Joint Budget Committee [Mar 11, 2026 - Upon Adjournment]

. Thank you. Thank you. Thank you. Thank you. Thank you Thank you. Thank you. Thank you Thank you. Thank you. . Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you Thank you. Thank you. . . Thank you. Thank you. All right. All right. the joint budget committee will come to order. We have a few things on our agenda today. I think we're going to go in reverse order, at least to start, so you can turn to tab three, and we are going to start on consideration of potential legislation packet number four.

SO WE ASKING FOR YOUR PERMISSION TO DRAFT YEAH I WOULD LIKE TO RUN THAT BILL I THINK ONE OF THE SUGGESTS VICE CHAIR BRIDGES for your permission to draft Yeah I would like to run that bill Vice Chair Bridges Thank you, Madam Chair. Move to draft mental health transitional living home potential legislation. Give you all the permissions you need to do what you need to do.

Thank you, Madam Chair. John Catlett, JBC staff here with a bill draft for the Colorado National Guard tuition waiver. this bill is a result of legislation last year that there was a different interpretation than I believe the committee's intent was so this bill is to streamline the process and make it easier to administer and also expand the reach of these funds to Colorado National Guard members you can see there's a table there there were some questions during the presentation about the number of denials that were due to missing, I'm sorry, the number of denials due to enrollment caps versus missing doc, and I've broken that out there, and you can see the overwhelming number of denials are due to enrollment caps, which this legislation would end. If the committee has any questions, I'd be happy to take them.

Thank you, Madam Chair. My question isn't so much for the legislation as just to make it absolutely certain, Mr. Catlett, and this isn't your responsibility, so please don't interpret that I'm putting this on your shoulders, is that all the institutions have been involved and advised of this change because we thought that was the case and found out there was at least one major institution that had not been spoken with. And that's critical because otherwise they come back to us and say, what are you guys doing? So I just, they're in the audience. So I just want to make sure that that, not if you guys have had those conversations, please. Thank you.

Thank you, Madam Chair. Representative Taggart, yes. I've talked to the people in the audience, and they have consulted with the IHEs, and they have not received any pushback on the new proposal.

Thank you, Madam Chair. Thank you very much for your incredible work on this. Thanks to all the institutions of higher education. I know the drafting on this has been extensive over two years, So I think we've got it, and I move to introduce LLS 0898.

and you have permission to make technical changes Mr Bous Thank you Madam Chair Jake Bous from the Office of Legislative Legal Services Mr Catlin and I were talking before committee It looks like there as drafted there a petition clause included in this We were wondering if it actually might make sense instead to have a safety clause with an effective date of July 1, just so it's cleaner that we're starting the new fiscal year with this distribution model.

NOW IT'S ON. I HAD ORIGINALLY RECOMMENDED A TRANSFER OF 1.6 MILLION. I NOW THINK THAT THE COMMITTEE CAN TRANSFER THE FULL UNENCUMBERED BALANCE, WHICH IS 1.8 MILLION, AND REMOVE THAT PROGRAM FROM STATUTE. AND I KNOW THAT THE COMMITTEE HAD EXPRESSED INTEREST IN THE SOLICITATION HELP DESK CONTINUING. THAT IS SEPARATE FROM THIS PROGRAM, WHICH IS WHY I'VE UPDATED MY RECOMMENDATION. AND THAT HELP DESK WILL STILL FALL UNDER THE STATE PROCUREMENT EQUITY PROGRAM AND THE RESPONSIBILITIES OF THE FTE IN THAT OFFICE THAT IS FUNDED BY GENERAL FUND. SO THE COMMITTEE CAN TAKE THAT FULL BALANCE IN THAT PROGRAM. THE HELP DOS PROGRAM WILL CONTINUE. SO I'VE INCLUDED SOME ANALYSIS HERE, AND THEN THE BILL FOLLOWS, AND I'M HAPPY TO ANSWER ANY QUESTIONS RELATED TO THAT.

THANK YOU, MADAM CHAIR. I JUST WANT TO MAKE SURE WE'RE REPEALING THE CASH FUND, BECAUSE SOMETIMES WE END PROGRAMS AND WE FORGET TO REPEAL THE CASH FUND, AND THEN CASH FUNDS WITH LIKE A COUPLE OF PENNIES IN THEM HANG OUT FOREVER.

THANK YOU, MADAM CHAIR. MR. VICE CHAIR, WE ARE REPEALING THE CASH FUND AND THE BOND ASSISTANCE PROGRAM.

I MOVE TO INTRODUCE LLS 0892 REPEAL BOND ASSISTANCE PROGRAM. ARE THERE ANY OBJECTIONS? ARE THERE ANY OBJECTIONS? THAT PASSES ON A VOTE OF 6 TO 0. This bill will run with the long bill. It will start in the House with House sponsors, Sirota and Taggart. And in the Senate, Abomble and Bridges. And Brown and Kirkmeyer, would you like to co-sponsor?

Okay. All right. Ms. Bova, you have permission to make any technical changes needed.

Moving on to the second bill this is the retail delivery fee revenue allocation This will accompany the long bill as well and this reallocates the revenue from the retail delivery fee that goes to the multimodal fund Originally 70 went to local multimodal projects and 30% went to state multimodal projects. This will, or sorry, originally 85% went to local and 15% went to state. This will adjust those allocations, SO 70% GOES TO LOCAL MULTIMODAL PROJECTS AND 30% GOES TO THE STATE. AND THIS WAS IN RESPONSE TO THE COMMITTEE'S DESIRE TO HAVE THE STATE PORTION REMAIN AT CURRENT LEVELS WITH THE ELIMINATION OF THE GENERAL FUND TRANSFER FROM THE BILL THAT I PRESENTED PREVIOUSLY. OKAY.

Senator Mobley. So this is where we took the $10 million general fund, and we're not doing that anymore?

Yeah. Okay. Great. Great. All right, this bill will start in the House and run with the long bill. House sponsors will be Brown and Sirota, and in the Senate, Kirkmeyer and Amable. And Bridges and Taggart, would you like to, okay, we'll co-sponsor. No, it's not. ALL RIGHT, MS. BOVA, YOU HAVE PERMISSION TO MAKE TECHNICAL CHANGES AS NEEDED.

ALL RIGHT. IS THAT IT FOR BILL DRAFTS OR DO WE HAVE MORE? THANK YOU. This will be very quick. Okay. Thank you. Can we just give her a hand in the permission, please? Thank you, Madam Chair.

So the transfers and changes you'd be contemplating for one bill?

All right. Vice Chair Bridges. Thank you, Madam Chair. Can we give you ongoing permission for this bill every year and you don't have to come back and change the date on the memo? I move to grant permission to move to drafting combined ARPA bill. Are there any objections? That passes on a vote of 6-0.

Madam Chair, I would suggest disposing of the comebacks next.

Vice Chair Bridges. Thank you, Madam Chair. I move to draft along the lines of the governor's letter. Are there any objections? That passes on a vote of 6-0.

Hopefully there wouldn't be another government shutdown next October.

Well, the committee can mull it over and in the meantime we'll have a draft and then we'll have an opportunity to make a decision once it's drafted.

But this is just a request. It will not be in the governor's, or it won't be in the bill.

Okay. Okay. All right. Are we ready for Mr. Rickman? Yep.

Vice Chair Bridges. Thank you, Madam Chair. Let's cut those FTE. Move staff rec, Department of Ag. Are there any objections? That passes on a vote of 16.

Okay.

