The USFWC is excited to share yet another win in a series of recent worker ownership legislative successes.
House Bill 23-1081, Employee Ownership Tax Credit Expansion, was passed by the Colorado General Assembly on May 5 and signed into law by Governor Polis on May 23rd. The bill expands the state’s employee ownership tax credit, which provides a tax break to businesses that convert to employee ownership or expand their existing employee ownership programs.
The bill increases the cap on the tax credit from $25,000 to $40,000 for businesses that convert to employee ownership through a worker cooperative or employee ownership trust, or $100,000 to $150,000 for businesses that convert to an employee stock ownership plan (ESOP).
The bill was sponsored by Representative Rick Taggart (R-Lafayette) and Senator Nick Hinrichsen (D-Denver). This program is in addition to the Employee Ownership Grant program also offered through the Colorado Employee Ownership Office.
“We thank Reps. Taggart, Lindstedt, and Sen. Hinrichsen for their leadership on worker ownership.” said USFWC Policy Director Mo Manklang. “Colorado continues to be on the forefront of the movement to drive stronger businesses and good jobs through worker co-ops and ESOPs. In the short time that Colorado has implemented its Employee Ownership tax credit and grant programs, the state has seen an immediate uptick in worker co-ops; in its first year, the tax credit alone had 15 applications for reservation. Out of the 2022 funding pool ($10 million), a total of $607,829.91 in tax credits have been reserved. The Colorado Employee Ownership Office has supported 57 businesses with their conversions to worker ownership, including 27 cooperatives; these are some of the most successful numbers we’ve seen across the country.”
“With the expansion of Colorado’s Employee Ownership Tax Credit, local businesses can continue to increase wages, improve job security, and offer better benefit options for hardworking Coloradans,” said Rep. William Lindstedt, D-Broomfield. “Employee-owned business models make succession planning easier for business owners while keeping businesses within their community. With this bill being signed into law today, Colorado business owners will now have additional tools to sell or retire and employees will have more opportunities to own the business they work for.”
The bill was signed into law by Governor Jared Polis on May 23rd.The Employee Ownership Tax Credit Expansion was also sponsored by Sen. J. Bridges, Sen. J. Buckner, Sen. J. Coleman, Sen. L. Cutter, Sen. T. Exum, Sen. S. Fenberg, Sen. R. Fields, Sen. C. Hansen, Sen. S. Jaquez Lewis, Sen. C. Kolker, Sen. J. Marchman, Sen. D. Moreno, Sen. K. Mullica, Sen. K. Priola, Sen. D. Roberts, Sen. R. Rodriguez, Sen. F. Winter.
