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Right to Repair for Electronic Equipment Bill Passes Committee

 

DENVER, CO – The Senate Business, Labor & Technology Committee on April 11 passed legislation to establish the right to repair for electronic devices.

HB24-1121, sponsored by Senators Nick Hinrichsen, D-Pueblo, and Jeff Bridges, D-Arapahoe County, would extend current right to repair laws to certain electronic equipment, including cell phones, gaming systems, computers and televisions and would require original equipment manufacturers (OEMs) such as Amazon, Apple, and Google to comply with existing consumer right to repair laws. OEMs would need to provide software and physical tools to consumers and independent repair providers upon request.

“Manufacturer-imposed repair restrictions affect a wide variety of products from tractors to cell phones, resulting in surging costs, monopolistic business practices, and thousands of electronic devices thrown out every day,” said Hinrichsen. “I’ve said it before and I’ll say it again: if you can’t repair something that’s yours, do you really own it? I would argue no, which is why this legislation is so important. Right to repair laws are essential for empowering consumers and ensuring a fair market.”

“Accidents happen, people drop their phones and break their screens every day, but because of ‘parts pairing’ and repair restrictions, owners aren’t allowed to fix their devices,” Bridges said. “Colorado has led the nation in expanding right to repair laws, from agricultural equipment to wheelchairs to now electronics. This legislation is good for consumers, small businesses, and our economy.”

Under this bill, OEMs could charge a fee for physical tools but software tools must be made available free of charge for the consumer. This bill aims to save electronic consumers money on necessary equipment repairs while speeding up the repair process. HB24-1121 also would prohibit “parts pairing” – a technology used by manufacturers to program certain parts together, which restricts the consumer’s ability to independently repair their devices and allows OEMs to monopolize replacement parts.

The bill now heads to the Senate floor for further consideration. Follow its progress HERE.

Can Colorado Avoid the Rising Male Unemployment Rates Across the US?

Even as women enter the workforce at rates never before seen in our country, a disturbing trend is arising among men between the ages of 25-54.

A new Common Sense Institute study finds these men, in their prime working-age years, are leaving the workforce. 

How many men? Today, across the US, roughly seven million men are not in the labor force, or NILF, as the US Department of Labor refers to them. This does not apply to men who are employed part-time. In fact, one only needs to work an hour in the period being recorded to be counted as employed.

These men are neither working nor looking for work. One of the reasons the unemployment rate across the country appears to be so low is because for every man looking for work, two-to-three men are NILFs.

READ: Colorado’s Labor Market Paradox —  Plentiful Jobs, Mismatched Talent

This trend for men is not a matter of being in transition or working to take care of households while their spouses go to work. When time-use studies are done to document how these men spend their non-working time, they spend much more time than working men or women in general on socializing, relaxing and leisure. This includes an alarming amount of video game playing. 

Married men and men with kids are more likely to be working. Married black men work at a higher rate than single white men. Men with higher education levels are also more likely to be working. Men’s retreat from the workforce has also occurred with a retreat from civil society. NILF men are likely to be unmarried and not in clubs, involved in church or otherwise engaged in their communities. 

This is also not a blip. Prime-age working male labor force participation rate (LFPR) has been trending down since the 1960’s and continues post-pandemic. In 1969 the LFPR of prime working age men was 96.1%. Since Title IX was enacted in 1972, women have consistently increased their labor force participation rate, reaching a post-pandemic high of 77.8%, while men’s has dropped to a current national level of 89.7%. 

Women are advancing their educations at a higher rate than men as well. In 1970, just 12% of young women had attained bachelor’s degrees, compared to 20% of men. By 2020 4 % of women had a bachelor’s degree, compared to 32 % of men. Since better-educated men are more likely to be in the workforce, this national trend is concerning. 

But what about Colorado? The state’s male LFPR is higher than the national LFPR at 92.5%. Note that Colorado also has the second-highest percentage of college-educated citizens. While encouraging, now is the time to sound the alarm in Colorado. Despite an overall better LFPR for prime-age working men in Colorado, the rate has dropped four percentage points since 1977 while Colorado’s female LFPR has risen 20 points to 83%.

READ: Guest Column — Closing the Racial Wealth Gap With Education and Financial Planning

At a time of low unemployment and a plethora of available jobs, the bigger question is why are men leaving the workforce at all? To start, for men with only a high school diploma, inflation-adjusted real wages have dropped since the 1970’s. It’s estimated that this factor alone accounts for 44% of the growth in labor force exit. 

