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September 21, 2009 11:18 PM UTC

Did Somebody Say Special Session?

  • 25 Comments
  • by: COFPI

(How’s that Laffer curve working for us? Cutting the budget is like shooting fish in a barrel–when you’re the fish. – promoted by ThillyWabbit)

Today’s news coming out of the Joint Budget Committee was not good.  The numbers being presented by Legislative Council were scarier than driving over an unplowed Monarch Pass in a January snowstorm.

State revenues are down another $240.7 million, on top of the $320 million shortfall announced in June.  That means the state is facing a $560.7 million revenue shortfall for FY 2009-2010.  It also means that a special session is needed to help us get out of this mess.

As the state’s revenue situation deteriorates, the urgency for a new approach to our ongoing fiscal crisis grows each day.  Colorado simply cannot afford to cut our way out of this problem, nor can Colorado families be expected to keep shouldering the burden of continued cuts.  

Cuts mean tradeoffs, and right now those tradeoffs are falling on families, businesses, children, seniors, and families who rely on state services every day.  

As Legislative Council noted in their presentation to JBC today, the revenue numbers actually understate the impact on the state budget, especially beyond this year, because those numbers do not account for rising caseloads, inflation, or constitutional requirements.  

All the more reason that all options need to be on the table, and that means looking at revenue.  

Lawmakers should explore revenue options that spread the sacrifice to corporate citizens and not just Colorado families, including:  temporarily suspending the net operating loss carry forward deduction, limiting the amount of salary deductions that can be claimed by corporations, stronger tax law enforcement, and requiring income tax withholding for out-of-state partners and shareholders, and other options.

State leaders need to explore revenue options, and they need to do so in a special session.  Why a special session?  Because TABOR requires income tax policy changes to apply to the following calendar year.  So waiting until January to act on revenue options virtually guarantees more painful and inequitable cuts in FY 2009-10 and beyond.    

Colorado can’t afford to wait.  At stake is our state’s fiscal future and the economic security of Colorado families.  

Comments

25 thoughts on “Did Somebody Say Special Session?

  1. Congratulations, Bill.  You’ve done it.  Your resume officially places you in the top five worst Governors in America.

    1–Pat Quinn

    2–David Paterson

    3–Ed Rendell

    4–Bill Ritter

    5–Arnold Schwarzenegger

    6–Jon Corzine

    7–Deval Patrick

    8–Charlie Crist

    9–Mark Sanford

    10–Bill Richardson

    Quite an accomplishment.

      1. I know most of you disagree with it.  But I think running a state like Colorado into the ground with half a billion in debt in your first term is a pretty worthy accomplishment.

              1. …based on supporting legislation that has a positive effect on the economy.  He can also threaten and back-up threats of vetoing any legislation or budget that doesn’t meet that goal.

                Governors can also control expenses, and cut programs that aren’t necessary (i.e. most of them).

                1. Boulder–

                  It’s a huge stretch to say a governor can “control” revenue flow.  A governor might be able to influence revenue flow through the mechanism you suggest, but not “control” it.

                  Also, the idea that a governor can “control” expenses is silly–and you know better.  They can influence expenses, but that is about it.  As you undoubtedly know, spending originates in the General Assembly, not the governor’s office.  

                  To claim otherwise is to suggest the governor’s office has powers it clearly does not.

                  1. That’s a fair point.

                    But I think that the threat of a veto is something governors don’t use enough to control expenses.  They need the assembly’s permission to spend money on a program, but the assembly also needs the governor’s permission to spend money on a program.  It’s tough to do much without their approval on existing programs though, which is the bulk of expenses.  Fortunately, Ritter has a solid Democrat majority in each house.

                2. The low tax states would attract all the jobs and business. NY , NJ, and CA would quickly  turn into ghost towns as the high income industries centered there all moved to South Dakota, Wyoming or Alaska. Hell evener CO is in the top 10.

                  But it doesn’t happen- NJ, NY and CA are still crowded with biz and new startups. How could that be?

                  http://www.taxfoundation.org/f

                3. What did Governor Ritter do that has caused the budget hole we are now experiencing? I think you’ll find it was caused by the economic downturn and he doesn’t have any control over that. I wish he did because in that case it wouldn’t have happened.

                  By the way, don’t blame the revenue downturn on the new oil and gas rules and regulations. That has been discussed to the last inch on this blog and the overwhelming evidence is that drilling declined throughout the United States oil patch, including Colorado, because the price for natural gas and oil collapsed.

                4. You are so completely full of shit that there’s no point in engaging you in discussion.

                  The legislature controls appropriations.  The economy controls revenues.

                  Since we don’t print our own money in Colorado, the Governor controls whether to expend what has been appropriated.

                  End of discussion, unless you have a different version of the Colorado Constitution that I haven’t seen yet.

        1. running a state like Colorado into the ground with half a billion in debt

          Ritter did that?

          If he’s responsible for the worldwide recession, he must be awfully powerful.  Don’t you think that awesome power alone is reason enough to keep him out of your five worst list?

          1. …Rick Perry or Mitch Daniels, who still have budget surpluses, have cut taxes, increased education funding, maintained a multi-billion dollar rainy day fund, etc…

            Yes, the recession will hit everyone.  But some much harder than others.

            And I take issue with MADCO’s statement up above that NY and California are seeing a lot of new businesses and investment in their states.  People and businesses have been leaving those states in droves for years, and with the new tax increases this year New York especially will see a increase in the rate at which they lose medium to large corporations.

      1. The wacky R logic behind it will be something like- these governors just sat and watched when they could and should have been cutting taxes.

        Which makes sense in some states and some years- but if we look at the changes that altered the CO taxes, it should be Owens, no Ritter who makes the list.  Which governor gave us Ref C?  Which governor changed the rule preventing the University form becoming a private enterprise? Etc

  2. Tough times – let’s cut back and fire some citizens.

    Of course, if we really attempted to run the state like a business, we’d stop all expansion projects- no new roads. And we’d hire some new sales people to get more market share and increase revenue.  And we’d eliminate unprofitable activity – no prisons unless those prisoners can make it pay.

    1. If CO were run like a business than we could truly convert to a green economy here.

      All schools teach green curricula and nothing else. There will be nothing else except green jobs for Coloradans.

      Welfare moms, running green community gardens.

      CEOs of investment banks, only investing in green.

      Kids selling medical marijuana instead of lemonade.

      If one was to visit NYC, for example, and introduced themselves as a Coloradan, the New Yorker would say, “Oh, what part of the green economy do you work for?”

      [Actually he would say, “F***! Wha paht uh’da green ecaunomy d’ya wark fah?”]

      That, my friend, is running the state like a business! None of this half assed hundred green job here, hundred green jobs there crap.

    2. We’d outsource all the jobs to China. The guv and other elected officials would keep any excess revenue. And we wouldn’t hear any complaints because the only way to complain would be through some web-based form.

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