Ritter vows to take on state's fiscal fiasco

Remember the coalition for Referendum C back in 2005?

By Jason Kosena
THE COLORADO STATESMAN

Any Colorado lawmaker will tell you the state Constitution is in need of repair.

A myriad of ballot measures over the last two decades have tied the state’s fiscal policy in knots, leaving legislators helpless to accommodate changing needs. Republicans and Democrats agree something has to be done, and both sides warn that unless that happens soon, Colorado will face the kind of fiscal nightmare California is dealing with today.

But that’s where consensus ends.

TABOR, the Taxpayer’s Bill of Rights, approved statewide by voters in 1992, caps revenue growth, tying it to inflation and population growth, and allows taxes to be increased only by referendum.

Former House Speaker Andrew Romanoff, left, with Gov. Bill Ritter, right, at a press conference on education earlier this year. Romanoff crafted a ballot initiative in 2008 utilizing compromise language similar to what Ritter may have to do in 2011 for another attempt to fix the state constitution.
File photo from The Colorado Statesman

Amendment 23, added by voters in 2000, prescribes annual increases to K-12 funding, creating an exception to TABOR for public schools. To meet the obligations of Amendment 23 and other prescribed spending mandates, such as Medicare, the Legislature has been forced to make massive cuts to other programs and, as a result, has closed prisons, watched as roads crumble and seen tuition at state colleges and universities double in seven years.

Colorado’s constitutional knot has essentially put the budget on autopilot, and lawmakers are unable to change the course.

Republicans, who champion TABOR, say the state’s fiscal problems are a result of the spending mandates in the Constitution, such as Amendment 23, and not a product of the spending restrictions set by TABOR.

Democrats disagree, saying Amendment 23 was passed by voters in response to TABOR’s spending limits, which forced large-scale budget cuts in education; they argue that the problem is with TABOR.

Some wonder if a workable solution will ever be reached.

Untying the knot

But that isn’t stopping Gov. Bill Ritter. Speaking to reporters earlier this month in his office, Ritter confirmed that he would push for a 2011 ballot initiative aimed at fixing the state’s conflicting budget statutes.

In other words, he wants to untie the knot.

Ritter is steadfast in his belief that 2011 is the proper year to ask voters for the change. Still unknown, however, is what that change will look like and how much bipartisan support it will receive. As he laid out the plan in broad strokes this month, Ritter seemed to be looking for guidance from the 2005 success of Referendum C, which effectively gave the Legislature a five-year “timeout” from TABOR.

“What I would like to do is bring together a coalition of folks who can work on it,” Ritter said, adding that such a coalition would be charged with fixing conflicting sections in the Constitution — including the Gallagher Amendment, TABOR and Amendment 23 — that are at cross purposes.

Sound familiar? It should. When Ref C was pushed in 2005, it had the support of former Republican Gov. Bill Owens, Democrats, the business community, non-profits and labor organizations.

“I think it’s most important for us to focus on what the problem is first,” Ritter said. “And that problem is that we have conflicting mandates that regard spending and regard the kinds of restrictions that you have on how you can spend revenue that flows into the state.”

Ritter said some of those conflicts were addressed this year when Senate Bill 228 was signed into law and called the controversial legislation that repealed a 6 percent spending cap on the General Fund “a starting point.”

Ritter said he doesn’t believe additional legislative action is needed next year in order to prep for the 2011 ballot initiative and that a workable solution would have to change “the Gallagher Amendment, parts of TABOR... (and) parts of Amendment 23.”

Although Ritter was vague on details, his wording may hint at what he believes is needed to gain the support of voters and interest groups in 2011. After all, as much as Democrats dislike TABOR, voters very much believe in what it stands for, and as much as the GOP is against Amendment 23, Coloradans support funding K-12 education.

“People want to vote on their own taxes, which TABOR allows,” said former Republican lawmaker and Statehouse veteran Norma Anderson, who served as majority leader in the state senate during her tenure. “That part would have to remain no matter what. As for Amendment 23, the
teachers’ union is a very strong organization, and they will want to keep the (spending increase) in place for K-12. Without those components, I don’t see any fix gaining the support of voters.”

Moving forward

So where does that leave Ritter? He may not have to look any further than former Speaker of the House Andrew Romanoff to find out.

After rising through the ranks at the Capitol to take the top position in the House, Romanoff worked in 2008 to craft a ballot initiative utilizing much of the compromise language Anderson considers necessary for a successful initiative in 2011.

