Success from the session: Leadership, bipartisan effort keys to fixing unemployment insurance

Gov. John Hickenlooper signed legislation today that restructures the way Colorado's Unemployment Insurance Trust Fund is financed. The bill, HB 1288, makes a number of both short- and long-term fixes that will ensure the trust fund returns to solvency sooner, maintains solvency well into the future and does so in a way that meets the needs of businesses and workers.

Unemployment insurance plays an important role in helping workers who lose their jobs through no fault of their own. These temporary benefits are particularly important for low-wage workers, when they often can be the difference between making ends meet and slipping into poverty.

Colorado's Unemployment Insurance Trust Fund is insolvent and is expected to remain so through at least 2012 because of the high rate of unemployment caused by the Great Recession. Benefits are currently paid with funds borrowed from the federal government. Complicating matters further, a 2010 audit of Colorado's UI system also found flaws in the way the system is financed, resulting in a structural gap and an overreliance on solvency surcharges.

During a legislative session in which partisan differences attracted most of the headlines, HB 1288 passed the House and Senate with only one negative vote. It is easily one of the most significant pieces of legislation passed by the General Assembly this session – yet hardly anyone knows about it. It represents what can be accomplished when people with divergent views come together, work hard to understand a problem and focus on crafting practical solutions that work for everyone.

Don Mares, director of the Colorado Department of Labor and Employment under Gov. Bill Ritter, brought together a broad, bipartisan work group that included representatives from business, labor and advocacy groups, including the Bell Policy Center, to develop recommendations to solve the financing problems. Ellen Golombek, the new labor department director, continued the work group, supported it and saw that its recommendations were reflected in HB 1288. Mares and Golombek should be commended for establishing, supporting and encouraging the activities of the work group.

The Bell Policy Center was honored to be part of the work group and looks forward to similar collaborations in the future. We also give a special shout-out to Kathy White of the Colorado Fiscal Policy Institute, Virginia Morrison Love of the Colorado Competitiveness Council and Gary Estenson of the Colorado Department of Labor and Employment. They did most of the heavy lifting in crunching the numbers, assessing various proposals and developing what became the work group's recommendations.