Governor Jared Polis recently vetoed Senate Bill 26-134, a measure that threatened to undermine Colorado's tourism industry and make it harder for Coloradans to earn the airline miles, hotel points, and cashback rewards they use every day.

That wasn't the state legislature's intent, of course. Supporters of the legislation were trying to curb "interchange fees" -- the small fees paid by merchants to credit card processing networks whenever a customer purchases something using a card. Specifically, the bill would have prohibited interchange fees from being charged on the sales-tax portion of a transaction. 

In theory, the savings for retailers would enable them to lower their own prices, ultimately benefiting consumers. 

But in practice, shoppers would never see those trickle-down savings. Instead, their credit card rewards programs would become significantly less generous -- or vanish altogether. 

We know this, because lawmakers have already tried something similar at the national level -- with disastrous results. In 2010, Congress passed the Durbin Amendment, which capped interchange fees on debit cards. Proponents argued then, just as they're arguing now, that capping these fees would reduce costs for businesses and consumers. 

But subsequent studies found that most merchants did not pass savings along through lower prices -- in fact, retailers were 18 times more likely to raise prices than reduce them after the law took effect. 

Because the Durbin Amendment dramatically reduced the interchange fees that banks use to fund rewards programs, those banks and other financial institutions simply eliminated debit card rewards programs. 

The governor's veto helps ensure the same outcome does not occur in Colorado. Around 80% of Coloradans use rewards cards, and polling shows voters overwhelmingly value the ability to earn points, cashback, and travel benefits through routine purchases. Across the country, millions of Americans use credit card points to book flights, hotel stays, and family vacations. Everyday purchases -- groceries, gas, and utility bills -- often translate into airline miles and travel rewards that make trips more affordable.

These rewards particularly support Colorado's tourism economy. The sector is one of the state's most important economic engines, contributing roughly $28.5 billion to the economy and supporting more than 188,000 jobs statewide. Increasingly, rewards programs help drive that spending by incentivizing travel and consumer purchases. According to industry estimates, airline credit card rewards funded travel for more than 740,000 domestic visitors to Colorado, generating more than $1.2 billion in economic activity and supporting nearly 10,000 jobs.

From ski towns and mountain resorts to Denver restaurants, breweries, concert venues, and outdoor recreation businesses, Colorado benefits when travel is easy and consumers feel empowered to spend. Weakening rewards programs risks creating ripple effects that extend far beyond the payments industry itself.

Tourism in Colorado has grown under Governor Polis' leadership. By vetoing SB 26-134, he reinforced that legacy and protected an important driver of travel, consumer spending, and economic activity. His decision helps ensure Colorado remains a top vacation and business destination for years to come.

SB 26-134 asked Coloradans to accept a dangerous bargain: give up valuable rewards and consumer benefits today in exchange for the promise of lower prices tomorrow. But history suggests those savings were unlikely to materialize in any meaningful way. 

Governor Polis recognized those risks and acted accordingly. His veto protected consumers, supported Colorado's tourism economy, and spared the state from an experiment that has failed before.