SB 03-161

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	The Amendment to the Bill
	First Regular Session Sixty-fourth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 03-0403.02 Jason Gelender SENATE BILL 03-161 SENATE SPONSORSHIP Cairns, HOUSE SPONSORSHIP Crane, Senate Committees House Committees State Veterans & Military Affairs A BILL FOR AN ACT CONCERNING AUTHORITY FOR ANY STATE AGENCY TO PROVIDE LIMITED MONETARY INCENTIVE AWARDS TO STATE EMPLOYEES WHOSE IDEAS RESULT IN NEW COST SAVINGS. Bill Summary (Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments that may be subsequently adopted.) ! Requires any state agency, including any legislative service agency, to incentivize a specified percentage of the amount of certain new cost savings from budget returns achieved during the first fiscal year in which any new cost-savings measure is implemented by the agency. ! Requires an agency to distribute the moneys as incentive awards to eligible managers and employees of the agency who propose, develop, or implement new cost-savings measures. Limits incentive awards as follows: ! Specifies a maximum amount of an incentive award that an agency may make in a single fiscal year regardless of the amount of new cost savings from budget returns achieved by the agency. ! Allows no more than a specified percentage of the total amount of an incentive award made by an agency as a result of new cost savings from budget returns for any single line item of appropriation to be made to an eligible employee who has the primary responsibility for administering the program or service funded by the line item and requires the remainder of the total amount of the incentive award be shared by other eligible employees of the agency who helped to propose or implement the measures that resulted in the new cost savings. Requires an agency to provide a report to the joint budget committee (JBC) that details how the incentive awards will be distributed before distributing any incentive award. ! Specifies that an incentive award is not counted as salary to an employee for purposes of calculating the benefits to which the employee is entitled. ! Specifies that an incentive award is in addition to and does not reduce any other increase in compensation to which an employee may be entitled. ! Requires the staff of the JBC to compile annually in a single report information regarding the total amount of new cost savings from budget returns achieved for which an incentive award was made during each fiscal year and the total amount of the incentive award. ! Requires the JBC to consider new cost savings from budget returns compiled in the report as part of its budget setting process. ! Repeals an existing incentive award suggestion system program for state employees. ! Defines terms. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. 24-38-101, Colorado Revised Statutes, is amended to read: 24-38-101. Legislative declaration. The general assembly hereby finds and declares that state agencies should be authorized and encouraged to improve their services and save money wherever possible. THE GENERAL ASSEMBLY FURTHER FINDS AND DECLARES THAT ALLOWING STATE AGENCIES TO RETAIN A PORTION OF ANY INITIAL COST SAVINGS FROM BUDGET RETURNS RESULTING FROM NEW MEASURES IMPLEMENTED BY SUCH AGENCIES AND TO USE A PORTION OF THE INITIAL COST SAVINGS FOR INCENTIVE AWARDS TO STATE MANAGERS AND EMPLOYEES WHO PROPOSE AND IMPLEMENT NEW COST-SAVINGS MEASURES THAT RESULT IN COST SAVINGS FROM BUDGET RETURNS WILL HELP IMPROVE THE EFFICIENCY AND EFFECTIVENESS OF STATE GOVERNMENT. SECTION 2. 24-38-102 (1), Colorado Revised Statutes, is amended to read: 24-38-102. Definitions. As used in this article, unless the context otherwise requires: (1) "Agency" means every agency in the executive branch of state government that is required by the constitution or statutes of the state to exercise discretion or to perform judicial or quasi-judicial functions AND EVERY STATE LEGISLATIVE SERVICE AGENCY. The term includes, but is not limited to, any board, bureau, commission, department, institution, division, section, or office of the state. SECTION 3. 