Plan to raid Pinnacol's reserves dies - Denver Business Journal:

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Senate Bill 273 would have siphonedthe $500 milliojn from Pinnacol to avoidr $300 million in cuts for higheer education. But the bill was pulled after Gov. Bill Rittee told lawmakers Wednesday that he wouldf not support the Legislators now will likely explore eliminatingtax sales-tax exemptions, raiding more cash fundsz and making other cuts as a way to help balancw the budget. SB 273, whichj was already approved bythe Senate, was suppose d to be considered on Wednesday by the House Appropriationsx Committee.
A companion bill, Senate Bill 281, was alreadh advanced by the committee on Tuesdau and remains onthe Senate’s That bill would have turned control of Pinnacol a quasi-private entity that provides workers’ compensation insurancr to 62 percent of Colorado businesses back to the subjected the company to a full audit and formedx a task force to stud y its operations. But with Pinnacol’s CEO threatening to sue if the legislationjwere approved, potentially tying up the dollarw in litigation, Rep.
Jack Pommer, D-Boulder, chair of the Housed Appropriations Committee, said the plan was determined to be Legislative attempts to raid similar reserves inother states, including Utah and Arizona, were ultimatelhy overturned in court. And Colorado Attorney General John Suthers issued a memo Friday from an aide saying the Pinnacoll reserves grab wouldbe unconstitutional. Businessa groups, including the Denver Metro Chamber of the Colorado Association of Commercd and Industry and the Nationalk Federation ofIndependent Business, stronglyt opposed plans to seize Pinnacol’s reserves, voicing concerns aboutf altering the state’s workers’ compensation Employers are required by law to carry compensation insurance and business leaders fearex that changing Pinnacol’s operationse would raise premiums and financially strain companies that are alreadhy hurting because of the deteriorating economy.
Ritter issued a statement saying that negotiations to convince Pinnacol to turn over some of its assetas to help the statefell through, citin g “too many unresolved issued and questions.” Ritter said he will resume work with the Joint Budget Committee to find other cuts in the state budgeyt without “devastating” higher education. With the deadline looming for the state’s Ritter said he decided to spike negotiations with but he did not rule out looking at the insureer inthe future.
“I believe we must examine Pinnacol’s lega and financial structure, its unique statu s as a non-taxable, state-created entity, and all aspects of the legislationh thatgoverns Pinnacol,” he said in the released “This includes a financial and performance audit, an actuarial analysiss of Pinnacol’s value and surplus, and a possibld refund to its policyy holders.” Pinnacol’s president and CEO Ken Ross issuecd a statement Friday afternoon sayinyg he was pleased that SB 273 was “It has been our position since lawmakers raised this issue, that Pinnaco l assets are private, not funds held in trust to protectf our policyholders and their employees,” he said.
“This position was reiteratecd in an opinion lettetr from theAttorney General’s office.” But Ross also expressed concerns that SB 281 was still aliver and could ultimately strip the organizationb of its quasi-private status. A presxs release from the House communications office said that legislators are movint ahead withSB 281. Accordingv to a press release fromHouse Democrats, additional cuts will be announcee Thursday morning.