The big issue this year for the Colorado General Assembly will be balancing the 2016-2017 budget. There are several factors, issues created by laws and constitutional amendments passed by either the legislature or by citizen’s initiative, which play into this process.
The first issue to be addressed is adjusting the current year budget which is anticipated to have a $160.3 million shortfall. The governor proposes to pay for this by reducing the required budget reserve of 6.5 percent. The reserve reduction must be paid back in 2016-2017.
For 2016-2017, the governor anticipates new revenue of $457.2 million compared to the primary costs of $830 million leaving a $373 million budget shortfall. The primary costs are $301 million for K-12 education which includes enrollment and inflation as required by Amendment 23, $289 million for TABOR refunds, $160 million to backfill the 2015-2016 reserve, and $80 million for new Medicaid clients.
The governor proposes to pay for the shortfall by reducing hospital provider fee revenue by $100 million which would also reduce TABOR refunds by $100 million; by increasing the Negative Factor, what we owe K-12 education, by $50 million; by allowing the state education fund balance to drop from $342.7 million to $102.8 million; by reducing higher education spending by $20 million; by reducing Medicaid provider rates by 1 percent (excluding primary care physicians); and by reducing controlled maintenance spending for state-owned buildings by $10 million.
The full version of this story is available in the print edition and e-edition of the Pagosa Springs SUN. Subscribe today by calling (970)264-2100 or click here.