| Colorado's budget crisis is so serious that the Legislature has taken actions that would have been unthinkable just a year ago. With the passage and signing of S.B. 65, which officially reduced K-12 funding by $130 million in the current school year, lawmakers have reinterpreted Amendment 23 into irrelevancy. From social services to mental health to the senior homestead tax exemption, the Legislature has made deep cuts to the safety net beyond what anyone could ever have predicted.
Given the depth and impact of those cuts, the legislature has now turned to the other side of the ledger: the elimination or suspension of various tax exemptions and credits. Many business groups oppose the revenue enhancements, saying that -- as summarized by Senator Josh Penry: "People's livelihoods rise or fall based on whether these pass."
Those supporting the suspension of tax exemptions and credits (including Great Ed) point out that people's livelihoods (and lives) also depend on preventing deeper cuts to K-12, higher ed, Medicaid, public health, child protection services and other safety net programs. Every dollar that is not brought in through revenue enhancements, requires another dollar of cuts from these programs -- most likely K-12. As summarized by Andrew Bateman, President of the Associated Students of Colorado, supporters of the revenue enhancements seek "a budget that is balanced [between cuts and revenue enhancements], not just a balanced budget."
The unfortunate truth is, there are no budget fixes left that will not have a detrimental impact on someone. The immediate question before the Legislature is whether the entire burden of cuts should be borne by schools, colleges, kids, public employees, and people who depend on the safety net, or whether instead lawmakers should use all the budget tools available to them in order to fashion a budget that better reflects the values and priorities of this state.
And on this point, all parties should agree -- the Legislature needs more tools at its disposal to solve this budget crisis. As business points to the need for more broad-based sources of revenue, because of TABOR the legislature is limited in the new revenue sources that are available. Under a 2009 Colorado Supreme Court ruling, the Legislature's options lie primarily in eliminating and suspending tax credits and exemptions.
Unfortunately, the legislature's hands are largely tied on this one. And Colorado will not be able to emerge from this economic crisis in a thoughtful, fair and deliberative manner, until the legislature has more tools at its disposal.
In the meantime, you can voice your support for a more balanced approach to budget balancing at a Capitol rally at noon on February 11.
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