DENVER — A bill aimed at getting more cars off the road by encouraging employers to provide alternative transportation options died in committee Monday.
House Bill 22-1138 had two main priorities- create an income tax credit for employers that provide alternative transportation options for their workers and require businesses with 100 employees or more to complete an annual transportation survey.
The survey would ask things like how the business’ employees commute to and from work each day, their commute distances and alternative transportation methods. Businesses that applied for the tax credit would have also been required to participate in the survey.
The bill would have also required the businesses to provide alternative transportation options to all essential workers and those making less than $40,000 per year in order to qualify for the credit. The alternative options could have included bicycle parking, ride share, flex work policies, electric vehicle charging stations and more.
“Transportation is the number one source of greenhouse gas emissions in all of Colorado, and passenger vehicles account for the majority of that,” said Jenny Gaeng, transportation manager for Conservation Colorado. “We need to transform how people commute in our state. That much is very, very clear.”
Gaeng and supporters of the bill believed it would be a big step forward for the state to clean up air pollution and help protect people’s health, particularly in disenfranchised communities, without taking away the options of employees. They supported the business survey because they say it would give the state a starting point for how far people are commuting and why they are choosing some transit methods over others.
However, the bill faced steep opposition from business groups, cities, the Colorado Chamber of Commerce, builders and more.
“Coloradans depend on their cars, and we don’t believe it should be up to the state legislature to make it harder for or incentivize them to move people out of cars and other forms of transportation,” said Tim Jackson, president and CEO of the Colorado Automobile Dealers Association.
Jackson opposed the bill because he believes people like having their cars for convenience and he worries this bill would have created unnecessary hurdles for businesses. There’s also areas of the state he doesn’t believe this is viable for, like rural or mountainous communities with fewer transit options.
“Our auto industry is moving to an all zero emission feature, and we’re rapidly expanding to that. It’s going to take awhile to get there,” Jackson said. “We think that’s a much more practical solution to improve air quality.”
During a committee hearing Monday, bill co-sponsors offered several serious amendments to the legislation to tax out the tax credits and remove the mandatory survey, instead making it voluntary for businesses to complete. However, even with the changes, both Democrats and Republicans on the House Finance Committee expressed concern with the bill and decided to kill it.
A second, more bipartisan bill that offers similar tax credits was able to pass its first committee test earlier this month. House Bill 22-1026 would eliminate the current corporate income tax deduction for alternative transportation methods and replace it with another one that incentivizes employers to provide alternative transit options to workers.
“There’s no mandate on this. It’s just an incentive for employers, and I think that’s the best thing right now,” said Rep. Dan Woog, R-Weld, one of the bill’s co-sponsors.
According to a fiscal analysis of the bill, the current state corporate income tax deduction for alternative transportation is not widely used by employers in the state because it was difficult to navigate. A federal deduction that was eliminated in 2018 also made the state-level deduction difficult for businesses to use.
The new bill aims to not only educate businesses about the tax credit but also offer a bigger incentive for employers to use it.
“There would be a refundable tax credit of 50% towards the expenses for alternative transportation. So, it’s pretty substantial and just a great incentive to hopefully promote them to look towards that type of transportation method,” Woog said.
HB 22-1026 passed the finance committee earlier this month and is still working its way through the legislative process. If passed, the tax credit is expected to cost the state $9.9 million in revenue this fiscal year and another $21.3 million the following year.