Thank you, Madam Chair. The next one is page 6. It's a correction to a calculation I made last week. It's a net neutral reallocation of about $180,000 general fund from the community corrections placements line item to the facility payments line. and the net effect of this is to hold the FY26-27 facility payment for 12 smaller providers constant with the current fiscal year. The original calculation was a bit low, so that's the net effect of it. The bullets there explain kind of the reasons for doing, reallocating the larger amount to begin with, mainly that it ties provider revenue to the number of offenders served when you move it from facility payments to placements, and that's kind of the idea behind it. Given the amount of pushback on this, I'll just add in past years, I will add that the Community Corrections financial study found that most costs are fixed in Community Corrections, and that leads, and the argument I've heard is that the revenue from the state should also be fixed accordingly. I think that would be a bad idea if local authorities cannot guarantee a fixed level of service. So if and when they're willing to say that we're going to provide a certain number of beds and a certain number of placements, I would not recommend that the state fix more money for providers and community corrections.

Thank you. Thank you.

Thank you. Thank you. Bless you.

I think Senator Kirchner is on the way back.

Alfredo Kemp, JBC staff. So today I'm presenting the fiscal year 26-27 staff figure setting for Department of Higher Education. And we're looking at a total of about 20 decision items for the committee's consideration, plus footnotes and RFIs. Beginning with the summary of staff recommendations on page two, A couple of things I want to just quickly point out. You will see that staff recommendations come in at about $2.1 million lower general fund than the department's request. When you take a look at these numbers, total general fund, based on my recommendations, are increasing by 0.7%, about $11.9 million. Most of that, as you can see, just above on page 3, that table on page 3, the bottom, prior year actions reflect $10.7 million. That's basically restoring the base reductions from the supplemental adjustments. So most of what you're seeing in terms of the increase reflected in this table relate to simply restoring the base. And that's about where I have managed to keep my recommendations for the committee. I think at this point I'm not going to go through any of these descriptions of each of these items that are in that table, nor am I going to go through the major differences from the request on page 7. But those are kind of summary items where you can kind of take a look at the differences, particularly with the major differences in my recommendation versus the request. but moving on to I think the business at hand I am going to start on page 8 with the R1 request for institution operating in tuition. The department's request would lead to a total or a net increase of 90.5 million total funds. That includes 4.7 million general fund for the state support portion and 82 million cash funds from student tuition. Now, this total adjustment includes the following components. The continuation of that fiscal year 25-26 supplemental reduction of $9.5 million. On top of that, a $10.6 million increase that is identified as related to covering the cost of classified employees, and this was offered to be made as a step one adjustment, which is a base adjustment but not performance-based. The next piece, there is a budget neutral step two formula adjustment across the institutions based on the funding formula metrics. And then, of course, there are the statutory aligned increases, 2.3 million for specialty educations at CSU and CU, an aligned increase of 0.6 million for local district colleges and area technical colleges, and an aligned increase of $3.5 million for financial aid. of which .7 million was included specifically in the R1 request. The tuition adjustment requested is 2.6% for in-state undergraduate students and 3% for all other students. That's basically the summary of the request. Following that, in order, I have placed the Institutions of Higher Education Statement on Base Corps Minimum Costs. Now, they identify a total statewide that they are anticipating of $136.5 million. This is generally based on a 3.1% increase for salaries, which follows the governor's request, the Cohen's agreement. a blended rate of 5.92% for benefits, and a 2.6% increase for other operating expenses. I've included the table at the top of page 9 that reflects the table as they would present this data, this information. I am going to go ahead and go through my recommendations first, because this is such a chunky decision item that we will go through piece by piece, but I want to give you kind of my recommendation points following the request and kind of the identification of base core costs that the institutions are suggesting. So on page 9, I have my recommendations. I am recommending that the committee restore the $9.5 million supplemental reduction and basically just restore that as a base budget restoration. In other words, we're not going to make any adjustments to it, just simply restore that supplemental adjustment. That is a basic standard methodology for establishing base budget. I am recommending that the committee restore that $9.5 million. Second, no additional state funding. I'm recommending no new dollars added for institutions, and on that basis that no adjustments should be made using the funding formula, the step two funding formula adjustments for fiscal year 26-27. I am recommending a college opportunity fund stipend adjustment of $17.9 million. This ends up being a budget neutral adjustment between the COF stipend and the fee-for-service contract. So this is simply a technical adjustment in fund sources across the governing boards. Fourth item, no additional aligned financial aid adjustments since I'm recommending no new dollars for institutions. There is no additional need for an aligned financial aid adjustment. Next, similarly, no additional aligned adjustment for the local district colleges or the area technical colleges. And then finally, what I am recommending that the committee consider is a 3% 3% tuition increase. That would be appropriated at $88.3 million using kind of our standard percentage increase on the base. Using the legislative council staff forecast tool, I estimate that that could generate up to $116.9 million in revenue for the institution. So I think that's about probably the place that keeps the institutions whole for one more year, kind of basically just meeting costs. In doing this, I've also kind of made the decision that the base core minimum costs are based on the predominantly on that 3.1% salary increase. THE COMMITTEE HAS NOT YET MADE DECISIONS ON COMPENSATION, BUT IF IT COMES IN AT LESS THAN 3.1%, THAT BASE CORE MINIMUM COST TOTAL WOULD BE LOWER THAN THAT IDENTIFIED IN THE INSTITUTION LETTER NOW I WILL MOVE ON INTO SOME ANALYSIS lower than that identified in the institution letter Now I will move on into some analysis We can go point by point The first one I want to bring up, beginning there on page 10, is that governor's request for $10.6 million increase for classified employees. This is kind of an unusual allocation. If you take a look at the table on page 11, there at the center of the page, you can see that the requested allocation across institutions is basically a 10% split across all of them. Now, when you compare that to actual classified employees identified by institution, you can see that that ends up being considerably different. The allocation based on classified FTE there in the last column would identify what kind of a proportional allocation would look like across those institutions. There was never an explanation made by the department for why they went with that requested allocation. They did explain why they wanted it as a step one allocation to base adjustment without funding formula adjustment rather than a step two funding formula allocation, but they did not explain why they came up with basically a 10% to every governing board. kind of just based on the fact that this doesn't really make much sense to me I am just recommending denial as I said I am recommending we just stick with restoring the base reduction basically in its place not adding new money but just kind of going back to the original fiscal year 25-26 appropriation and kind of living with that base moving forward moving into 26-27 Moving on to page 12, I have included a table here where I've taken the basic... Can I just ask a question? Yes.

So you're essentially saying we need to live within our means.

but the restoration of the fiscal year 26 funding, you are essentially saying we do that instead of the proposal that the administration made, which you think doesn't make sense. Is that maybe a crass way to say that? Yeah, Madam Chair, I think you can look at this in some different ways. My thought is the first step, let's consider restoring the base. First step. rather than adding new money that's kind of allocated in a very unusual way. And in fact, if we went with basically an equivalent to that request for some funding in order to meet the compensation policy pieces, you could basically take that amount and allocate it in some other way that probably makes a little more sense. my recommendation would be let's just restore the base, live with that, keep the institutions even in terms of state support for the coming year. I think from their perspective that that is actually a boost because we are restoring what was reduced as a supplemental action. So in my mind, I would just recommend we start there. I think if the committee felt that you wanted to actually, let's say, look at this as an opportunity for some additional general fund savings you could choose not to restore the base and that adds that million But in my mind at this point my recommendation would be to just let keep the institution budget flat relative to what the committee decided a year ago that had to be reduced through the supplemental. If we just restore that, yes, it's approximately equal to the additional money that's being requested. I think it's a simpler transaction in terms of budget, steps, the methodology. And to me is probably a way of considering it from that perspective of let's keep stable funding for the institutions. This is what that would look like. Like, as I said, I think in staff's opinion, I was not impressed with the methodology used for that $10.1 million increase. I've just kind of wrote that off, said, yeah, no. But I think restoring the reduction is reasonable.

Yeah, 26-27.