Social factors contribute as well. As society has shifted and more men are born to single mothers, their likelihood of being nonworkers has grown. When single mothers are less educated, or have low household incomes, the boys growing up in these households are more likely to be nonworkers as adults. 

Perhaps most alarmingly, because work is not only a source of income, but also dignity, belonging and self-respect, the loss of work and the possibilities work creates lead to disconnection, hopelessness and negative emotions that cause both physical and psychological pain. The US male life expectancy has dropped and the rate of deaths of despair are increasing. Men in Colorado accounted for 77% of suicide deaths from 2010 to 2020 and 62% of suicide deaths. Colorado has the sixth highest suicide rate in the US.

READ: Transform Your Mental Health in the Workplace — Strategies for a Healthier, Happier Experience

In terms of economic empowerment, it is a great time to be a woman in our country. But men not working is a problem, not just for our economy, but for our society. 

What if women’s gains since 1972’s Title IX law have occurred to the detriment of men? How might we recover these losses and build up all people moving forward?

In November 2021, the Global Initiative for Boys & Men published a report on the need for a Colorado Commission on the Status of Boys & Men. This report identified six areas where boys and men have been disproportionately impacted, including physical and mental health, education, careers and financial health, family and relationships, criminal justice and court systems, and male narrative in the public discourse. In each of these key areas, the trends for boys and men are concerning, but it is not too late. Now is the time for a state commission to be created to keep Colorado boys and men from falling farther behind.

 

Tamra Ryan is the CSI Coors Economic Mobility Fellow and CEO of the Women’s Bean Project.

February 6 Event to Discuss Inaugural Northern Colorado Intersections Report

The Community Foundation of Northern Colorado’s inaugural report, Northern Colorado Intersections: Pursuing Regional Well-Being, is a result of a year’s worth of research, discussions and engagement that discovered what the Northern Colorado region is doing well and where is it feeling the pressures of growth most acutely.

The goal of the report is to help inform the Northern Colorado region on how it builds and implements a collective strategy that will create well-being for all. The NoCo Foundation partnered with Colorado State University to review and analyze local, state and national data in relation to needs and gaps in services and opportunities.

Findings from the report will be shared with the Northern Colorado community on Tuesday, February 6 from 8 to 10 a.m. at the Embassy Suites in Loveland and will offer dialogue with a Mayoral Panel and Industry Expert Panel.

Mayor panelists are Jeni Arndt, Fort Collins; John Gates, Greeley; Paul Rennemeyer, Windsor and Jacki Marsh, Loveland. It will be facilitated by Ken Amundson, Managing Editor of BizWest.

The industry panel of experts include Andy Feinstein, University of Northern Colorado President; Jay Dokter, CEO of Vergent Products, and general partner in The Forge; Tracy Mead, Executive Director of Project Self Sufficiency and the Nonprofit Sector Partnership; and Raymond Lee, Greeley City Manager. It will be facilitated by Erin O’Toole Host and Senior Producer at KUNC.

To secure your spot to the February 6th launch event, register here by January 30. Tickets are $25 ticket and include breakfast and parking.

Registration link: https://nocofoundation.org/intersectionslaunch.

“The data and stories gathered in this report make it clear that there are issues we cannot solve alone that will require a collective and collaborative approach throughout Larimer and Weld Counties,” said Kristin Todd, President & CEO of the NoCo Foundation.

The NoCo Foundation will also engage community partners and leaders to work together to address the report’s findings. To read the full report, visit nocointersections.org.

About the Community Foundation of Northern Colorado

The NoCo Foundation is a nonprofit, public foundation that stewards more than 600 individual funds and over $200 million in assets. We play a unique leadership role by bringing people and resources together around important regional issues. Together with community partners and organizations, twe are a confluence of ideas, impact, and solutions. Community is our business. Learn more at nocofoundation.org.

Capitalizing on Colorado’s Homegrown Energy

In a global economy where products are not only delivered the next day, but sometimes the next hour, it can be easy to lose track of where things come from. A former industry trade executive used to quip, “Kids today think milk comes from the grocery story, gasoline from the Conoco station, and 2x4s from Home Depot.”

He may not have been far off in our modern-day comprehension of where things come from. Indeed, one consequence of America’s economic success these past hundred years may be our loss of a direct connection to the land and basic understanding of our natural resources.

Or has it?

There’s something deep within the power behind the Colorado brand. Countless companies have found a way to subtly profit from Colorado’s homegrown reputation.

