(March 18) – The state government’s leading economists issued their highly anticipated March economic and revenue forecasts today, predicting continuing economic growth and job creation in Colorado. But they said the state budget has hit a wall.
The Colorado constitution requires the state government to balance its budget each year, and the March revenue forecast is the one that the state budget is based on. Typically, the Joint Budget Committee chooses the more conservative of the estimates provided by the state Office of Planning and Budgeting or the Legislative Council, and today the more conservative estimate came from the Legislative Council.
Because refunds to taxpayers under the constitutional provisions known as TABOR are estimated to total $70 million in the current 2014-15 fiscal year, the legislature’s chief economist, Natalie Mullis, told the JBC that the amount of revenue available in the state’s general fund budget would actually decrease by $13 million.
“Even though our revenue forecasts went up, we have less money available in the general fund to spend on other obligations,” she told the JBC today. She added that any further increase in state revenue “is not new money for the budget. That is new money to be set aside to be refunded to the taxpayers under TABOR.”
She estimated that TABOR refunds would grow to $117 million in the 2015-16 fiscal year, which begins in July, and to $435 million in 2016-17.
“It’s wonderful to hear that Colorado’s economy continues to improve, and we are dedicated to helping that trend to continue,” said Speaker Dickey Lee Hullinghorst, D-Boulder. “However, we still won’t have more to invest in vital services like roads and bridges, schools and colleges, and programs to help sustain Colorado’s economic rebound and strengthen our middle class.”
“Quite frankly, the math doesn’t work anymore,” the speaker said.
“We’ll prioritize state spending like we always do, but the fact is our government can no longer keep up with the state it serves,” said Rep. Millie Hamner, D-Dillon, vice chairwoman of the Joint Budget Committee, which will now go to work finalizing the 2015-16 state budget.
“It seems a little incongruous to be cutting while the state flourishes, but we’ll make do with what we have,” said Rep. Dave Young, D-Greeley, who also sits on the JBC.