July 23, 2010
For those of you who missed our July townhall, it was on Amendments 60, 61 and Proposition 101 and featured the following guest panelists:
- Sheila MacDonald, President Solutions West
- Mark Neuman-Lee, Policy Analyst @ Fiscal Policy Institute
- William Stuart, Chief Academic Officer, Aurora Public Schools
- Henry Sobanet, former Budget Director under Gov. Owens
Supporters of these measures were hard to find in part because they have not filed any of their campaign finance reports, but after serial evasion of process service a Judge found Douglas Bruce linked to them.
Colorado will be facing record cuts next in addition to the recent $1.2 billion in cuts, even if these measures do not pass, but here is what you can expect if they do pass:
- $2.1 BILLION in lost state revenue
- Requirement to INCREASE K-12 by $1.6 BILLION
- But no net increase to K-12 because property taxes cut by 50%
- Requiring a state back-fill to K-12 which would force 99% of the General Fund to K12
- That would leave 1% of the budget for Corrections, Higher Education, Judicial, Attorney General, Legislature, Agriculture, Regulatory Agencies, Child Welfare, Medicaid, Transportation etc.
Proposition 60 reduces school district property taxes in half by about $1.5 BILLION each year which the state would be required to backfill, triggering a minimum of another $1.5 billion cuts in state services. This is a constitutional amendment and therefore not realistically changed if passed.
Proposition 61 prohibits state from incurring any new debt and imposes new limits on the amount of local government debt and requires taxes to be reduced when debt is repaid. While it may sound appealing, the effect is eliminate economic development financing in Colorado in the avenues that are most cost-effective, which is paying for use over time (like a car payment or mortgage payment). It also has the consequence of interfering with timing or delayed invoice payments (i.e. bill and pay in 30 days). This would require the state to cut its revenue by another $500 MILLION and local governments by $2.8 BILLION. This overturns several the results of several local elections and means about 36 school districts will have to cease new public school facilities. Those districts represent about HALF of the students in the State of Colorado This is a constitutional amendment and therefore not realistically changed if passed.
Proposition 101 is expected to reduce state revenue by $1.6 BILLION per year as a result of decreased income & sales tax, vehicle registration fees, telecommunications fees. Local governments will lose $936 MILLION in revenue from specific ownership taxes and local sales taxes. The School Districts will lose about $150 MILLION (which the state will have to backfill)
Aurora Public Schools would be expected to lose 40.17%, or $1,298.76 in funding PER student or approximately $42,845,335.
In many respects these measures would take Colorado to a funding level over 100 years ago despite our population of over 5 million people. The combined effect of these measures will be to cause an explosion in the size of any remaining K-12 classrooms and cause a new recession in the anticipated loss of 70,000 jobs.
It would also force closure of public higher / conversion to private higher ed, close all or most of state prisons in Colorado, stop capital development, public safety, economic development, infrastructure investment, senior services, child welfare.
These measures will save you potentially a few hundred dollars per year and will likely sound appealing but will destroy Colorado business, jobs, schools and families.
July 23, 2010
This morning CPC (academic clinical research trials specialists) announced it is joining The Stem Cell Research Center at the CU Anschutz Medical Campus in Aurora. This partnership will help bridge academic research with clinical applications in some key areas of concern to most people:
And it has the potential for saving lives and teaching us more about healthy living.
- heart disease
- cardiovascular illnesses
- Parkinsons
- cancer
- Alzheimers
The research at the Stem Cell center has discovered how to work with adult stem cells, "regress" them to embryonic state, "correct", grow and strategically use them in ways to replace one's own damaged cells with one's own cells that are not damaged.
This is by no means the only type of research that is going on, but this research is showing promise for restoring vision in corneal cell translants to some people who have been blind, stopping and shrinking cancerous growths (even where metastasized) by better differentiating be cancerous and non-cancerous stem cells, helping with neural degradation, blocked arteries -- you name it.
Seems real progress often comes in understanding not only the treatment or management of symptoms but understanding disease mechanisms so we can better prevent or at least cure many of those conditions that can be most disabling.
This is also good news for us regionally on the economic development front in that:
- it attracts research grants
- generates intellectual capital and property
- fosters new bio-business development
- employs more scientists and researchers
And it has the potential for saving lives and teaching us more about healthy living. This is good news for jobs, economic development, intellectual pursuits, health care and quality of life for potentially millions of people. While nothing is a "silver bullet" I think it is important to highlight progress where it is happening.
