Colorado state budget

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Colorado is facing what the University of Denver's Center for Colorado’s Economic Future has described as an “Economic Tsunami” - a $1.5 billion budget gap for the upcoming FY 2011 budget. In January 2010 Gov. Bill Ritter proposed a $260 million cut in funding for K-12 schools and a sales tax on candy and soda which is estimated to raise $312 million.^[1][2]

The Colorado General Assembly had just ended its session on May 6, 2009 having addressed a $1.454 billion, two-year shortfall when a subsequent economic forecast on June 22, 2009 showed a new state deficit well over $300 million.^[3][4] Gov. Bill Ritter announced August 18, 2009 his plan to close the latest $320 million budget gap for the current FY 2010 (July 1, 2009 - June 30, 2010).^[5] Gov. Ritter’s plan included a nine percent overall reduction in spending that includes $263 million in cuts and eliminating 270 full-time equivalent state positions. ^[6] The Colorado General Assembly took measures during the 2009 Session to balance the $7.5 billion FY 2010 General Fund budget.^[7]

Colorado anticipates being hit with another budget deficit of $500 million for FY 2011. ^[8]

[edit] Budget Background

Colorado’s state revenue increased annually 1.9 percent for the period from FY 1999 to FY 2009 while three of its largest General Fund appropriations (K-12, Corrections, and Health) grew 5.4 percent each year on average. These three spending categories have grown from 54 percent of the General Fund budget in 1999 to 76 percent within a decade. They are estimated to increase their portion of the budget to 91 percent in five years. ^[9]

Colorado's fiscal year begins July 1 and ends June 30. State departments submit their budget proposals to the Governor's Office of State Planning and Budgeting as part of the executive budget process. The governor and his staff review the budget proposals and limit each department's budget request based on the governor's priorities, and they determine which new funding initiatives may be included in the request. ^[10] Departments submit budgets to the Joint Budget Committee by November 1. Shortly thereafter the committee schedules hearings with each agency. The staff analysts brief the Committee on each budget request a few days prior to the hearing with a department. Briefings and hearings for most departments are scheduled in November and December. By February 1, the Legislature is required to certify, by joint resolution, the amount from the state's General Fund available for appropriation for the next fiscal year. Once the General Assembly convenes in early January a series of hearings and joint budget meetings that run both through the House and the Senate. Both houses must accept the final bill before it is signed into law. ^[11]

See Colorado state budget (2008-2009) for more information.

General Fund Revenue Collections: FY 08-09 compared to FY 07-08^[12]

All figures in millions, and include revenues collected for State Education Fund, based on March 2009 forecast.

[edit] Accounting Principles

Office of the State Auditor reports to The Legislative Audit Committee. The Legislative Audit Committee (LAC) is a permanent standing committee comprised of four senators and four representatives with equal representation from the two major political parties. The Committee is responsible for reviewing and releasing audit reports and recommending special studies. The LAC also recommends an appointment for State Auditor to the leadership of the General Assembly every five years. Sally Symanski is Colorado’s state auditor. Audit reports are published online.^[13]

The Institute for Truth in Accounting (IFTA) rates Colorado “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – the annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Colorado’s CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[15] Colorado’s state controller is responsible for filing the CAFR. The state controller is David J. McDermott, appointed April 1, 2008.^[16]

[edit] Accounting transparency checklist

Comprehensive Balanced budget Timeliness Usability

[edit] The good

• The website has Comprehensive Annual Financial Report (CAFR) dating back to 1995.
• It provides supplements to the budget workup, such as notes.^[17]
• An independent auditor’s report is published within the CAFR on page 16.
• The CAFR compares estimated and actual budgetary numbers in a separate report.^[18]
• The budget is posted using organized and consistent methods of financial reporting.
• Colorado law requires a balanced budget and prohibits a deficit at the end of the year to be carried over to the following year.
• It includes all costs incurred by the government, including future liabilities between pages 102 and 121 of the report.

[edit] The bad

• The CAFR is posted in a PDF format, so it’s not searchable online.

[edit] 2009-2010 budget crisis

Gov. Ritter’s plan has a 9% overall reduction in spending that includes $263 million in cuts and eliminating 270 full-time equivalent state positions.^[6][19] The Colorado General Assembly took measures during the 2009 Session to balance the $7.5 billion FY 2010 General Fund budget, some of which include: ^[7]

• $760 million from one-time federal stimulus money^[20]
• $77 million in cuts
• 255 million in new taxes
• Furlough days (8 per year) for state employees
• Wage freezes
• Hiring freezes
• Transfer of $35 million from tobacco money to General Fund
• One-year suspension of senior citizen property tax exemption for $90 million
• Reduced percentage of sales tax collected vendors can keep for administrative costs from 3.33 percent to 1.35 percent% to increase state revenue an estimated $93.3 million over the next 3 ½ years.^[21]

