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LATEST SUBMISSIONS

Voters betrayed by Ref C shell game

Friday, September 7 at 12:00 AM

By Mark Hillman

Two years ago, lawmakers asked voters for a “timeout” from the spending restrictions of the Taxpayer’s Bill of Rights in order to allow the state budget to rebound from the recession of 2001-’02. Referendum C, which passed by a narrow 52 percent to 48 percent margin, erased the TABOR spending limits for five years and permanently increased spending caps thereafter. Voters were promised that K-12 education, colleges and universities, and health care would split the lion’s share of the resources if the measure passed.

Following the 2005 vote, Colorado Senate President Joan Fitz-Gerald said, “We already agreed, if Ref D failed, it would be 331/3, 331/3 and 33 1/3,” for schools, colleges and health.

But a funny thing happened after the election. Spending on programs not associated with Ref C has grown more than twice as fast as spending on education and health care. Now, voters have cause to believe they were sold a bill of goods.

According to the Joint Budget Committee, nearly $3.2 billion from the Ref C windfall has indeed been split between K-12, higher ed and health care. However, as any economist knows, money is fungible.

Since the 2005-’06 budget, passed prior to Ref C, general fund spending has increased by $1 billion, or 16.1 percent. Spending on K-12, higher ed and health care has grown by just 11.9 percent, or $557 million. Meanwhile, the remainder of the general fund, which wasn’t targeted for a Ref C infusion, has grown by 28.7 percent, or $446 million.

Advocates for loosening the state’s remaining spending limits complain that the 6 percent cap on annual growth in general fund spending is too restrictive. Yet even with this limit, lawmakers chose to shift spending away from Ref C beneficiaries and into other programs.
After Ref C passed, lawmakers approved a fiscal shell game, reducing K-12, higher ed and Medicaid spending from existing sources, then replacing those funds with money from Ref C. In some instances, education and health care actually received less money immediately after Ref C passed.

The Joint Budget Committee’s 2006-’07 Appropriations Report details what happened. After Ref C passed in November 2005, the legislature cut $306 million in K-12 spending from the general fund and “replaced” it with $261 million from Ref C. A similar cut-and-switch took place in Medicaid. Higher ed initially absorbed a $271 million general fund cut, mostly offset by a $253 million Ref C appropriation.

Such maneuvering gave the legislature a free hand to divert ordinary resources to other programs. Not surprisingly, some who expected their programs to be bolstered are now frustrated by the “Ref C shuffle.”

University of Colorado President Hank Brown, widely credited with convincing moderate Republicans and Democrats to support Ref C, recently told higher ed leaders, “I would not use the terminology that higher ed gets 30 percent of Ref C. We are not getting 30 percent.”
Brown has cause to feel double-crossed and so do Colorado voters.

Prior to Ref C, the state’s annual subsidy to colleges and universities was cut from $750 million to $498 million — with students and parents taking up the slack by paying higher tuition. For 2007-’08, general fund spending on higher ed is $746 million — still below pre-recession levels.
Ironically, Ref C’s health-care beneficiaries have fared even worse. General fund spending on “medical services premiums” has actually decreased since Ref C passed, despite receiving more than $1 billion in “excess revenues.”

By contrast, K-12 education, which was shielded from cuts even during the recession by its sugar daddy, Amendment 23, has reaped a $359 million general fund increase.
It’s fair to assume that Colorado voters expected that education and health-care spending would fare better than those programs not identified with Ref C. Since that clearly has not happened, convincing voters to approve new taxes for higher ed, transportation and health care — as leading Democrats have proposed — will be a tough sell.

Mark Hillman is the former Colorado Senate majority leader. He is co-author of “Budget Scrutiny Reveals Ref C Shuffle,” available at www.independenceinstitute.org.

READER COMMENTS

We need to re-do our entire state budget system. Mike Coffman, Secretary of State, accurately described Ref C as a "Band-Aid" solution when he returned from serving with the Marines in Iraq. Mike's right. We need to drop all income taxes, personal and business, and go to a use and sales tax system that reaches all of the people in Colorado, not just the "50% at the top." Imagine all the new business, the new jobs, and, yes, the new revenue that would pour into Colorado.

