Rep. Hamner navigates Colorado’s deficit as new chair of Joint Budget Committee
Representative Millie Hamner, D-Dillon, recently concluded her first week as chair of the Joint Budget Committee. The committee met on Thursday, Nov. 12, by looking at the budget draft released by Gov. John Hickenlooper at the beginning of this month.
As it stand now, Colorado faces a $373 million shortfall, driven by Colorado Taxpayer Bill of Rights (TABOR) requirements, increasing healthcare costs and paying off a deficit from the 2014-15 fiscal year.
“Figuring out this budget situation is going to be my priority for this next legislative session,” Hamner said. “Within that, the top priorities are funding K-12, not cutting higher education funding, and I really want to see our full investment in transportation.”
One of the largest pieces of the shortfall stems from $289 million allocated as tax rebate through TABOR, as the state will likely reach its revenue cap this year. At this level, the average rebate would be about $51.
Since taxes cannot be raised without a vote of the people under TABOR, Hickenlooper’s initial draft proposed spending cuts to balance the budget. The primary decreases would include hospital provider fees, higher education funding, transportation funding and an increase to the “negative factor,” a reinterpretation of Amendment 23 made necessary during the recession when school funding could not keep pace with inflation plus one percent. The negative factor allows for increased per-pupil funding while still decreasing the ammount of money spent on K-12 funding.
“This proposed budget strikes a balance between the contradictory rules in the Colorado Constitution, funding for essential State programs, and an unclear revenue picture,” Hickenlooper said in a statement. “We had to make difficult decisions to find this balance that will affect health care providers, students from kindergarten through college, and state workers. We look forward to working with the General Assembly and the Joint Budget Committee on the final plan.”
According to the budget draft, while per-pupil funding will increase by 1.4 percent, the negative factor will grow by $50 million to $905.2 million next year, essentially making for a $50 million funding decrease. To minimize increasing the negative factor, the proposal would allow the ending balance in the State Education fund to drop to $102.8 million, instead of a projected ending balance of $342.7 million next year.
“If we were going to fund our schools at the rate of inflation plus enrollment, (amendment 23) we had also hoped to keep what’s called the negative factor from getting larger. We had hoped to fund $300 million in our schools and we’re only able to fund $225 million,” Rep. Hamner said. “If we weren’t doing those (TABOR) refunds, that’s where I’d put it.”
Transportation funding was also hit hard by the proposal, with funding cut to about half for next year, from $201.9 million in funding for this fiscal year to $107.4 million for fiscal year 2016-17.
The proposed budget would also cut higher education funding by $20 million, about three percent, reduce healthcare provider rates by one percent and cut hospital fees used to cover emergency room costs by $100 million next year.
“These problems just continue to compound year to year, and really tie our hands as state government and state legislature in responding to what people want,” Hamner said. “That (hospital fee) revenue comes in for a specific purpose and goes right out to a specific purpose. It should not go to the revenue cap.”
A bill proposed in the house last session to change the hospital provider fee as an enterprise, thereby not counting toward TABOR’s revenue cap, was stopped in the Senate last year. But Hamner said the bill might make another appearance next session.
“This fee has nothing to do with population growth or inflation,” she added.
If the fee were designated as an enterprise, the state would not need to issue $229 million in TABOR rebates.
Summit County Commissioner Dan Gibbs weighed in on the budget, noting that he would like to see a recommendation for the Wildfire Risk Reduction Grant Program that the county uses to fund its annual chipping program. Last year, Summit received $100,000 through the grant.
“It’s been very important throughout the state of Colorado to reduce fuels and provide public information on wildfires,” Gibbs said. “In past years, the legislature has been very supportive of wildfire preparedness measures. Putting resources on the ground and providing public information for communities has been a priority for the state.”
In the future, Hamner noted she would like to discuss ways to ameliorate the workforce housing crunch in Colorado’s mountain communities, an issue close to her constituents in Summit, Lake and Pitkin counties.
“I think this is going to be a statewide issue as well,” Hamner said. “The rental pool is shrinking — it’s going to have a serious impact in the economy and the workforce.”
The initial budget will undergo months of discussion and negotiations before it is finalized this session. Hamner maintained her commitment to keeping state services where possible, despite the shortfall.
“The question to the people, we have a choice right now between a tax refund or a state government that would be able to provide services. That’s the heart of the matter,” Hamner said. “I believe we can sign that agreement without a tax increase within the parameters of TABOR. That’s what I’m committed to doing this session.”
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