For more than a century, Golden-based Coors has pedaled beer made from the pristine waters of the Rocky Mountains; Pueblo is burning up the market with their chilies; Olathe sweet corn rivals that from Iowa; Rocky Mountain Chocolate Factory has built a global dynasty; Palisade peaches and melons from Rocky Ford are unmatched; and of course, Colorado’s brand of cannabis-derived products, including edibles and hemp-made products, are known from coast to coast.

Perhaps the same could be true for Colorado’s homegrown energy.

READ: Who Will Lead Colorado’s Energy Future?

According to the U.S. Energy Information Administration, last year, the Centennial State’s fertile energy ground made it the fifth-largest crude oil-producing state, with 82% of production coming from Weld County. Colorado was also the eighth-largest natural gas-producing state in 2022 and has the eighth-largest natural gas reserves.

Some have criticized oil and natural gas as the primary contributor to a climate change, claiming the elimination of fossil fuels is paramount to protecting the environment and saving Mother Earth. Timing is running out, they say. The end of the world is near. However, rarely do they offer realistic, practical energy alternatives that will keep us comfortable at home and work and at a price we can afford without completely upending our economy and forcing us to relocate back to caves.

Others argue the opposite — oil and natural gas is the solution, not the culprit.

READ: Biden is Right About One Thing — Oil and Natural Gas Aren’t Going Anywhere

They point to the fact that energy poverty and a lack of access to affordable energy is literally leaving billions freezing in the dark. These third-world countries and emerging nations are only looking to replicate America’s success: an economic engine built entirely on the foundation of cheap, abundant, reliable fossil fuels. Still, there’s no doubt the talking points that extreme environmental groups — as unrealistic as they are — have made an impact.

What began as a campaign to end “dirty coal” has pivoted to a ban on oil and natural gas and fossil fuels altogether. Perhaps public opinion polling showed them that eliminating fossil fuels was impossible, maybe even ill-advised, and their slogan of “keep it in the ground” seems to have morphed into “keep it from moving around.” In other words, they have conceded that it’s OK to produce hydrocarbons, but you can’t transport or sell them, which of course is just a more clever, de facto ban.

This year, the Institute for Energy Research released its inaugural Environmental Quality Index comparing the environmental quality of all major oil-producing countries. The results were overwhelming if not shocking. The United States, the world’s largest producer of both oil and natural gas, is only outranked on environmental quality by three of the top 20 global oil producers and three of the top natural gas producers, but none of those countries produce even one quarter of the volumes of oil or natural gas that the U.S. does. That means the U.S. produces the cleanest energy in the world at the highest volume bar none.

Energy must be produced somewhere. Our modern way of life is irrevocably I dependent upon abundant, affordable, reliable energy. America, and Colorado specifically, has some of the toughest environmental rules and oil and natural gas regulations in the world. We’ve seen what happens when we outsource manufacturing to other countries. Our principles around child labor protections are violated, the environment is outright ignored if not abused, and jobs traditionally performed here seem to never return.

READ: Andy Filson and the Future of Manufacturing in Colorado (Q&A)

A case could even be made that it’s now more important than ever to ensure the United States is able to meet the energy needs of its citizens while limiting its reliance on foreign entities. According to a report from the World Bank, the recent war between Israel and Hamas may cause oil prices to balloon by 35%. Couple that with increased tensions with Russia given their ongoing invasion of Ukraine, recent geopolitical conflicts expose the incredible gaps in depending on oil and gas imports for our energy needs. As uncertainty arises at the international level, it’s all the more important for the United States to be self-sufficient, and Colorado can play a huge role in achieving energy independence for the nation.

Perhaps it’s time to rally around these facts and the opportunities to capitalize on Colorado’s brand when it comes to our homegrown energy.

 

Jon Haubert Hb Legacy Media Co 2Jon Haubert is the publisher of ColoradoBiz magazine. Email him at [email protected].

Balancing Net Zero and Keeping the Heat On

Access to affordable energy is a prerequisite for economic security, physical health and social wellbeing. Energy poverty occurs when a household is unable to access essential energy services and products.

Coloradans are fortunate to live in a state where energy is reliably available, and instances of brownouts and blackouts are rare and promptly remedied. In the developed world, energy poverty is preceded by financial insecurity, rather than insufficient supply and delivery.

READ: Who Will Lead Colorado’s Energy Future?

