The curtain officially rose Thursday in the House on the long drama centered around the Democratic-led effort to reclassify the state’s $700 million hospital provider fee as an enterprise fund. By Friday at roughly 11:00 a.m., the first act had concluded. Two bills concerning the reclassification passed with Republican support and headed to the Senate, where opposition to the bills was always going to be strong but looks to be growing rigid as the hours pass.

Supporters of the reclassification have pitched it as much-needed and overdue measure to generate revenue. Opponents have described it as an accounting trick that acts against the spirit of the small-government Taxpayer Bill of Rights. The battle over the proposal has been legalistic, ideological, political and practical.

Legislative debate and strategy has been waged on the stump and in the media for months and it is at last unfolding on the chamber floors, in committee rooms and in hallways, as Republican swing voters on the issue start to make their positions known.

House bills 1420 and 1450 passed Friday. They would reclassify the fee and state where new general fund revenue produced from the reclassification should be spent. The bills passed on a voice vote Thursday in the Democratic-majority House after debate that stretched through the morning and on a recorded vote Friday morning after continued debate.

The reclassification bill, 1420, passed 39 to 26, with the support of Republicans J. Paul Brown from R-Ignacio, Dan Thurlow from Grand Junction, Bob Rankin from Carbondale, Don Coram from Montrose and Kit Roupe from Colorado Springs.

The bill recommending where reclassification revenues should be spent, 1450, drew the support of an additional four Republicans — Kevin Priola from Brighton, Yeulin Willitt from Grand Junction, Jim Wilson from Salida and Tim Dore from Elizabeth.

Speaker of the House Dickey Lee Hullinghorst, D-Gunbarrel, sponsored both bills.

Brown said that the way the hospital fee works now relies on the federal government to subsidies Colorado taxpayers.

“I want you to think about one thing: Is it morally responsible, is it a conservative value to take a federal subsidy which sets up the hospital provider fee — it’s a federal subsidy — and then use it to backfill a TABOR refund (to Colorado taxpayers)? That’s not a conservative value, if you ask me,” Brown said. “We can solve this problem today — cut the umbilical cord, cut the strings and make the provider fee an enterprise. I know there’s questions about the constitutionality of doing that, but we have had two attorneys general — Republicans I might add — that have said we can do that.”

Minority Leader Brian DelGrosso, R-Loveland, and others took repeated swipes at the bills, proposing unfriendly amendments and driving home the message that, in their opinion, the reclassification was a backdoor attempt to take taxpayer refunds out of constituent hands.

DelGrosso urged his colleagues to avoid “the shiny object” being dangled in front of them and vote against the bills. He said he went back and watched the debate on the proposal that created the hospital provider fee in 2009 and that it seemed clear that lawmakers at the time meant to create the fee as it exists in order to ensure legislative control over it.

“It was not a glitch,” he said. “It was a conscious decision of the Legislature back in 2009 to not make it an enterprise fund. That is one of the many reasons I urge a no vote today,” DelGrosso said during floor debate Thursday. “All of the money that (HB 1450) is going to use would be money that would otherwise be refunded back to taxpayers through TABOR refunds.”

DelGrosso also underlined that House Bill 1450 has no binding authority. He said future Legislatures will spend the revenue generated from the reclassification as they like.

Rep. Janak Joshi, R-Colorado Springs, offered several amendments that were voted down.

Brown and Rankin both offered amendments that passed. Brown’s amendment to HB 1450 suggested more money be spent on transportation. Rankin’s amendment created a study on the rising cost of Medicaid and how to control it.

In the Senate, the reclassification proposal has enjoyed early and vocal support from Republican Larry Crowder from Alamosa. If he alone votes with Senate Democrats, th bill would pass the upper chamber. It is far from certain, however, that Senate President Bill Cadman, R-Colorado Springs, will allow the bill to make it to the floor.

Sen. Ray Scott, R-Grand Junction, who chairs the Senate state affairs “kill” committee, tweeted out his opinion on Friday morning: “We don’t have an income problem. We have a (spending) priority problem.” Sen. Chris Holbert, R-Parker, added a hashtag for the benefit of House supporters of the bills. “#bringit,” Holbert tweeted.

Americans for Prosperity, the big-budget small-government group that has led opposition to the fee reclassification, was quick on Friday to issue a statement.

“HB 1420 does not address the real issues our state is facing; instead these gimmicks just hide the fact that our government can’t balance its books without taking more from hard-working taxpayers,” the group wrote.

“The real budget train wreck ahead is caused by Obamacare’s Medicaid expansion. The Speaker and other supporters of the bill must realize that that they can’t rely on the enterprised hospital provider fee to protect taxpayers and the budget from the expansion’s costly impact. Lawmakers have mismanaged the state budget, and now they want to be bailed out by our future tax refunds. We won’t stand for it, and we encourage the senate to stop this legislation.”

The drama is heating up. Don’t leave the theater.

— ramsey@coloradostatesman.com