Colorado senators on Wednesday voted to advance a proposal to eliminate credit card “swipe fees” on sales taxes.

Proponents say the move would save businesses tens of thousands of dollars annually, while critics have countered those fees are needed to ensure a stable and secure environment for financial transactions.

Also known as interchange fees, swipe fees refer to the 2% to 3% that credit card companies charge retailers every time a customer swipes a credit card to make a purchase, according to convenience.org.

Senate Bill 26-134 would prohibit credit cards from charging businesses a transaction fee based on the sales tax amount. That is, they may not include the sales tax portion of a transaction when calculating the percentage-based “swipe” fee.

The proposal received a close 18-16 vote, but a last-minute procedural move means the bill’s final vote — and whether it moves over to the House — could be in question.

Restaurants see the bill as a way to help the struggling industry.

Mas Torito, district manager for Kokoro, said that if the bill passes, “it would save each of my restaurants over $10,000 annually. Combined across both locations, this amounts to almost a quarter of a million dollars over a decade. That’s real money. With those savings, we could purchase new, more environmentally friendly cooking equipment, hire more staff, or begin taking steps toward opening a new location. “

Opponents, including banks and credit unions, chambers of commerce and credit card issuers, pointed to big box retailers as the largest beneficiary of the bill.

They’re referring to Walmart, Target and Home Depot, among others, which support SB 134. Backing for the legislation also comes from organizations like the Bell Policy Center and Towards Justice, small retailers and the state’s restaurant association.

Meanwhile, unions who oppose the legislation also pointed to the potential for loss of union jobs.

A letter from an airline union in late February claimed the bill would harm good union jobs in Colorado, “while delivering millions in additional profits to corporations like Walmart that systematically fight against workers’ right to organize and collectively bargain.”

“It is unconscionable to reward these companies while they continue to undermine the very foundation of worker power, especially as they attempt to hide the fact that they are the main financial beneficiaries of a policy like this, not the small businesses they are hiding behind in their deceptive efforts,” the union said.

The final vote in the Senate that took place on Wednesday, however, may not be the last word in the chamber.

Sen. Julie Gonzales, D-Denver, was the 18th vote in favor of the bill, with four Democrats voting with the chamber’s 12 Republicans.

Missing was Sen. Jessie Danielson, D-Wheat Ridge, who voted in favor of SB 134 when it was heard in the panel she chairs — the Senate Business, Labor and Technology Committee.

As the Senate was wrapping up its business Wednesday, Senate Majority Leader Robert Rodriguez, D-Denver, notified the chamber that a motion for reconsideration had been filed on the bill.

He didn’t identify the senator who filed it, but Colorado Politics has learned it was Gonzales, who told Colorado Politics it was a policy issue.

The Senate had made substantial changes on Monday to quell the opposition from progressive and union-backing Democrats.

Sen. William Lindstedt, D-Broomfield, told the Senate current law benefits banks and credit unions — in that they are able to charge retailers interchange fees on sales tax, which doesn’t belong to the retailer, he said.

Those tax dollars belong to the state, he told the Senate, and banks and credit card companies are “skimming profits” on those taxes and taking money from small business, he said.

Lindstedt offered an amendment, which the Senate adopted, that requires retail businesses with more than 500 employees to take the savings that result from the law and use them to reduce consumer prices or invest in employee wages or benefits.

Gonzales questioned just how much those cost savings would be.

Lindstedt said the bill would apply to 80% of credit cards, and that the amount credit card companies have “skimmed” amounts to about $218 million annually.

The Electronic Payments Coalition disagrees with Lindstedt’s assertion on skimming.

“The suggestion that interchange fees ‘skim profits’ from tax revenue is categorically false. Merchants must remit 100% of the sales tax they collect,” Mansur Gidfar, the group’s spokesman, told Colorado Politics. “If they collect $100, they must remit $100.  Card processing fees are paid by the merchant and do not reduce government revenues in any way.”

But those savings may never come to pass.

The Office of the Comptroller of the Currency issued final rules on April 24 that says all federally-chartered banks would be preempted from having to follow state-level interchange laws.

The ruling could subject Colorado to litigation from the federal government.

A legal opinion provided by the National Restaurant Association insists the interim final rules only preempt national banks from an Illinois law that led to the rules and they “do not preempt other key players within the payments system like payment card networks from the law. This is because card networks simply are not banks, and therefore the agency does not have the authority to preempt non-bank entities from state law.”

As for Colorado’s SB 134, the opinion said it is “outside of the scope of the OCC regulation and is on solid legal ground to become law.”