Colorado budget would grow 2.7% under governor's plan
Colorado Gov. Jared Polis’ proposed $34.5 billion for fiscal year 2020-21 represents an increase of 2.7%, or $897 million, including federal dollars.
Polis, in his first year as governor, submitted the proposal Friday to the Joint Budget Committee. Polis’ plan, which will go to the General Assembly that begins in January, calls for increases to transportation and preschool funding.
The general fund, made up of income and sales taxes, would grow 2.9%, or $389 million, to a total of $13.8 billion.
“Investing in education, working to lower the cost of health care, making our transportation dollars stretch and ensuring everyone has access to opportunity is the focus of my administration,” Polis said in a statement.
Polis said the budget includes savings of $238 million through cutting unused, duplicative or unnecessary spending. Using the state inventory on license plates, and unfilled positions in state government were cited as examples.
Amid warnings of a slowdown in the nation’s economy, the state’s rainy day fund would grow by $31 million, rising to 7.5% of state spending from the current 7.25%. The 7.25% covers the state’s operating budget for 41.6 days.
Polis proposes ending an accounting gimmick enacted in 2003 that shifted the last paycheck in June to the first working day in July. Colorado’s fiscal year begins July 1.
Polis’ budget came four days before voters consider amending Colorado’s Taxpayer Bill of Rights passed 27 years ago that limits government’s ability to retain revenue in excess of a formula based on population growth. If approved by voters, the General Assembly would see much more slack in 2020.
Proposition CC would eliminate state TABOR tax refunds and use surplus revenue for transportation, K-12 and higher education one-time spending. Another measure, Proposition DD would raise revenue for state water projects by legalizing and taxing sports betting.
Polis would submit a budget letter to the JBC if either measure passes. The JBC writes the state budget during the legislative session.
Polis' budget would provide $550 million in funding for transportation after several years of failed efforts to pass long-term bond funding proposals.
“Coloradans are tired of being stuck in traffic and want to see improvements in Colorado’s roads,” Polis said.
Colorado does not issue general obligation debt but carries an issuer credit rating of Aa1 from Moody’s Investors Service, and AA from S&P Global Ratings. Outlooks are stable.
Colorado’s Education Loan Program provides seasonal cash flow for school districts with loans from the State Treasurer. The program typically issues two series of tax and revenue anticipation notes under the program each year.
“The program continues to benefit from strong program mechanics, which include the state's oversight of participating school districts as well as the Treasurer's covenant to provide the state's substantial available liquidity to support full and timely repayment of the program's notes, if necessary,” Moody’s noted in a July report.