March 17, 2012 06:45 PM UTC

Election-Year Gridlock Rules, Unless You're Pinnacol Assurance!

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• by: Colorado Pols

As the Denver Business Journal’s Ed Sealover reports:

Colorado Gov. John Hickenlooper would not rule out the possibility of pushing a bill to privatize Pinnacol Assurance this legislative session, but said Thursday that he wants to concentrate first on resolving issues that business groups have with the idea.

Hickenlooper met in the morning with the Denver Metro Chamber of Commerce board of directors to discuss the idea of privatizing the state-chartered workers’ compensation insurer, a discussion that Pinnacol board members had said last month that they would slow down from the rapid pace on which it had been. The Democratic governor had met with Colorado Concern on the same topic Tuesday and is scheduling similar sit-downs with other business groups in the coming weeks.

An attendee at the meeting said the governor did not talk about any specific proposals or bills but focused instead on hearing the concerns of chamber leaders about proposals that the Pinnacol board and he had put out since December. Business groups had reacted lukewarmly – or even voted to oppose – those earlier plans because they did not believe Pinnacol could maintain its low premiums and high level of customer service if it lost its tax breaks for being a state-chartered entity [Pols emphasis] and expanded its business outside of Colorado.

When we last touched on the ongoing story of Colorado’s state-chartered and tax exempt workman’s comp insurer Pinnacol Assurance, this year’s attempt to privatize Pinnacol was being shelved in the face of opposition from business groups and Democrats in the legislature. Gov. John Hickenlooper hasn’t been around for the long fight over Pinnacol’s status as an unhappy entity of the State of Colorado, which stretches back years, including an aborted attempt to use some of its hefty reserves to balance the budget during the recent recession. Since that time, scrutiny of Pinnacol’s aggressive methods investigating worker injury cases, combined with a nasty TV exposé of lavish spending on board members has both increased both anger from Democrats, as well as Pinnacol’s agitation to privatize–and put an end to the cramping of style that accompanies status as an entity of the state. Naturally on both counts!

But note carefully what business’ concern is in privatizing Pinnacol, irrespective of what Pinnacol offers to compensate for decades of operations as a tax-exempt state chartered entity:

Hickenlooper said after the meeting that he took away the message that more work needs to be done on ensuring business groups that any rate hikes [Pols emphasis] won’t send the lowest-risk businesses fleeing from Pinnacol to competitor companies, resulting in even higher rates [Pols emphasis] because the company is left with a higher risk pool among its clients. Pinnacol now represents about 55 percent of the businesses in Colorado.

Ask yourself: what is Gov. Hickenlooper, our supposedly so pro-business it pisses off all the other Democrats governor, doing by doggedly pushing something that will jack up overhead for so many businesses? His defense doesn’t just assume the possibility of higher rates, it assumes higher rates. The upshot being, it won’t be bad enough to hurt that much? Seriously?

Well folks, before Gov. Hickenlooper gets to make that case, he’s going to want to explain:

1. Why Pinnacol “needs” to be privatized at all, and

2. Why privatizing Pinnacol would be a good thing for anyone except for Pinnacol.

Because as extraordinarily accommodating as we seem willing to be to an entity that hasn’t exactly earned it, nobody’s successfully made the case on either of those questions to us.