“It all starts with a good job” has become this session’s mantra as we plan to roll out several bills focusing on job creation and job training.   The upcoming session will also see bills seeking to expand Colorado’s New Energy Economy through the increase of our Renewable Energy Standard; bills which will continue to reform education and keep Colorado at the top of the “Race to the Top”; and a bill which will secure retirement for the 450,000 state employees who are relying on a stable, sustainable system. (click here for press release)

Click here for the full text of my speech.

COLORADO FACES $249M BUDGET SHORTFALL FOR REMAINING FISCAL YEAR

DENVER—    Monday, Colorado’s Legislative Council released its economic forecast.  For budget year 2008-09, which ends June 30th, 2009, there is an estimated $249 million shortfall.  Thanks to the hard work of the Joint Budget Committee Colorado has a balanced budget and, despite these numbers, the General Assembly will not have to reconvene for a special session.  For fiscal year 2009-10 Colorado faces a $384 million shortfall according to Legislative Council.  Nearly all the decrease in the General Fund Revenue forecast was due to a decrease in income tax and sales tax revenue as a result of the economic downturn.

The numbers are bleak but these are not the numbers I agonize over. It’s the nearly 47,000 Coloradans who are out of work, the 17,000 children who lost access to health clinics, the middle-class college kid who can no longer pay the ever-increasing tuition bill – these are the numbers I’m focused on. While tough times don’t last, tough people do.  We’ll lead the state through this recession and move forward to a brighter future.

Senate Bill 228 passed its final vote in the Senate and now heads to the House. When enacted, it will eliminate the decades-old provision that handcuffs us with an arbitrary allocation formula called Arvescough-Bird. (Click here for some background.)

The passage of this bill will let us:

• maximize the federal stimulus dollars
• determine budget priorities according to our needs
• be accountable to the citizens by funding services instead of formulas, without raising taxes
• position us for a full recovery from the economic downturn

The Senate has done its part to eliminate what Senator Morse calls “the tyranny of the formula.” The bill now moves to the House. Stay tuned!

There is a deeper reason for wanting to create jobs. It’s because we care about the people of Colorado.

This concern for people guides all of our choices and shines most clearly through our budgeting process. Our budget truly is a moral document—the place where our priorities show loud and clear.

When we worked on balancing the 08-09 budget with a $600 million shortfall, we kept you in mind. The initial set of recommendations for budget cuts included decreases across the board, such as:

• Veterans Trust Fund
• Supplemental Old Age Pension Health and Medical Care Fund
• Breast and Cervical Cancer Prevention and Treatment
• Prevention, Early Detection, and Treatment of Disease
• Short Term Innovative Health Care Grants
• Livestock Brand Inspection

These cuts would have had direct negative impacts on the people of our state, and we said NO. We preserved the services that help people, and we protected our safety nets. We will continue to make budgeting decisions based on our priorities and values as we look forward to the 09-10 budget.

When we have thousands of homes in foreclosure, when 5,000 people are calling Colorado unemployment offices every single day, when health departments in our state aren’t inspecting restaurants, when our student population grows while our teacher population shrinks, when we have fewer beds than inmates in our prisons, something is wrong. We have to put a stop to the ill-advised, decades-old budget restrictions that prevent us from responding to the needs of our citizens. 

That’s what Senate Bill 228 will do. By eliminating specific, off-the-top appropriations, SB 228 will stop the “tyranny of the formula.” It will put all of the state’s needs on equal footing, and allow us to prioritize them according to current circumstances. (For a full explanation of what the bill does, click here.)

Unfortunately, change is difficult…and sometimes, a bit scary. Senate bill 228 proposes to eliminate a spending allocation formula that has been in statute for decades. Our conversation surrounding this change was spirited, and it lasted until 2:30am last night. At the end of our conversation, the proposal passed its initial vote in the Senate. Tomorrow, we will take up the proposal again for a final vote.

I want to thank my friends on both sides of the aisle for their work on this legislation. We don’t always agree, but I respect all the members of the Senate who engaged in the debate and shared their opinions on this important issue.

The culmination of months of work by the select committee has resulted in an extensive set of proposals that will provide a long-term plan for creating and keeping good jobs for Coloradans. All of the bills must undergo the standard rigorous legislative review process, so some of them may not pass in the end, but these are the bills introduced thus far that we’ll consider in an effort for economic recovery:

SB 108
FASTER: Funding Advancements for Surface Transportation and Economic Recovery

HB 1001
Income Tax Credit for Colorado Job Growth

HB 1105
Colorado Innovation Investment Tax Credit Act

SB 85
Phase Out Business Personal Property Tax

HB 1035
Tax Refund for Colorado-based Technology Companies

SB 232
Local Government Financing with Severance Tax Cash Funds

SB 67
Colorado Credit Reserve Program to Expand Credit for Small Businesses

SB 233
Tax Credit for Some Home Businesses

SB 178
Unemployment Insurance for Unemployed Individuals Available to Small Business

HB 1126
Encourage Solar Thermal Installations

HB 1149
Encourage New Homes to Use Solar Energy

SB 31
Clean Technology Discovery Grant Program

SB 171
New Energy Economy Training Programs

SB 238
Government Treatment of Solar Device Permits

SB 234
Create a Statewide Enterprise Zone

SB 162
Inventory of Broadband Service Areas

HB 1275
Emergency Medical Technician Provisional Certification

It’s a quirky Colorado statute referred to as the Arveschoug-Bird limit, or the 6% provision, which limits the growth of our operating budget to 6% more than the previous year. It passed in 1991 and fits nicely with the Grover Norquist philosophy of drowning government in a bathtub.