Unfortunately, there has been an uptick of environmental activism in the Centennial State, the effects of which contribute to a diminished energy supply, increased costs and more instances of energy poverty.

Regulatory policies and their sponsors may be well-intended, but they are demonstrably harming those who can least afford it.

When he ran for governor, Jared Polis campaigned on a platform calling for the state to be exclusively reliant on renewable energy by 2040. Along with democrat legislators and regulators, Gov. Polis is pursuing that lofty goal through a series of new laws and regulatory requirements that directly impact fuel supplies and prices.

House Bill 1261 is a climate-action plan empowering regulators to pursue Polis’ aggressive renewable goals. According to a report released by the Common Sense Institute (CSI), the new regulations will not dent national, let alone global, greenhouse gases in the atmosphere, but the renewable mandates are costly and will unnecessarily impact all energy consumers.

Those in the lower socio-economic strata spend a significantly larger percentage of their incomes on energy and will feel the brunt of higher costs much more than their affluent neighbors. CSI’s report recommends a net-zero energy strategy, rather than a 100 percent renewable strategy. They argue that this compromise will allow energy to remain affordable and reliable by allowing for the “continued use of fossil fuels with appropriate offsets and/or capture of greenhouse gases.”

READ: Understanding ESG & Colorado’s Energy Transformation

Colorado’s environmentalists are unlikely to consider such a compromise. Instead, they persistently bring forth a never-ending tab of new proposals effectuating the deconstruction of the oil and gas industry upon which we rely to heat our homes and drive our cars.

Energy assistance programs in the state are receiving record-breaking numbers of calls. Energy Outreach Colorado has received 335,555 calls so far in 2023, a 20 percent increase from last year. “Last year, natural gas prices were absolutely unprecedented,” says Ms. Denise Stepto, chief communications officer at Energy Outreach Colorado. “This year already, people are calling our office and saying, ‘I’m scared I can’t afford to heat my home this winter.’” Stepto said she’s worried about people having to choose between heat and food or medicine, or having to bundle their children in winter coats at bedtime.

Rising natural gas prices and increasing utility rates are financially clobbering Coloradans, and policymakers are insufficiently moved to consider a course correction. Instead, it’s full speed ahead on climate action, and banning the natural gas that could rescue the people who are struggling the most.

Challenges Ahead: Economic Concerns and Inflation Spell Trouble for 2024 Elections

President Biden’s re-election prospects face serious challenges. Despite public approval for many of his initiatives and strong disdain for former President Trump’s and his most ardent supporters’ behaviors, polls increasingly show Biden losing enough swing states to shift the electoral college in Trump’s favor.

A myriad of factors will determine the outcome of the election, including perceptions of the economy. Conversely, the economy is likely to see greater volatility in 2024 due to the election and abnormally heightened emotions. We will watch events unfold between the oldest sitting president whose challenge may be remaining fully functional and a former president who never concedes he has lost anything and thrives in a litigious world increasingly supported by social media and thugs. Unfortunately, we seem to be debating the typical liberal versus conservative views while standing on a tinderbox in a new technological world where AI can create more powerful false narratives.

READ: AI in Journalism — Transforming News Reporting and Storytelling (For Better or For Worse)

Of all the economic issues, inflation, despite dropping substantially in 2023, is the greatest threat to Biden’s re-election. Bidenomics, an effort to brand his campaign for economic achievements, was viewed unfavorably by a 2:1 margin in an October Bloomberg poll, while the individual economic components pushed through under the Biden administration are viewed positively by the majority of likely voters. A big part of the negative perception results from inflation rates of 6.5% to 7% after the pandemic and even higher rates in the housing sector for renters or new home buyers.

Currently, inflation has dropped to 3.5%, which is above the average rate of 2.9% the last 100 years. During the last century, the median rent in the U.S. increased from $60 in 1920 to $2,000 today (3.6% average annual compounded) and will be $62,000 in another 100 years. While the numbers are astounding when viewed in a 100-year context, the annual incremental increase of 3.5% is generally normal. 

Unfortunately for Biden, the Federal Reserve has created a widely publicized expectation that inflation should be managed to 2%. While that would be great, it happens infrequently and I believe is unattainable. We have the largest generation in American history, the millennials, dramatically increasing demand across the economy, especially for housing while the boomer generation has drastically decreased their productivity by retiring from the labor market.