June 21, 2010
For those of you who could not make it, our last townhall meeting on June 17, was on "Money & Politics". We were extremely lucky to be joined by:
- Bernie Buescher, Secretary of State
- Jenny Rose Flanagan, Colorado Common Cause
- Jon Caldera, Independence Institute
- Martha Tierney, Election, Campaign Finance Attorney
The panelists covered a wide range of topics from how much money is spent on our elections, how the public can trace the money and where the current loopholes are. The panel discussed the impact of Citizens United US Supreme Court case.
As of the time of writing this post $2.3 billion dollars has already been spent on the 2010 election on campaigns. (www.opensecrets.org).
Yet, a series of U.S. Supreme Court decisions has opened the floodgates for money on politics. The original line of decisions decided that "money" was "speech" and the recent line of cases (Citizens United) went further to decide that "corporations" were also "people". The net effect is that the ability for wealthy individuals or rich corporations to bring an influx of cash to our elections is given a great deal of 1st Amendment protections.
Some of the issues raised are:
- Have we moved away from one person, one vote?
- If money is "speech", do rich people have more speech rights than others?
- If corporations are "people" do they in essence get 2 votes?
- Do limits on campaign finace contributions level the playing field or drive donations underground?
- Is the free flow of money in politics really just an extension of a "free market"?
- What are the possibilities of publicly financed campaigns to help reduce the role of special interest money in elections?
- Does special interest money influence access or shape public policy?
- How can regular citizens find out who is behind political ads?
Colorado has a few basic features as a part of campaign finance reform that you should know (that the voters approved):
- $400 limits a candidate can receive from an individual or PAC;
- Any contribution beyond that can not be coordinated with the candidate but could be spent as an independent expenditure;
- Colorado prohibited direct contributions from corporate or union treasury to candidates or from making independent expenditures from their direct treasury;
- Colorado law prohibits contributions from foreign individuals.
The decision in Citizens United removed the prohibition against corporations and labor unions making independent expenditures, which has opened up the prospect of potentially unlimited amounts of money from previously prohibited sources. SB 203 (M. Carroll - Weissmann) was brought to at least close the disclosure loopholes, however, Colorado voters will not be inundated with new sources of previously prohibited campaign transactions.
Tools for Voters: In order to know where and how to follow the money, every voter should be armed with the following:
- Secretary of State's website: provides state candidate, PAC, 527, Issue committee, small donor committee disclosure, and lobbyist disclosures and will now include independent expenditure committees. Their website is:http://www.sos.state.co.us/
- Follow the Money. org: this website provides great information about macro trends about who is donated where, to which candidates, and which parties. It is particularly helpful to identify the spending of various special interest groups. Their website is: http://www.followthemoney.org/
- Open Secrets. org: this website provides great information about macro trends about who is donated where, to which candidates, and which parties. It is particularly helpful to identify the spending of various special interest groups. Their website is: http://www.opensecrets.org/
June 09, 2010
If you are an employer, employee or taxpayer in Colorado, you are impacted. Pinnacol is Colorado's quasi-governmental workers compensation carrier of last resort.
Because they hold nearly 60% of the market they impact practices for employers and employees throughout the state, either directly or indirectly. They are taxpayer subsidized in a few significant ways: they pay no federal corporate income tax, no state corporate income tax, no premium tax, no state court fees, no property or sales and use tax and their employees participate in PERA (the public employee's retirement).
The performance audit was triggered by SB 281 and the results of that audit were presented June 7, 2010. Key findings in the audit were:
- Bonuses significantly high
- Setting bonus goals for execs artificially low to ensure executives received maximum bonuses from 2002-2008
- Pinnacol paid more than $1.9 million in bonuses from 2007 – 2009, which if divided by their 611 employees is almost $88,000 in bonuses per employee.
- Pinnacol cannot adequately document their rationale
- Bonuses were awarded on duplicative and unclear criteria
- Gainsharing targets too low, lack rationale
- Reward programs do not consider any component about injured workers experience or satisfaction.
- Golden Parachute Agreements for executives if change of control
- Salary, benefits, bonuses for up to 2 years
- If terminated without cause Pinnacol’s exposure would be more than $4.3 million
- The agreements are "very unusual" for state WC funds
- This limits the Board's ability to fire the CEO even if doing a poor job
- Pinnacol Rates excessive and unfairly discriminatory as follows:
- Pinnacol Loss Cost Multiplyers (LCMs) may unfairly discriminate among employers,
- Overcharge employers with policies in Standard and Non-Standard tiers relative to employers in Preferred or Superior tiers.
- Used inaccurate information, unsubstantiated assumptions to calculate LCMs
- Lack of adequate controls over rate-setting process
- Pinnacol’s method of determining employer’s eligibility for Schedule Rating may not be fair to all employers.
