GOP, Dems Spar Over State Employee Compensation, Tax Relief for Seniors

April 3, 2012
wallyg / Foter

DENVER– After breaking through a series of partisan stalemates, members of the Joint Budget Committee will introduce the Long Bill – the proposed state budget for fiscal year 2013-14 – in the state House on Wednesday.

The bill is expected to be amended in the Republican-controlled House and later in the Democrat-dominated Senate over the next few weeks.

The six-member committee, which is equally split between Republicans and Democrats, dug their heels in on several partisan positions before wrangling out compromises. The chasm between spending perspectives was most apparent in March when the Governor’s Office of State Planning and Budgeting projected a net increase of $149 million in general fund revenue for next year.

Democrats fought to increase funding for state employees; Republicans battled to restore the Senior Homestead Exemption that reduces property taxes for seniors aged 65 or older who have lived in their homes for at least 10 years.

Republicans wanted a 2 percent cut – a $ 20.3 million savings – in the state employee payroll. Democrats had initially agreed to the cut through “vacancy savings” that could be achieved as high-salaried employees retire and are replaced by lower-paid workers, but in exchange wanted $15.9 million to help cover the rising costs of state employees’ health coverage. Later they reneged on the deal and argued that the 2 percent cut that could slash 500 government jobs.

Rep. Claire Levy (D-Boulder) asked, “Why are we asking state employees to shoulder a bigger burden to their health care costs?” Levy said that the cost increase of health, dental and life insurance coverage would equate to a cut to the employees’ compensation.

JBC Chair Rep. Cheri Gerou (R- Evergreen) countered that people who have lost their jobs during the recession have no health insurance. Even though state employees have gone through cuts and furloughs, she said, they have not experienced the devastation that private sector employees have endured.

“Government employees of Colorado, since the recession in 2008, have increased while private sector employees dropped by 155,000,” said Sen.Kent Lambert (R-Colorado Springs) during a townhall meeting Saturday.

Citing the Colorado Business Journal, Lambert said that Colorado is ranked the fourth highest state in creating government jobs since January 2008, and the lion’s share were created by state government.

A compromise was reached after Rep. Jon Becker (R-Fort Morgan) proposed a 1 percent “vacancy savings” derived from high-salaried government employees retiring or leaving. Judicial employees would be subject to a 0.5 percent cut. Agencies with 20 or fewer employees and 24-hour public safety workers would be exempted.

When Becker’s motion carried unanimously last Thursday, Gerou yelled gleefully, “Score!”

The following day the JBC grappled with a slight problem in the proposed budget – a $1.3 million deficit in the general fund for 2013. A few tweaks, and the committee found a workable solution.

The JBC bucked Gov. John Hickenlooper’s suggested budget to restore $38.1 million of a $48 million cut to K-12 education and $23.8 million of a $30 million cut to higher education. Instead of restoring the Senior Homestead Exemption, the governor proposed adding $9.5 million to property tax rebates for heating costs paid by needy seniors.

Instead, the JBC supported restoring the Senior Homestead Exemption and K-12 education funding, and maintaining Higher Education Colorado Opportunity Fund at the level of last year.

The committee also set aside $9.7 million for the state’s Old Age Pension Program and dental care for low-income seniors and $100 million in the State Education Fund, a savings account for K-12. The budget would infuse $13 million of liquid assets into the TABOR Emergency Reserve and maintain a 4 percent state reserve fund.

It would increase Limited Gaming Funds by $5 million – the fund would allot $3.7 million to promote tourism, $1 million for community gaming impact, and $300,000 for the Council of Creative Industries.

Compromises weren’t reached without a few testy exchanges. When Levy’s proposal to provide $9.9 million to promote tourism was shot down, she complained.

“I have sat here and accommodated people who said they need things for their district,” said Levy. “If we go forward with this (budget), I going to go back empty handed.”

Later, Levy said she’d support a motion for one proposed budget expenditure with assurances that $4.5 million would be added to promote tourism.

“We’re not trading votes here, right?” quipped Gerou.

Lambert predicted there will be “arm wrestling” in the House and the Senate over the next few weeks. The Republican representatives, he said, will amend the budget – those amendments will eventually be stripped by the Democrat senators.

“It’s a good budget, not a perfect budget,” said Rep. Bob Gardner (R-Colorado Springs) who lauded the restoration of the Senior Homestead Exemption that was suspended two years ago.

“The Governor said in the fall that we can’t do that,” said Gardner. “We are doing that.”

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