Armed with a new study showing the fiscal impact of recent business regulations, Colorado business advocates from the Colorado Chamber of Commerce urged state legislators to “let businesses get back on their feet” before passing more.
The study by the Common Sense Institute shows new rules and regulations including measures like increased paid family leave, full-day kindergarten and soaring unemployment insurance will cost Colorado businesses an additional $1.8 billion annually in coming years.
Loren Furman, Colorado Chamber’s senior vice president of state and federal relations, called the study “comprehensive and shocking” during a Tuesday press conference via Zoom.
“As the legislature meets, we urge lawmakers to think about this before passing new laws that carry costs via new taxes, fees or regulations,” Furman said. “Let businesses get back on their feet. It’s the only path to recovery.”
Colorado voters passed Proposition 118, which increased paid family and medical leave for employees. The study showed the fiscal impact of that measure alone will be $1.2 billion in fiscal year 2023 (between increased employee and employer contributions).
The study notes there were 150,000 fewer jobs in Colorado in December 2020, a 5.4% drop from January 2020 levels. Taxable sales statewide plummeted $8.9 billion in 2020, compared to the previous year, according to the CSI study.
It also notes Colorado went from having one of the nation’s lowest unemployment levels of 2.5% in January 2020, to one of the highest at 8.4% in December.
Institute CEO Kristin Strohm said business owners are especially concerned about the state’s unemployment insurance trust fund, which was depleted in July in the face of soaring new state claims. The study shows the fund is currently $1 billion in debt and will require huge tax increases on businesses to recover.
“These are higher costs facing our job creators,” she said.
“These increased costs disproportionally affect small businesses and start-ups,” said Tony Gagliardi, Colorado state director for the National Federation of Independent Businesses. About 7,000 businesses belong to the Colorado NFIB.
“The last time that unemployment insurance trust fund went into the negative, some of our Colorado members saw 200-300% increases in their unemployment insurance tax bills,” Gagliardi said. “This time could be worse.”
The institute bills itself as a non-partisan, charity organization dedicated to “the protection and promotion of the Colorado economy,” Furman said.
The full study can be found on the institute’s website.