So moving on to page 12, what I've included in here is a table where I've taken the institution's base core minimum cost matrix, and I've sort of simplified it to take a look at what these impacts actually look like with a lot of that other information stripped out of it. And basically where you see that blue center column, that's the 2.6%, 3% governor requested resident, non-resident tuition cap adjustment would deliver 82 million tuition revenue. That would require state funding increase of 54.5 million general fund. again having aligned increases for the special education programs, financial aid, local district colleges, area technical colleges, it ends up requiring about $86.6 million general fund in order to meet how the institutions have framed their base core minimum costs relative to that tuition increase. IN DOING THIS, I'VE TRIED TO KIND OF JUST MAKE IT A LITTLE BIT CLEAR IN TERMS OF THE IMPACTS. I'VE ALSO INCLUDED THAT 1% INCREASE COLUMN AT THE END THAT KIND OF GIVES YOU AN IDEA OF WHAT GENERALLY A 1% INCREASE WOULD LOOK LIKE FOR COSTS. ABOUT 15.8 MILLION IF YOU'RE GOING TO ADD 1% FOR STATE FUNDING FOR INSTITUTIONS ALONG WITH THE ALIGNED ADJUSTMENTS. Moving on to page 13, what I have in here is I've taken that same table, and I've now included what the, using the legislative council staff forecast assumptions tool, I have basically set those adjustments to the requested 2.63%, the 3%, 3%, and then a 3.5%, 3.5% increase on tuition. This is actually reflecting that tuition revenue increase that's identified in the forecast tool. This is not the standard way we would appropriate it, which would just be a simple mechanical calculation on the base. But this is the forecast estimate for what tuition revenue might look like And so if you take a look at that what you see is that even at 2 3 probably deliver about $111.5 million in tuition revenue for the institutions, reducing the total state funding need. But looking across, if you actually increased to a 3%, 3%, we do a little bit better in terms of that tuition revenue, 3.5%, 3.5% almost delivers as much as is identified in the base core minimum cost. So this would be another way of considering what would these tuition revenue adjustments actually deliver to the institutions. Now, as I said, this looks a little different, and it's not going to match up with how we would calculate the appropriation. What I am suggesting is that the Legislative Council forecast does a pretty good job of identifying current year and out year costs using its model. So I would say this is a way of estimating what tuition revenue could look like for institutions, what that might deliver for them at those tuition cap levels. Senator Mobley. I don't understand the chart, I guess. Why, as tuition goes up, does the financial aid increase go down? Thank you, Madam Chair. So, Senator Mabile, the increases there at the bottom, the SEP increase, financial aid increase, LDC and ATC increase, those are all aligned to the institution's increase. As tuition revenue is increased, it requires less state funding.

Okay. Senator Immobile.

Yes, but this is not based on need.

Thank you, Madam Chair. Yes, so Senator Mobley, the required statutory alignment is based on state support for institutions. There's not a method built into statute that identifies the need for financial aid. It simply says if you're going to increase state funding for institutions, you have to do a matching increase for financial aid. That's what we have to live by in terms of the amount that would have to be appropriated if you increase funding for institutions. But we are decreasing funding for institutions now. Except for through tuition, but you're saying if we raise tuition, then we're raising funding for institutions. That's part of this formulaic idea. I mean, great. I now understand that you just plug these numbers into a formula that already exists or a statute that already exists, but in the real world, this feels like this would be super damaging to students.

Thank you, Madam Chair. So basically as institutions have higher costs as each year progresses for compensation for salaries and benefits and for other operating costs, as their costs increase they have to manage that, and they manage that in the two ways, raising tuition and state funding. If the state is unable to provide state funding, then the tuition cap needs to be increased in order to allow them to meet those costs. And yes, it does have an impact then on students. Students have to cover that difference. They have to pay that higher tuition amount based on that. And there's less financial aid to help them do that.

Senator Mobley.

Mr. Kemp.

Rep. Taggart. Thank you, Madam Chair. Chair, because we have, since I've been on the JBC, we have looked at this chart that the CFOs have put together, which you reference, I think going back as far as page 11, somewhere in that neighborhood, pages 10 or 11. This is the first time that I recall seeing an LCS tool utilized and that has a huge swing I mean it to million swing when it comes to whether you take the 2 and 3 or the 3 Those are very significant swings.

Thank you, Madam Chair. So, Rep Taggart, I certainly can't explain how the model is built, but it is more based on what are the actual cost experiences and revenue experiences for the institutions. So it's almost like a pure operations business model, whereas what we do with appropriations is start at a base and increase that base based on a mechanical calculation of, let's say, if we set it at 3%, we give them 3% additional tuition revenue spending authority. So we're plugging in spending authority. What the forecast is doing is actually measuring where are they today in terms of their revenue collection from tuition and what do they anticipate it being. So it's a different illustration of that amount relative to what we're doing with appropriations. We're setting kind of here's the maximum spending authority for this increase. But it's very likely that institutions are generating revenue that's somewhere below that cap. and therefore when it's increased, we're reflecting in the budget an increase of that 2.6% or 3%, but they are probably starting from a lower floor in terms of their actual revenue. So that's where that forecast model will deliver that big of a difference, I think. What I would say is I don't know that, you know, this is my first time working with this, and I would say, okay, it's a different illustration of what the potential for revenue looks like with these increases. I don't think it's something that we can simply just say, yep, that's the number and we're good, but it does give us that sense of the institutions may actually generate this much revenue, and on that basis, especially if you're looking at that last column there at a 3.5% cap, that almost generates all of their identified need for the year. But I think that's optimistic. So I would say, yes, somewhere, you know, that's on the high side. What we're identifying with the appropriations increase is simply this is total spending authority that's necessary in the budget for whatever their increases may be. having said that I will also add at this point I don't believe that the institutions probably want to increase tuition beyond about 3% no matter what I think they're feeling very stressed in terms of going beyond that so that's partially why I have recommended just a 3% across the board on tuition but I do believe that that generates the potential that they could come pretty close to meeting their costs even if state support is kept flat.

