Innovative budget reform bill passes House

Senate Bill 228, the controversial budget reform bill introduced to lawmakers and the public in February, was passed in the House today, clearing yet another hurdle on its remarkable path toward loosening the state’s famously rigid spending structure.

Sponsored by Colorado Springs Democratic Sen. John Morse and Loveland Republican Rep. Don Marostica, the bill inspired exasperated attacks in the Senate that culminated in an historic GOP filibuster, where members of the minority party argued the bill was an unconstitutional attack on voter-mandated spending limits and that it would drain the state’s transportation fund.

But the bill’s proponents, especially Morse, argued persuasively that business as usual was no longer good enough, that proposing temporary fixes every year to fund state programs other than transportation would simply not do. He argued that lawmakers needed to reclaim the responsibility to allocate the state’s shrinking revenues.

Senate Bill 228 repeals the so-called Arveschoug-Bird 6 percent formula, which automatically drops a certain percentage of revenue into the state’s transportation and construction fund each year. But there are no special funds for other essential state programs — for education, health care, public safety and job training programs, for example. Indeed, as SB 228 supporters have argued, nearly all of the other programs in the state have been left to share out money from the state’s discretionary General Fund.

In addition, by calculating the annual amount for the General Fund as a percent of revenue generated the previous year, the old 6 percent formula has meant that it takes years to climb out of recession-level funding, forcing lawmakers to make difficult public-sector cuts even as private-sector employment climbs, stalling across-the-board recovery in Colorado.

Morse and Marostica’s bill enjoyed support from big names at the Capitol, including Gov. Bill Ritter, Speaker Terrance Carroll, House co-sponsor Rep. Lois Court and former Supreme Court Justice Jean Dubovsky.

Although no amendments to the bill were introduced in the Senate, anticipated compromises were made in the House. The final version includes provisions that upped the state’s rainy-day fund and that continued to specifically provide funding for transportation and state construction.

Budget analysts applauded the work of the bill’s sponsors and supporters.

A statement issued by Colorado Fiscal Policy Institute Program Director Kathy White celebrated the bill and the coalition that came together to pass it:

For years, Colorado has fallen prey to outdated fiscal policy that imperiled our ability to withstand and recover from economic downturns. This bill is an important step that will help us make quick, strong recoveries and move us closer to having all of the state’s priorities on a level playing field.

Instead of relying on the failed fiscal policies of the past, the Legislature’s support for SB 228 shows that a broad coalition of different stakeholders can work together to fix what is broken.

Although the ground covered by advocates of the bill in turning attitudes and winning support in just the two months since it was introduced is remarkable, the battle to make it law is not over. The House-amended version now moves back to the Senate where it must be approved again — a process known as concurrence. SB 228 will certainly again face opposition by Senate Republicans, who may try to further amend it.

Republican lawmakers have threatened to challenge in court the constitutionality of the bill should it pass.

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