JBC Trues Up 2015-16 State Budget
(Feb. 9) – The House Appropriations Committee voted today to support a series of adjustments to the current 2015-16 state budget that will save nearly $100 million and go a long way toward closing a jarring state budget shortfall in the midst of a healthy, growing state economy.
“If we adopt this package,” Rep. Millie Hamner, chairwoman of the legislative Joint Budget Committee, told a Democratic caucus meeting, “we actually have a net decrease in the amount that we’re spending by $96.7 million.”
“Outside, hundreds of thousands of Coloradans are celebrating the Broncos’ victory in Super Bowl 50,” said Rep. Dave Young, who also sits on the JBC. “In this room, we have an additional reason to celebrate – we’re saving Colorado taxpayers nearly $100 million that we can apply to next year’s budget. It’s a great day for our state.”
Some of the variables that contributed to $97.6 million decrease in appropriations from the original 15-16 “long bill” include a lower-than-expected increase in K-12 student enrollment; lower-than-projected inmate populations; higher-than-anticipated local assessed property values; and decreasing revenue from federal mineral leases, mainly oil and gas.
The current 15-16 budget was based on the March 2015 Legislative Council forecast. As the future turns into the present, the amount of funding required sometimes fluctuates as individual line items in the budget deviate from projections, necessitating a true-up. To bring the budget for the remainder of the fiscal year in line with actual funding needs, this package of supplemental budget requests makes mid-year adjustments based on the December 2015 forecast, which still predicts economic growth but was slightly lower than the March 2015 forecast.
Rep. Hamner, D-Dillon, and Rep. Young, D-Greeley, also explained the two bills attached to the package, which make policy changes related to the supplemental budget requests:
· HB 16-1253 – Due to lower-than-predicted pupil counts, less funding was called for by the education funding formula - $24.5 million less, to be exact. The JBC decided not to “take back” this funding, and instead to put it back into the formula – increasing per-pupil funding and reducing the “negative factor.” Since the negative factor and per-pupil funding are set in statute, the JBC had to bring a bill to make those policy changes.
· HB 16-1254 – implementing funding for the task force recommendations regarding mandatory reporting of abuse for adults with developmental disabilities. SB15-109 put a task force in place; this bill is needed to appropriate funding to implement the program.
As part of the true-up for education funding, the JBC decided to hold $93.5 million from higher-than-anticipated local assessed property values with the intent of applying those dollars for school funding in the school finance bill for the next budget year (FY16-17), and still balancing the budget while doing TABOR refunds. Appropriating all $93.5 million this year would risk having to take it all back in FY16-17 – a “rollercoaster funding” scenario that would hurt students, not help them.
The decisions by the Joint Budget Committee reduce the shortfall the state is facing in the current budget year. Gov. John Hickenlooper’s prior estimates put it at approximately $160 million; with this supplemental package, the state is now “only” $61.4 million away from meeting the state’s statutory reserve requirement of 6.5 percent. That money will be trued up in the 2016-17 “long bill.”
“Our conflicting constitutional mandates are not only causing shortfalls, they are preventing us from making needed investments in education and transportation,” Rep. Hamner said. “Only by making these investments can we assure our future prosperity.”