Could water funding sweeten a compromise on the hospital provider fee?

Gov. John Hickenlooper has added water to the list of needs that could be funded if the General Assembly reclassifies the state’s hospital provider fee.

Hospitals in Colorado pay a fee to the state, based on the number of overnight patient stays and outpatient visits. Those funds are matched with federal dollars and the money is used to pay for uninsured care and Medicaid expansion.

The fee currently counts as state revenue under the Taxpayer’s Bill of Rights. But Democrats, including Hickenlooper, would like to reclassify the fee as a state-owned business, or enterprise. That would remove the provider fee dollars from TABOR revenue limits, estimated in 2016-17 at $656.5 million.

Related: What you need to know about Colorado’s hospital provider fee

The fee is among several types of state revenue that are pushing state spending to those TABOR revenue limits. Currently, any dollars that exceed the TABOR limit must be refunded to taxpayers, although those refunds haven’t been necessary for more than a decade. However, state economists believe that if the fee isn’t reclassified, refunds would be required, as soon as next year.

Democrats have tried unsuccessfully for two legislatives sessions to persuade Republicans, including the Senate Republican majority, to allow that reclassification. Senate President Bill Cadman of Colorado Springs drew a line in the sand before the 2016 session even started, releasing an opinion by legislative attorneys that said the reclassification would be unconstitutional.

Democrats countered with opinions from current Attorney General Cynthia Coffman, a Republican, and her predecessor, John Suthers, who both said the change would be legal.

Hickenlooper has been weighing the idea of a special session to revisit the hospital provider fee issue, which would bring lawmakers back to the Capitol, most likely in early July. If Hickenlooper vetoes a bill that would gradually allow the sale of full-strength beer and wine in grocery stores, that issue could end up on the special session agenda, too.

Hickenlooper has until tomorrow to make a call on the beer bill; by law, the governor must decide what to do with any bill passed by the General Assembly no later than 30 days after the session ends.

Part of the issue with the hospital provider fee is in what to do with the extra money. Speaker of the House Dickey Lee Hullinghorst, a Boulder Democrat, proposed a bill during the session that would use those dollars to fund transportation, education and higher education. According to a fiscal analysis, reclassifying the fee would allow the state to put $155.7 million into those funding priorities in 2016-17.

But now Hickenlooper is attempting to add water as a way to sweeten the deal for Senate Republicans. He told several lawmakers this morning that he has been talking to Cadman about adding water projects to the funding list, although he didn’t say exactly how the money would be used.

Hickenlooper’s offer hasn’t quite tipped Cadman from opposition to support. “I haven’t persuaded him yet. I keep looking for that key,” Hickenlooper said.

The governor made those comments prior to signing a bill to set up a study of the South Platte River between Julesburg and Greeley. That study would look at possible storage solutions to keep millions of acre-feet of water that leave Colorado every year, over and above the amount required by compacts between Colorado and Nebraska.

has been a political journalist since 1998. She covered the state capitol for the Silver & Gold Record from 1998 to 2009 and for The Colorado Statesman in 2010-11 and 2013-14. Since 2010 she also has covered the General Assembly for newspapers in northeastern Colorado. She was recognized with awards from the Colorado Press Association for feature writing and informational graphics for her work with the Statesman in 2012.


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