Senate Business, Labor, & Technology [Mar 17, 2026]

We'll welcome him online. The Senate Business Labor Technology Committee will come to order. Ms. Chapman, please call the roll.

Lindstedt. Present.

Madam Chair. Here.

Hey, sorry about the kiddo.

Thank you, Madam Chair, and thank you, committee. I'm here to present Senate Bill 122. Earlier in the year and last fall, we had some fuel distributors out of my district. that were all of a sudden getting dinged and getting shut down for vent pressures on their storage tanks being too high. And the inspectors were coming to the conclusion that you would have to get all your fuel from Suncor up here in Denver, which puts fuel on the road that much longer, more liability, and more cost per gallon in the final product they could sell. And in the summer when things get busy, there's going to be shortages. So I looked into it. I had Mr. Bailey help me out and found a little glitch in the statute that the department worked with us to get a fix. They gave us a waiver to get us to April 15th. Now this bill is going to put a permanent fix into that statute to where our rural fuel suppliers will still be able to get fuel from out of state. The other part of this bill is updating the petroleum storage tank fund. It's bringing it from $2 million up to $2.5 million because of the cost of cleanup as everything else has gone up. So it's just kind of updating that to more current standards. Pretty easy bill. I don't think there's any opposition to it. It sounds like we may have to run an amendment on seconds. But other than that, that's what I've got. It's a good bill. Thank you.

Thank you, Madam Chair, and thanks for letting me join remotely. Senator Pelton covered the main points of the bill. And I'm glad to be on this bill with him because out here in my district, we, of course, have some businesses that like to source their fuel. It's closer to get it from Utah than to come down to the front range. So like Senator Pelton said, this is already happening as the result of a waiver process right now from the department. And so this bill would just formalize the flexibility that's already been granted and would appreciate the committee support today.

Thank you, Madam Chair. I'll be fairly quick. Greer Bailey, on behalf of Colorado Wyoming Petroleum Marketers, first off, I just want to elevate and thank our partners at OPS. When the RVP, which is a reed vapor pressure standard promulgated by ASTM, was passed, they reached out and they've kind of really stood in the breach for consumers in rural parts of the state. As Senator Pelton said, we bring in fuel from Kansas and Nebraska, Wyoming, Utah, and all of those states have different RVPs currently under the new standards. So I really want to thank Director Albuquerque and his team for standing in the breach there. This does provide some long-term statutory flexibility. OPS has developed a working group between the suppliers, the refiners, the pipeline companies, and marketers to discuss these things, as they always do. OPS is a great agency for that. And so I'd imagine any future changes would be informed and would have the consent of the industry. But this does provide the foundational authority. The second part of the bill is more like an inflationary adjustment. When we first set up the Petroleum Storage Tank Fund in the committee, better part of 25 years ago, the cap was set at $2 million per reimbursement event. This provides, in the current bill, in the language, it goes up to $2.5 million with the authority. The department reached out earlier today, though, and asked if it could just be at the discretion of the committee and the director. And so after speaking to my board members who supported this, we would be supportive of that amendment on second reading. It's just not ready for today. So thank you, Madam Chair. Thank you, committee.

Hi, can you hear me now?

Thank you. Thank you, Madam Chair and members of the committee for the opportunity to testify today. My name is Andy Smith. I am a board member of the Colorado-Wyoming Petroleum Marketers and represent Evergreen Oil Company, a small family business in Evergreen. I served on the Petroleum Storage Tank Committee for many years and have worked closely with the Division of Oil and Public Safety. I'm here in support of Senate Bill 122. Our fund, the Colorado Petroleum Storage Tank Fund, is recognized by the EPA and the retail petroleum industry as the gold standard. This is in large part due to the efforts of OPS Director Mahesh Albuquerque. Mahesh and his team, along with the Colorado Petroleum Storage Tank Committee, have done a tremendous job of cleaning up contamination, all while protecting the integrity of the state fund. In 2005, recognizing higher cleanup costs due to inflation, the Colorado legislature increased the fund's per-occurrence maximum liability protection from $1 million to $2 million. It's been over 20 years since the fund's liability protection was increased, and with ongoing inflation and rising cleanup costs, the $2 million ceiling no longer fully covers severe contamination cases. The retail fuel business is highly competitive with razor-thin margins. Many gas stations, which are often small businesses, cannot afford massive, unexpected cleanup costs. The increased protection this bill provides is essential security against bankruptcy and ensures that resources are available to thoroughly clean up contamination from fuel dispensing facilities. On behalf of Colorado Petroleum Marketers and the environment, I urge you to pass Senate Bill 122. Thanks again for the opportunity to testify, and I'm available to answer any questions that you have.

