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March 14, 2023 HB 23-1198
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Revised Fiscal Note
(replaces fiscal note dated March 6, 2023)
Drafting Number:
Prime Sponsors:
LLS 23-0266
Rep. Titone
Date:
Bill Status:
Fiscal Analysts:
March 14, 2023
House Finance
John Armstrong | 303-866-6289
Louis Pino | 303-866-3566
Bill Topic: TEACHER EXTERNSHIP PROGRAM FOR STEM DISCIPLINES
Summary of
Fiscal Impact:
☒ State Revenue
☒ State Expenditure
☐ State Transfer
☒ TABOR Refund
☒ School District
☐ Statutory Public Entity
The bill establishes a teacher externship program in the Department of Labor and
Employment and establishes a tax credit for participating employers. The bill
decreases state revenue through 2028 and increase state expenditures on an ongoing
basis.
Appropriation
Summary:
For FY 2023-24, the bill requires an appropriation of $141,334 to multiple state
agencies.
Fiscal Note
Status:
The revised fiscal note reflects the introduced bill as amended by the House Education
Committee. It has also been revised to reflect new information.
Table 1
State Fiscal Impacts Under HB 23-1198
Budget Year
FY 2023-24
Out Year
FY 2024-25
Out Year
FY 2025-26
Out Year
FY 2026-27
Revenue General Fund ($340,000) ($816,000) ($1.1 million) ($1.3 million)
Total Revenue ($340,000) ($816,000) ($1.1 million) ($1.3 million)
Expenditures General Fund $141,334 $150,380 $150,380 $150,380
Centrally Appropriated $50,110 $62,670 $62,670 $62,670
Total Expenditures $191,444 $213,050 $213,050 $213,050
Total FTE 1.6 FTE 2.0 FTE 2.0 FTE 2.0 FTE
Transfers - - - -
Other Budget
Impacts
TABOR Refund ($340,000) ($816,000) Not estimated Not estimated
GF Reserve $28,717 $31,958 $31,958 $31,958
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March 14, 2023 HB 23-1198
Summary of Legislation
The bill establishes a teacher externship program for K-12 science, technology, engineering and
mathematics teachers to participate in experiential learning with employers to gain knowledge and
improve their classroom curriculum. The Department of Labor and Employment (CDLE) will
administer the program and create three models for participation. CDLE must collaborate with the
Department of Education (CDE) to determine minimum standards for participation in the program
and to select employers that can offer training and experience that will provide value to the school.
Teachers may be compensated by their local education provider or participating employer, and may
apply for graduate and professional development credits. The bill establishes data reporting
requirements and adds the externship program as a professional development option for renewal of
a teacher license. CDLE may accept gifts, grants and donations and create rules to implement this
program.
The bill creates a tax credit for income tax years 2024 through 2028 that allows participating employers
to claim a credit for all expenses incurred over up to eight weeks in placing a teacher in the externship,
including stipends or other compensation for the teacher, paid by the employer.
Assumptions
The fiscal note assumes approximately 50 employers will participate in an externship program in tax
year 2024, based on the number of employers currently participating in one school district’s externship
program. This fiscal note assumes that employers may receive tax credits for any wages paid to
teachers.
The fiscal note assumes approximately 200 K-12 teachers will participate in the program in the first
year the credit is available. Of these, about 95 percent will participate in the program for two to
six weeks, working 40 hours each week at $25.00 per hour. The remaining 5 percent will participate
for the full eight weeks allowed under the bill working 40 hours per week at $25.00 per hour.
It is assumed the number of employers and K-12 teachers participating in the program will increase
during the period the income tax credit is available, consistent with other state income tax credits. By
2026, it is assumed at least 360 K-12 teachers will participate in an externship program.
State Revenue
The bill is expected to decrease General Fund revenue by $340,000 in FY 2023-24 (half-year impact),
by $816,000 in FY 2024-25, by $1.1 million in FY 2025-26, and by $1.3 million in FY 2026-27. Revenue
impacts will continue through FY 2028-29. Estimates are based on the assumptions discussed above.