The result is an inflationary labor market and the lowest unemployment rate in decades. To make matters worse, the new national agenda to bring a lot of manufacturing back to America reverses actions that helped keep prices down since the 1980s. Similarly, inflationary pressures come from a flood of migrants across the southern border until we integrate them, even if temporarily, into the labor market. The migrant situation will add fuel to the housing fire which will continue until baby boomers “permanently retire.” These realities will not change with the next president. 

READ: The Economics of Housing Inflation in Colorado — Exploring the Supply and Demand Imbalance

The greater long-term concern among the political right is the sustainability of the federal debt. Even many moderates, who will swing the election one way or the other, are fiscally conservative and socially progressive. While investment in infrastructure is desirable as it pays economic dividends in the future, there are important ramifications to printing and distributing “helicopter money” for all to enjoy.

It tends to be inflationary and will become more so over time; possibly at exponentially increasing rates. The 90-day debt obligations of the United States government are the benchmark of global economic stability defining “risk-free” in the financial world. When the day of reckoning arrives sometime in the coming decades it will be a worldwide calamity that could constrain needed public and private investment to adapt to the concurrent devastation related to climate change. 

Sooner or later, even central governments must own up to what they owe by dramatically cutting costs, increasing taxes and/or defaulting on their debt, leaving creditors with worthless paper and an unwillingness to lend more. When this occurs, economies transform radically and social safety nets dissipate.

Social strife escalates. Democracy can evaporate. If wars erupt, national defense demands higher budgets, which requires even more money printing, leading to hyperinflation where the monthly rate of inflation far exceeds what we experience now on an annual basis. Under such circumstances, our children will experience rapid declines in wellbeing. To get a good sense of this, look at Venezuela, which is the primary source of the current mass migration to the U.S..

I’m convinced that the number one economic goal of people is stability. We want to know our economic approach to meeting basic needs tomorrow will be like the past. Sure, economic thriving is much nicer than surviving, but knowing we have a secure base provides the greatest increment to our wellbeing.

America’s economy has become the envy of the world because we have a long history of economic stability, which we have built upon. Now, if we could just get to the issues rather than age, personalities and political drama highlighted by physical threats. I wish both Biden and Trump would abandon their campaigns and let two new fresh faces step forward. If one side changes their top candidate, I predict they will win the presidential election. Imagine that — personal egos subjugating to our national wellbeing.  

 

Tom BinningsTom Binnings is a senior partner at Summit Economics in Colorado Springs. He has more than 30 years of experience in project management, economic and market research, real estate development, business analytics and strategic planning. He can be reached at (719) 471-0000 or [email protected].

Who Will Lead Colorado’s Energy Future?

As ColoradoBiz prepared its fifth Energy Report, we identified more than 100 story ideas for consideration. From renewables to hydrogen to the electric grid to battery storage and critical minerals, we were again reminded that we’ll never run out of business stories to tell.

And while this report may merely scratch the surface when it comes to protecting our environment and wildlife, the state’s role within America’s energy security plan, the face of energy poverty, legal, regulatory and political challenges facing our state, and its competitiveness compared to other states, we felt the following articles set the scene for energy today and key topics that will matter most in the next decade.

READ: Understanding ESG & Colorado’s Energy Transformation

The world energy market is complex, to put it plainly. Many don’t know that the robust history of oil in Colorado began in Boulder in 1901. Yes, Boulder, the most progressive and environmentally conscious city and county in the state, initiated our dependence on fossil fuels. Yet, a look at modern-day Boulder proves without a doubt that hydrocarbons like oil and gas can be extracted and the land safely returned to its pristine state, sometimes even better than it was before.

So, who are Colorado’s energy leaders who have found a way to protect the environment we love while producing the energy we need?

The people behind it may be just as complex as the market itself. In short, there are two classifications of oil and gas producers: independents, who usually operate only in the U.S. or a single state like Colorado; and major oil companies, typically with hundreds of thousands of employees and operations across the world. Examples of major U.S. oil companies are Chevron and ExxonMobil.

READ: Biden is Right About One Thing — Oil and Natural Gas Aren’t Going Anywhere

Both independents and majors are positively shaping our energy future. Major oil companies have earned their right to the pick of the litter not just across the U.S., but across the globe, and their investments go well beyond just oil and gas. Think of them as the Apple or Google of energy.

