Colorado budget writers hear cautious revenue forecasts
DENVER (AP) — Budget writers will carefully consider the long-term sustainability of Gov. Jared Polis’ proposal to adopt publicly-funded full-day kindergarten after they heard quarterly economic forecasts suggesting a possible slowdown in economic growth in the next few years, the head of the Legislature’s Joint Budget Committee said Friday.
Democratic Sen. Dominick Moreno voiced both optimism and caution about the state’s ability to ensure full-day kindergarten can be permanently funded.
Polis has asked for $227 million, plus $25 million in implementation costs, for full-day kindergarten in a $33.7 billion budget request for the fiscal year that starts July 1. Thanks to a sustained robust economy, legislative budget writers have more than $1 billion in surplus revenue to work with this session.
Legislative and executive branch economists presented forecasts suggesting that growth could slow over the next two to three years in part because of trade disputes initiated by the Trump administration, global economic uncertainty and a possible slowing in the growth of state property tax income and retail sales.
The committee now launches into intense work crafting a proposed budget to submit to the Senate by March 25. By law, Colorado’s annual state budgets must be balanced.
“I am still confident that we will be able to find a way forward that protects the state’s finances while also delivering on many of the important legislative priorities that our Democratic majorities were elected on,” Moreno said after the hearing.
Both Kate Watkins, chief economist of the Colorado Legislative Council, and Lauren Larson, director of the governor’s Office of State Planning and Budgeting, on Friday lowered their December general fund revenue forecasts by about $200 million for 2019.
They expressed cautious optimism about the outlook for fiscal years 2020-21 and beyond. Watson said legislative economists anticipate a strong 4 percent economic growth rate in the current fiscal year, 3.7 percent growth in 2019-2010, and 2.8 percent in 2020-2021.
Larsen advocated for Polis’ kindergarten proposal. The Democratic governor insists early childhood education produces higher graduation rates and contributes to a strong economy. Colorado currently guarantees half-day kindergarten.
“Once we meet that (kindergarten) obligation ... we don’t want to take it back,” said Republican Sen. Bob Rankin, a budget committee member.
Polis’ budget request increases the state’s rainy-day reserves, keeps tuition flat at state-run colleges and universities and allocates $200 million for transportation.
Friday’s presentations came amid fierce debate over Democratic-sponsored legislation to grant more local control over the $32 billion oil and gas industry’s operations in Colorado.
Supporters insist public safety, health and combatting climate change must take priority over a current state-regulated regime that emphasizes production. The industry warns it could jeopardize the more than $600 million it says it generates each year in local and state revenue for K-12 and higher education.
With Democrats controlling both legislative chambers, the measure, which hurriedly made its way through the Senate, appears set to pass. It gets its first House hearing next week.