H_FIN_2019A 02/07/2019 10:50:42 AM Committee Summary

Senator Court called the committee to order.  She introduced the Tax Expenditures Compilation Report (https://leg.colorado.gov/audits/tax-expenditures-compilation-report-sept...) from the Office of the State Auditor (OSA) and explained tax expenditures.  She also introduced the 2018 Colorado Tax Profile and Expenditure Report (https://www.colorado.gov/pacific/revenue/colorado-tax-profile-and-expend...) from the Department of Revenue.

Mr. Trey Standley, OSA, introduced a memorandum regarding tax expenditure evaluations findings (Attachment A) and began a presentation (Attachment B).

Mr. Standley responded to a question from the committee regarding whether the memorandum reports annual or cumulative tax expenditures.

Mr. Standley presented information about the scope and history of state tax expenditures in Colorado.  He responded to a question from the committee regarding expiring tax credits.  Mr. Standley presented how OSA evaluates tax expenditures.

Mr. Standley presented the costs and benefits of tax expenditures and issues that lead to data constraints.  Committee members made comments regarding data constraints and policy considerations.  Ms. Michelle Colin, OSA, responded to the comments.  Mr. Standley and Ms. Colin described strategies OSA uses to ameliorate data concerns.

Mr. Standley presented policy considerations identified by OSA during its review.  Mr. Standley responded to questions from the committee regarding why some tax credits or deductions are unclaimed and options for finance committee actions on such tax expenditures.

Mr. Standley presented OSA's upcoming plans for tax expenditure review.  Committee members made comments on how they will use the information provided.  Mr. Standley responded to questions from the committee related to the history of tax expenditure evaluation, statutory performance measures, and state-to-state comparisons.

Senator Court made comments on the report.  Mr. Standley responded to a question from the committee related to interactions between tax expenditures and the Taxpayer's Bill of Rights (TABOR).  Committee discussion ensued regarding tax expenditure sunsets.  Mr. Standley responded to a question from the committee regarding the timeline of measuring the impact of new tax expenditures.  Mr. Greg Sobetski, Legislative Coucil Staff, responded to a question from the committee related to data collection.

Ms. Colin made closing comments.