CO-04 (Special Election)
See Full Big Line
(R) Greg Lopez
(R) Trisha Calvarese
90%
10%
President (To Win Colorado)
See Full Big Line
(D) Joe Biden*
(R) Donald Trump
80%
20%↓
CO-01 (Denver)
See Full Big Line
(D) Diana DeGette*
90%
CO-02 (Boulder-ish)
See Full Big Line
(D) Joe Neguse*
90%
CO-03 (West & Southern CO)
See Full Big Line
(D) Adam Frisch
(R) Jeff Hurd
(R) Ron Hanks
40%
30%
20%
CO-04 (Northeast-ish Colorado)
See Full Big Line
(R) Lauren Boebert
(R) Deborah Flora
(R) J. Sonnenberg
30%↑
15%↑
10%↓
CO-05 (Colorado Springs)
See Full Big Line
(R) Dave Williams
(R) Jeff Crank
50%↓
50%↑
CO-06 (Aurora)
See Full Big Line
(D) Jason Crow*
90%
CO-07 (Jefferson County)
See Full Big Line
(D) Brittany Pettersen
85%↑
CO-08 (Northern Colo.)
See Full Big Line
(D) Yadira Caraveo
(R) Gabe Evans
(R) Janak Joshi
60%↑
35%↓
30%↑
State Senate Majority
See Full Big Line
DEMOCRATS
REPUBLICANS
80%
20%
State House Majority
See Full Big Line
DEMOCRATS
REPUBLICANS
95%
5%
April 13, 2009 08:00 PM UTC
33 Comments
Never mind potential law suits, if this doesn’t pass then public higher education as we know it will be gone. The amount colleges will need to raise tuition by will make it virtually impossible for the middle class to attend college.
Rep. Rice is exactly right that it’s in everybody’s best interest to solve this problem, but what is his solution? By all accounts, the JBC did everything they could to find the money.
I’m not saying I like this plan either, but we’re running out of options–and time.
I fully agree higher ed as we know it will end in Colorado, with Colorado going to virtually last in state funding of higher ed. The real tragedy is tuition will be unaffordable at community colleges, or they will close altogether, so the only gateway for many to get a four year degree will end. The middle class once again gets screwed.
You’re right about running out of options. Put another way, one Senator I talked to flatly stated there is no Plan B to fund higher ed. It’s Plan A (the Pinnacol deal) or higher ed goes bust.
I think I’d rather see Pinnacol go bust than higher ed.
What about the Feds? If AIG can get $186 billion in loans than why can’t we get a loan for the $300 million they’re planning to cut?
What about private donations? HB 1273, the health care bill that’s going to have its 3rd reading soon, relies heavily on private donations for its funding.
Single-payer health care is undoubtedly going to be more expensive to administrate than $300 million.
Allowing in your words, higher ed to be scuttled, at the expense of other fundings like: the CEA (producing a 50% HS graduation rate) or some office of energy or some other state bureaucracy just seems like irrational claims on leaderships part.
A state-funded entity? We do fund K-12 education, but as almost anyone with any Colorado political knowledge knows, A-23 precludes cuts to said K-12 spending.
And If the state energy office costs $300 M, then sure, let’s cut off some of the pork. But you know, as well as all of us, that it doesn’t.
What’s that I smell? Aha, another Liberturd. Why do you assert that the CEA is a a department of the state?
Or are you advocating cutting K-12 funding? What would replace it? How would Colorado graduates be able to qualify getting into any school?
Given the property tax decision, my guess is that the legislature will get away with moving the money. I bet the Supreme Court ultimately holds that the legislature was outside its authority and will tell them not to do it again – and to consider the transfer a loan to be paid back when they can.
The bigger good is keeping higher ed from cratering.
such insight … it is amazing to have you here floating the proponent solution to why it is ok to take Pinnocol’s actuarial required reserves.
Under federal laws won’t this put Pinnocol in violation of some federal requirements? Maybe it will result in a forced bankruptcy and require that the state take back over Pinnocol.
I believe most authorities on the issue say that these reserves are above and beyond their actuarial reserves.
Even with the transfer of $500 million of Pinnacol funds to the General Fund, Pinnacol has ample reserves to pay present and future claims. Anyone who claims this will “bankrupt” Pinnacol is blowing smoke, as is anyone who claims worker comp premiums will go up as a result of these bills
Ironically, this whole Pinnacol thing should be a non-issue, because Pinnacol shouldn’t even have the money it has. By statute, Pinnacol is required to perform an annual audit and refund money to policy holders in excess of operating costs, claims (present and future) and prudent reserves. Pinnocal hasn’t done this, hence the surplus funds it has.