MR. Thank you, Madam Chair. So if I digesting this what you saying is you taking the appropriations from last year of step one and step two Does cough play into that at all or just step one and step two You're taking what we actually appropriated to all the institutions and made it accurate to our appropriations and just put the 1.03 on it to come up with your calculations? Yes. Okay. And just to clarify, there are two separate pieces. The state support piece is both the COF funding and the fee-for-service contract funding. Tuition revenue is what I'm addressing here, and that's a separate revenue source. But yes, I'm basically calculating that mechanically. Okay. Sorry, Senator Kirkmeyer. Thank you, Madam Chair. So I'm trying to figure out which number I compare to from the chart on 9 to your chart on 13. So you have 3% resident, 3% non-resident. Total revenue would be $117 million. And on chart 9, it's 3%, 3%. and their resident tuition rates, according to higher education institutions, is 88.3. So that's close to a $30 million difference. And so this one on page 13 is based on enrollment, where the one on page 9 is based on expenditures, correct? The one on page 9 is, in fact, the number I would use if we pegged a 3% tuition increase. It would be 88.3, and that's spending authority. that provides room for them to increase tuition from current plus 3%. We're just simply mechanically adding 3% to tuition revenue at that 88.3. And yes, so the table on page 13 is presenting the Ledge Council forecast that looks more at costs and revenue kind of from an actual perspective rather than a spending authority. Expenditure. Yes. So the forecast is buying down the expense without accounting for the fact that there are increased students. So that's what I'm saying. The numbers aren't reconciling for me. So you're, I mean, I don't know if we're going with this model here where it's saying we should have state funding of 31 million. In the other one on page nine, it's saying we need state funding with financial aid of 62 million. So I'm trying to figure out how this actually all reconciles and we're comparing apples to apples and not apples to oranges. So thank you, Madam Chair. So Senator Kirkmeyer, what I've done is just basically taken the same table, but substituted the legislative council tuition revenue that's built into their forecast. Now their forecast also includes enrollment changes. So they are incorporating all known changes into the next year for that. I'm only presenting it not as like this is what we should be working off of and making the assumption from, but that this is probably the optimistic high range of tuition revenue that could come into institutions for these adjustments That basically what is intended by this table I just don think that where we getting to Okay. But then your recommendation goes on further to say that instead of adding any additional money, we would restore. So the additional money would end up being 9.5. They already made the cuts this year, 9.5. Not all of us were happy with that, but that's life, I guess, is the way it goes. They just accepted it. I don't think they liked it, but I know other people think they did. But you're just saying that we would add in $9.5 million plus the money that, and I need to go to a different chart someplace, but plus the money for the financial aid, the SEP, and the LDC increase, and the ATC. I'm trying to figure out what page we were on for that. That was on page 12. So you're saying page 12 formula that, or page 12, we would stick with the way it's allocated out now, not making any changes. I would agree with you on the fact that I didn't think it made sense either. But requiring state funding increase at 9.9, which is a 1% increase, and then adding in the SEP, the financial aid, the LDC, and the ATC, that total state funding for higher education in this request would end up being $15.8 million. Is that correct? Right. I'm looking in that last box that you have, the box that you have around the numbers, where 1% is at the top. And at the bottom, total state funding, it says $15 million. Yes. So the 1% increase is just basically a funding increase, a state funding increase of 1% along with all those aligned adjustments. Yes, totals 15.8 million. Every 1% of additional funding would cost 15.8 million. It's right here. Down at the bottom. See where it says total state funding across the bottom. Huh. So do we, thank you Madam Chair. Do we know what, I mean, Cohen's only covers part of the staff. Do we know if we actually went with whatever our common policy was for all of their staff, what that would mean as far as an increase? Senator Kirkmeyer, I don't. I reflect the numbers that the department used at the top of page 11. They identified salary increases, health, life, and dental, and other benefits totaling $18.7 million for the institutions. They then set it at a general fund split of 57% to come up with their number. I have no idea how they generated the COEN's increase amount. That is not included in any of their data bills. They don't do it on all the employees is the problem for them. Yeah, it would not include all employees. . . BUT IT LOOKS TO ME LIKE WE COULD END UP BEING ABOUT $50 MILLION SHORT FROM WHAT THE INSTITUTIONS ARE SAYING TO COVER THEIR BASE CORE COSTS INCREASE. NOW I'M NOT SAYING WE SHOULD INCREASE BY, YOU KNOW, $65 MILLION. I KNOW WE DON'T HAVE THAT. So this greatly worries me that we are going to fundamentally start shutting down higher education institutions because they won't be able to afford a 3% increase on tuition to keep up with their costs. I mean, I don't know how legitimately I can put that into law to say that it has to be 3%, and at the same time, I don't know how I would say to students, oh, by the way, you might have to go up to 5% increase in tuition. That just, I don't like either one of those scenarios. And I'm just making a comment, that's all. I mean, I don't know how we find some reconciliation here, but this isn't quite it. But I appreciate now that I know on page 12 that a 1% increase means for every 1% increase we do, it's 15, 15.8 million bucks. That's good to know. Mr. Kim. Okay.

Thanks. And that's a 1% increase over the current year. And then this common policy or the co-wins increase, is this making some assumption that whether they're covered by the wins agreement or they're not, that they're getting a similar raise to whatever is happening with co-wins? Is that what that $18 million includes on page 11? Or is that just the co-wins employees? Thank you, Madam Chair. So, Senator Mobley, this is only for classified covered employees that are employed at institutions. This does not include all of their employees that are not covered. Okay. I feel like last year we made it so that they would have resources to cover the rest of their employees at a similar increase. and that seemed very important last year and it still seems important to me now. And that was your question, is what is that number? Okay, and we don't know. We don't know.

Thank you, Madam Chair. I would like to point the committee to the table at the top of page 14, which is really maybe the better table to work off of in terms of the scenarios. This basically takes that same institutions base core minimum cost table with that standard percent tuition increase. So you can see tuition revenue at each of those kind of cap levels, you know, 82 million, 88.3 million, 103 million, depending on if it's set at a 2.6 and 3, 3 and 3, 3 and a half, 3 and a half. Now, yes, if we're going to assume that the institutions-based core minimum costs is accurate, and that is the standard that we want to try to live up to, then this gives us what those total state funding amounts there at the bottom would be required, along with that tuition revenue increase at each of those. the difference here is that I'm presenting just the straight this is the adjustment we're going to make to spending authority the prior table was kind of making a forecast of what the potential for tuition revenue may actually deliver to the institution so two different ways of thinking about it but yes if we were to fully fund base core minimum cost this would be the table we would be looking at TOTAL STATE FUNDING of about million under the 2 scenario million under the 3 3 and $53.3 under the 3.5, 3.5. Just for the institutions, again, you're looking at that $54.5 million, $48.2, and $33.5. But then, of course, we have all those aligned increases as well. And I think at this point I will move on to the COF adjustment piece. This is basically just a technical adjustment. This is a budget neutral adjustment. This simply increases COF based on enrollment and reduces fee for service contract funding. So it's just a budget neutral adjustment. That total is $17.9 million for fiscal year 2627. And that's one of the pieces that I've included in my recommendations. To conclude on the R1 and my staff recommendations, Basically what I've done is I've said I think the best thing we can do for institutions for fiscal year 26, 27 is to try to maintain just state funding stability. And on that basis, I am simply recommending that we restore that 9.5 million supplemental reduction and not make any other increase adjustments. That's basically it. for tuition revenue, that we would make a 3% tuition increase. And again, based on the conversations that I've had with institutions, I don't think they have an appetite for going beyond 3%. So I think that that's a reasonable cap, but one that the committee probably needs to consider is I think that the 2.63 is going to just leave them that much shorter on their needs. Thank you. Can you tell me how much total we have in financial aid? I see what the increase is. Your chart on 14 would be $10.8 million. But what do we have, what do we give out financially to financial aid right now? Okay, so. Thank you. Also on 14, Mr. Kim. Yeah. Is it down here somebody? Is it that $322,389 million? Oh, yes. That's total financial aid. So, I'm just asking, so don't anyone think they want to hit me? But is there a way to maybe buy down, maybe not increase, like, financial aid by that $10 million to buy down the total state funding? I mean, I don't know. Does all the financial aid get used? Does it not get used? I just don't know. But is there a way to try and buy down something here? I'm just asking. Thank you, Madam Chair. Senator Kirkmeyer, I believe all of financial aid is used. I can't imagine that any of that money would be left sitting kind of in the coffers on the table, whatever. Thank you, Madam Chair. And we talked a little bit about this. And I realize this isn the year to mess with this but it seems counterintuitive to take the COF increase and deduct it from the fee for service And I know it been in the formula the way it been done for years but that calculation alone hurts the institutions that are growing. Because the faster they grow, the bigger that cough number. Yes, it does increase their base somewhat, BUT IT DECREASES. IT JUST SEEMS COUNTERINTUITIVE. AND I KNOW THERE'S NOTHING WE CAN DO ABOUT IT RIGHT NOW, BUT I WISH THERE WAS A BETTER METHODOLOGY THERE. SO JUST TO BE CLEAR, THE RECOMMENDATION HERE IS TO RESTORE A CUT. THAT'S IT. That's it. So, Senator Mobley, the standard budget methodology, we automatically restore that cut to the base. It would take the committee's action to kind of reconsider and move that cut into fiscal year 26-27. The way that it's submitted in the request, it's basically saying, let's just keep this as a base reduction and move it into the budget year and into future years. That's how the base thing would work. Technically, the way we're doing it is we're restoring it, and then the committee makes a decision for 26-27 moving forward. And, yes, you can then take that base reduction that was already done through the supplemental for 25-26. but yeah my recommendation would be not adding any money but just restoring that base and not touching it Okay Alright

Thank you, Madam Chair. On page 16, we have R4 funding formula data adjustments. This is basically adjustments related to a data error that was included in fiscal year 23-24. This would restore funding for two institutions that were affected. $190,000 for Colorado Mesa University, $31,000 for the University of Northern Colorado. I am recommending that the committee approve the request. I'm sorry, what page are we on? I'm sorry. Page 16.

