As Colorado budget shortfall grows, a state senator questions $4 million in spending on new furniture
The hole in the Colorado state budget is getting bigger.
The latest figures show a shortfall of about $1.2 billion, and the state's chief economist says the reserve -- or rainy-day fund -- will run out of money by 2029 if nothing changes.
"The message is we are on an unsustainable path with our budget if we don't change our spending habits," said State Sen. Barb Kirkmeyer, who is one of six lawmakers on the Joint Budget Committee.
The Republican says lawmakers have simply overspent, pointing out the state has added more than 7,000 full time employees and 17 new state offices in the last six years alone.
But the biggest budget driver is Medicaid. It makes up a third of the general fund and has ballooned by nearly $600 million in the last year. The Department of Health Care Policy and Financing says the increase is due largely to utilization by older Coloradans and people with disabilities, who make up only 9% of the Medicaid population but account for 50% of the costs. Colorado has the second fastest growing population of people over age 65 -- they outnumber those under 18 -- and long-term care is covered by Medicaid, not Medicare.
State Sen. Jeff Bridges -- chair of the budget committee -- says the state is generating enough revenue to cover expenses but lawmakers can't tap all the money. He says the problem isn't spending, rather it's the Taxpayer Bill of Rights -- or TABOR -- which caps how much the state can spend to the growth in population plus inflation.
"Inflation is the price of dishwashers and washing machines and that's not what we buy as state. We pay wages. We invest in health care and those costs grow way faster," the Democrat said.
Bridges says the budget committee is also limited in where it can trim expenditures. In addition to Medicaid, K-12 education accounts for another third of the general fund while the other 40% is divided among higher education, human services, corrections and judicial.
"Where are we going to cut? Show me where all these savings are because there's not a billion dollars worth of savings to be had in this budget," he said.
As the budget writers search for where to cut, Kirkmeyer found a surprise in the legislature's own budget -- about $20 million in unspent general fund allocations from previous years. The money has been deposited in a cash fund used primarily for renovations at the capitol.
There are nearly a thousand cash funds in various departments throughout the state. Kirkmeyer says the budget committee needs a full accounting of those funds.
"So what we need to do is sunset the cash funds. Fund them for a half year and tell each of those departments to come back to us and say what's in those cash funds, what are those cash funds used for? What's the fund balance? How much are we spending and where did it come from. Is it fee generated revenue? Did we transfer general fund into there?" Kirkmeyer said.
The legislature's cash fund was approved by lawmakers more than a decade ago. State House Speaker Julie McCluskie says they are planning to return more than $4 million from the cash fund to the general fund. She says the legislature's executive committee -- made up of leadership from both parties -- decides how to spend the money and it's also cutting the legislature's overall budget by 5%, including eliminating all interim committees this year.
Kirkmeyer says she'd like to see all $20 million in the cash fund returned. But McCluskie says they need the money to move lawmakers' offices into the capitol. Many are in other buildings right now that she says aren't as easily accessible to the public. They are also moving about 200 legislative staff from the capitol to another building that she says needs big renovations, including an estimated $4 million in furniture alone.
Meanwhile, Kirkmeyer says, Gov. Jared Polis is proposing cutting child welfare funding by $3 million.
"It's clear to me they have a crisis of priorities. They value furniture over neglected and abused kids," she said.
McCluskie says the estimate for the furniture is on the high end, and she expects the final number to be lower.