Posted by wrtr83 on September 15, 2007 12:40 AM

Why is anyone surprised about democrats raising taxes? That is their primary mission to make sure YOU support their bleeding heart concerns. Chances are the ones whining the loudest are the ones exempting themselves from the taxation. I almost cried myself to sleep after learning from "Wonderful Colorado" about the abyssmal ranking Colorado has in supporting socialist causes. Don't worry, folks, that's changing. We're going to be the new California and New York when it comes to taxation. Your democrat party is seeing to that.

Posted by fred on September 12, 2007 07:19 PM

Don't forget! Your legislature increased its per diem to $150 per day. Tax free too! Not bad for a citizen legislature. Are we ready for a legislature that meets 120 days every other year? Wyoming and other states do it and they get by quite fine.

Posted by Freaky on September 12, 2007 07:03 PM

Sorry.

The last post was mine.

Posted by mopmma y on September 11, 2007 01:41 AM

10:39

If the government wants to save money they can decide to drill on the Roan and get that money. Ritter decided we don't need it. I hope that every time they ask for so much as a dime in new taxes or fees someone will hold up a sign with just the word, "ROAN" on it to remind them that this governor thinks places are more important than people. We can stop printing state benefit forms in languages other than English and actually enforce the laws against illegal employment and impose the fines already specified. Multiply the number of fast food restaurants and construction companies in Denver alone by two and you could get about two thousand dollars times that number.

They can decide that building a fancy new museum designed by a moron with too much model glue in his nostrils is unnecessary and they can stop bowing to state employee unions demanding more and more pay raises. Most of those things you mention are extras and the few, like education, are already overfunded but the ones in charge don't care because they can do as they please since the teacher's union owns the democratic party. Get rid of Ammendment 23 and/or pass vouchers so parents can choose the schools they desire. I'd pick my local public school but let those who would make other choices do so.
It is not the business of government to provide for every desire or want in the state. Colorado is the state where our compassion is rooted in reality, not sob stories.

Immunizations for kids are a federal program so there is no relation there but nice try anyway.

The children who lack the health insurance are almost all eligible for CHP but are not part of it. My grand daughter is counted as one of these because we included her in our insurance and dropped her from Medicaid. Both the Social Services and some children's advocacy group have included her as uninsured but she is covered so you could most likely reduce the number they cite by 3/4 and have it right. Again, it isn't the government's job to be a nanny.

Library funding increases dropped but the libraries are still open and available. When there is tight money you choose between the necessary and the frills. Most of what you list is a comparison to other states where the people have no right to regulate their levels of taxation. Since the one prime example of how much good throwing money at a problem does to solve it is the education system I suggest you find something else to base your comparisons on. People deserve to keep the money they earn and not have it spent by the greedy for their own pleasure.
Wonderful Colorado. Where people understand that you should be responsible for yourself and not lean on the government. And where they have to power to make it happen.

Posted by on September 11, 2007 01:39 AM

You get what you pay for. As a result of the Tabor Amendment this is what happened to your wonderful Colorado:
Teachers pay is 7% below the nationa average.
Colorado ranked 47th in K-12 education funding.
Last in the country for on-time immunization rates for kids.
Eliminated the mental health programs in youth corrections.
Probation officers in CO carried nearly double the national average cases. And 50 were laid off between 2002 and 2004.
CO ranked 48th in the nation for state funds for higher education.
The percentage of low income CO children who lack health insurance rose to 27% in 2002-03. During the same period the national average declined.
Eliminated funds for full day kindregarten in low performing schools and pre-school for 2,000 at risk 4 year olds.
Eliminated all state support to local and regional health agencies.
Devistated library funding throughout the state.
And more....
Wonderful Colorado, where people care about each other......what a laugh.

Posted by on September 10, 2007 10:39 PM

Did any of you read in yesterdays Post how they (our legislature, along with some other special interest groups) have a whole bunch more tax increases they want to ask for in the next election? Hold on to your hats folks because the misrepresentations of facts to get these passed will fly like the coming snows. And those who don't read the initiatives are the ones who usually vote in favor of these increases not realizing the short or long term ramifications.