Are there any objections? That passes on a vote of 6 to 0. All right, so next up, the bottom of page 16. These are the limited purpose fee for service contract funding reductions.

Similarly, this cyber coding at $2.55 million, that's a chunky appropriation. Nevertheless, this is a program that appears to have generated additional revenue from that base state funding over its history. Again, institution hearing responses indicate kind of how it's being used. The institution's going to feel that that is critical. I would say until we get to a point where I think we feel that cyber coding is not something that's important in the world that we're living in, I wouldn't recommend eliminating that program or funding. Finally, the Food Systems Advisory Council. fairly small appropriation 75,000 however right now this is this program is scheduled to sunset on September 1, 2026 and it is under the authority of the Sunset Review Advisory Committee so I would recommend that the committee not take action on this allow the Sunset Review Advisory Committee to make a determination on whether the Food Systems Advisory Council is doing what it's supposed to so basically across those programs I am recommending that the committee deny the request, deny that request to continue that supplemental reduction from fiscal year 25-26. I'm actually willing to maintain the reduction. I don't know if anybody else, or at least for some of these.

Thank you, Madam Chair. I think the rural education, the supporting educator workforce in Colorado one, that from everything I've heard is a very low dollar amount that we save by keeping it and it has an incredible impact from everything that I've heard. But I'd be okay continuing cuts for all of this. You can throw in the rural health care workforce initiative. We could keep that too.

Thank you, Madam Chair. I'm going to just make a motion and see how it goes. I move department recommendation with the exception of supporting educator workforce in Colorado and Colorado rural health care workforce initiative.

Okay.

Vice Chair Bridges. Thank you, Madam Chair. I'd also say that insofar as AI may be replacing those, that notwithstanding, there is a great demand for these programs from the market and the need for us at a state level to subsidize those particular efforts, and this is the argument I made last year as well, the need for the state to subsidize those efforts I think is not present. There are a lot of people demanding that, and to have a special fund that goes to creating more of that, I don't think is answering a desperate workforce need that we have in the state. I think that the market is functioning on that particular piece of higher education. My understanding is graduates with coding degrees are actually having a terrible time trying to find jobs right now in the field. But not people who are learning about AI, which I assume they will pivot. Anyway, we cut it. That's fine. Let's go.

that's run through the Department of Public Health that was put into statute by a bill that was very, I don't know, very well supported that is trying to let people know about the potential harms of this product, it seems like a perfect thing to be funded through the Marijuana Cash Tax Fund. And in order to restore a $3.8 million appropriation for another institution like that, I know I said this the other day, fair shmer, but that just doesn't seem right to me. If we want to make a cut, I would say we cut the Institute of Cannabis Research by the 7.25 and whatever it adds up to to make them both receiving $2 million. Senator Kirkmeyer. Representative Brown had his hand up. Oh, sorry. Representative Brown. Thank you, Madam Chair. And I don't know that I support cutting the cannabis research, but I definitely don't support the department's request here. I appreciate Mr. Kim's analysis, but I agree with Senator Mobley that this is a really important program. It seems like a really worthy expenditure of MTCF dollars, and I can't support what the department is requesting here. Senator Kirkmeyer. I don't really support it either, but I'm just going to say I'm kind of getting frustrated with the fact that we keep trying to do stuff with the MTCF and why we just aren't doing that all at one time when we're looking at the MTCF. so we know what funding is going where, and then maybe we can prioritize. Because as I told the good senator from Boulder, maybe we should be cutting the governor's office when it comes to the MTCF. I don't know why they need the money. And I keep bringing that up every year. So I'm going to know on this for today and probably every day because I don't agree with where the money is going on some of these and on one of these. And I just think it's something that we're going to be looking at anyways under the MTCF when we look at that. I'm part of the piecemealing.

I wouldn Does this have something to do with No I don You did inhale guys Let leave that alone But I mean the strength of these concentrates today is I think

Yes, it's much higher than that.

Can we deny this request today? I mean, I'm fine denying this request because I think we're going to have to come back to balancing on the MTCF, and we're welcome to make those adjustments at that time.

Okay. Are there any objections? That passes on a vote of 6-0. We have to fight another day. All right. Moving on to page 26.

Vice Chair Bridges. Thank you, Madam Chair. In Jeannie's honor, I move staff rec.

HCR2, Longville Center of Appropriation Restructure.

Thank you, Madam Chair. Next up on page 27, very bottom, this is my first staff-initiated recommendation, SI1, indirect cost assessment adjustments. I am just basically recommending adjustments to the indirect cost assessment plan. It includes two primary pieces. One is the elimination of the $4.9 million reappropriated funds that's included in the current indirect cost assessments line. The second is a redistribution of indirect cost recoveries, that's the revenue side, across administrative lines that fully offsets general fund. basically this comes from a year ago staff requested that the committee run a request for information asking the department to submit an indirect cost plan for 26-27 they asked for a delay at the November request they then said well we're actually not going to be able to get it done by January 2nd either, I was aware of that I was in conversation with them and I'm fine with them working as long as they need However, I am comfortable enough in indirect cost work that I have made recommendations for 26-27 anyway. And basically, the current indirect cost assessments line includes $4.9 million that's identified as indirect cost recoveries from institutions. This is really not the place that this should be appropriated. That amount of recoveries from institutions is actually revenue to the department and should be identified in letter notes that offset general fund and administration lines. So what I've done is I've recommended removing that from that particular line, and then I've restructured their indirect costs across the entire department as shown in the table on page 30. So the table 2B includes the requested table or the requested indirects and my recommended use of indirects. This generates about an additional $2 to $2.1 million in general fund savings. So basically, I am giving them an indirect cost plan since they did not submit one.

Okay. Vice Chair Bridges. Probably because they don't have the FTE to figure it out. Or they can't close their books. I move staff rec SI1 indirect cost assessment adjustments.

So those were all decision items that affected more than a single division. We are now at Division I, the Department Administrative Office. This is actually just centrally appropriated items. This really isn't the Administrative Office. and first up at the bottom of page 32 I have my second staff initiated recommendation very simple last year there was a lease termination appropriation added sometime after figure setting it included 40,910 cash funds from the division of private occupational schools cash fund I was told that that plan is no longer happening this appropriation should just go away I'm recommending the committee eliminate this operating expenses line item appropriation.

Are there any objections? That passes on a vote of 6 to 0. All right.

I move base appropriation and line item detail staff rec for department administrative office.

