Senate Bill 25-242

BY SENATOR(S) Amabile and Bridges, Kirkmeyer;

also REPRESENTATIVE(S) Sirota and Taggart, Bird, Woodrow.

Concerning the division of unemployment insurance funding adjustments, and, in connection therewith, making and reducing an appropriation.

Be it enacted by the General Assembly of the State of Colorado:

SECTION 1.  In Colorado Revised Statutes, 8-70-103, amend (24.5); repeal (11.5); and add (28.5) as follows:

8-70-103.  Definitions. As used in articles 70 to 82 of this title 8, unless the context otherwise requires:

(11.5)  "Employment and training technology fund" means the employment and training technology fund created in section 8-77-109 (2)(a.9)(II)(A).

(24.5)  "Support surcharge rate" means an employer's rate that is used to calculate the money payments owed to the employment support fund, the benefit recovery fund, and the employment and training technologyunemployment insurance program support fund, calculated in accordance with section 8-76-102.5 (3)(a)(IV) using the same methodology as is used to calculate an employer's percent of excess in accordance with section 8-76-102.5 (3)(a)(II)(A).

(28.5)  "Unemployment insurance program support fund" means the unemployment insurance program support fund created in section 8-77-109 (2)(a.9)(II)(A).

SECTION 2.  In Colorado Revised Statutes, 8-71-103, amend (2)(b)(I) as follows:

8-71-103.  Organization of division - authority to issue bonds. (2) (b) (I)  Except as provided in subparagraph (II) of this paragraph (b)subsection (2)(b)(II) of this section, the enterprise established pursuant to this subsection (2) has all the powers and duties authorized by articles 70 to 82 of this titletitle 8 pertaining to unemployment insurance and unemployment compensation. The unemployment compensation fund, created in section 8-77-101, constitutesand the unemployment insurance program support fund, created in section 8-77-109 (2)(a.9)(II)(A), constitute part of the enterprise established pursuant to this subsection (2).

SECTION 3.  In Colorado Revised Statutes, 8-77-109, amend (1)(b), (2)(a)(I)(B), (2)(a)(II)(A), (2)(a.9)(II)(A), (6)(a) introductory portion, and (6)(b) as follows:

8-77-109.  Employment support fund - unemployment insurance program support fund - created - uses - repeal. (1) (b)  There is hereby established the employment support fund. The fund consists of thirty-fiveeleven percent of the support surcharge rate assessed annually as part of each employer's support surcharge rate payments paid and dedicated to the employment support fund in accordance with section 8-76-102.5 (3)(a)(IV) and other money credited to the fund.

(2) (a) (I) (B)  To the extent allowed by the United States department of labor employment and training administration, the state treasurer shall credit nineteenfifteen percent of each employer's annual support surcharge rate determined pursuant to section 8-76-102.5 (3)(a)(IV) to the benefit recovery fund, up to a maximum of fifteen million dollars each year.

(II) (A)  At the end of the 2023-242024-25 state fiscal year, and at the end of each state fiscal year thereafter, the state treasurer shall credit any money collected pursuant to this section that would cause the balance in the employment support fund to exceed seventhree million five hundred thousand dollars, as adjusted annually forby an amount equal to the United States department of labor's bureau of labor statistics consumer price index for Denver-Aurora-Lakewood or its successor index, excluding gifts, grants, or donations, to the employment and training technology fund created in subsection (2)(a.9)(II)(A) of this section. If the employment and training technology fund has reached the maximum allowable balance pursuant to subsection (2)(a.9)(II)(A) of this section, the treasurer shall instead credit the money to the workforce development fund created in section 8-83-107 (4)change in the average weekly earnings prescribed in section 8-73-102, rounded to the nearest one hundred dollars and excluding any gifts, grants, or donations, to the unemployment compensation fund created in section 8-77-101 (1).

