State Budgets: Colorado Continues Questionable Credits and Subsidies Despite Shortfall and Across-the-Board Cuts
January 2, 2009
In November, Colorado Gov. Bill Ritter (D) unveiled a $19.2 billion budget proposal for 2009-10, of which the general fund portion is a 5% increase over 2008-09. The proposal includes a $386 million shortfall. Ritter estimates that the state faces a shortfall in the current year’s budget of $77 million, but legislative analysts put the gap at $604 million. The difference is primarily due to different assumptions about economic performance, especially volatile capital gains revenues. Although Ritter has imposed a hiring freeze and has asked departments to cut spending by 2.5% and identify 10% cuts, he has also proposed spending money on a series of state-run incentive programs (including job creation credits, using state funds to recapitalize banks, green jobs training, and clean energy subsidies) and six town hall meetings where state officials give advice to small businesses on how to survive the recession. Ritter has also been vocally supportive of a federal stimulus bill, even submitting a $1.4 billion wish list to the Obama transition team.
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