Here's a mystery: Colorado's economy is healthy. Its unemployment rate is low and its tax collections are healthy. So why are lawmakers looking at a recession-sized budget gap? And just as importantly: Where are they going to find the savings to close it?
and explore the colliding circumstances that got Colorado into this situation and talk about the hard choices lawmakers must face as they craft next year's spending plan.
Those tough calls stem from the fact that the state's costs are rising faster than revenues are allowed to grow under the Taxpayer's Bill of Rights, or TABOR. That constitutional amendment caps spending increases at the rate of inflation plus population growth.
High inflation had the effect of allowing spending to grow faster. But now inflation has slowed, while the state's spending commitments have not. Those commitments include a $350 million increase in law enforcement spending that voters approved in November and a requirement to fully fund K-12 education.
The end of COVID relief money may also be a factor. Republicans say Democrats spent what was meant as one-time funds on long-term priorities.
However, the biggest driver of the shortfall appears to be Medicaid. Spending is exceeding projections, and no one seems exactly sure why.
So how do lawmakers close the gap? The solution will likely involve curbs on Medicaid and higher education spending, and they may need to find a way to contain the K-12 budget.
Some of the problems appear to be systemic, which means budget gaps could become a regular thing headed into the future.
Purplish is produced by CPR °µºÚ±¬ÁÏ and the Capitol °µºÚ±¬ÁÏ Alliance, a collaboration between KUNC °µºÚ±¬ÁÏ, Colorado Public Radio, Rocky Mountain PBS, and The Colorado Sun, and shared with Rocky Mountain Community Radio and other news organizations across the state. Funding for the Alliance is provided in part by the Corporation for Public Broadcasting.
This episode of Purplish was edited by Stephanie Wolf and Megan Verlee and produced by Shane Rumsey. Our theme music was composed by Brad Turner.