[edit] Proposed legislation

Proposed bills: Approximately 12 bills have been introduced to the House which could suspend, eliminate or reduce a number of existing state tax exemptions in Colorado. If approved the proposed legislation would take effect March 1, 2010.^[22]

November 2010 ballot: Three ballot measures are scheduled to appear on the November 2, 2010 statewide ballot - Proposition 101 and Amendments 60 and 61. Proposition 101 would make amendments to current vehicle, income and telecommunications taxes and fees. Amendment 60 proposes limiting how property taxes are raised and reversing recent tax laws which increased taxes. Amendment 61 calls for prohibiting borrowing by state or local government and require voter approval for future loans. Gov. Bill Ritter is urging that residents vote down all three measures because according to Ritter the measures would "would shut down colleges and prisons, increase class sizes, put thousands of teachers out of work and prevent the repair of unsafe roads and bridges."^[23]

Eliminate tax exemptions & add new taxes: In Fall 2009 the governor proposed eliminating 13 existing tax exemptions starting in July 2010, however, in light of recent revenue reports in January 2010 the governor proposed eliminating 7 tax exemptions in March 2010 instead of July. Eliminating 7 of the existing tax exemptions is estimated to generate $18 million. All 13 tax exemptions, when eliminated, were estimated to generate $132 million. The governor is proposing to cut a total of $600 million from the current year's budget. For example: the industrial energy use sales tax is estimated to bring in $48 million in revenue per year; a candy and soft drinks tax would generate $7.9 million per year; and a pesticides tax would generate $2.9 million.^[24]

[edit] Budget transparency

Colorado currently does not have a statewide spending database online, but the state will have one by no later than January, 2010.^[25] According to Governor Ritter's 2009 State of the State address, "...we're making government more modern and transparent by putting more services online and soon, working with Treasurer Kennedy's Office and Representative Marostica, we'll have the state's checkbook online."^[26]

On June 4, 2009, Governor Ritter signed Colorado House Bill 1288, the "Colorado Taxpayer Transparency Act," into law. HB 1288 mandates the creation of an online spending database by no later than January, 2010.^[27] This law will increase Colorado's transparency beyond what Governor Ritter's original executive order (from April 2, 2009) had required.^[28][29]

[edit] Website evaluation

Budget Usability Elected Officials Administrative Officials Ethics Audits Contracts Lobbying Public records Taxes

Colorado.gov is the website for the state of Colorado.

• Main article: Evaluation of state websites

[edit] The good

• Site has a search function and is fairly easy to navigate.
• Budget is published.^[30]
• Elected officials are listed with contact information.^[31]
• Administrative officials listed with contact information under respective departments.^[32]
• State tax information is posted.^[33]
• Information on the state ethics commission is available.^[34]
• Financial audits are published.^[35]
• Includes information on making requests under the Colorado Open Records Act^[36], as well as a CORA FAQ from the Attorney General.^[37]

[edit] The bad

• Information on lobbying is provided, but not on Colorado taxpayer-funded lobbying.^[38]
• The state is in the process of creating a contracts database, but as of July 18, 2009 it was not online.^[39]

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
Colorado T.O.P.

[edit] Economic Stimulus Transparency

• The American Recovery and Reinvestment Plan of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.^[40]

• It is estimated that Colorado will receive $3,232,477,903 in federal funding.^[41] In the next two years, that number is expected to be approximately $85 billion.^[42]

• The economic recovery website for Colorado is available here.

[edit] Error in ARRP

On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[43][44]

Colorado appears to have 10 extra Districts, according to where ARRP money went, including District 00, which received over $10 million.^[45]

[edit] See Also

• Colorado taxpayer-funded lobbying
• Colorado state budget (2008-2009)

[edit] External links

[edit] Additional reading

[edit] References

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	v • d • e State of Colorado Denver (capital)
Transparency Topics	Open Records Act | Sunshine Law | Government corruption reports | Transparency Legislation | Open Records procedures | Transparency Advocates |
Divisions	State | List of Counties | List of Cities | List of School Districts | Evaluation of State website | Evaluation of county websites | Evaluation of city websites | Evaluation of school district websites |
State spending	State budget | State salaries | Stimulus allocations | Taxpayer-funded lobbying |
Government	Colorado State Constitution | Executive | House of Representatives | Senate | Local officials | Public school system |
Judiciary	Colorado Supreme Court | Court Election (2008) | Court of Appeals | District Courts | Judicial Nominating Commission | County Courts | Judicial activist organizations |
Ballot Measures	2008 Ballot measures | Historical listing of ballot measures | Initiative procedures | Campaign finance requirements | Direct democracy laws | Recall process |