So what will happen if the bills pass, the money is transferred, and it survives legal challenges, is the policy holders won’t get a refund of excess premiums Pinnacol was supposed to previously pay them.
AG Suthers issued an opinion Friday afternoon (which one Senator retorted to me was more of a political opinion than a legal opinion) stating the transfer was unconstitutional. I have not read that opinion, so I don’t know the basis for that determination.
Although I’m no attorney, I see the real legal issue is not that of a constitutional nature, but of contract law because the policies between Pinnacol and its policy holders are considered contracts, and thus this legislation would appear to retroactively void valid contracts.
One legislator I talked to thought this wasn’t the case, while of course opponents of the bill would advocate that the enforcabilty of valid contracts is supremely germane in this issue.
the potential constitutional issue I see is one of “takings,” that is, that no government agent can take anyone’s property without due process, which generally would have to be due process that shows why the property of those whose property is being taken either are liable in some way, or particularly benefit in some way. If the money that is not being refunded to the policy holders is defined as a legitimate property interest on their part (which is a bit broader than the conventional notions of what is one’s property), then there could be a takings issue.
Also, expecting the feds to bail us out when we, as a state, have chosen to live by the delusion that we can have a functioning state without funding it, may be a bit of a stretch. Having said all that, I definitely prefer the lesser of evils that leaves affordable higher education intact. Once we kill that, we have really done mortal harm to the state of Colorado.
but did we mess up any worse than AIG?
But I’d rather we figure out a way to save this state from the yahoos who don’t understand how much they depend on the state being able to fund things that they are refusing to let the state be able to fund.
And while it’s a noble long-term goal, it doesn’t help us out of our current predicament.
I’m not suggesting we hope the Feds offer funds, I’m suggesting that Governor Ritter should openly lobby for Federal money to solve this. It’s an easy sell if you ask me.
The legislature is apparently out of ideas, so I don’t see how it could hurt.
on the notion that the state should get a federal bail-out to cover expenses which the people of the state have made constitutionally impossible for the state itself to cover? Sure: ask, beg, cajole, whatever. But….
So Congress passes and Obama signs a higher education bailout bill just for Colorado…..
Osama Bin Laden would have a better chance of being confirmed as head of Homeland Security.
This is a rumor I have heard: if we don’t meet a certain threshhold of funding for higher ed, we lose $100,000,000 in stimulus funds.
Do anyone heard about this?
Please advise.
and the part that most people don’t understand that if the higher ed funding is not equal to 2005 levels, both higher ed and K12 will not receive the stimulus funding. Getting those funds is contingent upon both K12 and Higher Ed funding being at least at 2005 levels. It’s all or none.
has more information and says that it would be counterproductive for us to fall below the 2005 threshold.
I wonder if Pinnacol would get at least partially reimbursed if the state uses their money?
AIG messed up because of greed and gross incompetence, while the State of Colorado is “messed up”, i.e. it’s budget crisis, predominately because of a severe recession and resulting drop in revenues.
We were told the taxpayers had to bail out AIG because “it was too big to fail”. The citizens of this state, acting through its elected representatives, have to ask the question “Is higher education too important to fail?”
If we let higher education fail in this state, if we abandon the hopes and dreams of our young, our best and our brightest, then we have surely all failed.
it’s not on the website, no one has seen it. Does it really exist? If a Suthers falls in the woods, would anyone care?
SB 281, which would make Pinnacol a state-controlled entity, was passed 18-15. Al White voted “yes” while Dems Paula Sandoval, Dan Gibbs and Gail Schwartz voted “no.”
SB 273, which forces the $500 M transfer from Pinnacol to the state, passed 19-14. Sandoval was a “yes” vote here, and every other vote remained the same.
Sens. Heath (D) and Penry (R) recused themselves on these two votes.
Did Heath and Penry recuse themselves because they were formally on Pinnacol’s board or some other conflict?
It was just noted that both were the only members of the body to recuse themselves for either vote.
The Governor still has no position on the bill according to the Denver Post article this afternoon… Now that’s the definition of leadership, just hide under your desk until all the angry mob goes away.
…what we pay for workers comp? It’s pretty clear they’ve been overcharging.
…about insurance.
Colorado has some of the lowest WC premiums in the country because of Pinnacol.
Claims reserves are simply the predicted value of current incurred losses. It is money that has to be paid out.
The state spun-off CCIA (now Pinnacol) in 1987 – with depleted reserves.
Management has worked for the last 20 years to finally make Pinnacol’s financials look like a real insurance company.