Posted by Jack Bauer on September 10, 2007 03:58 PM

And the politicians wonder why we don't want to repeal TABOR!

I can't wait to hear the reasons to extend Ref C when it expires.

Posted by on September 10, 2007 12:37 PM

Ever seen a lie a poitician didn't like? You can explain it any way you want, these guys and girls have the art of manipulation down to a science. The success of the infomercials might give a clue as to how easy the public is to fool.

Posted by sam18 on September 10, 2007 06:16 AM

This is the reason I voted against Ref. C and D. I knew the government was going to screw the people.

Posted by Can I get an AMEN! on September 9, 2007 10:44 AM

If the money is used for what was promised then it would be more dufficult to use the same reasons for more tax increases!
We cannot pay enough in taxes as long as we allow more to be spent (Ref C)

Posted by brain on September 8, 2007 05:40 PM

Kevin wrote,

"Joan FitzGerald (D) is running for the Second Congressional District this year. Maybe some Dems out there should ask if she knows what a third is...."

That's an easy question. Third is where the voters are...right behind the Democratic (or Republican in other cases)party and individual pet projects. Anyone who doesn't automatically say, "NO!!" when asked to give the government more money is susceptible to and seserving of being conned. Politics is the last refuge of the flim-flam artists.

Posted by momma y on September 8, 2007 03:23 PM

The first writer (i'm not fooled) has it right. Political party has no meaning when it comes to looting the Treasury. Remember, Bill Owens (R) was in favor of C and D. Alsi remember that Joan FitzGerald (D) is running for the Second Congressional District this year. Maybe some Dems out there should ask if she knows what a third is....
Bottom line, we were warned not to believe what the pols SAID about C, but to actually READ it. They are spending the money as the amendment allows them. Those who did not read it and voted for it are getting what they deserved. Those who DID read it, and still voted for it, I disagree with you, but am glad you made an informed decicision.
Read the contract, folks. Don't believe the used car salesmen we keep electing to public office.They'll say anything to get their hands into your wallet.
Actually, I suppose I should apologize for that analogy. It's unfair to the used car salesmen.

Posted by kevin on September 8, 2007 09:29 AM

The bottom line is that our elected officials knew there were sufficient numbers of the electorate that were completely ignorant of how the state legislature could manipulate the funds from Referendum C.
If you think you can trust anyone that has more allegiance to their political party (Democrat or Republican) than you the constituent, then you are the fools they perceive you to be.
Perhaps it’s time that you educated your family, friends and neighbors. Organize collective groups in your community to place pressure on your elected officials….if they will not do the right thing, then bend them to your will by flooding their phones, faxes and email with inquiries and petitions.
Oh, and the next time there is an election do more than go to the polls and bellyache to the RMN “Letters to the Editor”…get involved. If this is the best we can do to solve the poor performance of our elected officials…then we are truly in trouble and at their mercy.

Posted by I'm not fooled on September 8, 2007 07:52 AM

Those tricky Democrats pulled another fast one on all of you who voted for this sham. It is amazing how they say they will increase spending in schoolsa dn health care when in fact they reduced their spending! I am not surprised and neither should anyone else. This is what happens when you let one party rule - no matter repubs or dems - things get screwed up and the taxpayers get shafted.

Posted by on September 7, 2007 09:46 PM

I told you so!!

Knew I wouldn't have to wait very long to say that to all those who believed the lies the politicians spouted to get C passed. When all those rosy projections of budgetary salvation floated around Ref C, I was one of the minority who tried to warn the voters that government didn't need more money it needed lower spending. Of course I tried to sound the same warnings on Amendment 23 but what ya gonna do when the snake oil salesmen are out in full force sobbing that the "children" need the money?

Now, if we were to be honest, we'd repeal Amendment 23 or at least reel it in, and put vouchers up for a vote as well. so that perhaps more of the education money would be spent on education and less on overhead.

Douglas Bruce has made Colorado one place where politicians at least have to ask for permission to pick our pockets. Unfortunately, too many people remain ignorant of the fact that the fastest way to waste money is to let government have it.

Those who favor socialism will be burning him in effigy for decades because TABOR will prevent Colorado and its citizens from being another testing lab for failed socialist policies.