Former Sen. Norma Anderson, R-Lakewood, helped craft the school finance act when she served in the Legislature. She says a strong coalition would be needed for a ballot initiative to fix the state constitution in 2011.

Romanoff’s effort, Amendment 59, would have eliminated TABOR’s requirement that revenues in excess of required spending limits of TABOR be refunded to taxpayers. And although it would have repealed the requirement under Amendment 23 that education spending increase every year, it also would have preserved K-12 funding by placing the excess revenue in the state Education Fund.

Apparently that wasn’t enough. Amendment 59 failed to get enough votes last November.

“Andrew had the ‘word’ of support from many groups, but he didn’t have the financial backing or the heavy support that Ref. C got,” Anderson reminded The Colorado Statesman this week. “The business groups were too busy fighting labor (with ballot initiatives), and the labor groups were too busy fighting for and against the different labor initiatives. It got lost in the fray.”

Romanoff, who was term limited and left the Statehouse at the end of last year, agreed.

“I don’t want to short change the team we had on 59,” Romanoff told The Statesman last week. “A lot of organizations signed on, but there was a lot of competition for their time and money.”

Unlike 2008, when Romanoff pushed Amendment 59, Ref C was among the very few ballot initiatives presented to voters in 2005.

“We didn’t have a lot of other competition then,” said Romanoff, who worked closely with the Ref C and Ref D campaigns. “So it was easier to get things passed because we were all alone on the ballot. That was an advantage.”

Feeling the pain

There was more behind the success of Ref C than just an empty ballot and a broad coalition of support, however. There also was the fear of a looming budget crisis on the horizon, which gave voters an added perspective.

Unlike last year, in 2005 Colorado was coming out of an economic downturn caused by the crash of the tech bubble. As state revenue increased year after year in the 1990’s, TABOR’s limits kept the budget growing at a steady pace and handed money back to taxpayers on an annual basis. But then, in 2002, the force of the economic downturn hit the state, and Colorado collected significantly less than it had the prior year. By 2003, the state’s revenue had returned to almost normal levels, but the limitations of TABOR — which allow 6 percent revenue growth from the year before — had “ratcheted” government down.

Massive cuts were made to transportation, higher education and prisons funds. Coloradans who had grown used to a government that offered more services began to feel the pain.

“I think Ref C, in some ways, was a simpler proposal (than) Amendment 59, but we weren’t trying to fix as many things all at once,” Romanoff said. “And the problems the state was facing were more imminent.”

Anderson, a former Joint Budget Committee member and House Majority leader, agreed that Colorado’s constitution can be repaired only when people feel the restrictions imposed by the state’s tangled fiscal knot.

“Part of Ref C passing was the fact that we had to close a lot of the Department of Motor Vehicle offices statewide, and people were standing in lines,” Anderson said. “The people were feeling the pain. If you’re not feeling the pain, it’s hard to get people to do the right thing. The Legislature shouldn’t offset the pain if they want to fix the problem. They need to quit robbing the cash funds to balance the budget and just make the cuts needed to allow people to find out what it’s like. Then go to the voters.”

But even if the pain is enough to convince voters to change the Constitution and untie the fiscal knot, Anderson said that wouldn’t be enough. As long as it’s easy for voters to change the Constitution, and so easy for special interests to push their issues onto the ballot, there’s no guarantee that any fix Ritter and supporters can pass in 2011 will stand.

“You have got to change the process of amending the Constitution first — because even if you were to pass something, somebody else would come along and change it all the next year,” she said.

A little education can go a long way

Although everyone seems to have a slightly different plan for the success of a 2011 ballot initiative, they seem to agree on the need for an extensive — and expensive — voter outreach campaign. Voters need to understand the very technical and complicated factors that have led the state to the position it’s in today.

“We need to build that coalition and build it over a long period of time, which is why we need to start right now for a 2011 measure,” Ritter said. “The second thing is an education campaign for the voters of this state.... If you look at how (voters) react to things, there is really a rationale for what they do, but sometimes (when) there is a really complex (issue), it’s important that you take your time (to) educate them.”

So how does a broad coalition go about doing that?

“That is the 64-million-dollar question,” Anderson said. “My personal opinion is it takes an education of the public before you can try anything. But even then, it’s going to be a tough fight. These things don’t come easy.”

Jason@coloradostatesman.com