Economic and Fiscal Impact Assessment

Fiscal Impact

The fiscal impact of the Artist Corporation (A-Corp) proposal will be minimal. The most relevant impact will likely mimic House Bill 13-1388, which created Public Benefit Corporations.

With this proposal, the new expenses will likely be related to programming costs for the impact on tax forms. New revenue will be related to the filing fees established in the bill. If the fees are like existing fees at the Colorado Secretary of State, the impact on revenue will be small.

Over time, there are strategies available to minimize expenditure and revenue impacts on the General Fund.

Economic Impact

The exact economic impact on the bill is not easy to quantify. This is because of the lack of precision around estimating the activity that would not occur but for the bill.

Qualitative Economic Benefits

Creative Industries in Colorado

Creative industries are significant in Colorado. From the Colorado OEDIT annual report: "In 2022, the U.S. Bureau of Economic Analysis (BEA) reported that arts and cultural production accounted for $18 billion and 3.7% of the Colorado economy, contributing 104,163 jobs and $10.1 billion in compensation."

Increased Collaboration

To the extent the new structure allows more collaboration among creative workers or business interests, this could distinguish Colorado further in creative economic activity.

Enhanced Purchasing Power for Gig Workers

Many creative workers are "gig" workers and with this structure they could achieve more purchasing power for important services, notably health care insurance and business insurance.

Administrative Efficiency

The A-Corp designation allows for all the benefits of existing legal structures to be accessed with the same administrative efficiency.

Increased Liquidity

The A-Corp structure allows for increased liquidity of ownership shares. By increasing liquidity, some academic research indicates that this could raise the market value of a given asset.

Key Findings Summary

Fiscal Impact: Minimal impact on state budget, similar to Public Benefit Corporation legislation

Economic Contribution: $18B annual impact from creative industries in Colorado

Job Creation: 104,163 jobs supported by arts and cultural production

Worker Compensation: $10.1B in compensation to creative workers annually