(a.9) (II) (A)  The employment and training technologyunemployment insurance program support fund, referred to in this subsection (2)(a.9) as the "fund", is created in the state treasury. Notwithstanding any provision of this subsection (2) to the contrary, the state treasurer shall credit thirty-twofifty-four percent of each employer's annual support surcharge rate under section 8-76-102.5 (3)(a)(IV) to the employment and training technology fund. On and after April 27, 2021, and on or before June 30, 2023, if cumulative revenue to the employment and training technology fund equals thirty-one million dollars, less any money transferred to the unemployment compensation fund, no additional money shall be credited to the employment and training technology fund but instead shall be allocated to the unemployment compensation fund. On and after July 1, 2023, any amount collected in a fiscal year in excess of thirteen million two hundred thousand dollars under this subsection (2)(a.9)(II), as adjusted annually for the United States department of labor's bureau of labor statistics consumer price index for Denver-Aurora-Lakewood or its successor index, excluding gifts, grants, or donations, shall be credited to the fund and then credited to the unemployment compensation fundAt the end of the 2024-25 state fiscal year, and at the end of each state fiscal year thereafter, the state treasurer shall credit any money collected pursuant to this section that would cause the balance in the fund to exceed twenty-five million dollars, as adjusted annually by an amount equal to the change in the average weekly earnings prescribed in section 8-73-102, rounded to the nearest one hundred dollars and excluding any gifts, grants, or donations, to the unemployment compensation fund. Money in the fund shall be used for employment and training automation initiatives established by the directoradministrative costs of the division, including technology and staffing costs, and other costs to support the unemployment insurance program as determined by the director of the division. Money in the fund is subject to annual appropriation by the general assembly for the purposes of this subsection (2)(a.9) and shall not revert to the general fund or any other fund at the end of any state fiscal year. The money in the fund is exempt from section 24-75-402. At any time, the money in the employment and training technologyunemployment insurance program support fund may be appropriated by the general assembly to the unemployment compensation fund or allocated to the unemployment compensation fund at the discretion of the executive director of the department of labor and employment.

(6) (a)  The portion of each employer's support surcharge rate that the employer paid and that is dedicated to the employment support fund pursuant to section 8-77-109 (1)(b), to the benefit recovery fund pursuant to section 8-73-116, to the workforce development fund pursuant to section 8-83-107, and to the employment and training technologyunemployment insurance program support fund pursuant to subsection (2)(a.9)(II)(A) of this section:

(b)  Any money transferred or credited from the employment support fund, the benefit recovery fund, the workforce development fund, or the employment and training technologyunemployment insurance program support fund, or support surcharge rate payments to the unemployment compensation fund pursuant to this section is not used in calculating the employer's experience rate or percent of excess for the standard premium rate schedule.

SECTION 4.  In Colorado Revised Statutes, 8-73-116, amend (2)(e)(I) as follows:

8-73-116.  Benefit recovery fund - recovery benefits - eligible individuals - third-party administrator - definitions - rules - access to personal information or tax data to administer fund - confidentiality requirements. (2) (e) (I)  If the amount in the fund exceeds thirty million dollars, as adjusted for the United States department of labor's bureau of labor statistics consumer price index for Denver-Aurora-Lakewood or its successor index, excluding gifts, grants, or donations, the state treasurer shall transfer the money in the fund in excess of thirty million dollarsAt the end of the 2024-25 state fiscal year, and at the end of each state fiscal year thereafter, the state treasurer shall credit any money collected pursuant to this section that would cause the balance in the fund to exceed thirty million dollars, as adjusted annually by an amount equal to the change in the average weekly earnings prescribed in section 8-73-102, rounded to the nearest one hundred dollars and excluding any gifts, grants, or donations, to the unemployment compensation fund created in section 8-77-101 (1).

SECTION 5.  In Colorado Revised Statutes, 8-76-102.5, amend (3)(a)(IV) introductory portion as follows:

8-76-102.5.  Rates effective upon fund solvency - repeal of prior rates - solvency surcharge - definitions. (3) (a) (IV)  The support surcharge rate, which is the rate dedicated to employer support surcharge payments deposited into the employment support fund, the benefit recovery fund, the employment and training technologyunemployment insurance program support fund, and the workforce development fund, is calculated using the following support surcharge rate schedule:

SECTION 6.  In Colorado Revised Statutes, 8-83-107, amend (4)(a) and (9) as follows:

8-83-107.  Workforce development enterprise - creation - powers and duties - enterprise fund - fee - legislative declaration - definitions. (4)  The workforce development fund is created in the state treasury. Money in the fund shall be used by the workforce development enterprise to engage in and support employment and training workforce initiatives throughout Colorado. The workforce development enterprise may deposit or permit others to deposit other money into the workforce development fund. The workforce development fund consists of the following:

(a)  FourteenTwenty percent of the support surcharge collected pursuant to section 8-76-102.5 (3)(a)(IV);

(9) (a)  At the end of the 2024-25 state fiscal year, if the amount in the fund exceeds six million eight hundred thousand dollars, the state treasurer shall transfer the money in the fund in excess of six million eight hundred thousand dollars to the unemployment compensation fund created in section 8-77-101 (1).

