Bill to save rural hospitals survives Republican headwinds, up for final vote

Inside of the Colorado State Capitol. (Photo by Li Tsin Soon via Flickr:Creative Commons)

The sweeping omnibus bill to save rural hospitals, provide a one-time funding boost to rural schools and a tax break for small business is just one vote away from heading to the governor.

Monday was a whirlwind day for the measure, sponsored in the House by Republican Rep. Jon Becker of Fort Morgan and House Majority Leader KC Becker, a Boulder Democrat. In the Senate, Republicans who opposed the measure railed against it in speeches. In the House, Republicans tried amending the bill to death.

The action began in the Senate, when the bill, which reclassifies the state’s hospital provider fee program into a government-owned business, won final approval on a 27 to 8 vote, with ten Republicans joining the 17 Democrats in support.

The bill seeks to reverse a $264 million cut to hospitals statewide, which is contained in the state’s 2017-18 budget of $26.8 billion.

The measure, “Sustainability of Rural Colorado,” would save close to a dozen rural hospitals, fund rural schools, give small businesses a break on business personal property taxes, and set aside money for long overdue transportation projects. But perhaps its most sought-after achievement — at least by Democrats — lies in reclassifying the hospital provider fee. The fee helps cover the medical costs of low-income Coloradans and is matched by federal dollars. Reclassifying it moves roughly $500 million to $600 million out from beneath state constitutionally-mandated revenue limits set by the Taxpayer’s Bill of Rights (TABOR).

With reclassification, the state can collect more revenue starting July 1 to spend on roads, education and other projects. It also spares hospitals from the budget chopping block this year. Republican lawmakers long have opposed reclassification because they see it as an end run around TABOR. In exchange for reclassification, Democrats working on the deal agreed to lower the state’s revenue limits by $200 million, a move that, in turn, limits state spending.

But before the final Senate vote, Republican Sen. Tim Neville of Littleton had a fully-prepared speech ready to outline his opposition.

“I’ve seen my share of large, complicated bills…the ones that actually passed graded poorly when the dust settled. I’m not sure I’ve ever seen anything like SB 267,” he said. “It stretches the bounds of the single-subject rule, Taxpayer’s Bill of Rights and the Colorado constitution.”

He reserved his harshest complaints for the provision that reclassifies the provider fee, which he said removes the program from legislative oversight. “Somehow, the Colorado constitution doesn’t apply anymore and it’s treated as a new government-owned business. In the 267 grand bargain, the $800 million income line gets negotiated to a $200 million reset for TABOR purposes…That’s some convenient math” for politicians who want to spend $600 million more without going to the voters.

Senate President Pro Tem Jerry Sonnenberg of Sterling called the months of negotiations “one of the finest experiences of my legislative career,” to work with Senate Minority Leader Lucia Guzman of Denver, and House members Jon Becker and KC Becker.

Sonnenberg said he sought advice on whether the measure would be legal. “I trust the opinions of the current and previous attorneys general, both Republicans,” and the lawyers and drafters who deal with these issues daily. “If there was any doubt that Senate Bill 267 was not constitutional, I would have never introduced it,” he told the Senate. He disputed that it was a backdoor around TABOR. “The worst backdoor around TABOR is our budget…We as a legislature took roughly $250 million in refunds to the people of Colorado and said ‘we’re not giving it to you. We’re going to take take money away from hospitals so you don’t get your refund.’ We used a simple shell game to remove income collected by hospitals” and the matching federal dollars. “For every dollar we took from hospitals or from taxpayers, by not issuing that refund, we took $2 from hospitals…We did this accounting maneuver on the backs of hospitals.”

The bill quickly moved across the second floor from the Senate to the House, where it was rushed into two committee hearings. The House Finance Committee quickly approved the bill on an 11-2 vote; the House Appropriations Committee sent it on to the full House on a 9-4 vote shortly after.

Republican Rep. Bob Rankin of Carbondale attempted to amend the bill during the appropriations hearing to require more transparency, but that move was rejected by KC Becker, who said she had promised the bill’s Senate sponsors that the bill would not be changed in its trip through the House.

Then it was on to the House floor late Monday night for debate and a preliminary vote, a debate that ran into the wee hours of Tuesday morning and where the Beckers (who aren’t related) fought off Republican efforts, some serious, others, not so much, to amend the bill.

While at least 60 amendments had been planned for Monday night’s debate, a bit of legislative legerdemain by Democrats kept the number of amendments down to about two dozen.

As of 1 a.m., 21 amendments had been offered and rejected. As Republican Rep. Tim Leonard of Evergreen stepped up to offer number 22, the debate chair, Democratic Rep. Matt Gray of Broomfield quickly announced there were no more amendments and gaveled the debate to a close. A surprised Leonard didn’t protest, nor did the Republican leadership.

The proposed changes from Republicans ranged from sending the measure to voters for approval, increasing the TABOR revenue cap reduction to $597 million, requiring hospitals to put provider fee charges on patient bills, or lowering the income level that allows patients to get on Medicaid.

Republicans also tried to force through an amendment to repeal the state’s limit on the size of ammunition magazines, allow seaplanes to land on Colorado lakes (Colorado is the only state that doesn’t allow seaplanes) and to repeal a law from 2013 that requires rural electric associations to boost their use of renewables.

But the measure gained support from Republicans, too; Rep. Clarice Navarro-Ratzlaff of Pueblo West said while it didn’t have everything she wanted, the bill “addresses needs of rural Colorado in a way that I can live with.”

“Rural, rural, rural,” said Rep. Jim Wilson of Salida. “Music to my ears!”

The measure also has earned back its support from the Colorado Rural Schools Alliance, which had dropped out of supporting it early last week. Friday, Alliance Executive Director Michelle Murphy issued a statement of support. “Though the amount allocated to rural schools through the compromise is far less than the $79 million initially set forth in the bill,” the one-time boost of $30 million will allow rural schools to address needs such as new curriculum, technology, school buses and building maintenance, Murphy said. She also lauded the efforts of Jon Becker and Sonnenberg for their leadership on the measure.

The bill will be up for its final vote in the House on Wednesday, and without changes, goes straight to the governor.

Photo credit: Li Tsin Soon, via creative commons license, Flickr