Okay. It just was backwards on my screen. I'm Arlen Scholl, president of the Scholl Oil and Transportation Company. We're located in Holyoke, Colorado, founded in 1932, fourth generation family-owned business. we're in support of Senate Bill 26-122, primarily because we're located 13 miles west of the Nebraska border. And our choice of terminals is either North Platte or Denver primarily. And we purchased about 40% of our fuels from the North Platte terminal over at Sunoco Terminal in North Platte. And so for us, many times it's more of a supply or pricing situation where sometimes Denver may be 30 cents higher than North Platte. So obviously, financial considerations allow us to go east to Nebraska. And so it's pretty important to us to be able to get these exceptions. one of the three areas that I noticed in the bill it talks about it addresses consumer protection especially regarding pricing and supply networks And all three of those things are important to us the supply networks and also obviously the pricing being the differential between Denver and Nebraska And then we want to protect our consumers so that the pricing and also the availability is always there. So an exception to the rules would be great for us. I think all of us that are on the eastern end of Colorado and dealing with that border of Nebraska. Thank you so much.

Hello, can you hear me?

Thank you, Madam Chair. My name is Kyle Call. I am currently the Director of Fuel Supply at Maverick, who also is involved with the Colorado Petroleum Workers Association. Maverick has roughly 130 convenience stores within the state of Colorado, which accounts for roughly 25 million gallons a month or so. We appreciate the efforts of Senator Roberts and Senator Pelton in advancing Senate Bill 122, particularly as it applies to the Class 1, Class 2, and 3 liquid fuel products. Allowing the Director of the Division of Oil and Public Safety to adopt these rules, to adopt rules or issue policy guidance that provides targeted exceptions to specific ACM standards specific ASTM standards will help address important considerations related to consumer protection, pricing, supply chain dynamics, and other factors that may not be fully contemplated when ASTM standards are developed and are adopted by reference by the state of Colorado. We have recently seen this with ASTM's updated version of D4814, as mentioned by Senator Pelton, as well as others on this call. So we appreciate and thank you for your consideration of supporting this bill.

that'd be great. Welcome. Mr. Chairman of the Committee, thank you for allowing me to speak with you today. My name is John Drafts and I support the position of the CWPMA. I'm the Vice president of environmental services for NWESCO and have over 30 years of experience in underground storage tank compliance and cleanup in Colorado. As we all know, the inflation and the cost of doing business today is exponentially different than it was in 2005. Inflation-adjusted prices have increased approximately 64% since the $2 million cap was instituted, meaning if we adjusted the maximum allowable amount to fully compensate for inflation, that number would be approximately only $3,300,000. We do not need the maximum amount allowed to be adjusted to that level due to the leadership and policies instituted by Director Albuquerque and the excellent staff at the Division of One Public Safety. We do, however, need the maximum allowable to be adjusted to help keep up with these inflationary pressures. By raising the maximum allowable cap to $2,500,000, you are allowing the sites that have been the most difficult to remediate to continue to be cleaned up. These sites are generally the most expensive because they are near sensitive environments, have impacted drinking water wells or near schools or daycares. The additional funds we are requesting are first and foremost needed to continue to protect human health and the environment. Based on inflation, the amount being requested seems to be a small amount, but can have huge implications on those remediation sites that have or are approaching the $2 million maximum. As you can attest, everything and every facet of life is more expensive, including doing business and remediating UST release sites. I respectfully request you vote yes to approve the maximum allowable cost adjustment so the remediation sites that most need it and their surrounding neighbors and sensitive environments remain protected. Thank you again for your time. I'm happy to answer any questions you may have.

More of a statement than a question Madam Chair for Mr. Smith it's been a long time you probably don't remember but once upon a time I know you guys got all of your deliveries from Manweiler and then Grandyke and you had an excellent excellent online fuel inventory system that made planning really easy. But as with all technology, there was maybe five or six times a year that that would go offline, which meant for me as the manager of dispatch operations at 7 o'clock in the morning phone call. And I believe it was you that I spoke to on those occasions. So I don't know that we ever met, but good to see you on the screen and hope you're doing well.

Okay, seeing no further questions from the committee, I just want to thank all the witnesses for taking time out of their busy days to be with us here, even if it's just virtually. Thank you so much. Are there any other witnesses to testify on Senate Bill 122? Seeing none, we'll close witness testimony. Okay, welcome back, Senator Pelton. Senator Roberts, are there any amendments? I know you spoke of some for second reading, but are there any for today?

Members of the committee, are there any amendments for today? Okay, seeing none, we'll close the witness testimony phase. Quick wrap-up. Senator Pelton.

Senator Roberts

good bill, vote yes quoting Senator Catlin

Madam Chair, I move Senate Bill 122 to the Committee of the Whole with the favorable recommendation.

