J_LS_2023A 12/04/2023 09:23:35 AM Committee Summary PUBLICSTAFF SUMMARY OF MEETINGJOINT COMMITTEE COMMITTEE ON LEGAL SERVICES Date 12/04/2023 Attendance Dickson E Gardner X Hansen X Mabrey X Roberts X Van Winkle X Weissman X Wilson X Soper X Gonzales X Time 09:23:35 AM to 10:23:55 AM Place Old State Library This Meeting was called to order by Gonzales This Report was prepared by Angela Titus Hearing Items Action Taken hRules of the Department of Revenue concerning wildfire mitigation measures Committee Discussion Only hRules of the Colorado Department of Education on regional service areas Committee Discussion Only hApproval and Sponsorship of Committee Bills Committee Discussion Only hUpdate on XDOME Project Committee Discussion Only hUpdate on litigation and approved counsel Committee Discussion Only hOther business Committee Discussion Only Rules of the Department of Revenue concerning wildfire mitigation measures - Committee Discussion Only 09:24:11 AM Megan McCall, Staff Attorney, Office of Legislative Legal Services (OLLS), presents to the committee what the OLLS believes is a conflict of two rules of the Executive Director of the Department of Revenue (DOR) with the underlying statutes. The first rule promulgated by the DOR concerns the wildfire mitigation measures income tax subtraction in 1 CCR 201-2, Rule 39-22-104 (4)(n.5). The second rule promulgated by the DOR concerns the wildfire mitigation measures income tax credit in 1 CCR 201-2, Rule 39-22-543 (2) and (3). These issues are uncontested, and a representative of the DOR is present to address any questions from the committee. Because of the conflict, the OLLS recommends these rules not be extended. 09:29:08 AM Chair Gonzales asks the committee if members have questions. 09:30:30 AM Senator Roberts asks Ms. McCall a clarifying question about not extending the rules and the reasoning for the OLLS recommendation. 09:30:55 AM Ms. McCall responds that not extending the rule will affect the way the tax credit is administered and the recommendation is a result of the rule narrowing the scope of the tax credit in a way that is inconsistent with the statute. 09:32:23 AM Representative Weissman shares with the committee how this rule intersects with a bill being drafted for the Tax Policy Interim Committee. The interim committee considered exactly this deduction and credit and came to the conclusion that this incentive is too low. Therefore the pending legislation will propose to change the language to alter the scope of the tax incentive and clarify for the DOR how to promulgate rules to conform to the statute. 09:35:05 AM Ms. McCall comments that as a result of the pending legislation, the DOR will need to promulgate rules to address the changes to the statute moving forward in any case. 09:35:49 AM Senator Roberts asks the representative of the DOR if he is aware of any examples of the hypotheticals raised in the memo. 09:37:05 AM Josh Pens, Director of Tax Policy for the DOR, responds that he has not reviewed these specific claims, so he is not aware if any of these issues have occurred. He adds that his staff recalls having questions during the rule making process for the statute many years ago. 09:38:30 AM Senator Roberts asks Mr. Pens why the rule issue is uncontested by the DOR. 09:38:53 AM Mr. Pens responds that the DOR was able to work with the Tax Policy Interim Committee to add clarifying language to the statute if the pending legislation passes, and it wasn't worth the time to contest the issue if the DOR will need to revise the regulation in any case. 09:40:00 AM Motion I move that Rule 39-22-104 (4)(n.5) (2) and (3) of the rules of the Department of Revenue's executive director concerning the wildfire mitigation measures subtraction be extended. Moved Soper Seconded Dickson Excused Gardner No Hansen No Mabrey No Roberts No Van Winkle No Weissman No Wilson No Soper No Gonzales No YES: 0 NO: 9 EXC: 1 ABS: 0 FINAL ACTION: FAIL 09:41:00 AM Motion I move that Rule 39-22-543 (2) and (3) of the rules of the Department of Revenue's executive director concerning the wildfire mitigation measures credit be extended. Moved Soper Seconded Dickson Excused Gardner No Hansen No Mabrey No Roberts No Van Winkle No Weissman No Wilson No Soper No Gonzales No YES: 0 NO: 9 EXC: 1 ABS: 0 FINAL ACTION: FAIL Rules of the Colorado Department of Education on regional service areas - Committee Discussion Only 09:42:29 AM Alana Rosen, Staff Attorney, OLLS, presents the State Board of Education's Rule 1 CCR 303-76, 2.01(2), which the office believes is in conflict with 22-5.5-105 (2)(a), C.R.S. The issue is uncontested and a representative from the Department of Education is present to answer any questions from the committee. Due to the conflict, the OLLS recommends the rule not be extended. 