State House Democrats believe Colorado could be on the crest of a new wave in the business marketplace: employee-owned companies. While the concept has been around a long time — and occasionally has been put into practice — it seems to hold new allure amid the uncertainties of the rapidly changing, 21st century economy. It also draws inspiration from the likes of Fort Collins’s own New Belgium Brewing Co., a 100 percent-employee-owned dynamo in our state’s booming craft-brew trade. As of 2015, New Belgium was the fourth-largest craft brewery and eighth-largest overall brewery in the United States.
Which is why state Rep. James Coleman, D-Denver, wants to give employee ownership a boost. His House Bill 1214, which passed the House Business Affairs & Labor Committee Thursday on a party-line vote, directs the state Office of Economic Development and International Trade to promote employee ownership as part of its small business assistance center.
According to a statement from the House Democratic press office, the bill would establish and administer a revolving loan program cash fund, financed by gifts, grants and donations, to help existing businesses convert into employee-owned businesses. No state revenue would be involved.
States the press release:
…Small businesses employ a million Coloradans, about half the workforce. Of those million Coloradans, about two-thirds work for companies owned by baby boomers, who are now starting to retire in large numbers. In many, perhaps most cases, converting these businesses to employee ownership, rather than selling the businesses to outside investors, would be the softest landing for the employees, for the companies’ health and for the Colorado economy.
By many statistical measures, employee-owned companies simply perform better. They hire more employees and lay off fewer employees. They pay higher wages and have better retirement plans. They even have higher sales than non-employee-owned companies. The ranks of employee-owned businesses include widely acclaimed companies like New Belgium in Fort Collins, demonstrating that this business model can be highly successful.
The novel proposal now heads to the full House for debate and a vote.