In the current economic environment, the Arveschoug-Bird provision will ultimately contribute to a prolonged recession in our state. It will inhibit our ability to bounce back even when economies in the rest of the world have bounced back, and it also threatens to make permanent cuts to higher education, K-12 education, and health care. Below is a graph showing how the 6% limit will ratchet down the state’s operating budget in the future.

When the economy recovers and our revenues increase by more than 6%, all of the money above the 6% limit is allocated through laws passed in 1997 (SB97-001) and 2002 (HB02-1310) for transportation and capital construction projects. In this way, the 6% limit has become an allocation device, not a growth limit. Unfortunately, this presents an unstable mechanism for funding transportation and capital construction projects because the funding is tied to fluctuations in the economy. We absolutely must fund transportation, but we need to do so with a stable source of revenue.

My colleague from Colorado Springs, Senator John Morse, has introduced a plan that will begin to untie Colorado’s fiscal knot by eliminating the Arveschoug-Bird provision. This will allow us to develop a stable stream of revenue for transportation and capital construction projects. It will also allow us to fairly fund state services according to our values instead of by adhering to arbitrary formulas. I applaud him for taking action, and for having the courage to do the right thing for our state. I will keep you posted as his measure moves through the legislative process.

On Monday, our President addressed the nation about the state of our economy and his plan to fix it. He declared that above all else, we must focus on creating jobs. Our President’s charge extends across all levels of government. Colorado has not been sheltered from this recession. When we have a billion dollar budget shortfall, we cannot be distracted.  Job creation is our number one priority.  

Our statehouse is an emblematic example. During the Panic of 1893 when the silver mining industry in our state went belly up, legislators of the day discussed whether to abandon construction of Colorado’s Capitol building. They ultimately decided not to suspend construction, and as a result, gave the economy a much-needed boost. “The Capitol’s construction provided not only jobs, but also had a more lasting cultural impact, installing a new confidence in the state’s citizens that they’d transformed the state from Wild West outpost to a bastion of cultural respectability.” (Chris Bragg, Colorado Statesman, 01/30/2009)

It is beneath that gold dome—constructed during the late nineteenth century depression—that we stood today, again debating how to best serve the people of Colorado during this twenty-first century recession. And again, we chose to march onward in difficult times—to repair, maintain, and develop our transportation system—to revitalize our economy and keep Colorado strong.

Dan Reeves, the former Broncos coach who led the team to three Super Bowls, once said, “Tough times don’t last, but tough people do.”

That’s sort of how I look at the legislature during this economic downturn. It’s easy to come to the Capitol during the good times and vote to support things like full-day kindergarten and tax exemptions for seniors, but when the purse strings are tied tight, as they are now, our options are limited and we have to hang tough to keep Colorado strong.

The state’s budget shortfall of more than $600 million is a symptom of our current tough times. The “Long Bill” (budget bill) will be introduced in April. However, preparing for this year’s budget conversation is a bit like preparing for the Super Bowl when the odds are stacked against you. In the budget conversation, there is only one team: all of us, driving forward to a common goal line – a solid economy.

Economists say we are in the most threatening recession since the Great Depression. This is not the first recession Colorado has climbed out of, nor will it be the last. Throughout the history of our state, Coloradans have risen with resilient spirits and persevered through severe circumstances. This time of economic hardship will be no different.

With this in mind, my colleagues at the Capitol and I – members of both political parties – are keeping our eyes on the ball, and we have risen to meet these fiscal challenges head on. It’s with great resolve that we approach the task in front of us to make difficult decisions concerning Colorado’s current budget. At the same time, we’re looking forward to the future with legislative initiatives that will create jobs and fortify our economy for the future.

During the next several weeks, we’ll be exploring various proposals for economic development that will span a variety of industries.

Senator Dan Gibbs and Representative Joe Rice introduced a transportation bill – Funding Advancement for Surface Transportation and Economic Recovery (FASTER) will create thousands of jobs while addressing the safety concerns of structurally deficient bridges and roads in disrepair. Two Senate committees have voted in favor of this bill, and the full Senate will consider it later this week.

We’ll look at Senate Bill 31, Senator Rollie Heath and Representative Jim Riesberg’s plan for improving and expanding the development of clean technology discoveries at our colleges and universities. Advancing technologies such as solar, wind, and biofuels will create green-collar jobs, enhance our new energy economy, and sustain our environment, all while helping our higher education institutions.

We’ll examine a plan Senator Gail Schwartz will bring forth to put hundreds of Emergency Medical Technicians (EMT) to work almost immediately. Currently, when EMTs come to Colorado, they must obtain a state-specific license, which can take months to process. This legislation will let EMTs obtain provisional licenses, allowing them to get to work and respond to emergency situations without delay.

We’ll also consider Governor Ritter’s proposal to increase the availability of credit to small businesses throughout the state. When small businesses thrive, so do our local economies.

With the economy in a slump, and with so many critical services potentially facing the chopping block as a result, we must act with purpose, innovation, and creativity to strengthen Colorado, and to keep moving forward. Vince Lombardi, the football coach for whom the Super Bowl trophy is named, said, “People who work together will win, whether it be against complex football defenses, or the problems of modern society.” I’m committed to working together, and I stand shoulder-to-shoulder with my colleagues at the Capitol and the Governor to charge onward and open up worlds of unseen possibilities.

Times are tough, but our future is bright. We are surely on the threshold of a new era, and one thing is certain: failure is not an option.