Page 1
April 29, 2024 SB 24-181
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Revised Fiscal Note
(replaces fiscal note dated April 24, 2024)
Drafting Number:
Prime Sponsors:
LLS 24-0652
Sen. Priola; Hansen
Rep. deGruy Kennedy;
Amabile
Date:
Bill Status:
Fiscal Analyst:
April 29, 2024
Senate Second Reading
Kristine McLaughlin | 303-866-4776
Emily Dohrman | 303-866-3687
Bill Topic: ALCOHOL IMPACT & RECOVERY ENTERPRISE
Summary of
Fiscal Impact:
☒ State Revenue
☒ State Expenditure
☒ State Transfer
☐ TABOR Refund
☒ Local Government
☐ Statutory Public Entity
The bill creates the Alcohol Impact and Recovery Enterprise and several grant
programs within the enterprise. The bill increases state expenditures and revenue on
an ongoing basis.
Appropriation
Summary:
For FY 2024-25, the bill requires an appropriation of $40,974 to the Department of
Revenue.
Fiscal Note
Status:
This revised fiscal note is provided pursuant to Senate Rule 25(e) and reflects
amendments L.028, L.030, and L.033 through L.039 adopted during Senate Second
Reading. It has been republished to make technical corrections to the printed copy
distributed to Senate on April 29, 2024.
Table 1
State Fiscal Impacts Under SB 24-181
Budget Year
FY 2024-25
Out Year
FY 2025-26
Out Year
FY 2026-27
Audit Years
FY 2030-31
Revenue Cash Funds - $19,824,437 $19,824,437 $19,824,437
Total Revenue - $19,824,437 $19,824,437
$120,134,514
$19,824,437
Expenditures General Fund $40,974 - - -
Cash Funds $178,932 $19,455,437 $19,455,437 $19,824,437
Central. Approp. $20,524 $80,698 $80,698 $80,698
Total Expenditures $240,430 $19,536,135 $19,536,135 $19,905,135
Total FTE 1.3 FTE 4.1 FTE 4.1 FTE 7.8 FTE
Transfers General Fund ($650,000) $369,000 $369,000 -
Cash Funds $650,000 ($369,000) ($369,000) -
Net Transfer $0 $0 $0 -
Other Budget GF Reserve $6,146
- - -
Page 2
April 29, 2024 SB 24-181
Summary of Legislation
The bill creates the Alcohol Impact and Recovery Enterprise under the Behavioral Health
Administration (BHA). The enterprise is authorized to collect fees from self-distributing
manufacturers and wholesale distributers of alcohol who manufacture or distribute at least
100,000 proof gallons of spirits, 130,000 gallons of wine, or 186 million gallons of beer. The
enterprise board will consist of various department representatives and stakeholders and will
report to the General Assembly annually. The enterprise will be audited in FY 2030-31 and every
4
years thereafter or as frequently as necessary as determined by the State Auditor.
The bill creates the following grant programs under the enterprise, all of which will be
implemented by January 1, 2026:
the Colorado Alcohol Treatment and Recovery Affordability Grant Program to award grants
to Behavioral Health Administrative Services Organizations (BHASOs) to provide substance
use disorder (SUD) treatment and recovery services on a sliding fee scale;
the Colorado Alcohol Use Prevention and Early Intervention Grant Program to award grants
to entities dedicated to SUD prevention;
the Colorado Alcohol-Related Impaired Driving Enforcement Grant Program to award grants
to local governments to deter alcohol-related impaired driving; and
The Colorado Tribal Alcohol Impact Grant Program to award grants to tribal governments.
The DOR may retain revenue from the fee to cover the administrative costs of collecting the fee.
The remainder will be credited to the Colorado Alcohol Impact Fund as follows:
75 percent for the treatment and recovery grant program;
15 percent for the prevention grant program;
5 percent for the impaired driving grant program;
2 percent for the tribal grants; and
up to 3 percent on administrative needs of the enterprise including the costs of the state
auditor.
