The legislature continues to grapple with the budget. On Thursday, we debated Senate Bill 11-230, the school finance act. Through the hard work of Rep. Tom Massey, a deal was struck with Senate Democrats and Gov. Hickenlooper to add $90 million to the K-12 budget. There is a problem, though. Of those dollars, $67.5 million will come from the general fund balance after the required 4 percent is reached. In other words, these are monies that we hope will be there. The other $22.5 million will from the state education fund. The problem is that if the economy does not rebound, next years budget will be even harder and counting on these funds will make it that much more difficult.
One of the major factors in the budget is Medicaid. The federal government continues to mandate increases in Medicaid eligibility. In the last 10 years, the Medicaid enrollment has jumped from 275,299 to 533,407, a 101 percent increase. These federal mandates force the state of Colorado to pull money from other programs like K-12 education and higher education. Last year Colorado spent $5.1 billion on Medicaid which is half a billion dollars more than we spent on the departments of transportation, corrections, and higher education combined. This is plainly unsustainable.
In at least one other state, the federal government has allowed money for Medicaid as a block grant. This allows a state more flexibility to provide a safety net to protect those that are most in need while allowing the state to do so in the manner that is most effective. The House Republican leadership, Speaker Frank McNulty and Majority Leader Amy Stephens have written a letter to Colorados congressional delegation urging them to give all states the freedom they need to end the crushing effects created by federal Medicaid mandates. It is important to note that they are not asking for more money, but are asking to end federal mandates that are forcing Colorado to make cuts in other very important programs.
It is very important that the legislature stand firm on no increases in taxes or fees. High taxes and fees force businesses to locate in other states, resulting in fewer jobs and a net decrease in tax revenue. One of the big fights over the budget was over vendor fees which, in the past, were paid in the amount of 3.3 percent to Colorado businesses for the collection sales taxes. It seems only fair to me to pay those who do our work. In 2009, vendor fees were suspended to balance the budget, and businesses have been forced to collect and remit sales taxes with no pay. This year the House reinstated two-thirds of the vendor fee. I believe that this is just one of the things that we have done that will encourage businesses to stay right here in beautiful Colorado. We also need to look at Colorados regulatory structure and repeal rules that are ineffective and result in higher costs for the consumer.
J. Paul Brown represents House District 59 in Colorados General Assembly. The district encompasses San Juan, Archuleta and La Plata counties and parts of Montezuma County. Contact Rep. Brown at (303) 866-2914 or by e-mail at jpaul.brown.house@state.co.us.