- Pinnacol used rating factors from 2006 – 2010 that was not filed with the Division of Insurance which violates CO law
- Pinnacol Insurance has no insurance actuary on staff
- This is highly unusual and likely to impact accuracy of rates
- Pinnacol surplus continues to exceed range established by Board
- Surplus continues to exceed levels recommendd by Board
- Level of surplus is adequate to cover claims
- Claims Handling Problems
- 8% of sample not in compliance with statutes and rules
- Does not use injured worker satisfaction surveys as component of exec performance plan or gainsharing program, but does use policyholder satisfaction.
- Travel and Entertainment that "borders on abuse"
- Pinnacol paid $1.5 million in travel and entertainment in 2009
- Weaknesses in Pinnacol’s policies and controls over travel & entertainment expenses
- Weaknesses in controls over 3rd party payments made on behalf of Pinnacol personnel and Board members
- 45 out of 60 travel & entertainment expenses did not comply with Pinnacol’s own policy.
- Routine reimbursement of expenses that violate its own policies renders those policies virtually meaningless as controls on spending for travel & entertainment
- Pinnacol had subordinates approving supervisors expenses
- Found potential for conflicts of interest
- Pinnacol has failed to set limits on lodging and non-business meals
There were 14 audit recommendations. indicated they agreed and would comply by December 31, 2010, but will be brought back before the audit committee in September to ensure they are making actual progress.
Pinnacol has been in the press lately and over the last year for resisting the Interim Committee to review their performance and status, for resisting the performance audit (above), for seeking to eliminate state oversight through privatization, for tying defeat of Pinnacol reform legislation to a several hundred million dollar proposal for privatization, for a highly publicized luxury trip to Pebble Beach Resort and for trying to claim they are not subject to Colorado's Open Records Act.
Injured workers in the interim committee reported significant problems with denial of appropriate claims, inability to get timely access to appropriate medical treatment, harassment through surveillance in unwarranted circumstances, going into bankruptcy and foreclosure for non-payment of benefits from Pinnacol and expressed great frustration at having to fight for everything in a system that is not supposed to require litigation or hiring of legal counsel.
To their credit, in the audit committee Pinnacol agreed with the audit findings to fix problems they were defending just days before.
You can download a full copy of the audit by going to the State Auditor's website.
May 24, 2010
Our most recent townhall meeting on May 20, 2010 was on "Tips to Save Money". There were some great tips provided by our expert panel and members of the audience.
1. Track EVERY dollar you spend for 3 months. You need a baseline to know what you are spending where if you are to better understand where you can save money.
2. Pay down debt. The faster you pay down debt the better your interest rates will be and the more of your own money you can keep.
3. Save. Put something away every month (like need to pay a creditor). The habit is more critical than the amount initially. http://www.americasaves.org/
4. Comparison Shop. The amount of time spent comparing should be somewhat proportionate to the size and significance of the purchase. i.e. a home, car, insurance or major appliance may warrant more research.
5. Check out the vendor. You should check out the vendor with the Better Business Bureau and if buying any good or service from a licensed profession, check out the profile from the Department of Regulatory Agencies to see what their complaint or disciplinary history includes (plumbers, doctors, electricians, cosmetologists etc.)
6. If you need help resolving tax issues, consider the DU tax clinic.
7. Look for bargains and deals (MileHighOnTheCheap.com) and other places. Remember coupons don't always mean its cheaper and look for a recognized vendor and expiration date on coupons to ensure they are legit. Corporate v. franchise may mean some coupons are not honored everywhere.
8. Ever tried frecycle? This is about as cheap as it comes, given that it is free. The Aurora freecycle group is at: http://groups.freecycle.org/Aurora-Freecycle/description.
9. Craig's List is another great resource for finding good deals. http://denver.craigslist.org/
10. Watch out for scams. Check with the consumer affairs division of the 18th Judicial District Attorney's office for the latest trends in scams. Also check with the Better Business Bureau. Don't give your social security, date of birth or other information out over the phone or internet unless you know who you are dealing with. Bottom line: you should be able to say "I'll get back with you" to any purchase and if they do a "now or never" on you, walk away.
11. Libraries. Membership to Colorado libraries are reciprocal and you can get free books, videos, computer access, classes, research assistance, job help, tax information. This is one of the best deals around.
12. Entertainment: Look for "free days" or matinees or other bargain times for museums, movies, plays, concerts.
13. Check out Fees and Deals at http://feesanddeals.blogspot.com/.
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