In recent years there has been a slew of multi-billion-dollar acquisitions and consolidations within the oil industry. In 2019, Occidental Petroleum Corp. acquired Anadarko Petroleum Corp. and its Colorado assets for $57 billion. The following year, Chevron announced it was acquiring Denver-based Noble Energy for $5 billion. In May of this year, Chevron also acquired Denver-based PDC Energy for $7.6 Billion. Last month, ExxonMobil announced it was acquiring Pioneer Natural Resources for $59.5 billion. Two weeks later, Chevron announced it is acquiring Hess Corp. for $53 billion. Some of these deals mark three of the five largest oil and gas acquisitions in history.

Companies like Chevron and ExxonMobil, or Apple or Google for that matter, don’t make multi-billion-dollar investments without a firm grasp of the future.

Clearly, oil and gas will continue to fortify, if not lead, our energy mix for several decades to come. But make no mistake about it, there is an energy transition underfoot – literally. Oil and gas are unlikely to be the predominant energy sources beyond 2050 like they are today. However, leaders in this industry, and companies like Occidental and Chevron, are infinitely better positioned to solve problems associated with climate change. After all, who’s more likely to cure cancer, a scientist in the laboratory testing real-life samples, or a professor waxing philosophical in the classroom? My money’s on the oil engineers. No one knows carbon like they do.

 

Jon Haubert Hb Legacy Media Co 2Jon Haubert is the publisher of ColoradoBiz magazine. Email him at [email protected].

Colorado Cities Soar in Milken Institute’s Best Performing Cities Report 2023

The Milken Institute, a global non-partisan think-tank, has provided its index-based Best Performing Cities report since 1999. The index is created by ranking 400 American cities across three categories: access to economic opportunity, labor markets and the impact of high-tech industries.

The index gives a good assessment of community-level economic vitality. While job growth is important, by including insights into wage growth, housing affordability and broadband access as well as high-tech industry indices, the report informs us of different communities’ adaptations to a modern economy. 

READ: Economic Activity Study of Metro Denver Culture Reports Record-Breaking $2.6 Billion in Economic Activity

While we know most of Colorado’s cities have performed well over decades when compared to the nation, it’s less clear how the state performs relative to its closest competition in the Rocky Mountain region (Colorado, New Mexico, Arizona, Utah, Nevada, Idaho, Montana and Wyoming). The 2023 Best Performing Cities report does this with 2021 data. 

All Colorado cities (Boulder, Colorado Springs, Denver, Fort Collins, Grand Junction, Greeley and Pueblo) have performed well in recent years. Averaging the rankings for each city from 2021 and 2023 to exclude the pandemic year and calculating where that ranking lies among all large cities and small cities (for Pueblo and Grand Junction) in the U.S., we see that the lowest-ranked Colorado city is Greeley. This is largely due to a softer carbon-based energy economy. But even Greeley falls in the top half of all large cities, and during boom times for carbon energy after the Great Recession, Greeley ranked 10th out of the 200 largest US cities. 

The rest of Colorado’s cities rank in the top 20 percent of the nation’s cities except for Boulder (21st percentile) and Pueblo (34th percentile). This is impressive until we compare Colorado’s cities to other Rocky Mountain states. Utah and Idaho are especially impressive given those states’ cities rank in the top 7 percent except for Pocatello, Idaho, which comes in at the 26th percentile of small cities.  

READ: Open for Business — Four Priorities for Maintaining Colorado’s Economic Competitiveness

When the change in city rankings is viewed over the last decade, several trends stand out. First, the shift away from a carbon energy economy is evident as Farmington, New Mexico and Wyoming’s cities dropped dramatically along with Greeley. Second, smaller cities are performing better as are those closer to California (Phoenix, Las Vegas, Prescott and Reno).

These factors have moved Idaho’s cities up dramatically since 2013 by an average of 51 percentile points. In contrast, Utah’s cities have consistently remained in the top 10 percentile over the decade except for St. George, which jumped into the top category. The steady high performance by Utah is observable across data sources and is generally attributed to low taxes and a favorable business climate. Governor (now Senator) Hickenlooper once quipped it was hard not to feel competitive with Utah. 

In 2013, Denver, Fort Collins and Boulder all ranked in the top 10 percentile while Colorado Springs, Pueblo and Grand Junction were lagging with rankings in the 38th, 40th, and 46th percentiles respectively. Since then, these laggards are the only Colorado cities to move up in the rankings. Colorado Springs now ranks ahead of Boulder and Fort Collins and is closing the gap with Denver (including Aurora and Lakewood). Especially notable in the improving Colorado cities is their strong performance relative to average wage growth as opposed to job growth.  