Thank you, Madam Chair. So Division II, this is CCHE and Special Purpose Programs. I will start on page 45. This is the Department's request for additional staff support. Basically, the request includes funding for five new positions for finance and compliance staff, in addition to one-time funding to contract for the creation and implementation of a fiscal training program a total of about half a million general fund including approximately for four FTE plus one funding and that annualizes to general fund five FTE in future years I am recommending that the committee deny this request. I mean, I think as I looked through this, the parts that I focused on in looking at kind of the need, their justifications, they identify that right now their budget and finance teams are working significant overtime hours. They attribute that partially to being understaffed as well as to saying they have experienced increased turnover in recent years, so much so that over the past three years they've had three budget directors, three CFOs, and three controllers. The organizational chart that's included in the request identifies that their budget team includes eight staff. Their accounting team includes six staff. Based on kind of the numbers for the department, I am not convinced that they are understaffed for these items. There's not enough there that convinces me that they need more staff. Further, I do think that under the current general fund deficit position, there's no way that I could request something that looks kind of like, no. I think what they need to focus on is basically establishing some stability in their fiscal office. and once that happens, they should be able to sort of turn things around is what I would expect. I do believe that that needs to happen first. I do think even if there was funding, I would be concerned about adding resources when the problem really needs to be resolved internally. So at this point, I am recommending the committee deny the R5 additional staff support request.

I would, thank you, Madam Chair. I would recommend a one-year term limited compliance staffer, compliance manager, basically to get them through a one-year period. Again, that could be re-upped next year if they feel like they need to continue with additional compliance staff resources. That would be one piece. The second piece I would say, in terms of their fiscal team, I would recommend an additional accountant before I would recommend anything else. I think that that's where there has probably been the greatest fails in terms of their books, settling their books. So that's probably the one place that I would recommend a staff position at this point. that would be it. I think in probably, I would probably do it in that order in terms of priority in my mind. However I do think those are either or I think you could prioritize either one or the other above the other And my understanding is the department currently has no compliance staff

So, Madam Chair, I believe they have one compliance officer that's term-limited related to, I think related to one-time funding that is soon to be going away. And I think about compliance as helping out when there are critical fiscal fails. So they are making sure that things are happening. Representative Taggart.

Mr. Kemp. Thank you, Madam Chair. And excuse me. I think I understand both Madam Chair and Rep Taggart and the concerns expressed, what I would say is, I think if there are internal organizational cultural fails, I don't think that adding more resources is gonna help that problem. I think that, as I said, I think I've worked on assignments where there are leaner fiscal teams than this for much larger appropriations. And I'm not convinced that they're understaffed. I don't think that's the problem. However, I think if you feel like giving them that additional staff to get through what we've been going through in terms of their fiscal challenges, I think that that's reasonable.

NEW SPEAKER 9 REP. NEW SPEAKER 9 Thank you Madam Chair and Mr Kim I really appreciate this is an incredible write up I appreciate where you coming from I going to die I would say this Having served as a CEO for a long time culture comes from the top and you got brand new leadership And I think the cultural side of things potentially could shift very quickly, and I hope very quickly, because it usually comes from that leader and he's sitting right behind you. So hopefully he's hearing that. But I don't have to tell him he's led other organizations. And if he's got a cultural problem, which we know we heard for a long time, I'm sure it's at the very top of his priority list.

One employee, one accountant, without the term. Not term.

One appliance, which appliance?

The fridge? Dishwasher?

The fridge.

Look, the refrigerator was an excellent running back.

What is it?

Are there any objections? That passes on a vote of six to zero. My apologies to everyone for that. No, that's correct. So we didn't say how much money. Well, whatever they have built into the request,

A small. I'm going to, I should probably stop. Yeah. Next.

Thank you, Madam Chair.

All right.

I like that for conditions. Vice Chair Bridges.

Are there any objections? And that requires accompanying legislation. That passes on a vote of 6-0. All right.

Senator Mobley. Thank you Madam Chair so I don't even see where there's budget savings in this one because presumably if it stays in the limited gaming fund it does something else.

Okay. Senator Mobley. All right, I'll just say that I think I'm happy to go with staff recommendation, except for, I don't know, there's $300,000 for the teacher mentor grants. It just feels like that's such a small amount that I'm not sure why we're wanting to keep that. Is that the recommendation? Like maybe we should just get rid of that program.

All right. Well, I can do away with it in entirety because I think we have some kind of program fairly similar to it that we fund out of the SEF fund. I would agree about the limited gaming funds. That doesn't really save us any money, and I don't know what we're gaining there other than do they just want to stop that program? And then the student exchange on the optometry, I don't want to get rid of that. But what, well, on that note, if the board already voted to do away with it, are we then just, we would be functionally appropriating money that would revert?

Because we got rid of it last year. The CCHE has authority and statute to either to have a program or not. It's under their authority. They had previously requested it seeking guidance from the JVC and General Assembly on whether they should or should not, but ultimately. So they got our guidance and said, I don't know, we're going to do a name on it. I pushed on that one, Senator Kirchmeyer. Okay. So we would get rid of the teacher mentor grant program I guess CCAG got rid of the optometry program And what does eliminating 2 million of limited gaming fund transfers get us Is this another one of those things where we take from here and move over here and you know what I call spaghetti budgeting

I didn't understand that, but that's fine. I'm good with getting rid of all of it.

MR. KEM, DO YOU KNOW THE DIFFERENCE?

and I can't remember which is doing what, but maybe something is, one is supporting the teachers who are the mentors and one is supporting the students who are the mentees. I can't remember what we are completely doing on teacher mentorship. Yep, that's what it says. Yep, Madam Chair. Second page, page 52. What you just said is what the teacher. Grant Mendes. Program partners with local education providers provide training and stipends to teachers who serve as mentors for teacher candidates. And then the one in CDE is actually supporting the teacher candidates, not their mentors.

That may be right. I'm unaware of the one in the Department of Education.

Rep Taggart. The other thing I would say, and Mr. Kim's right up, and I appreciate it, although this subject comes up on debt collection every single year. I don't understand for the life of me why we don't turn this over to a credit agency and ask them to do it. because yes, you're going to lose money off the top of it, but they could do it and get it done. It just comes up, and I do appreciate having had large credit teams. It takes a very special person that wants to make those phone calls. They are not fun phone calls on either end of it, and it does take a specialized skill. of a credit individual or credit manager to do this. But for goodness sakes just get this to a credit agency and get it done if you don have the right people to do it

Mr. Kim. Thank you, Madam Chair. Rep. Brown, it does not eliminate the program. It retains the program but eliminates the state funding. So it can continue to operate based on gifts, grants, and donations.

Are there any objections that passes on a vote of six to zero?

Mr.

All righty. That'll be fun.

Okay. I don't like covering it. So just take the 300? No, I think we take the 600, but we leave it in statute. Okay. Okay. So that if we can next year, they don't have to pass a bill to create it again. Okay. All right. All right.

Page 60. It's page 60, isn't it? 60. Yeah.

That passes on a vote of 6-0.

I feel like we're on let's make a deal here you know the 125 and 75 and 250 and I don't know the other option would be to repeal the project

Thank you, Madam Chair. This is the classic case that we keep coming up with. I realize this is the research or the linkage is going through CU, but this is another behavioral health. I don't understand for the life of me why this is in higher education. And maybe it's a moot point if this committee says let's end it,

Mr. Kuhn. Thank you, Madam Chair. So, Rep. Tager, just for clarification, yes, this was kind of lumped into work completed by the CU Center for Research into Substance Use Disorder Prevention Treatment and Recovery Support Strategies. So, this has been kind of a multi-year project since Senate Bill 19-228. Significant funding applied to that project generally and ongoing. and a kind of a smaller amount related to this data linkage study that has been funded in pieces over time Senate bill 24 provided kind of steady regular general fund in order to continue work on that data linkage project and continue to report findings on an ongoing basis So that is the piece that

Vice Chair Bridges. Thank you, Madam Chair. I'm convinced that we've spent a lot of money on this, and I think the data that we're about to get is going to be useful. I move staff recommendation SI3.

Vice Chair Bridges. Thank you, Madam Chair. Can we put an RFI in here as well just to make sure that we get back and know what it is they're doing and the effect? How long is it supposed to go on for? Mr. Kim.