Yes.

Yes.

To keep peace in Peltonia and western Colorado, yes.

Thank you for serving on the committee today.

Thank you, Madam Chair. Senate Bill 94 is a pretty simple idea. It creates a new license for Colorado alcohol beverage producers to use what's already a federally authorized process to enable alcohol beverage producers to operate their capital equipment more efficiently. Alternating premises is an arrangement that allows two adjacent alcohol manufacturers to share equipment by occasionally and temporarily altering the footprint of their licensed premises to share production equipment. For instance, a brewery owner's canning line may sit idle in the winter season when business is typically slow. with this bill, they could contract with a nearby distillery to package ready-to-go cocktails using that canning equipment. Some Colorado breweries and producers are already using this through a federally authorized process. Each time they do that, they have to pay $300 to modify it and another $300 to change it back. So it's really inefficient. It takes a lot of time, a lot of staff time, a lot of bureaucracy, a lot of headaches for something that should be simple. So basically allows breweries, distillers to better utilize equipment, save money, and hopefully keep doing what they do best, which is make Colorado craft beer and cocktails and spirits. So I do have an amendment the distributors and folks have asked for that I can explain in the amendment phase. and I have some experts from the industry that can answer specific questions. But that's all I've got for you.

Yes, ma'am.

Thank you so much. My name is Kristen Hartman, and I am here representing myself as a health equity policy researcher and as a childhood survivor of alcohol-driven violence that left me homeless at 16. I actually am against this bill because I have a better idea. I came with so much data to share and all these sad stories and all this impact stuff. And I thought, no, you all are aware of this. I've been here before. Alcohol deaths have been rising for 20 years, so I have nothing new to show you. But what I do have because of the policy researcher, I actually came up with a great idea that's better than this bill. um why not directly pipe the local alcohol products directly to our homes that homeowners could um pay for by subscription and that way it would give preference to the locals they could pipe it directly to the homes paid for by subscription that would reduce the number of dui deaths on the highways. And because demographically, according to the data, 82% of Colorado craft beer consumers are upper income white men. So they would not have to be embarrassed by DUIs because they could get it right at home. And the more pedestrian alcohol users...

Yes. Okay.

Okay, then I was just trying to help out because 50% of Coloradans of us families don't use alcohol drugs. Yet at the rate, we have no voice. We have no say. We're not stakeholders on any of these decisions. We have no way to stop the state and these sellers from grooming our children. We can't go to the grocery store. We can't go to a restaurant. You know, it's really hard to try to protect our children from the alcohol drug sellers when we have no voice and no say. And we're just being railroaded by these alcohol deaths and privileges while we can't get health care for our kids. And it's just really getting hard. And so my thought was, why not just get it over with? Because at the rate they're killing people, we're going to be in the majority soon. And then we can be heard. Thank you so much.

Terry Danielson, members of the committee, my name is Robert Runco. I'm an attorney here in Denver, Colorado, representing many of our craft and independent manufacturers, as well as general counsel to our state Brewers Guild, representing Colorado's independent brewers. Do you want me to wait?

Welcome. I just wanted to briefly address a couple concerns that have been raised regarding excise tax and collection of excise tax and related to SB 94. There has been some confusion as to whether this bill would make it difficult to assess and collect proper excise taxes if you have two different manufacturers utilizing the same area at different times. This system is actually currently in place in Colorado. We do have alternating proprietorships, which allow two manufacturers of the same alcohol type to alternate using the same equipment. I'm unaware of any audits or issues that the state has had regarding collecting those excise taxes in those instances. And we actually think in this instance, an alternation of premises actually makes it easier to track those taxes because this is allowing manufacturers of different alcohol product types to, you know, utilize that same equipment. So if an audit were to occur, it's, you know, I think fairly easy for an auditor to look and see, okay, well, this is wine. This clearly belongs to the wine manufacturer, and this is beer. This belongs to the beer manufacturer. But we do, you know, want to allow, you know, the tax division to make comment and, you know, put rules in place so that way record keeping is appropriate so that way taxes can properly be collected. I also on the private side of things do represent several manufacturers here in Colorado that are currently operating under this structure on the federal level. They are doing the state work around that is very cumbersome and expensive and those manufacturers have not had any issues getting their taxes collected and paid. And again, here to answer any questions, and thank you again for your time this afternoon.

