By Michael Davidson (Contact)
Saturday, January 10, 2009
DENVER -- Colorado is facing tough times that will try residents and require painful cuts to the state budget, Gov. Bill Ritter told lawmakers Thursday in his annual State of the State address.
That means creating new jobs and making up a budget shortfall that could reach $630 million must be the state's top priorities, Ritter said.
"Over the next 120 days, our collective focus must be on protecting business, creating jobs and managing the budget. I will look at everything we work on this session through the lens of the economy -- of what's responsible and what's best for the long run," he said.
Broomfield's legislators had mixed reviews of the governor's speech, as could be expected by their party affiliations.
Ritter touted plans to create tax credits for businesses that hire new employees, extend loans to small businesses and nurture companies working on advances in renewable energy technology as ways to sustain the economy and keep the unemployment rate -- currently at 5.8 percent in Colorado -- from climbing.
Sen. Shawn Mitchell, R-Broomfield, said Ritter's vision is flawed.
"Gov. Ritter is a decent guy with good intentions, but he's got the wrong idea about weathering a downturn if he thinks raising taxes on hard-working families is the ticket out of our problems," Mitchell said.
Ritter didn't propose a tax increases per se, but did criticize the Taxpayers' Bill of Rights, which requires voter approval for tax increases and limits government spending.
Ritter blasted the law, part of the state Constitution, as a "straitjacket that makes modern, sensible and value-based budgeting an impossibility."
Republicans ardently defend the amendment, while Democrats criticize it, in part, because whenever the Legislature has to cut the budget during a recession it cannot later increase the budget without taxpayers' approval. That's a continuing problem, said Rep. Dianne Primavera, D-Broomfield.
"We're elected to do this job, but we're hamstrung sometimes because of the budgetary process," Primavera said.
Mitchell viewed Ritter's comment as irrelevant to the current budget shortfall.
"He made the tired attack on the Taxpayers' Bill of Rights, which has nothing to do with our current crunch. The budget is down because the economy is down. When the economy comes back, state revenues will rise without a tax increase."
The governor also didn't go into detail about from where the budget cuts would come. Primavera said the heads of major state departments should be given time to figure it out.
One area sure to be hit hard is the budget for higher education, said Rep. Jack Pommer, D-Boulder. Pommer is a member of the budget committee and chairs the House Appropriations Committee.
"Higher education is going to get killed," Pommer said. Among the possible cuts is $210 million for the University of Colorado system.
The fate of 160 transportation projects with a price tag of $1.4 billion also wasn't clear on Thursday. Mitchell criticized the governor's hope that the incoming Obama administration would pass an economic stimulus plan that could be used to pay for the work.
"He seems to be leaning pretty heavily on a federal bailout check that may or may not come," Mitchell said.
The Republican did praise Ritter's support for a measure that would put the state budget online and make it easier for residents to access. He called that a step forward for more transparent government.
Thursday's speech reordered some priorities Ritter emphasized when campaigning for office in 2006 and through his first two years in office. The governor still pushes "the New Energy Economy" -- one proposal this year will require all new single-family homes to have the capability to install solar panels -- but issues such as improving education and expanding health care coverage moved farther down the list of priorities.
Just last year, those two areas were the subjects of high profile special committees charged with completely overhauling teaching standards and curriculums and providing medical care to more than 700,000 uninsured Coloradans.
Primavera said the speech stayed true to Ritter's commitments to promoting renewable energy research and expanding access to health insurance. She also liked Ritter's comments about lawmakers' "sacred trust with the people who elect us."
"It gave me pause for thought again about the level of faith people put in you when they elect you to do this job," Primavera said.
She was unhappy with what she viewed as tepid Republican support.
"It was disappointing not to see the entire room erupt in applause when he talked about how important it would be to work in a bipartisan fashion," she said.
Saturday, January 10, 2009
DENVER -- Colorado is facing tough times that will try residents and require painful cuts to the state budget, Gov. Bill Ritter told lawmakers Thursday in his annual State of the State address.
That means creating new jobs and making up a budget shortfall that could reach $630 million must be the state's top priorities, Ritter said.
"Over the next 120 days, our collective focus must be on protecting business, creating jobs and managing the budget. I will look at everything we work on this session through the lens of the economy -- of what's responsible and what's best for the long run," he said.
Broomfield's legislators had mixed reviews of the governor's speech, as could be expected by their party affiliations.
Ritter touted plans to create tax credits for businesses that hire new employees, extend loans to small businesses and nurture companies working on advances in renewable energy technology as ways to sustain the economy and keep the unemployment rate -- currently at 5.8 percent in Colorado -- from climbing.
Sen. Shawn Mitchell, R-Broomfield, said Ritter's vision is flawed.
"Gov. Ritter is a decent guy with good intentions, but he's got the wrong idea about weathering a downturn if he thinks raising taxes on hard-working families is the ticket out of our problems," Mitchell said.
