Words can't bury budget woes Senate, house meet on fiscal plan

By Tim Hoover
The Denver Post
Posted: 02/16/2009 12:30:00 AM MST
Updated: 02/16/2009 12:36:05 AM MST

An oxymoron has been in wide use this year at the Capitol: "negative supplemental."

That's the term budget officials use when they make a midyear cut to a program. In a good year, there are mostly "supplementals," meaning upward, but usually small, adjustments to programs based on unexpected costs.

But in the current budget year, which ends in June, the state's revenue is expected to be more than $600 million below original projections. The "negative supplementals" have been plentiful and deep.

Lawmakers on the Joint Budget Committee last week finished their plan to balance the current year's budget. Their staff will make a presentation of the plan today to the full legislature in a rare joint session of the House and Senate.

Rep. Jack Pommer, a member of the JBC, said the joint session is meant to bring other lawmakers up to speed on what has happened to the current year's budget.

"This year we have an extraordinary number of bills and supplementals cutting a huge amount of money," Pommer, D-Boulder, said. "In some ways, it's like redoing the budget."

The Joint Budget Committee followed, or came close to, many of the recommendations Gov. Bill Ritter, a Democrat, made last month to balance the budget in the current year.

For example, the six-member panel agreed that colleges and universities should be cut $30 million in appropriations from the state's general fund and Ritter's office should take a $2.6 million cut.

Meanwhile, the panel rejected the governor's supplemental request for $26 million in additional funding for schools.

The JBC's balancing plan rests on the assumption, also used by Ritter's office, that the state would get an estimated $107 million in federal stimulus package funding just to help offset the costs of Medicaid in the current year.

Pommer said that with changes to the stimulus package last week, the state could get an additional $100 million for Medicaid in the current year.


While the governor's office called for using $207 million in cash funds — pots of money financed from fees in exchange for goods and services — the JBC recommended using $230.9 million.

The panel approved a recommendation to limit the amount of sales tax revenue that businesses can keep as compensation for collecting the tax for the state. That change would save the state $12.8 million in the current year.

But the panel nixed a proposed $250,000 cut to veterans' programs.

The panel also reversed a recommendation that would have cut $2 million from a senior assistance program that funds services like Meals on Wheels.

"We got a surge of lobbying from senior citizens' groups," Pommer said.

House OKs vehicle fee-hikes

By John Ingold The Denver Post
Posted: 02/24/2009 07:48:32 PM MST

I think we were hoping for a headline more along the lines of "Disaster Averted! House Rescues Failing Bridges."  Oh, well. 

A major bill to raise annual vehicle registration fees to pay for road and bridge improvements squeaked through another vote today at the state Capitol.

Senate Bill 108, known as FASTER, won initial approval in the House, over the objections of every House Republican and four Democrats, including the House majority leader. It must still receive another vote in the House.

The bill's sponsor, Rep. Joe Rice, D-Littleton, urged his colleagues to pass the bill, saying it is critical the state invest money to repair its aging infrastructure. He said the work generated by the bill would preserve as many as 8,000 jobs in Colorado and generate new ones.

"The cost to doing nothing is much greater than the cost of this bill," Rice said. " Things wear out. The infrastructure wears out. This is an important part of the solution. It's something we can do now."

Republicans, meanwhile, continued to blast at the bill's registration fee increases and complained that their suggestions to fix the bill went unheard.

Unheard?  We listened to them ranting about the bill for hours.  Personally I think it's an awful bill, but not for the reason most Republicans opposed it.  They seem to think we can maintain the transportation system for free.  We can't.  But we should do a better job of managing it before we impose a regressive fee to repair it.

"We have a fundamental difference that this is a fee bill instead of a broader bill," House Minority Leader Mike May, R-Parker, said. " We don't have a solution together for Colorado. We have a bill that we feel like we have had minimal input on the process."
 

They wanted to spend General Fund money on transportation.  That would mean cutting higher ed, K-12, Judiciary, or some other service.  And they would oppose those cuts, I assume, since they opposed a lot of the cuts this year.

State representatives Tuesday argued into the evening over the bill, and the vote on the bill followed a by now familiar pattern for FASTER, which sponsors once hoped would be a bi-partisan effort but has seen a string of largely party-line votes since it was introduced.