That is the correct pronunciation. Thank you, Madam Chair. Thank you, Madam Chair and members of the committee for allowing me to testify today. My name is Eli Kolodny. I'm the technical director of our quality and production operations for Odell Brewing Company. I'm here to testify in support of Senate Bill 94. Odell Brewing is an independent employee owned brewery that started in 1989. We operate three tap rooms, two in Denver and one in Fort Collins. We also own the OVC Wine Project and make wine. The winery and our primary production facility sit directly adjacent to each other in Fort Collins. When we started the OVC Wine Project, we made the strategic decision to primarily sell our wine in our tasting room and in cans. This decision was made because of the customers we were trying to reach and because our brewery already owns a state-of-the-art canning line. For us to can our wine in our brewery, we plan a year in advance on the dates that we are going to can. We have to file paperwork with the state LED to shrink our brewery license for several days in the canning area and then expand our winery license into that canning area. This requires a lot of strategic planning, excessive paperwork, and money. Each time we do this, it costs us $600. If plans need to change or equipment breaks, we are required to refile new applications, adding to the time, effort, and costs. Because of our type of operations, we already have an improved alternation premise license with the TTB at the federal level. This means that we do not have to make the advance filings with the TTB, just our state licenses. The TTB has strict tracking and paperwork guidelines that we follow to ensure proper and accurate tracking of product and taxes. As others will testify today, our excise taxes are paid at both the state and federal level by the licensee producing the beverages per its manufacturing license and the beverage type being packaged. This bill will allow us to file one application for an alternation of premises with the state, give us a lot more flexibility in our production schedule, and continue to ensure complete and accurate taxes are paid on all alcohol produced by both the brewery and the winery. And I ask you to vote yes on Senate Bill 9-4.

Hello, Mark Cerini. Madam Chair, members of the committee, I represent the Brewers Association and that we are in support of SB 94. I'm going to confine my remarks to one of the concerns I understand has been raised with the committee, and that is that this bill is, if enacted, would be contrary to federal law. As you've already heard from two other witnesses, there are alternating premises already operating in Colorado. federal law does in fact establish the concept of an alternating premise this is definitely something that's started at the federal level is migrating down into the states and the more specific concern my understanding is is that you shouldn't have alternating premises between different taxpayers that too gets approved by the ttb on a discretionary basis like all licensing decisions. They exercise discretion to make sure the right folks are doing it. So there is no conflict with federal law. But then going further, my understanding is that the fear is that this will raise a legal challenge under preemption. As probably the committee knows, preemption is a fairly narrow doctrine. It almost never comes up in the alcohol field, and that's because we have the 21st Amendment, which gives states substantial rights to regulate and tax alcohol within their borders. And preemption only comes up in three narrow circumstances When Congress expressly wants preemption and there no preemption provision in the tax code for alcohol taxes Second of all where the federal government has basically occupied the field. And clearly that's not the case in alcohol. In alcohol, most regulation is done at the state level. And then finally, where federal law would be impossible or very, very difficult to comply with if compliance with the state law was required. Here, you would see that actually is the opposite case. So those are my remarks. I see my time is up. I am available for further questions if you like.

Yeah. Thank you, Madam Chair. Is it Mr. Runco?

Senator Liston.

So it's really more for the packaging than anything else. I'm just trying to understand this a little better.

All right.

Very good.

I move L1.

Thanks. This amendment came from conversation with stakeholders. Federal law uses the words adjacent and contiguous to mean the same thing in statute. so we had to make some clarifying language so that it actually made sense. And then it grants LED rulemaking authority. So pretty simple.

None.

You know, this is a pretty simple bill, despite how complex it reads, just to make it easier for people to do business in our state. I know I have a fiscal note problem working through trying to solve that and would ask to go to appropriations and continue trying to make that case as we make tweaks to see if we can get it through this year, because it will help our small craft breweries and distilleries and wineries across the state. So I ask for an aye vote.

Thank you, Madam Chair. I move Senate Bill 94 as amended to the Committee on Appropriations with a favorable recommendation.

Aye.

Aye.

As appropriate on St. Patrick's Day, aye.

Aye. Madam Chair. Yes. Congratulations. The bill passes unanimously. You are headed to the Committee on Appropriations. Okay, folks. The last measure on the agenda today is House Bill 1180. Welcome, Senator Hendrickson.

Thank you, Senator Henriksen. There should not be any questions for him at this point. Okay. We'll welcome any witness testimony if anybody planned or is here. Online? Seeing no one signed up or in the room or online to testify, I'm going to close witness testimony on House Bill 1180. Senator Henriksen.

Okay, that is a proper motion. Ms. Chapman, please call the roll. Senator Catlin.

Lindstedt.

Liston.

Henriksen.

Madam Chair. Yes. Congratulations that passes unanimously you're headed to the floor.

colleagues may I request consent calendar. Seeing no objections House Bill 1180 will be placed on the consent calendar. Thank you all so much seeing no further business this committee is adjourned have a great day. Thank you.