Vice Chair Bridges? Thank you, Madam Chair. I mean, what we're putting in here is just sort of an ongoing appropriation, and so there's no real check on whether or not that's doing anything, and so I want to make sure that there is, in your presentation to us next year, either a they're up and running and it's great and we should keep doing this, or a RFI came back and maybe we shouldn't do this anymore. So at least one year RFI where the data comes back. But then when you recommend that we remove it, you can say they're doing great and it's wonderful and we don't need the RFI and we should keep funding it.

Rep. Taggart. Thank you, Madam Chair. If we're going to do that, could we just please, by this time next year, move this into behavioral health so we make sure that we're not duplicating these types of things. I realize it's CU, and that doesn't change anything, but substance use.

Sure. I mean, I tend to agree with Rep Taggart that we should, I mean, you heard me say it over and over again, we should be streamlining these things and putting like items together, and the Behavioral Health Administration should be in charge of behavioral health programs. But I think it's a much bigger problem since we've seen behavioral health programs in every single freaking department in the state, including, you know, all the outliers like ag. I mean, at least this makes some sense because, you know, it's about studying something. But I do think that's maybe a conversation that we should be having at some point. Okay. Maybe we won't finish that conversation today as it appears to be ongoing. Yeah. I don't think we will. That's fine. We already voted on it.

Okay. And does that include the supplemental? 80,000. That is part of the staff recommendation for the one year. Just term limited. Term limited, yep. Are there any objections to that amendment? That passes on a vote of 6-0. All right.

Madam Chair. Senator Kirkmayer. Before we go there, so is, I'm looking on page A, appendix A20, where the COSI Colorado Opportunity Scholarship Initiative is. It's under special purpose.

That is going to be in financial aid, I believe. Yes, that will be in financial aid, division three. Oh, so it's not underneath special purpose. What about the fourth year innovation pilot program? What is that? And it looks like we have on A21, looks like there's a typo here. We go across on the Senate Bill 21-106, fourth year innovation pilot program. What is that? Why did the request jump up like double, basically, or close? Oh, you're recommending 175. What, what, I'm sorry. I'm sorry, I'm on A21. Is that in this line item or do I need to wait? That's the next. I think that's also financial aid. I thought we were in special purpose.

So, Senator Kirkmeyer, there is a special purpose within financial aid,

All right, then I'll wait. This is other special purpose. Thank you. Yes. Well, those are three things I want to talk. There's three things that I want to talk about. Okay. Okay, cool, thanks. All right. So, line item detail.

Second division. I don't know what it is. Division number two.

Are there any objections? That passes on a vote of six to zero. Now we're to page 86?

Vice Chair Bridges.

And next up on page 89, this is R3 and BA1 financial aid caseload adjustments. These are basically just adjustments based on caseload for two of the financial aid, special financial aid programs. one for the foster student program and the other for the homeless youth program. The department also included a certain amount for need-based grants. This was an aligned financial aid increase related to R1. I have recommended no funding related to that, so I am recommending denial of that aligned increase. But I am recommending that the committee approve those caseload adjustments for the two special programs for foster students and homeless youth. Basically, the Foster Students Program is projected to increase at 20% in enrollment into fiscal year 26-27. The Homeless Youth Program, being a much newer program that began in fiscal year 24-25, is projected at a 92% increase. Those are the dollar adjustments included in that request. And I am recommending those adjustments.

Are there any objections? I have a question about the grants.

No, Senator Immobile, no. The need-based grants piece is the standard financial aid. if you increase funding for institutions, we would need to increase financial aid equivalently.

So is this part of that $322 million that we did this year in financial aid?

Yeah, this is, all of these adjustments are on top of the base. So, yes, these are in addition to, but what I am recommending is those caseload adjustments for foster students and homeless youth.

So, those are two special purpose programs within financial aid for specified students that qualify for those. And then the general, or the need-based grants is the primary financial aid amount. That's the aligned piece. If the committee increased state funding for state institutions, we would need to increase that. And that is what the department submitted because they have actually requested an increase for institutions. This ties to that. But since I am recommending not, I am recommending denial of that need-based grant adjustment. And then we'll figure it out. But we'll figure it out based on the decision we made.

Okay. Are there any objections to staff rec? That passes on a vote of 6-0. Okay, so next up is line item detail beginning on page 90. And I think Senator Kirkmeyer had some questions.

Just be part of it.

Right. So as I understand, Senator Kirkmeyer, and I am new to this as well, this $10 million is mostly for financial aid, but it is some program pieces related to this particular group of students that is being assisted through this program. So that $10 million does include actual financial aid for these students, but in addition, other support that is intended to help these particular students kind of complete their degree programs.

Well, I would actually say, and I actually had the pleasure of getting to meet with some of the students who have gone through the COSY program, and it's much more than financial aid. I mean, they're being offered a variety of wraparound supports that other students don't necessarily get, and that the program has been really successful in helping students get through their college experience and to actually complete their degree.

Senator Kirgmeyer.

Yes. Okay. Senator Kirkmeyer, I think I'm understanding your question. Based on that aligned financial aid, yes, all of the special pieces help to cover the total financial aid cost. So the caseload adjustments for the foster students and homeless students, if there was an aligned increase, that would help offset that aligned increase by the same amount. But this is a base amount now. So everything that's in the base is kind of just, you would just continue it. If you, if I understand right, if you reduced any of that amount, it would need to be made up elsewhere in need-based grants. So basically, if we're going to stay even, if we're not going to, if financial aid is intended, I believe, to just move with institution funding. If there's no institution funding, you don't have to then increase financial aid. in the event you did, you could then use those caseload adjustments to offset that aligned need. And I think that's what you're referring to. But because this is already, this is just simply, this is continuing the base amount. This is not changing anything from the prior year. Within that overall $322 million that we pay out in financial aid. So this is part of the financial aid base.

Okay.

That's not the way it would be.

I don't know.

This is in, yeah, the division.

Division of Occupational Education.

Yes, so that's an FTE count. And I'm not sure why that is. These are reports driven by a system. And I did not look that over closely.

No, I just wanted to know where it was. And if it's part of our overall $322 million,

That's right.

Maybe they just need to fix that.

Vice Chair Bridges. Thank you, Madam Chair. I move line of detail and base appropriation staff rec for three Colorado Commission on Higher Education Financial Aid.

So, Madam Chair, yes, I think it would be fine, I think, if the committee moved line item detail, knowing that there are those items not yet adjusted. However, there are a couple of these items that are remaining the same for the year. So that would continue those, and you wouldn't have to take action later for those.

Vice Chair Bridges. Thank you, Madam Chair. I move base appropriation and line M-D-O for four college opportunity fund programs. Are there any objections?

So I am not sure that this is actually worth taking any action on at this point. Okay.

It is.

It is the institution itself. Right. So Madam Chair, Rep. Brown, I think what distinguishes the governing boards from the institutions is that most governing boards govern a single institution, but then you have CU and CSU that are systems and have multiple institutions within the system.

Okay. Okay, so next up on page 111, this is Division 6, Local District College Grants.

Moving on to page 114, Division 7, the Division of Occupational Education.

On page 117 is the Colorado First Customized Job Training Program.

Is there a way we could get some money here? And what does this mean that it's transferred from the governor's office?

Okay, so we can keep going, but could you maybe find out and let me know? Sure.

Yeah. I appreciate that. Thank you. Get about $500,000 out of it? Yeah, at least. I mean, I don't know where the money's coming from when it says it's coming from the governor's office, so I'd like to know what's coming from. because maybe, you know, when we're looking at MCTF, we could lower the amount of money that we give to the governor out of the marijuana tax cash fund. Just saying, you know, we can all play that game.

Thank you, Madam Chair. I think people are probably already guessing this but the money is originating with Oedit from Economic Development and International Trade That'll take me a little bit more time to figure out, but that appears to be the original source.

