5 things to know about Colorado’s state budget

March 30, 2015

Colorado budget writers have spent months assembling the state's spending plan for next year, and this week their fellow lawmakers will begin debating, tinkering, and voting on it. The process will begin in the Senate. By Thursday, the chamber is expected to pass it over to the House. Here are five highlights from the budget, which will take effect beginning July 1.

1) TABOR refunds

One sign of Colorado's improving economy since the Great Recession is the state is collecting enough tax revenue that they have to issue refunds under the Taxpayer's Bill of Rights. The voter-approved constitutional amendment requires refunds when revenue exceeds the combined rate of inflation and population growth. The first refunds are scheduled to happen when people file taxes in 2016, but lawmakers need to set aside nearly $70 million for them in the budget they're considering. While each taxpayer will get a different amount depending on their income, the refunds are expected to be small. On average, between $15 and $47. That last refunds in 2005, for a total of $40.3 million, averaged $15 per person.

2) Budget growing

The total budget is $26.3 billion. That includes federal dollars, and $10.25 billion from the general fund, which is made up of tax revenue. Overall, the state budget for next year is $1.6 billion larger than the present year. Most of that growth, however, comes from federal funds. It is the state general fund, though, that lawmakers have most control over.

3) Education sees boost

Money for K-12 education, prisons, and health care usually take up the majority of the budget. Education funding will be $5.4 billion, including federal funds. Of that, nearly $3.6 billion comes from the general fund — that's a 6.3 percent general fund increase from last year. Health Care Policy and Financing, which oversees Medicaid, takes up $2.5 billion in general fund spending and nearly $8.9 billion in federal dollars. Corrections, meanwhile, will receive $870 million, with $781 million of that coming from the general fund.

4) Little cash left for new bills

With funding already budgeted for departments and programs across the state, there's little money for lawmakers to spend on bills they're working on this year. Budget writers have set aside $5 million for each chamber to spend on bills, and another $8.5 million for pending workforce development legislation. That means lawmakers will have to scramble for ways to find funding for their proposals, sometimes at the expense of other programs or legislation. Among the bills competing for funding: Increasing penalties, including prison time, for repeat DUI offenders, and a measure to contract for a wildfire and flooding prediction system.

5) Marijuana money

Colorado's budget constrictions mean that they'll have to refund about $58 million from the new pot taxes— even though the taxes were approved by voters. Expect lawmakers to propose a ballot measure after the budget passes to ask voters to keep the money. One change related to pot is in the budget, though. The spending plan last year included a money switcheroo so that the state could use some of it to seek matching federal tax dollars without labeling the state portion as pot money. The shift of $3.5 million from the state's marijuana cash fund to its general fund was described by some as "money laundering" to hide the source of the money from federal health authorities. This year, budget writers are not doing that. Any pot money used on programs eligible for a federal match won't be sifted through the general fund. Colorado doesn't even know yet whether the feds will match the original money, with the state not scheduled to ask about the match until this summer.