The bill reduces corporate and individual income tax revenue, which is subject to TABOR.
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March 14, 2023 HB 23-1198
State Expenditures
The bill increases state expenditures in the Department of Labor and Employment and Department of
Revenue by $191,444 in FY 2023-24 and $213,050 in FY 2024-25, paid from the General Fund. The bill
also increases workload in the Department of Education by a minimal amount. Expenditures are
shown in Table 2 and detailed below.
Table 2
Expenditures Under HB 23-1198
FY 2023-24 FY 2024-25
Department of Labor and Employment
Personal Services $105,218 $140,288
Operating Expenses $2,160 $2,700
Capital Outlay Costs $13,340 -
Centrally Appropriated Costs
1
$50,110 $62,670
FTE – Personal Services 1.6 FTE 2.0 FTE
CDLE Subtotal $170,828 $205,658
Department of Revenue
GenTax Programming $20,616 -
Office of Research and Analysis - $7,392
DOR Subtotal $20,616 $7,392
Total Costs $191,444 $213,050
Total FTE 1.6 FTE 2.0 FTE
1
Centrally appropriated costs are not included in the bill's appropriation.
Department of Labor and Employment. CDLE will hire a Grant Specialist IV, Grant Assistant III and
a Labor and Employment Specialist II, totaling 2.0 FTE, to administer the program. These staff will
work with eligible businesses and local education providers to develop externship models, select
employers, establish standards, promote the opportunities, gather data, and monitor employers.
Costs include standard operating expenses and capital outlay costs and are prorated for the General
Fund paydate shift, with these employees expected to begin work in September 2023.
Department of Revenue. In FY 2023-24, this bill requires expenditures of $20,616 to program, test,
and update database fields in the Department of Revenue's GenTax software system. Programming
costs are estimated at $9,000, representing 40 hours of contract programming at a rate of $225 per hour.
Costs for testing at the department are estimated at $11,616, representing 363 hours of user acceptance
contract testing at a rate of $32 per hour. Expenditures in the Office of Research and Analysis are
required for changes in the related GenTax reports so that the department can access and document
tax statistics related to the new tax policy. These costs are estimated at $7,392 in FY 2024-25 and
ongoing, representing 231 hours for data management and reporting at $32 per hour.
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March 14, 2023 HB 23-1198
Colorado Department of Education. CDE will have additional workload to coordinate with CDLE
in implementing the program. No change in appropriations is required.
Centrally appropriated costs. Pursuant to a Joint Budget Committee policy, certain costs associated
with this bill are addressed through the annual budget process and centrally appropriated in the Long
Bill or supplemental appropriations bills, rather than in this bill. These costs, which include employee
insurance, supplemental employee retirement payments, indirect costs, and leased space, are shown
in Table 2.
Other Budget Impacts
TABOR refunds. The bill is expected to decrease the amount of state revenue required to be refunded
to taxpayers by the amounts shown in the State Revenue section above. This estimate assumes the
December 2022 LCS revenue forecast. A forecast of state revenue subject to TABOR is not available
beyond FY 2024-25. Because TABOR refunds are paid from the General Fund, decreased General
Fund revenue will lower the TABOR refund obligation, but result in no net change to the amount of
General Fund otherwise available to spend or save.
School Districts
Local education providers with teachers who participate in the externship program will have an
increase in workload to coordinate with CDLE and CDE regarding these externship opportunities.
This additional workload is assumed to be minimal.
Effective Date
The bill takes effect 90 days following adjournment of the General Assembly sine die, assuming no
referendum petition is filed.
State Appropriations
For FY 2023-24, the bill requires the following General Fund appropriations:
$120,718 to the Department of Labor and Employment, and 1.6 FTE;
$20,616 to the Department of Revenue.
State and Local Government Contacts
Education Labor Revenue
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit: leg.colorado.gov/fiscalnotes.