If you loot the surplus, then Pinnacol loses all ability to sustain itself in the face of price competition. Pinnacol will have to charge higer rates than its competitors.
It is the big “non-residual” insureds that subsidize the low cost of WC insurance for small businesses.
Without competitive rates, these big companies will go to other carriers.
Without the ability to price competitively, Pinnacol will lose all but the “residual” market. Claims costs will rise. Premiums will have to rise to compensate.
So, while the big corporations get a break via price competition from other carriers, small businesses suffer from the higher rates as a result of the smaller risk pool.
That means fewer jobs… no ifs, ands or buts.
Wouldn’t that have the effect of the free market working and pricing insurance as it should be?
How, in any way, is robbing $500MM from an existing free market participant, an effect of the free market?
Small businesses cannot get coverage anywhere else and Pinnacol is required to underwrite them.
In exchange for that, they get a small premium tax advantage over other insurance companies.
Their underwriting strategy allows them to accumulate surplus – which allows them to compete effectively with other companies.
That keeps the rates down across the board.
That is free market.
Now, take $500MM away from the only force in the market that keeps rates low.
See what happens.
Well, the way it appears, you will see what happens.
I buy enough of it as a CEO that I have to. My point was that if Pinnacol has reserves beyond what is necessary, their structure requires a refund to those paying in. They have an excess. At a minimum that means moving forward the rates should drop a bit.
As to Pinnacol having to charge higher rates than it’s competitors, first off the 500M only puts that day off, it doesn’t eliminate it. Second, if Pinnacol can’t compete – how did it build up a surplus. Third, if Pinnacol truly can’t compete, then we should all switch to the lower cost provider.
I think, based on the fact that you joined today and are coming up with lame arguments for Pinnacol, that you’re a Pinnacol employee.
I am a former employee (left in 2000).
I am now a policyholder. I own a software company.
I can tell you how Pinnacol competes. They reduced their cost structure. The re-organized the mismanaged, under-reserved piece of junk that the state left when it got spun off in 1987, and spent 20 years improving processes, improving service, embracing technology, and becoming a model for state fund insurers across the country.
Prior to Pinnacol, I worked for the Minnesota state fund (State Fund Mutual). Prior to that, I worked for the administrator of the MN Workers Comp Assigned Risk Plan. There I did actuarial reserve analysis. Prior to that I worked as a financial analyst performing risk based capital analysis on insurance company finanacials for a reinsurance brokerage.
After Pinnacol, I worked for a software company that provided enterprise systems to WC carriers: Montana, Louisiana, Kentucky, Pennsylvania, Arizona, Yukon – and a number of private carriers.
Plus I have MBA degrees from UCLA and the National University of Singapore.
Do you really want to get into an argument about free market economics or the economics of the insurance industry with me?
You feel that just because Pinnacol has a surplus, that it’s ok to just take that money.
First of all, it doesn’t belong to you. Under (current) law, it belongs to me, the policyholder. So you are taking it from me.
That’s enough of an argument against it. From a moral and ethical perspective, you are wrong.
Beyond that argument, however, I happen to have 20+ years of experience in insurance company operations and financial analysis, have worked either directly or indirectly for 8 WC carriers (including 4 state funds), have seen varying levels of government interference and outright corruption, and quite simply, I am an expert in the field.
As such an expert, what I am telling you is that you are about the screw the pooch.
Heed my warnings or don’t… it doesn’t make any difference, because you are guided by your agenda, rather than then plain facts.
Your agenda appears to be that anyone with money is evil, even though, in this case, that money happens to be held in trust for the 58,000 employers that Pinnacol insures.
Consequences be damned, we’re going to screw those effective public servants! They succeeded, so they deserve to have my heel on their neck – and who cares about the thousands of small business owners I will harm in the process.
I see that as evil.
You’ve also supported my long-held view that liberals cannot but resort to personal attacks and irrational demagoguery – because they have nothing substantive to offer.
The fact that I joined yesterday has nothing to do with my arguments. Do you really think that tenure of membership here has some sort of magical weight on the validity of an argument?
That’s just simply irrational.
Yes, I have an agenda. I believe strongly that our elected officials are about to make a gigantic mistake that will harm the people of Colorado.
My 20+ years of expertise in this specific subject area leads me to believe that.
What experience do you have to offer?
And your comment above also begs the question… Why do you think that Pinnacol employees would want Pinnacol to not be a state agency?
…that one of the two bills was approved by House Appropriations on a 9 to 3 vote. It didn’t say who voted how. But the breakdown indicates that at least 2 Repubs voted for it! Marostica (“Tell Josh Penry to jump in a lake”) was obviously one of the two. Who was the other?