09:46:15 AM Chair Gonzales asks the committee if any members have questions. 09:46:33 AM Motion I move that Rule 2.01(2) of the rules of the State Board of Education concerning rules for the development, expansion, implementation, and management of the regional service areas be extended. Moved Soper Seconded Dickson Excused Gardner No Hansen No Mabrey No Roberts No Van Winkle No Weissman No Wilson No Soper No Gonzales No YES: 0 NO: 9 EXC: 1 ABS: 0 FINAL ACTION: FAIL Approval and Sponsorship of Committee Bills - Committee Discussion Only 09:48:00 AM Brita Darling, Senior Attorney, OLLS, and Jacob Baus, Senior Attorney, OLLS, request authorization of the committee to draft the Rule Review bill. 09:52:30 AM Motion I move to authorize the OLLS to draft the 2024 Rule Review bill and it will originate in the House of Representatives. Moved Weissman Seconded Dickson Excused Gardner Yes Hansen Yes Mabrey Yes Roberts Yes Van Winkle Yes Weissman Yes Wilson Yes Soper Yes Gonzales Yes YES: 9 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS 09:53:26 AM Chair Gonzales names sponsors for the Rule Review bill. Prime sponsors are Representatives Weissman and Soper, and Senators Gardner and Gonzales. Co-sponsors are Senators Hansen and Roberts, and Representative Wilson. 09:54:36 AM Jennifer Gilroy, Revisor of Statutes, OLLS, requests the committee's authorization to draft the bill to Enact the 2023 C.R.S. 09:56:40 AM Motion I move to authorize the OLLS to draft the Bill to Enact the 2023 C.R.S., and it will originate in the House of Representatives. Moved Soper Seconded Dickson Excused Gardner Yes Hansen Yes Mabrey Yes Roberts Yes Van Winkle No Weissman Yes Wilson Yes Soper Yes Gonzales Yes YES: 8 NO: 1 EXC: 1 ABS: 0 FINAL ACTION: PASS 09:58:02 AM Chair Gonzales names sponsors for the Bill to Enact the 2023 C.R.S. Prime sponsors are Representatives Soper and Mabrey, and Senators Hansen and Gardner. Co-sponsors are Senators Gonzales and Roberts, and Representative Weissman. 09:59:00 AM Representative Weissman asks Ms. Gilroy to explain why a no vote to authorize the drafting of the bill to Enact the 2023 C.R.S. does not count as a no vote for all of the legislation passed in 2023. 09:59:20 AM Ms. Gilory explains the issue. 10:00:43 AM Ms.Gilroy requests the committee's authorization to draft the Revisor's bill and requests sponsors. 10:02:47 AM Motion I move to authorize the OLLS to draft the Revisor's bill, and it will originate in the House of Representatives. Moved Soper Seconded Dickson Excused Gardner Yes Hansen Yes Mabrey Yes Roberts Yes Van Winkle Yes Weissman Yes Wilson Yes Soper Yes Gonzales Yes YES: 9 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS 10:03:55 AM Chair Gonzales names sponsors for the Revisor's bill. Prime sponsors are Senators Gonzales and Gardner, and Representatives Soper and Weissman. Co-sponsors are Senators Van Winkle, Hansen, and Roberts, and Representatives Wilson and Mabrey. Update on XDOME Project - Committee Discussion Only 10:04:48 AM Ms. Gilroy updates the committee on the status of the XDOME project and informs the committee of plans to pursue RFPs for external vendors as a Plan B solution. 10:15:08 AM Chair Gonzales asks the committee if any members have questions for Ms. Gilroy. Update on litigation and approved counsel - Committee Discussion Only 10:18:12 AM Jeremiah Barry, Deputy Director, OLLS, updates the committee on ongoing litigation and approved counsel. 10:18:27 AM Chair Gonzales asks the committee if anyone has questions for Mr. Barry. Other business - Committee Discussion Only 10:22:36 AM Senator Gardner asks staff for projections on timeframes for upcoming committee meetings. 10:22:53 AM Mr. Barry is not aware of the need for any meetings before session begins. 10:23:55 AM The committee adjourned.