What’s behind the rankings and trends?  Affordable housing indices (costs relative to incomes) appear to play a role only in Utah and some Idaho cities that are only recently seeing high growth. Colorado’s poor ranking for housing affordability may have become a hinderance to continued strong economic and population growth, but the data is deceiving since it compares local incomes to housing costs. Pueblo ranks last in the state along with Boulder in housing affordability. Colorado Springs and Grand Junction have worse affordability indices than Denver due to Denver’s higher wages.  

READ: Housing Affordability Crisis in Colorado — Denver, Colorado Springs and Grand Junction See No Signs of Improvement

Colorado shines when it comes to broadband access as defined by the percentage of households with internet. Colorado’s average city ranking is in the top 20 percent while the next best statewide city averages in Arizona, Utah and Idaho are only in the top 40 percent of the nation.  

Other than total job and wage growth rates, the major performance drivers for the Milken index are high-tech industries, which are indicative, in theory, of long-term economic vitality. Colorado cities perform well in the top 25 percent of the nation’s cities (comparable to Arizona and Utah) in the municipal GDP growth rate of high-tech industries. In terms of high-tech industry concentration, Colorado’s cities, excluding Grand Junction and Greeley, averaged in the top 15 percent of the nation. This is great until one looks at Utah, where all cities averaged in the top 8 percent. 

Thinking about the future, proximity to California, great broadband, a favorable business environment, water availability, climate adaptation and possibly women’s reproductive rights are likely to determine the best-performing cities in the Rocky Mountains.   

 

Tom BinningsTom Binnings is a senior partner at Summit Economics in Colorado Springs. He has more than 30 years of experience in economic and market research for public policy, strategic planning, business analytics and project finance. He can be reached at [email protected]. 

The Economics of Homelessness: A Potential Win-Win-Win-Win 

The most fulfilling job I ever had was working for a mental health agency developing housing and job opportunities for its clientele. Many of the clients were, or had been, homeless and my team was tasked with providing them with a bridge to recovery, which meant being housed and largely self-sufficient in an environment with wrap-around support. The medical and clinical staff helped clients deal with their disorders through therapy and dispensing psychotropic drugs that were becoming more effective. Unfortunately, we all had to deal with the tendency of some clients to self-medicate with drugs and alcohol and had to learn the skills of de-escalation.

Given my role of creating jobs for people suffering from mental illness, I chose to hand out business cards instead of spare change to the “homeless” I encountered on the street. During the month I tried this approach, only one young woman accepted the offer. Unfortunately, she called on her start date telling me she would not be coming to work as her boyfriend threatened to beat her if she did.  

The economics of homelessness are complex. According to the Colorado Coalition for the Homeless (CCH), only 1 percent of homeless individuals live unhoused by choice. Fifty-three percent have jobs and simply cannot afford housing. Other sources indicate most of the homeless are over the age of 25 and male with a rapidly growing age cohort being 50 to 64 who need access to more affordable health care in addition to housing.

The majority of homeless women escaped domestic violence. Thirty percent of the homeless are part of a family. Less than a third are addicted to drugs and alcohol, approximately 14 percent are veterans, and 25 percent suffer from some sort of mental illness. With more resources dedicated to veterans in the last decade, the number of homeless veterans has been cut in half. Unfortunately, the affordable housing crisis is having a negative impact across the board and the legalization of sports betting promises to exacerbate addiction problems, pushing more young people into homelessness.  

Development of more supportive housing programs holds promise to assist those experiencing long-term homelessness. The CCH reports the cost of supportive housing and services to be $13,400 per person annually compared to $21,000 to $40,000 spent for a range of services delivered on more of a revolving-door basis such as health care, incarceration, detox treatment and shelter services.

Unfortunately, false narratives on negative impacts of supported housing on surrounding communities are often exaggerated. The biggest concern centers on criminalized vagrants or abnormal behaviors such as loitering, which can escalate with poorly trained responders. A recent study of Colorado inmates found former homeless inmates are less likely to be incarcerated for violent crimes and more likely to have drug offenses and trespassing convictions. Such narratives combined with a lack of funding hinder expansion of such programs. 

Summit Economics recently documented the socio-economic impacts of the Fort Lyon supportive housing facility on Bent County. Systematic higher crime levels resulting in arrests were not evident in the data. There is greater demand for health services as the homeless moving into supportive housing have often gone years with inadequate medical care except at expensive emergency rooms. We found many local residents appreciate supportive housing given the positive impact on individual lives and the surrounding community. Community engagement among those who graduated from Fort Lyon and stayed in Bent and Otero counties is impressive. In fact, the local American Legion Post is the first in the country established by formerly homeless individuals.  