Lawmakers from the two parties squabbled over registration fees, rental car fees, mass transit funding, eminent domain, tolling and just about any other issue the bill potentially touches in an exhaustive debate that lasted several hours.

Things got so contentious that Rep. Jack Pommer, D-Boulder, offered an amendment out of frustration that "no one shall have any power to charge anybody anything to support the transportation system."

"Let's vote yes and go home," Pommer joked.

I don't like the bill and initially wanted to vote against it.  Not because we don't need the money, but because I think we should be doing more to manage the demand for transportation. 

During the debate, reps from both parties ran amendments to take away options that could pay for transportation.  They opposed a fee based on the amount you drive, tolls and, of course, the registration fee that's the point of the bill.  Most legislators oppose a tax increase.  Yet everybody agrees the transportation system is falling apart. 

FASTER would ultimately raise vehicle registration fees by $41 for the average car — an amendment Tuesday phases in the fee increase over three years instead of two — generating more than $250 million a year for road and bridge fixes. The bill would also charge a $2-a-day fee on rental cars and would give local governments the authority to put tolls on existing roads if the governments get the buy-in of all communities that would be impacted by the tolls.

In one of the more bi-partisan moments of the debate, a group of Democrats and Republicans fought unsuccessfully to take the tolling provision out of the bill. Rep. Edward Casso, D-Thornton, said Colorado residents shouldn't have to pay to use roads they've already paid for with taxes.

But Rep. Claire Levy, D-Boulder, said the debate over FASTER shows the state has not adequately paid for its existing roads and bridges.

"We've got to be creative with how we fund our transportation system," she said.

Democratic dozen desert Ritter's tax credit bill

By: Tim Hoover
2/25/2009

They called it bad policy and said it was a government giveaway to businesses.

The way a group of House Democrats angrily talked about House Bill 1001 on Wednesday, you would have thought it was a Republican bill instead of the top economic development effort being pushed by their own governor.

What the bill does makes it seem more like a Republican bill -- a special interest tax break that will cut state revenue at the same time we're slashing budgets.  If we were the federal government and we could borrow money we'd be cutting taxes and increasing the deficit.  Sound familiar?

The bill, sponsored by Rep. Joe Rice, D-Littleton, would award tax credits to companies that create 20 or more jobs and to companies in rural areas that create at least 10 positions.
  
The tax credit is for up to 50 percent of the amount the employer pays in federal Social Security and Medicare taxes on the new jobs. An employer could claim the tax credit for up to five years. 

Ritter, a Democrat, had touted the proposal in December as one his key efforts to create jobs in Colorado.

Critics said studies have shown such incentives only reward companies for doing what they'd already planned to do anyway. Opponents said it would further strain the state's budget in a year when pennies are hard to find.

"How big should this deficit get?" asked Rep. Jack Pommer, D-Boulder. "This makes no economic sense. Vote no on this bill. Do not dig our deficit hole deeper."

Estimates say the bill would cost the state nearly $3 million next year.

Rep. Bob Gardner, R-Colorado Springs, supported the bill and was amused by the Democratic defections.

"This is the governor's No. 1 economic proposal this year," Gardner said. "I challenge you to join with us and your governor, the governor of all of Colorado, and support House Bill 1001."

The House approved the bill on a 52-13 vote, with 12 Democrats and one Republican voting against it. It now goes to the Senate.

Those 52 votes came from the same people who have been complaining about the budget cuts and the cash fund transfers we're using to prop up revenue.  Imagine spending three days listening to people complain about your recommendations for balancing the budget (without offering any suggestions), then listening to them talk about how great it is to cut taxes.

A spokesman for Ritter was unfazed by the Democratic opposition, instead focusing on the yes votes from both sides of the aisle.

"The bipartisan nature of this bill is a testament to the fact that creating jobs is not a Democratic issue or a Republican issue – it's a Colorado issue," said Evan Dreyer, Ritter's top spokesman.

The bill doesn't create jobs, it cuts taxes for a few businesses.  The bipartisan nature of the bill is a testament to the fact that members of both parties get a kick out of giving away money to special interests.