Ritter didn't propose a tax increases per se, but did criticize the Taxpayers' Bill of Rights, which requires voter approval for tax increases and limits government spending.
Ritter blasted the law, part of the state Constitution, as a "straitjacket that makes modern, sensible and value-based budgeting an impossibility."
Republicans ardently defend the amendment, while Democrats criticize it, in part, because whenever the Legislature has to cut the budget during a recession it cannot later increase the budget without taxpayers' approval. That's a continuing problem, said Rep. Dianne Primavera, D-Broomfield.
"We're elected to do this job, but we're hamstrung sometimes because of the budgetary process," Primavera said.
Mitchell viewed Ritter's comment as irrelevant to the current budget shortfall.
"He made the tired attack on the Taxpayers' Bill of Rights, which has nothing to do with our current crunch. The budget is down because the economy is down. When the economy comes back, state revenues will rise without a tax increase."
Actually it has everything to do with our current crunch. And state revenues will not rise enough without a tax increase. Just like they didn't rise enough last time.
We're still dealing with a legacy deficit from tax cuts and lost revenues that happened between 1999 and 2005. TABOR partially caused the deficit and partially compounded some bad decisions from the legislature.
If we pretend TABOR doesn't cause a problem, we'll repeat the same mistakes we made last time. During 2001-02 the state lost a billion dollars in revenue. The legislature cut $15 million in spending. That's the kind of absurd budget management you get when you ignore reality, and TABOR is part of our reality.
The governor also didn't go into detail about from where the budget cuts would come. Primavera said the heads of major state departments should be given time to figure it out.
One area sure to be hit hard is the budget for higher education, said Rep. Jack Pommer, D-Boulder. Pommer is a member of the budget committee and chairs the House Appropriations Committee.
"Higher education is going to get killed," Pommer said. Among the possible cuts is $210 million for the University of Colorado system.
This caused a bit of concern at CU. If you read it carefully, you'll see that it doesn't really say that I suggested the possible $210 million cut for CU. The line about the cuts just follows a quote from me. The juxtaposition combined with my injudicious use of the word "killed" caused some people to think I said we might cut $210 million from CU. I think that's the total amount of money CU gets from the state, so cutting it would come pretty close to shutting down the entire CU system.
So far we've only discussed cutting the new money CU, and all of higher education, would get next year. That pretty certain. Higher ed won't be getting any increase next year. As for cutting money they already get, we've only talked about it in general terms. It's certainly a possibility. We could cut some in the current year and we could cut some for next year -- it all depends on the economy and what other cuts we can make. It won't be $210 million from CU.
The fate of 160 transportation projects with a price tag of $1.4 billion also wasn't clear on Thursday. Mitchell criticized the governor's hope that the incoming Obama administration would pass an economic stimulus plan that could be used to pay for the work.
"He seems to be leaning pretty heavily on a federal bailout check that may or may not come," Mitchell said.
But it may come. And if it does come it won't make much difference for our state budget. The money will put some people to work, and it will help us patch up the deteriorating transportation system, but it won't patch up our deteriorating finances.
Our economists calculate that if we were to get $1 billion from the federal government for transportation it would generate $33 million in state tax revenues.
That $33 million, of course, would be spread over the entire time we're spending the billion dollars, which is unlikely to be in a single year, let alone this one, or what's left of it. (Our fiscal year ends in June).
And once we spend the billion dollars, it's gone. The people who got jobs lose them, the parts of the transportation system that didn't get fixed stay broken and the tax revenue stops flowing into the state budget.
Don't get me wrong, I'll take the billion dollars. It's just not going to solve our problems.
The Republican did praise Ritter's support for a measure that would put the state budget online and make it easier for residents to access. He called that a step forward for more transparent government.
Oh boy. I don't mean to be Johnny rain cloud here, but I spend every day accessing the state budget and it's not as exciting as you might think.
Thursday's speech reordered some priorities Ritter emphasized when campaigning for office in 2006 and through his first two years in office. The governor still pushes "the New Energy Economy" -- one proposal this year will require all new single-family homes to have the capability to install solar panels -- but issues such as improving education and expanding health care coverage moved farther down the list of priorities.
Just last year, those two areas were the subjects of high profile special committees charged with completely overhauling teaching standards and curriculums and providing medical care to more than 700,000 uninsured Coloradans.
Primavera said the speech stayed true to Ritter's commitments to promoting renewable energy research and expanding access to health insurance. She also liked Ritter's comments about lawmakers' "sacred trust with the people who elect us."
"It gave me pause for thought again about the level of faith people put in you when they elect you to do this job," Primavera said.
She was unhappy with what she viewed as tepid Republican support.
"It was disappointing not to see the entire room erupt in applause when he talked about how important it would be to work in a bipartisan fashion," she said.
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