Hickenlooper budget hits schools

Gov. John Hickenlooper, shown Tuesday before the Legislature’s Joint Budget Committee, has proposed further cuts in school funding and cuts in Medicaid reimbursement to health care providers in his attempt to balance the state’s budget.


Budget slashing

Gov. John Hickenlooper’s first proposed state budget calls for unprecedented cuts to public education, some cash transfers and real cuts in numerous other programs. Here are some highlights:

• Cut per-pupil funding to schools by $257 million.

• Elimination of an additional $117 million for schools, known as backfill funding, to make up for reduced local funding.

• Reduce funding to higher education by $36 million.

• Cut funding to state health care programs and lower Medicaid provider rates to save $57 million.

• Eliminate some human services programs, including those for the mentally ill, by $17 million.

• Close a prison and consolidate other functions in Department of Corrections, saving $5 million.

• Alter the contribution ratio state departments pay into pensions for state workers, saving $15.7 million.

• Dip into $122 million worth of severance taxes and federal mineral-lease payments to fund other programs.

DENVER — Gov. John Hickenlooper wants to slash the state’s budget by about $570 million more than his predecessor had planned for 2011-2012. The bulk of Hickenlooper’s additional cuts would be borne by the state’s public schools.

In releasing his first proposed spending plan Tuesday, the Democratic governor told legislators the state has little choice but to make deep cuts in some of its core services — education and Medicaid — because they make up about 63 percent of all state spending.

Increases in student enrollment and Medicaid cases over the past several years have far outweighed the state’s ability to keep up funding for the programs, Hickenlooper said, and are hampering efforts to balance the budget.

Hickenlooper said it will be up to the state’s 178 school districts to decide how to react to a proposed $375 million cut in public school funding, adding it could lead to layoffs in some districts.

“The four-letter word today is ‘math,’ ” the governor said. “We have a structural imbalance to the budget. If you’re that far under the water in revenues, and voters aren’t reaching out embracing new taxes, you really have no choice.”

Overall, the governor’s plan is to close the state’s structural budget gap over the next two years, hinting even deeper cuts could come next year if the state’s economy doesn’t recover soon.

But to do that, Hickenlooper needs to reduce Medicaid reimbursements to providers by millions of dollars, and he must take $122 million in severance tax revenue —  almost twice what former Gov. Bill Ritter used — to balance the budget for the current fiscal year, which ends June 30.

Hickenlooper’s budget plan also would eliminate about 260 state jobs and require state workers to contribute more to their retirement plans than their state-agency employers pay, saving nearly $16 million.

Hickenlooper’s plan also calls for “repurposing” three parks in the region — Harvey Gap State Park near Rifle, Sweitzer Lake State Park near Delta, and Paonia State Park — by having other agencies oversee them, such as the Division of Wildlife or a local government, said Todd Saliman, the governor’s senior adviser.

Saliman said those parks were chosen because they are the least visited ones in the state. The move won’t lead to their closure, but it likely will mean fewer services there.

Changing management of those parks, however, won’t save the state much, only about $216,000, but the move would be part of a larger plan to save the state more than $3 million a year, Saliman said. Hickenlooper’s plan also calls for reducing the state’s trail program by about $500,000, eliminating a trust fund for species conservation to save $400,000, and doing away with park entry-fee discounts for seniors for a $653,000 savings.

The governor also plans to close a state park near Burlington, a prison in southeastern Colorado and a drug-treatment center in Pueblo. He proposed taking cash funds from such accounts as medical-marijuana cardholders, read-to-achieve and gaming revenues.

Additionally, the governor is proposing increasing the size of the state’s reserve account from 2 to 4 percent of the state’s general fund, its main checking account. That proposal is expected to be a controversial one among some legislators because it would set aside about $100 million at a time of such huge cuts to education.

The governor said some may question the wisdom of putting that money aside, but he maintained it is necessary.

“By going to a 4 percent reserve, that only gives us about two weeks of operating revenue,” he said. “No business would ever put themselves in that position.”


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