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Facing our Fiscal Future

Facing our Fiscal Future. Mark Neuman-Lee Policy Analyst Colorado Fiscal Policy Institute. Budget Squeeze. Colorado doesn’t have the resources to fund the services we expect to receive.

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Facing our Fiscal Future

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  1. Facing our Fiscal Future Mark Neuman-Lee Policy Analyst Colorado Fiscal Policy Institute

  2. Budget Squeeze Colorado doesn’t have the resources to fund the services we expect to receive. Stagnant revenue combined with increasing demand for services is squeezing all services – public education, health care, human services.

  3. Stagnant Revenue,Rising Demand • Between 2001 and 2010, General Fund revenue fell slightly, but Colorado had about: • Over 700,00 more Coloradans • 100,000 new K-12 pupils • 40,000 new students in higher education • 5,800 more prisoners • 225,000 more residents on Medicaid

  4. However, resources do not meet need

  5. Muddling through To balance the budget, the legislature has • Taken money from cash funds • Used Federal stimulus funds • Cut services • However, • Cash fund balances are running low • Stimulus money is over • We will rely more on services cuts – K-12, Higher Education, Health Care, Human Services

  6. FY11-12 General Fund Spending Data from FY11-12 Appropriation Report

  7. Total K-12 Spending Data from JBC Appropriations Report

  8. K-12 Per pupil spending Data from JBC Appropriation Reports

  9. Colorado K-12 spending falling vs. national average FY07-08 Rankings (most recent) Per pupil 39th ($1,700 below national average Total spending per $1000 of income – 48th

  10. Funding burden shifting to state State share 2011-12 - 64% State share 1987-1988 – 43%

  11. Higher Education Cuts • Not protected constitutionally • FY11-12 Proposal – State will invest less than FY97-98 • Higher Education cuts cushioned by backfill from ARRA, but federal stimulus dollars ended last year • 25,000 more students but $187 million less in state funding FY 2011 compared to FY 2009. $1553 less per student

  12. Cutting State Support for Higher Education Graph from JBC Appropriation Report FY11-12

  13. Falling spending per college student Data from JBC, analysis by COFPI

  14. Financial Aid is helping less From JBC Appropriation Report FY10-11

  15. We have low taxes

  16. Taxes Have Fallen Legislative Council August 2010Per $1000 of Income

  17. Starting the conversation about revenue

  18. Initiative 25 Senator Rollie Heath’s proposal • Raises $536 million which will go to preschool, K-12, and public higher education • Average about $550 for each Colorado student • Raises state tax rates back to 1999 levels • Income tax 4.63% to 5% • Sales tax 2.9% to 3% • Temporary, expires after five years

  19. Less than a Dollar a Day A taxpayer with a median income of $55,700 in Colorado will pay about $150 more each year, primarily in income tax. www.brightcolorado.com

  20. What kind of Colorado do we want? Mark Neuman-Lee Policy Analyst Colorado Fiscal Policy Institute mneumanlee@cclponline.org

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