Colorado governor’s budget relies on legislature to find more transportation money

Author: Joey Bunch - November 2, 2017 - Updated: November 2, 2017

revenueFormer state budget chief Henry Sobanet, now en route to his next calling: CFO for the Colorado State University system. (File photo by Joey Bunch/Colorado Politics)

On paper, Gov. John Hickenlooper touts an 11 percent increase in transportation funding from legislation that passed last session, but the draft of his next budget request released to reporters Wednesday doesn’t go further than money lawmakers already have approved.

Republicans want to see more “skin in the game” from the state budget before asking voters for a tax increase.

They won’t get that from the governor’s budget proposal, however.

In May, lawmakers passed the bipartisan Senate Bill 267, which moved a hospital provider fee out from under the state spending cap to free up money for rural hospitals, transportation, transit and other needs.

The state sold $2 billion in bonds,  some of which adds money to transportation, accounting for $500 million increase for transportation next year, and $500 million the next.

As Colorado faces $20 billion in needs over the next 20 years, it will  be up to legislators or voters to decide where that money comes from. And 35 percent of that money goes to rural counties and transit, siphoning away help to resolve traffic jams and safety issues on Interstates 70 and 25, let alone preparing for the state’s projected growth in the next two decades.

Democrats want to ask voters for a tax increase on next year’s ballot, but Republicans, who control the state Senate, won’t allow it, arguing that the state’s budget grows every year, and some of that money could pay the freight for transportation needs.

The governor’s office is asking for the overall state budget to grow by $1.9 billion next year to $30.5 billion, an increase of 3.7 percent next year.

“Significant progress was made last year to address critical needs in Colorado,” the governor said in a statement about his request, which he formally will make to the legislature’s Joint Budget Committee this month.

“This new budget supports education and public safety needs across the state. But history tells us to be ready for when times are not as good. By building up reserves and shoring our pension plan, the proposal meets the needs of today and provides buffer for tomorrow.”

Lawmakers ultimately write and approve the budget, then send it to the governor for his approval in April.

Hickenlooper’s request will ask for increases to:

  • Department of Corrections, $57.8 million, an increase of 7.5 percent.
  • K-12 education, $84.6 million, an increase of 2.1 percent.
  • Higher education, $86.9 million, an increase of 9.7 percent.
  • Public safety and the courts, $87.3 million, or an increase of 6.2 percent
  • Health care policy and financing, $98.2 million, an increase of 3.5 percent.
  • The Department of Human Services, $60.2 million, an increase of 6.9 percent.
  • General Fund reserve infusion of $154.6 million.

Budget director Henry Sobanet said the governor hopes to build the state’s  reserves to 7 percent of spending, up from 6.5 percent this year,  to prepare for economic bad times or an unforeseen disaster.

He said the state was able to cover $100 million in  expenses from the 2013 floods on the Front Range, when it had a 4 percent reserve, without cutting state services. Colorado won’t always be so lucky, he implied.

Moody’s Analytics issued a nationwide report this month that said Colorado is among the worst in the nation at setting aside rainy-day money in its budget. Analysts recommended the Colorado build up a 15.1 percent reserve.

“Am I expecting a recession? Absolutely,” Sobanet said Wednesday. “The problem is I can’t tell you when it’s going to happen, so if we’re not saving money during an upswing, the next downturn is going to be all that much worse.”

The budget proposal also prescribes $94.7 million to state employees’ compensation package, a 3 percent across-the-board pay raise, but it also asks state employees to pay 2 percent more into their own Public Employees Retirement Association plan starting in 2019.

The governor’s budget would take effect on July 1 next year if the legislature were to adopt it.

Joey Bunch

Joey Bunch

Joey Bunch is the senior political correspondent for Colorado Politics. He has a 31-year career in journalism, including the last 15 in Colorado. He was part of the Denver Post team that won the Pulitzer Prize in 2013 and is a two-time Pulitzer finalist. His resume includes covering high school sports, the environment, the casino industry and civil rights in the South, as well as a short stint at CNN.