Ritter braces for cuts

Colorado hopes for $250m in federal funds

By Leslie Jorgensen
THE COLORADO STATESMAN

Gov. Bill Ritter delivered a “good news — bad news” economic forecast for Colorado in 2009.

On the bright side, compared to such states as California, New York and Michigan, which are facing budget deficits of up to $11 billion, Colorado’s economy appears relatively healthy. On the gloomy side, the state is, nevertheless, grappling with an estimated $100 million budget shortfall.

Part of that shortfall may be offset by budget cuts, a hiring freeze, suspended pay raises and an
estimated $250 million economic
stimulus package from the federal
government.

The national economic climate is “difficult,” Ritter told reporters at the Dec. 15 Legislative Forum sponsored by the Colorado Press Association. “We won’t be immune from the effects of that.”

As he braces for a possible 2.5 percent funding reduction next year, Ritter has asked state department heads to identify potential budget-cut targets. Ritter hopes the cuts will trim $200 million from the 2009-2010 budget for the fiscal year beginning July 1.

However, the cuts will not be applied across the board.

“We can’t compromise safety,” said Ritter.

The governor said departments that provide public health, safety and transportation services would be less vulnerable than some other areas, particularly K-12 and higher education.

“It would break my heart if I had to do anything as it relates to cutting higher ed funding, but I can’t take higher ed off the table,” said Ritter, noting that out of his “deep passion,” he had dedicated $120 million to higher education since 2006.

Ritter proposed continuing the hiring freeze on state jobs that he initiated in September.

Last month, Ritter proposed adding an estimated $77 million, in addition to the existing statutory 4 percent General Fund reserve, which has a current balance of $320 million. If approved by the Joint Budget Committee and the Legislature, the $77 million would be held in reserve until June 30, 2010, and more than half would become a permanent reserve fund.

Colorado also will benefit from the proposed federal stimulus package. Although it’s unknown how much money the state will receive or when, Ritter said it will be short-term injection with long-term investment.

Democratic leaders in Congress are developing a $500-billion-to-$2-trillion stimulus bill for infrastructure projects that will create thousands of jobs in the states. They hope that the bill is passed swiftly and is ready for President-elect Barack Obama to sign after his Jan. 20 inauguration.

Last week, Ritter sent in a wish list of transportation and energy infrastructure projects to create new jobs in Colorado. The state has a backlog of 160 bridge, highway, transit and airport projects that could be started within 180 days of receiving the funds.

The list was culled from input from several leaders, including county commissioners throughout the state. Earlier this month, U.S. Sen. Ken Salazar discussed the stimulus package and requested information on county projects at the Colorado Counties Inc. Winter Conference.

“It’s going to be a major inoculation into the infrastructure,” said Salazar, who asked the commissioners to send lists of proposed projects to Ritter.

“I want us to be ready to move forward with that kind of economic infusion. I don’t want to have Colorado left behind.”

Although some Republican county commissioners and legislators oppose the concept of taxpayers incurring more debt from the federal stimulus package, Salazar and Ritter urged bipartisan participation.

“We expect it to be an engaging legislative session,” Ritter told reporters. “We do our best work when we do it in a bipartisan fashion.”