State workers, education to get more funding under Hickenlooper’s proposed budget

The Colorado Statesman

Gov. John Hickenlooper on Thursday proposed a $21.9 billion state budget for the 2013-14 fiscal year that represents a $1.1 billion, or 5.4 percent, increase in total funds. The $8.1 billion from the general fund that is part of the budget includes a $387 million boost, or about 5 percent, over the current budget that ends in June.

State budget officials said a rebound in general fund revenue — including individual income tax revenue growth of 22.7 percent — exceeds the pre-recession peak. That has allowed for the upsurge. But when inflation and population growth are accounted for, revenue is still $1.1 billion, or 14.4 percent, below the 2007-08 fiscal year level.

The Democratic governor’s budget proposal includes a request for $201.6 million in new funding for K-12 education, and another increase of $37.5 million in additional funding for higher education.

State workers would see a 1.5 percent cost-of-living increase, as well as a boost to the state’s merit-based pool of money that could account for another 1.5 percent jump in salaries. It would be the first time state workers have seen a raise in five years.

As part of his request, Hickenlooper is asking lawmakers to approve another $174 million for health care policy and financing, including Medicaid. He said increases in the Medicaid program represent almost 40 percent of the total funds increase from federal support, which would cover the anticipated increase of about 51,000 enrollees in Colorado and push the overall figure of total participants to a record high of more than 700,000.

Additionally, Hickenlooper’s plan includes a $2 million expansion to a state fund that is used to recruit jobs from relocating or expanding companies, and an added $1 million for incentives for the film and television industry. The governor’s plan also calls for another $2 million for tourism promotion, including branding for the state.

Explaining that he never wants to forget the “last and the least,” the governor has asked for $13.1 million for services for people with developmental disabilities and $6.8 million in food assistance for low-income families. Moreover, he has asked for a $2 million increase for programs to serve the elderly and $5 million for estimated costs associated with the Elder Abuse Task Force, which will work to increase protections for vulnerable seniors.

Other notable increases in Hickenlooper’s budget include $38.1 million for human services and $44.9 million for controlled maintenance.

But the governor was careful to express that he wants to maintain a “cautiously optimistic” and “prudent” budget, and so he has requested a 5 percent general fund reserve, which currently stands at 4 percent of spending. The end goal, said Hickenlooper, is to achieve a reserve of 6.5 percent. A 5 percent reserve would represent 18 days of operating room in the event of a downturn.

The governor’s proposal now heads to the Joint Budget Committee. Budget officials are scheduled to present the request on Nov. 14. A final proposal will likely be submitted to the full legislature at the end of March.

“Colorado’s economy is outperforming other states,” said Hickenlooper. “This gives us the ability to restore some cuts and modestly increase funding in critical areas of the state’s budget. But we still have a long way to go to fully recover from this recession.”

“Rome wasn’t built in a day, and after all those attacks, Rome wasn’t rebuilt in a day,” he added at an afternoon news conference with reporters.

Republicans, however, appeared skeptical. House Speaker Frank McNulty of Highlands Ranch questioned the governor’s motivations for spending increases, cautioning against any proposals that lead to additional fees or increased taxes.

“During the past two years our House GOP has focused on responsible budgets that limit growth and prioritize funding for education,” he said in a statement. “Students, parents and teachers continue to be a top priority as we fight to save additional money for our schools. We certainly hope that the spending in Gov. Hickenlooper’s proposed budget is not a return to the tax-and-spend agenda that moved us closer to bankrupting our state during the [Gov. Bill] Ritter recession, but it will take us some time to fully review his suggestions."

The governor’s office may need to re-evaluate its proposal at the beginning of the year if Congress fails to act in a lame duck session of Congress on the looming so-called “fiscal cliff.” If federal lawmakers do not to reach a compromise on how to reduce the nation’s deficit, automatic spending cuts would take effect, which would impact funding to Colorado.

Henry Sobanet, the governor’s budget director, said his office has yet to determine a financial figure for any such impact on the state, but he acknowledged that a lack of action on the part of Congress would have dire consequences.

“We know where the sequestration cuts would go, but backfilling them is a much different discussion. The impact on the economy if they do cuts to defense, that sort of thing, we just don’t know what they are,” said Sobanet. “We’re assuming something happens favorably, some sort of solution, but if it goes south, we have to change.”

Local interests respond

Local interest groups are cheering the governor’s proposed budget, and are optimistic that they will actually see increases this year. But some believe the state still has much work ahead of it.

Kerrie Dallman, president of the Colorado Education Association, called the increased funding for education “modest,” suggesting that Colorado political leaders and voters should come together to secure a steady funding stream.

“Our K-12 investment is still more than $1 billion behind the level of public education funding that Colorado voters said they want for their children,” said Dallman, pointing to Amendment 23, which Colorado voters passed in 2000 requiring the state to annually increase K-12 funding by inflation plus 1 percent. “School districts across the state have made a wide range of painful, unpopular budget cuts resulting in larger class sizes, fewer curriculum offerings for students and increased fees for families.”

“State leaders still need to address these serious shortfalls,” Dallman continued. “Great economies start with great education, and all Coloradans need to recognize this budget only marginally increases the investment we need to make in our students to secure the strong, dynamic state economy we all desire for these children when they enter the workforce.”

Bruce Benson, president of the University of Colorado, agreed that additional funding is required, but is pleased with the increase.

“The past several years have been difficult times for budgets for higher education, so this is great news for CU and all of higher education,” he responded to the budget request. “We still face challenges in the coming years, but the clear message today is that the governor sees higher education as a top priority.”

Leaders for state workers shared in the restrained optimism.

“This is still a budget in crisis and so it is particularly meaningful to see a wage increase on the table along with a number of other important compensation elements,” said Scott Wasserman, executive director of Colorado WINS, the union that represents state employees. “We look forward to working with the governor and the legislature to build on this proposal and make the state a competitive employer in Colorado. If we want to attract and retain the best workers, we need to pay them fairly.”

Advocates for the elderly and disabled also offered their input, communicating their pleasure after years without increased funding.

“This is incredible news and reflects the governor’s commitment to community services for vulnerable people,” said David Ervin, president of Alliance Colorado, an association that advocates for people with developmental disabilities.

“After many years of no increases, we are very happy to see that the governor wants to set $2 million aside for the Older Coloradans Act,” added Morie Smile, AARP Colorado director. “And we hope that more fu

Peter@coloradostatesman.com