READ: Housing Affordability Crisis in Colorado: Denver, Colorado Springs and Grand Junction See No Signs of Improvement

The strongest support in Bent County came from local businesses that, like most businesses today, struggle to find enough reliable workers. There were numerous accounts of Fort Lyon residents, present and past, filling jobs across the skills spectrum, and I sensed the potential for an emerging entrepreneurial culture among graduates. The only problem was similar to what I encountered when developing vocational opportunities years ago. The need for labor results in employers wanting recovering individuals to work full-time. This is not necessarily beneficial to people in early recovery as job stressors and money can trigger negative behaviors that took them to homelessness in the first place.  

Visiting with supported housing residents and graduates at Fort Lyon took me back to my days working in the mental health agency, giving people a place to live and more money that comes from even part-time employment. We found dramatic declines in the need for therapeutic and medical treatment for clients engaged in work or volunteerism who had a roof over their head. Dramatically reducing homelessness through supportive residential programs is a win-win-win-win for the individual, businesses, communities and society as a whole.  

 

Tom BinningsTom Binnings is a senior partner at Summit Economics in Colorado Springs. He has more than 30 years of experience in economic and market research for public policy, strategic planning, business analytics and project finance. He can be reached at [email protected]. 

Simplifying Colorado’s Sales Tax System — One Success at a Time

Just a few short years ago, Colorado received a “D” rating from the Council on State Taxation, ranking Colorado’s sales tax system as one of the worst in the country. The abysmal rankings are a result of a confusing and cumbersome patchwork of 756 geographic areas with different sales tax rates and bases, and 72 home rule cities that require businesses to individually register and remit sales tax. This complicated and challenging sales tax system puts a significant burden on businesses around the state. 

In 2015, the Coalition to Simplify Colorado Sales Tax was founded by a non-partisan and diverse group of business and community leaders to address these challenges with one mission in mind — to simplify Colorado’s sales tax system. 

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This is not an issue that lands in news headlines very often. It is, however, critical to businesses and cities across Colorado and to our state government. Simplifying Colorado’s sales tax system will result in a thriving business climate, more jobs and an economy that is flourishing. This is an ongoing challenge, but we have come a long way since Colorado received that less-than-passing grade from the Council on State Taxation.

Working hand-and-hand with the General Assembly’s bipartisan Sales and Use Tax Simplification Task Force, the Simplify coalition has achieved tremendous success. One of the most substantial achievements has been the creation of SUTS, a one-stop portal designed to facilitate licensing and the collection and remittance of sales and use tax. SUTS will ultimately remove a significant amount of red tape and paperwork for businesses, untangle the more than 700 sales tax jurisdictions, and free up time to do what businesses do best — grow our economy.

READ: Higher Costs, Higher Crime, and More Red Tape — How Government Interference May Be Hurting Coloradans’ Wallets

SUTS is a remarkable tool for our small businesses and taxing districts. But it will soon be even better since House Bill 23-1017 passed in the most recent legislative session. The measure requires modifications that improve ease of use for businesses and municipalities remitting sales tax. The bill also requires the Department of Revenue to increase the awareness and participation of SUTS.

Another success of the 2023 legislative session is the passage of Senate Joint Resolution 23-004, which creates a process to achieve uniformity in the collection of sales and use tax for construction materials among municipalities, also improving Colorado’s business environment.

And one piece of legislation that has received some media attention and that the coalition fully supports is Senate Bill 23-143, which lends additional flexibility to the Colorado business community. Since it was made effective July 1st, 2022, the retail delivery fee has raised significant concerns with many Colorado businesses, particularly the costs of compliance and implementation of the fee. Signed by Governor Polis a few weeks ago, SB23-143 helps to alleviate some of those concerns by simplifying the fee collection and remittance process and providing an exemption for our state’s smaller businesses.

In light of the work of the coalition and the legislation that has passed, Colorado has climbed 18 spots — from 39th to 21st of states since 2017 — on the sales tax component in the Tax Foundation’s 2023 State Business Tax Climate Index. But there is still much work to be done continuing to simplify sales tax administration and address Colorado’s highly complex construction use tax and its equally complex lodging tax.

 

Paul ArcherPaul Archer is the president of the Simplify Colorado Sales Tax coalition and founder/CEO of Automated Business Technologies.