their children (parent-teacher conferences, meetings related to special education or disciplinary issues). This applies to both part- and full-time employees. Employers can limit leave to three-hour increments and require written verification from the school, and they can require a week of notice before leave is taken or as soon as possible in an emergency.
•    House Current Resolution (HCR) 09–1003 Amendment Construction Games of Chance — Moves oversight on bingos/raffles to the Department of Revenue. Allows General Assembly to make rules regarding which nonprofits qualify for limited gaming licenses and the duration of those licenses. This will be put up for vote by the public in 2010.
•    HB 09–1052 Donation Bin Signs When Sold For Profit — Requires for-profits that operate donation bins to provide signage that lets people know if they can claim a tax deduction for items donated. This legislation does not apply to bins for waste or recycling.

Over the summer, the Colorado Nonprofit Association will be looking at the incentives that promote charitable giving. It will also be following the impact of Referendum C’s expiration.

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