6 percent limit heads to House

By Jason Kosena
THE COLORADO STATESMAN

With one Senate-sized hurdle out of the way, Senate Bill 228 is headed to the House.

If passed, the legislation, sponsored by Sen. John Morse, D-Colorado Springs, would repeal the Arveschoug-Bird limit, a 1991 legislative provision that allows the state’s General Fund to grow by only 6 percent each year.

Sen. John Morse, D-Colorado Springs, speaks during a press conference after SB 228 is passed.
Photo by Jason Kosena/The Colorado Statesman

SB 228 passed on third reading in the Senate on a party-line vote Tuesday morning, two weeks after Republicans mounted a 10-hour filibuster in an attempt to delay its passage.

The 6 percent rule, as Arveschoug-Bird is known, is considered by some to be the underpinning of Colorado’s fiscal conservatism. Most Republicans say that without it, the state’s budget would balloon in good years, forcing Colorado to make California-size budget cuts during recession years.

Democrats, however, argue that Arveschoug-Bird precludes sound
budgeting practices and makes it nearly impossible to recover from a recession because it “ratchets down” spending.

“We are having to battle every minute of every day to get people to understand that it is OK to fix past (budgeting) mistakes,” Morse said to reporters after the bill passed the Senate.

“I am just pleased that half of the debate is over. The other half of the debate will continue to rage on for the next couple of weeks (in the House). But, if we stick together, we can ensure that this bill will move forward — and that is what we are going to do,” Morse said.

The fight in the House, however, is going to be different from the Senate’s struggle.

For one thing, the bill’s House sponsor is a Republican.

Rep. Don Marostica, R-Loveland, has bucked his party’s leadership for weeks, vowing to continue his support of SB 228 despite a tongue-lashing delivered by Minority Leader Mike May and Colorado Republican Chair Dick Wadhams. The reprimand came after Marostica said former lawmaker and state treasurer Mark Hillman and the Independence Institute’s Jon Caldara were “has-beens” and “losers” because they opposed his effort to overturn Arveschoug-Bird.

As he spoke to reporters Tuesday, Marostica seemed unfazed by the incident and vowed to continue his fight to pass SB 228.

“We do have a problem, and it’s called the ratchet,” Marostica said.

Marostica said his analysis of Colorado’s boom-and-bust economic cycle suggests that keeping a lid on General Fund growth makes it increasingly difficult to recover from recessions.

“My analytical mind tells me that this just won’t work for the citizens of Colorado,” Marostica said.

Sen. Rollie Heath, D-Boulder, talks about the need to repeal the 6 percent limit on the General Fund. Behind Heath are Sen. John Morse, D-Colorado Springs, left, and Rep. Don Marostica, R-Loveland, right, the two sponsors of SB 228 which proposes to get rid of the limit.
Photo by Jason Kosena/The Colorado Statesman

Marostica, who is expecting resistance from House Republicans, said he is ready to present his case. He will, however, slow the pace of the bill’s movement so it doesn’t race through the House as quickly as it moved through the Senate, slowed only by the 10-hour Republican filibuster. It’s expected to come before the House Finance Committee the week of April 15.

Marostica said he will take the time to thoroughly explain the problems created by the 6 percent limit.

“I know the math doesn't work and everyone I talk to, once I go through my mathematical presentation which I will do on the floor of the House..., people (will) say, ‘That just won't work.’” Marostica said.

After SB 228 passed the filibuster in the Senate, there was some back-channel scuttlebutt that Republicans were working with Morse to make a deal. As a part of that deal, Republicans would agree to vote for a “time-out” from the 6 percent rule for the next couple of years in order to allow the state to recover from the recession. In return, the Democrats would stop pushing SB 228.

However, Senate Minority Leader Josh Penry said on Monday that those discussions had stopped on Friday, March 13.

When asked if there would be room in the House for such a compromise, Marostica said that as long as the ratchet effect is left in place, he doesn’t think a compromise is possible.

“So far, I haven’t seen a deal that I think will work,” Marostica said. “We have to get rid of that ratchet and get rid of the 6 percent, and I haven’t seen that (kind of deal) so far.”

With Democrats in charge of the House and with Marostica pushing the bill, there is little chance of the bill dying before making its way to Gov. Bill Ritter’s desk to be signed into law. But, although reporters have repeatedly asked Ritter if he will support the bill, he refuses to answer and remains on the sidelines.

“We haven’t taken a position on that as we are watching all of the arguments that are being made,” Ritter said Monday.

Jason@coloradostatesman.com