Colo Lawmakers Prepare for Return to Capitol Amid Grave Budget Concerns

On Saturday, state Rep. Chris Kennedy, (D-Lakewood), was married in a ceremony attended by ten people, many of whom donned face masks.

But there was no honeymoon for Kennedy, who was back to work Monday afternoon at a virtual town hall focused on Colorado’s response to COVID-19.

Colorado Lt. Gov. Dianne Primavera, a Democrat who also spoke at the virtual gathering, said as of Sunday afternoon, there were around 16,000 COVID-19 cases across 56 Colorado counties, including over 800 in Lakewood’s Jefferson County alone.

“We’re planning to come back on May 18,” Kennedy said of the state legislature, which he expected to sit for “a session that’s most likely going to be three weeks long.”

This session would be focused mostly on passing a new balanced state budget in light of recent economic forecasts taking the COVID-19 crisis into account.

“We’re looking at significant budget cuts right now because of the reduction in income and the effects on the economy from this,” said state Rep. Brittany Petterson, (D-Lakewood), who was also part of yesterday’s virtual event.

“We’re going to have a long road ahead in passing this budget” and “trying to advocate for support with federal dollars,” considering Colorado’s stringent taxpayer bill of rights (TABOR) and constitutionally mandated balanced budget requirement, she said.

Budget Cuts

“We’re going to do everything we can to mitigate the cuts to Colorado,” Kennedy said, by “making smart decisions about how much we should be dipping into our reserve right now, but also making sure that we keep enough in the reserve, because we may not be growing out of this in one year.”

Rep. Kerry Tipper, (D-Lakewood), was unsure exactly how her town’s budget will be affected by these cuts at the state level, but she did know that it will be much worse off.

“These cuts are going to be excruciating, to be honest,” she said during the virtual town hall.

“This is a time when people need government most,” Tipper said, spotlighting the difficulty of budget cuts. “We need extra funding for schools, we need extra funding for human services, unemployment insurance and just the opposite is going to happen.”

While she was sure that Jefferson “is one of the counties that’s going to receive federal funds,” she said, “one of the big issues is those monies can’t be used to backfill revenue.”

Kennedy explained that the federal money granted to the states to fight COVID-19 comes with stipulations preventing states from using those funds to backfill gaps in their budgets.

No Backfilling Allowed

“None of those pieces of federal legislation have allowed the new federal dollars to be used to backfill the state’s needs outside of the direct COVID response,” Kennedy said. “While that’s understandable, that the dollars are focused first on responding to this crisis, in a state like Colorado where we have a taxpayer bill of rights in place, we don’t have other revenue sources, and our budget is already under really significant restraints.”

He said without the ability to deficit spend, a strategy the federal government and some states have at their disposal, Colorado’s state and local governments will be in a difficult spot.

“We do end up making really, really painful decisions, like cutting K-12, cutting higher education, cutting transportation funding, cutting mental health, cutting affordable housing,” Kennedy said. “These are really difficult things.”

Due to TABOR, all tax increases, even those on the most wealthy, must be approved by voters.

“In a time like this, the biggest restraint TABOR has on us is that we couldn’t put in place taxes,” Kennedy said.

“There are plenty of people who are not being adversely impacted by the economic downturn right now,” he said. “We don’t have ways to go after new revenue to backfill some of our needs right now.”

While Kennedy was supportive of efforts to ask, “voters to change our tax policy on the ballot this November,” and open up new sources of revenue to the state, he doubted organizers’ ability “to get the signatures in this climate.”

Looking Forward

“Before the stay-at-home order, new coronavirus cases in Colorado were growing at a staggering 66% rate, threatening our hospital capacity… and potentially leading to over 30,000 deaths across the state,” Primavera said. “Now, the daily growth rate of new cases is below 5% and the daily growth rate of new hospital admissions is below 1%.

Furthermore, U.S. Rep. Ed Perlmutter (D-CO) “introduced a piece of legislation last week that would have provided $500 billion in federal aid… to help backfill the places where states are potentially cutting right now,” Kennedy said.

“That’s certainly something we’re advocating for,” he said, “whether it’s part of Congressman Perlmutter’s bill or whether it’s added as an amendment to one of the other bills that are moving forward.”

Kennedy encouraged his constituents to call Sen. Cory Gardner (R-CO).

“If [Gardner] were to support some more funding to backfill state budgets, that would go a long way,” said Kennedy.

Speakers at the town hall didn’t try to sugarcoat Colorado’s budget situation.

“It’s going to be really hard, it’s going to be painful,” Kennedy said. “It’s going to be a tough time.”

He and the other representatives for Lakewood will “be using the best data available and being really smart about trying to make the cuts where we can and spreading out the pain as evenly as possible,” he said.