The bill creates the Colorado Alcohol Impact Enterprise fund which is continuously appropriated
to the enterprise.
Background
Enterprises. TABOR defines an enterprise as "a government-owned business authorized to issue
its own revenue bonds and receiving under ten percent of annual revenue in grants from all
Colorado state and local governments combined." Because the share of revenue that an
enterprise may receive from government sources is capped, enterprises are largely financially
independent of core government agencies. Additionally, enterprises cannot levy taxes. TABOR
limits the amount of money that can be spent or saved by the state government and all local
governments within the state. However, revenue collected by enterprises is not subject to these
constraints. Page 3
April 29, 2024 SB 24-181
State Revenue
The bill increases revenue to the new enterprise by approximately $20 million per year
beginning FY 2025-26. Over the first five years, the enterprise is estimated to collect about
$80 million, as the enterprise does not collect revenue in the first year. Fee revenue is estimated
based on the amount of liquor that has been subject to the current liquor taxes in recent years,
consistent with the March 2024 LCS forecast. This estimate assumes that 65 percent of all
alcohol sales are made by manufacturers and distributers that are subject to the fee.
The imposition of fees at the level in the bill is not expected to decrease consumption relative to
the levels expected under current law; however, if consumers respond to fees by purchasing less,
then the revenue increase will be less than estimated. Fees paid to the state enterprise are
estimated below and are exempt from TABOR.
Table 2
Fee Revenue
Fee Fee Amount Units Revenue
Malt Liquor, Apple Wine, and Hard Cider 4.09¢ per gallon 87,471,410 $3,577,581
Wine 30.60¢ per liter 50,041,211 $1,836,512
Spirituous Liquor 3.67¢ per liter 47,092,627 $14,410,344
Total 184,605,248 $19,824,437
Gifts grants and donations. The bill potentially increases state revenue to the Colorado Alcohol
Impact Fund from gifts, grants, or donations; however, no sources have been identified at this
time. Gifts, grants, and donations are exempt from TABOR revenue limits.
Revenue bonds. The enterprise also has the authority to issue revenue bonds. If the enterprise
chooses to issue revenue bonds, revenue will increase by more than what is shown above. This
revenue is not subject to TABOR.
State Transfers
The bill requires a one-time transfer of $650,000 from the General Fund to the Colorado Alcohol
Impact Enterprise Fund in FY 2024-25. The transfer is a loan to the enterprise, and must be
repaid with interest to the General Fund by July 1, 2027. The fiscal note assumes that the loan
will be repaid in equal installments in FY 2025-26 and FY 2026-27 with an interest rate of
approximately 4.5 percent. The loan repayment is expected to be approximately $369,000 per
year.
Page 4
April 29, 2024 SB 24-181
State Expenditures
The bill increases expenditures by $240,000 in FY 2024-25 paid from the General Fund and the
Colorado Alcohol Impact Fund and, in future years, by around $20 million per year paid from the
Colorado Alcohol Impact Fund. Costs will increase by additional amounts in years when a
required audit is scheduled. These costs are summarized in Table 3 and discussed below.
Table 3
Expenditures Under SB 24-181
FY 2024-25 FY 2025-26
Audit Years
FY 2030-31
Behavioral Health Administration
Alcohol Impact and Recovery Enterprise
Personal Services $98,267 $378,159 $378,159
Operating Expenses $1,280 $5,120 $5,120
Capital Outlay Costs $6,670 $20,010 -
Centrally Appropriated Costs
1
$20,524 $80,698 $80,698
Meeting Costs $15,106 $15,106 $15,106
Treatment and Recovery Grant Program - $14,698,849 $14,671,022
Prevention Grant Program - $2,939,770 $2,934,204
Impaired Driving Grant Program - $979,923 $978,068
Tribal Alcohol Impact Grant - $391,969 $391,227
Legal Services $57,609 $19,203 $19,203
FTE – Personal Services 1.0 FTE 4.0 FTE 4.0 FTE
FTE – Legal Services 0.3 FTE 0.1 FTE 0.1 FTE
BHA Subtotal $199,457 $19,528,807 $19,472,807
Department of Revenue
Computer Programming and Testing $33,582 - -
Data Reporting $7,392 $7,328 $7,328
DOR Subtotal $40,974 $7,328 $7,328
Office of the State Auditor
Enterprise Audit - - $425,000
FTE – State Auditor - - 3.7 FTE
OSA Subtotal - - $425,000
Total Costs $240,430 $19,536,135 $19,905,135
Total FTE 1.3 FTE 4.1 FTE 7.8 FTE
1
Centrally appropriated costs are not included in the bill's appropriation.