24-38-103, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SUBSECTION to read: 24-38-103. Agency authority and incentives for budget savings. (1.5) (a) (I) SUBJECT TO THE LIMITATIONS SET FORTH IN PARAGRAPH (b) OF THIS SUBSECTION (1.5), ON AND AFTER THE EFFECTIVE DATE OF THIS SUBSECTION (1.5), ANY AGENCY THAT ACHIEVES NEW COST SAVINGS FROM BUDGET RETURNS, OTHER THAN COST SAVINGS RESULTING FROM EMPLOYEE ATTRITION, THE ELIMINATION OF SERVICES OR PRODUCTS PREVIOUSLY PROVIDED BY THE AGENCY, OR A REDUCTION IN THE LEVEL OF SERVICE PROVIDED BY THE AGENCY TO PERSONS WHO USE THE AGENCY'S SERVICES OR PRODUCTS, BY IMPLEMENTING ANY NEW MEASURE TO REDUCE THE COSTS OF DELIVERING THE AGENCY'S SERVICES AND PRODUCTS BELOW THE AMOUNT OF THE AGENCY'S APPROPRIATIONS FOR A GIVEN FISCAL YEAR SHALL, IN ADDITION TO ANY TRANSFER OF MONEYS BETWEEN APPROPRIATIONS ALLOWED PURSUANT TO SUBSECTION (1) OF THIS SECTION, RETAIN AN ADDITIONAL TEN PERCENT OF THE AMOUNT OF THE NEW COST SAVINGS FROM BUDGET RETURNS ACHIEVED DURING THE FIRST FISCAL YEAR IN WHICH THE MEASURE IS IMPLEMENTED AND DISTRIBUTE THE RETAINED MONEYS AS INCENTIVE AWARDS TO ELIGIBLE EMPLOYEES OF THE AGENCY. (II) FOR PURPOSES OF THIS PARAGRAPH (a), "ELIGIBLE EMPLOYEE" MEANS ANY MANAGER OR EMPLOYEE OF AN AGENCY WHO, ALONE OR IN CONJUNCTION WITH OTHER EMPLOYEES OF THE AGENCY, PROPOSES, DEVELOPS, OR IMPLEMENTS A NEW COST-SAVINGS MEASURE; EXCEPT THAT THE TERM DOES NOT INCLUDE THE HEAD OF AN AGENCY OR ANY EMPLOYEE WHO IS THE PRIMARY BUDGET OFFICER FOR AN AGENCY. (b) INCENTIVE AWARDS MADE PURSUANT TO THIS SUBSECTION (1.5) ARE SUBJECT TO THE FOLLOWING LIMITATIONS: (I) AN AGENCY MAY RETAIN AND DISTRIBUTE TO ELIGIBLE EMPLOYEES AS INCENTIVE AWARDS A MAXIMUM OF FIVE HUNDRED THOUSAND DOLLARS DURING ANY ONE FISCAL YEAR REGARDLESS OF THE AMOUNT OF NEW COST SAVINGS FROM BUDGET RETURNS ACHIEVED BY THE AGENCY DURING THE FISCAL YEAR. ONLY ONE AGENCY MAY DISTRIBUTE INCENTIVE AWARDS FOR ANY PARTICULAR AMOUNT OF NEW COST SAVINGS, BUT THE FIVE HUNDRED THOUSAND DOLLAR LIMIT THAT APPLIES TO AN AGENCY THAT IS NOT A PRINCIPAL DEPARTMENT OF STATE GOVERNMENT IS OTHERWISE SEPARATE FROM THE FIVE HUNDRED THOUSAND DOLLAR LIMIT THAT APPLIES TO THE LARGER AGENCY THAT INCLUDES THE SMALLER AGENCY. (II) NO MORE THAN FIFTY PERCENT OF THE TOTAL AMOUNT OF THE INCENTIVE AWARD MADE BY AN AGENCY AS A RESULT OF NEW COST SAVINGS FROM BUDGET RETURNS FOR ANY SINGLE LINE ITEM OF APPROPRIATION MAY BE MADE TO AN ELIGIBLE EMPLOYEE WHO HAS THE PRIMARY RESPONSIBILITY FOR ADMINISTERING THE PROGRAM OR SERVICE FUNDED BY THE LINE ITEM. THE REMAINDER OF THE TOTAL AMOUNT OF THE INCENTIVE AWARD SHALL BE SHARED BY OTHER ELIGIBLE EMPLOYEES OF THE AGENCY WHO HELPED TO PROPOSE OR IMPLEMENT THE MEASURES THAT RESULTED IN THE NEW COST SAVINGS. (III) PRIOR TO MAKING DISTRIBUTIONS OF INCENTIVE AWARDS, THE AGENCY SHALL PROVIDE A REPORT TO THE JOINT BUDGET COMMITTEE THAT DETAILS HOW THE INCENTIVE AWARDS WILL BE DISTRIBUTED. (IV) AN INCENTIVE AWARD IS NOT SALARY, AS DEFINED IN SECTION 24-51-101 (42), TO THE EMPLOYEE WHO RECEIVES THE INCENTIVE AWARD FOR PURPOSES OF CALCULATING ANY EMPLOYEE BENEFIT UNDER ARTICLE 51 OF THIS TITLE. (V) AN INCENTIVE AWARD PAYABLE TO AN EMPLOYEE PURSUANT TO THIS SUBSECTION (1.5) SHALL BE IN ADDITION TO AND SHALL NOT REDUCE: (A) ANY INCREASE IN COMPENSATION TO WHICH THE EMPLOYEE IS ENTITLED PURSUANT TO SECTION 24-50-104 OR ANY OTHER PROVISION OF LAW; AND (B) ANY INCENTIVE AWARD PAYABLE TO THE EMPLOYEE UNDER A PERFORMANCE PAY PLAN DEVELOPED BY THE STATE PERSONNEL DIRECTOR PURSUANT TO SECTION 24-50-104 (1) (c) (I). (c) THE STAFF OF THE JOINT BUDGET COMMITTEE SHALL COMPILE ANNUALLY IN A SINGLE REPORT INFORMATION REGARDING THE TOTAL AMOUNT OF NEW COST SAVINGS FROM BUDGET RETURNS ACHIEVED FOR WHICH INCENTIVE AWARDS WERE MADE DURING EACH FISCAL YEAR PURSUANT TO THIS SUBSECTION (1.5) AND THE TOTAL AMOUNT OF THE INCENTIVE AWARDS. THE COMMITTEE SHALL CONSIDER THE NEW COST SAVINGS FROM BUDGET RETURNS COMPILED IN THE REPORT AS PART OF ITS BUDGET SETTING PROCESS. SECTION 4. Repeal. Part 8 of article 30 of title 24, Colorado Revised Statutes, is repealed. SECTION 5. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety. Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment. Capital letters indicate new material to be added to existing statute. Dashes through the words indicate deletions from existing statute.