Hickenlooper slashes K-12; Dems say it’s time to consider tax increases

Stating that Colorado needs to be more pro-business, Gov. John Hickenlooper cut deep into K-12, further sacrificed state employee earnings, and shut down some state parks and services in the budget proposal he delivered Tuesday.

Hickenlooper explained that many of the budget woes were the result of constitutional mandates that constricted fiscal flexibility. He said voters would be made keenly aware of those mandates this year. 

Gov. John Hickenlooper answers questions from the press on his budget proposal. (Boven)

Hickenlooper’s 2011-2012 budget request of $7.2 billion represents a $570 million reduction from former Gov. Bill Ritter’s proposal submitted in November. The 2011-2012 balancing plan consists of 90 percent expenditure reductions with nearly 80 percent of those representing on-going measures. 

Hickenloopers’s plan calls for a 4 percent budget reserve and invests $18.7 million in tourism promotion. However, it strikes hard at some services many have seen in the past as a sacred cows. The plan calls for $375 million in cuts to K-12 and further increases the amount of state employees’ contributions to their pension plan by 2 percent on top of a 2.5 percent increase already in place from last year. 

Hickenlooper said he is not trying to send a message that a tax increase is needed through severe cuts to the budget. Instead, he said that with 41 percent of the budget in K-12 education there were few other places to look that had not already been stripped to the bone. 

“Why did John Dillinger rob banks? Because that is where the money is,” Hickenlooper said to the press yesterday. While explaining that his own son is in public school and that public education is the single best anti-poverty program on earth, he said “If you don’t have money you don’t have the money. What are we going to do, wipe out higher education?” 

Jane Urschel, lobbyist for the Colorado Association of School Boards, said that while they expected cuts of the magnitude proposed by Hickenlooper, their significance would be felt. She said that thousands of jobs could be lost with further cuts to services, larger class sizes, shorter school weeks and bus fees becoming more prevalent across the state. 

Rep. Mark Ferrandino, D-Denver, told Hickenlooper in committee his proposal is only the start of the conversation. “It is not a conversation that just happens in the Capitol, it is a conversation that needs to happen across the state. I worry about these cuts, while necessary in our budget situation, what they will do to the quality of life for the future of our state. There is another side of the budget we haven’t talked about and that is the revenue side. 

“Are the people willing to look for revenue. I think it is these difficult choices that we should be bringing to the voters of Colorado. Ask them do you want these cuts? Do you support these cuts, or do you want to look at other ways to offset future cuts.” 

Gov. John Hickenlooper speaks to the JBC about his budget plan. (Boven)

While Ferrandino and other legislators appeared to point to the need for revenue increases, Republicans were generally happy with the two-year budget cutting measures offered by Hickenlooper.

Rep. Mark Waller, R-Colorado Springs, commented that while no one wants to see money removed from K-12 there should be no sacred cows.  “I don’t think that anybody wants to cut it (the budget) to the bone the way it is going to happen, but the reality is that is what needs to happen. But by the way I do think that we need to make government a little bit leaner and this is an opportunity to do that.”

Rep. Lois Court, D-Denver, pointed to a graph that showed the increase in the state share of K-12 funding in contrast to local funding over time. The graph showed large decreases in local funding of schools since the Gallagher Amendment set commercial property tax levels at 29 percent and mandated that 55 percent of property tax revenue should come from businesses. According to Court, the Taxpayer’s Bill of Rights, the Gallagher Amendment and Amendment 23 create a situation where “There should be more coming from local and less coming from state… that is the problem in a nutshell.” 

“The interconnections of 23, Gallagher and Tabor makes life not only difficult but complicated,” Hickenlooper said. However, he remarked that a discussion at the State Capitol about what needs to happen does not have the same effect as discussions held across the state. “There are a number of discussions the public needs to have over how can we harmonize or synchronize, some would say, our tax structure to attract businesses.” 

Hickenlooper said that he would be very conscious about not talking about raising taxes, but said he would make certain the constitutional mandates are part of the conversation. 

“We are going to talk about the state constitution, what is in there and basic policy decisions about how do we make this state successful.” 

Hickenlooper said he saw a need to change the culture of Colorado to make it more business friendly so that new businesses could increase in size, providing jobs and revenue. 

“When you are [this] far underwater in revenues and voters aren’t reaching out and embracing new taxes, you really have no choice but to reach out and try to make people more conscious of business and try to help each business hire each person,” Hickenlooper said. “It is not necessarily our budget plan or legislation, it is a cultural change in the state.”

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