Too bad we can't repeal C.

Posted by momma y on September 7, 2007 01:00 PM

I think the title "former" Colorado Senate majority leader says all you need to know about Mark Hillman’s creditability on REF C and other state affairs. Colorado voters had a taste of conservative libertarian government during the Owens / Andrews years and have flatly rejected it.

Posted by Doug H on September 7, 2007 09:57 AM

Posted by Doug H on September 7, 2007 09:55 AM

Monetary surpluses in government are bad because?
I think the whole issue is because republicans are inherently selfish. They espouse trickle down economy. Reganomics proved that doesn't work. Douglas Bruce has done more to damage our state than any one ever before. Just to get out of paying his fair share of taxes.

Posted by Froward on September 7, 2007 09:16 AM

Today's horrible jobs report, (the first shrinkage in years accompanied the halving of the prior month's data) suggests that we might be kissing recession in Q3 and Q4. The housing/mortgage fandango was only the tip of the iceberg signaling trouble ahead. Now we are getting bigger and more frequent signals of impending economic and financial difficulties. Will Colorado have another budgetary experience like the last one? It sure looks like Ritter squandered an opportunity to fix the entire budgetary process per the above, the duct tape is unraveling fast.

And just wait until Ritter's "Blue Ribbon" commission proposal of a $26 billion health care "fix" (tax hike) kicks in. That's over a $5,000 annual tax hike for every man, woman and child in the state. Meanwhile, needed tax revenues from the "out of bounds" Roan and Vermillion are also "out of bounds." Spending up, tax receipts down.
Bottom line: it could get a lot worse before it gets better, and meanwhile the taxpayer is going to get hammered.

Thank you Mr. Salazar and Mr. Ritter, obviously you have not received any wake-up call. Not just out of touch, but totally unconscious.

Posted by Hank on September 7, 2007 08:21 AM

Uh, Mary (or is it Gail or Carol?), actually the former Colorado Senate majority leader DID mention the 6 percent limit. ("Advocates for loosening the state’s remaining spending limits complain that the 6 percent cap on annual growth in general fund spending is too restrictive. Yet even with this limit, lawmakers chose to shift spending away from Ref C beneficiaries and into other programs.") Maybe we should dump even more into K-12 education to teach people like you to read?

Posted by Jim on September 7, 2007 07:38 AM

Posted by Jim on September 7, 2007 07:37 AM

None of the above is surprising. We have seen the principles applies across the country when Democrats get into power.
On the local level, we have a Mayor who is going to increase our taxes with $550 Million worth of new projects to go along with his high density plan with all that that implies, for Denver. He also is bringing us the DNC, and we may all get to pay for that, as well. We have our two wonderful Democrat Senators, aided by our Democrat Governor, blocking gas development of the country's largest untapped site, on BLM land, with gas prices projected to double this winter. Bureau of Land Managment land is multi-use by the way - intended for development of Oil, Gas, minerals, and Timber, et al. Oh, and our beloved Governor has plans to increase our income tax by 200% to pay for insurance policies for people with incomes maybe as high as $82,000 a year. Isn't that marvelous? On the National level, if Hilary gets in, you can bet your last bottom dollar (and it may be) that she will increase our taxes significantly. And you think the economy is bumpy now? Love those Democrats!

Posted by Alan on September 7, 2007 07:12 AM

The Solution is to get the tax and spend socialists out of the State government and get some people with integrity in there. It is always the same, The Dems promise utopia and deliver a higher tax.

Posted by on September 7, 2007 06:32 AM

Isn't it interesting how the former Colorado Senate majority leader neglects to mention that there is a "catch 22" the mix. The Bird-Arveschoug Amendment, which was passed in 1992, which limits increases in the general fund to 6 percent a year. Any money above 6 percent goes into the capital construction budget to fund 12-Lane Bill's (Owens) favorite cause - highway construction, which is why Owens supported C (&D) - he knew that we taxpayers would support C and might not support D, but he didn't care, highways would get money either way. The solution is to do away with Bird-Arveschoug Amendment, and use the money as the taxpayers intended.

Posted by Mary on September 7, 2007 05:26 AM