(b)  At the end of the 2025-262024-25 state fiscal year, and at the end of each state fiscal year thereafter, if the amount in the fund exceeds six million eight hundred thousand dollars, as adjusted for the United States department of labor's bureau of labor statistics consumer price index for Denver-Aurora-Lakewood, or its successor index, the state treasurer shall credit any money collected pursuant to this section that would cause the balance in the fund to exceed the adjusted amountthe state treasurer shall credit any money collected pursuant to this section that would cause the balance in the fund to exceed six million eight hundred thousand dollars, as adjusted annually by an amount equal to the change in the average weekly earnings prescribed in section 8-73-102, rounded to the nearest one hundred dollars and excluding any gifts, grants, or donations, to the unemployment compensation fund created in section 8-77-101 (1).

SECTION 7.  Appropriation - adjustments to 2025 long bill. (1)  To implement this act, cash fund appropriations from the employment support fund created in section 8-77-109 (1)(b), C.R.S., made in the annual general appropriation act for the 2025-26 state fiscal year to the department of labor and employment are decreased as follows:

(A)  Executive director's office

Personal services$2,099,845

Health, life, and dental$3,773,855

Short-term disability$26,392

Unfunded liability amortization

equalization disbursement payments$1,679,537

Workers' compensation$50,082

Operating expenses$201,213

Legal services$175,803

Payment to risk management and property funds$41,927

Vehicle lease payments$25,749

Leased space$1,418,497

Capitol complex leased space$10,969

Payments to OIT$4,894,442

Information technology asset maintenance$19,538

Statewide indirect cost assessment$153,180

(2)  To implement this act, cash fund appropriations from the unemployment insurance program support fund created in section 8-77-109 (2)(a.9)(II)(A), C.R.S., made in the annual general appropriation act for the 2025-26 state fiscal year to the department of labor and employment for use by the division of unemployment insurance for program costs is decreased by $10,459,436, and the related FTE is decreased by 74.0 FTE.

(3)  To implement this act, cash fund appropriations from the unemployment insurance program support fund created in section 8-77-109 (2)(a.9)(II)(A), C.R.S., made in the annual general appropriation act for the 2025-26 state fiscal year to the department of labor and employment and the related FTE are increased as follows:

(A)  Executive director's office

Personal services$1,226,689

Health, life, and dental$1,997,192

Short-term disability$13,967

Unfunded liability amortization

equalization disbursement payments$888,841

Workers' compensation$29,257

Operating expenses$117,545

Legal services$102,701

Payment to risk management and property funds$24,493

Vehicle lease payments$15,042

Leased space$828,659

Capitol complex leased space$6,408

Payments to OIT$2,859,240

Information technology asset maintenance$11,414

Statewide indirect cost assessment$89,485

Division of unemployment insurance

Program costs $10,000,000

Technology initiatives$30,459,436 (74.0 FTE)

(4)  To implement this act, cash fund appropriations from the workforce development fund created in section 8-83-107 (4), C.R.S., made in the annual general appropriation act for the 2025-26 state fiscal year to the department of labor and employment are increased as follows:

(A)  Executive director's office

Personal services$873,156

Health, life, and dental$1,776,663

Short-term disability$12,425

Unfunded liability amortization

equalization disbursement payments$790,696

Workers' compensation$20,825

Operating expenses$83,668

Legal services$73,102

Payment to risk management and property funds$17,434

Vehicle lease payments$10,707

Leased space$589,838

Capitol complex leased space$4,561

Payments to OIT$2,035,202

Information technology asset maintenance$8,124

Statewide indirect cost assessment$63,695

SECTION 8.  Appropriation to the department of labor and employment for the fiscal year beginning July 1, 2024. In Session Laws of Colorado 2024, section 2 of chapter 519, (HB 24-1430), amend Part X (1)(A), (2), and the affected totals, as Part X (1)(A) and the affected totals are amended by section 1 of SB 25-097, as follows:

Section 2. Appropriation.

Part X

DEPARTMENT OF LABOR AND EMPLOYMENT

(1) EXECUTIVE DIRECTOR'S OFFICE

(A) Executive Director's Office

(2) DIVISION OF UNEMPLOYMENT INSURANCE

SECTION 9.  Safety clause. The general assembly finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, or safety or for appropriations for the support and maintenance of the departments of the state and state institutions.