Page 5
April 29, 2024 SB 24-181
Behavioral Health Administration. The bill increases expenditures to set up the enterprise and
within the new enterprise to operate the new grant programs. Costs associated with these
efforts are detailed below.
Staffing. Once fully implemented, the BHA requires 4.0 FTE. This includes:
• 1.0 FTE program manager to lead the enterprise, develop the programs, and
supervise enterprise employees;
• 1.0 FTE to administer the grant programs; and
• 2.0 FTE to manage the revenue collections in line with the bill and current law
requirements, maintain the necessary documentation for the state auditor, and to
perform other accounting and budget functions for the enterprise.
Of the staff identified above, the program manager is assumed to start on July 1, 2024, to
help establish the enterprise, and the remaining staff are assumed to start on July 1, 2025.
Meeting costs. The BHA requires funds to host the board and compensate its members. It is
assumed that board will meet once a quarter Administrative and support costs for the
workgroup are estimated to be $3,777 per meeting. Member compensation is estimated at
$3,067 per meeting, assuming that 13 members will be eligible for compensation. Other
costs include venue and catering.
Legal services. The BHA requires 450 hours of legal services in FY 2024-25 and 150 hours in
future years to assist with rulemaking so that revenue collection aligns with existing law.
Legal services are provided by the Department of Law at a rate of $128.02 per hour.
Grant programs. Once the above costs are accounted for the remainder of the Colorado
Alcohol Impact Fund will be distributed to three grant programs as prescribed by the bill
Department of Revenue. The bill increases expenditures in the DOR to administer the new fee.
Computer programming and testing. This bill requires one-time expenditures of $33,582
in FY 2024-25 to program, test, and update database fields in the DOR's GenTax.
Programming costs are $21,785, representing 94 hours of contract programming in GenTax
at a rate of $232 per hour. Costs for testing at the department include $8,085 for 231 hours
of innovation, strategy, and delivery programming support at a rate of $35 per hour, and
$3,712 for 116 hours of user acceptance testing at a rate of $32 per hour.
Data reporting. The Office of Research and Analysis must make changes in the related tax
reports so that the department can access and document statistics related to the new fee.
These costs are estimated at 231 hours for data management and reporting at $32 per hour,
with ongoing costs of 229 hours thereafter.
State Auditor. The state auditor requires 3.7 FTE and $425,000 starting in FY 2030-31 and every
four years thereafter, assuming the state auditor does not exercise authority to change the
frequency. This will be appropriated to the DOR and reappropriated to the state auditor. Page 6
April 29, 2024 SB 24-181
Governor’s Office. Workload will minimally increase for the Governor’s Office of Boards and
Commissions to make the required appointment under the bill. This work can be accomplished
within existing appropriations.
Local Government
As discussed above, an estimated $1 million annually will go to the Impaired Driving Grant
Program starting in FY 2025-26. This program will redistribute funds to local governments to
deter alcohol-related impaired driving.
Effective Date
The bill takes effect upon signature of the Governor, or upon becoming law without his
signature.
State Appropriations
For FY 2024-25, the bill requires a General Fund appropriation of $40,974 to the Department of
Revenue. Additionally, $57,609 is reappropriated from the Colorado Alcohol Impact Enterprise
Fund to the Department of Law with an additional 0.3 FTE.
State and Local Government Contacts
Behavioral Health Administration Law 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 the General Assembly website.