Part of why we want to put it all together in one place. Yeah.

No problem.

It's a commission.

All right.

Okay.

General Fauna or whatever it is.

Yeah.

Where does it originate and how is it spent?

So, yeah.

We can keep going.

All right. Vice Chair Bridges. Thank you, Madam Chair. I move staff recommendation based appropriation in line of detail, Division of Occupational Education.

Next up on page 118, this is the Aurora area, HIGHER EDUCATION CENTER. AND SO FOR THIS ITEM, SI STAFF INITIATED NUMBER 4, YOU CAN GO TO THE ADDENDUM MEMO. THIS IS MY WRITE-UP RELATED TO THE RECOMMENDATION FOR THE DIRECT APPROPRIATION AND ALSO KIND OF AN OVERVIEW OF THE ARRERIA COMPREHENSIVE STUDY REPORT. BASICALLY, MY RECOMMENDATION IS TO RETAIN THE DIRECT APPROPRIATION OF GENERAL FUND FOR FISCAL YEAR 26-27 and that the committee may wish to consider extending Section 2370-118, guiding the use of service level agreements beyond July 1, 2026. Basically, the study looked at three areas at issue. One was TABOR and state funding. Next was governance and mission. And next was operations and finance. I include kind of their little summary statements there at the bottom of page one, top of page two. Basically, as far as the funding goes, they are recommending the direct appropriation until AHEC can be converted to a TABOR enterprise. Given that there has not been an idea brought forth either by this study or by anyone else that can accomplish that, I am recommending that we go ahead and just continue the direct appropriation for AHEC for fiscal year 26-27. Now I think I'm trying to understand kind of the history with this and where we're moving on this.

they will more actively participate in the budget process. THAT WOULD GIVE US STAFF AS WELL AS THE COMMITTEE A LITTLE BIT MORE INFORMATION ON WHAT'S GOING ON WITH THESE INCREMENTAL ADJUSTMENTS THROUGH THE YEAR. THEY HAVE SUBMITTED SOME ADDITIONAL COSTS TO ME TOTALING ABOUT 800,000, A 2.5% INCREASE, AND THEY'RE PREDOMINANTLY IDENTIFIED FOR COMMON POLICY RELATED ITEMS. I DON'T THINK I HAVE ENOUGH INFORMATION RIGHT NOW TO MAKE A RECOMMENDATION ON THAT, but I do think I would likely bring a comeback to the committee for some kind of incremental increase related to costs for those items. But at least for now, the recommendation is to continue the direct general fund appropriation As far as the Tabor Enterprise recommendation goes, best as I can tell, the study begins from the perspective that it's just a policy good to convert AHEC to an enterprise. And I'm not really understanding why that's the priority in this case. What they're basically doing is a lot of just central administrative office work. I think any executive director's office or central administrative office in any agency does this kind of work. You can piece it out. You can kind of identify it kind of by a fee cost, but it's not something I believe that's necessary. So I think until the point that some idea comes along that can actually get AHEC to be converted to a Tabor enterprise, It's something that I don't think there's going to be a practical resolution, at least not this year. Right.

Thank you, Madam Chair. Mr. Kim, I'm a little confused with the way you're positioning that, because I thought there was another part of this transaction that we did the direct from the general fund but we also reduced then by that same amount the combination of the base payments to the three institutions because what we were trying to avoid, what we were trying to solve by what we did last year was the dollars coming from the institution made those, they came into the TABOR calculation. So when you say direct, are we still taking the next step and making the reduction?

it sounded incremental to me. Mr. Kemp. Thank you, Madam Chair. So Rep. Tiger, this is one of the reasons I did not bring a recommendation, is I need to kind of think through that piece. This is not a traditional piece that's incorporated into how we're doing budgeting. I really need to think about that. And yes, it may be that we would need to offset any increase through reductions on those institutions. I'm going to have to think through that methodology a bit. But yes, I think that's reasonable. That may have to be how we would apply any increase to AHEC as an offset to the institutions.

That's the big piece.

Okay. So I have a phone a friend asking me to ask you if you have already or if you're planning to ask each of the institutions at AHIC. if they have feedback on these recommendations, and that they specifically want to create a formalized accountability mechanism for AHEC performance and transparency that builds on the continuing service-level agreements through statute, and that they want that to be a permanent thing, not a temporary thing. So I'm just sharing that because I know we're not deciding anything today. Right. I guess they maybe feel like they haven't been... Fully in the loop on what to do next. Right.

It's not going to get done this cycle. So should we be voting on that today or that's something for the future? Right.

Okay. We already know how they're playing together. They're not.

Are there any objections? That passes on a vote of 6-0. Okay. I think that maybe wasn't the right motion. No. Why? Was that the right motion? Mr. Kemp?

Was that the right motion?

Mr. Kemp says yes.

Thank you. Thank you for clarifying. Do we have to have legislation?

Do we need legislation?

Thank you. All right. And that leads us to line item detail on page 119, which is basically the one administration line for AHEC.

Are there any objections? That passes on a vote of 6-0. A lot of money. All right. And now we move into the final division. Question. Rep Taggart.

Thank you, Madam Chair.

But did we do the legislation that it was ongoing or did we just do it for one year?

So when are we going to get to a performance, a mechanism for AHEC performance? Isn't that where we're trying to get to? I mean, this thing's been a mess for three years from my perspective.

Madam Chair, may I?

Thank you. So do you think that we should maybe formalize the accountability mechanism in statute with those service level agreements? Is that something that's maybe a possibility?

So that was the recommendation for legislation.

Okay.

will put them at a $0.8 million deficit based on their anticipated revenue. Adding $1 million of revenue puts them into balance for the year. If we add spending authority, what it does is it gives them room to increase appropriations at certain points. They can only spend up to the revenue they actually get. But what I would say is that just stresses the situation. if we increase spending authority equal to the increase in revenue, which the problem we're solving is their operating deficit, their current operating deficit. Okay, thank you.

Thank you, Madam Chair. I move staff rec HCR1 limited gaming transfer.

I am recommending denial of the request. I think if the committee is hungry for savings, you can certainly take it. I think that cutting statewide community museums and historical site maintenance probably isn't the best place to be taking this little bit of general fund.

Being Madam Chair, I move staff rec HCR 3 for symbolic reasons.

I think as was communicated at the hearing, and I heard this in my conversations with Coombers and Toltec, this basically would lead to laying off one staff member of their current 18-year-round full-time employees located in Antonito. I think this is probably not a great tradeoff, and so I am recommending denial of the request.

In honor of Senator Lew Entz, I move staff recommendation HCR 4.

with those pieces what I am recommending is the elimination of the 933 934,000 general fund appropriation for capital complex lease space that's related to occupancy of 1881 Pierce which they have never occupied in addition I would recommend creation of a collections care and storage line item this would be intended to pay for energy performance contracts for the north storage facility into future years. I am recommending an initial appropriation for 26-27 of 250,000, which represents about half of what they estimate they will need probably to pay for energy performance contracts on an ongoing basis until those contracts are paid off. So I am recommending 250 for 26-27, annualized into 500,000 next year, but also that reduction of that capital complex lease space line item. Senator Mobley But the reduction of the capital complex lease space that kind of just a shell game because we still have the building and it yeah So Senator Mobley, yes, capital complex in DPA will still have to pay for the cost of that. What I would say is that property should probably be sold. it should not really remain on the books for capital complex to continue to maintain and service and pay for utilities because there's not anyone to move into it. It was too expensive to retrofit for the storage facility. It's an old phone company building. There's some very heavy concrete infrastructure through the basement because of it. So it's the kind of building where I don't know WHAT THE STATE IS GOING TO DO WITH ON AN ONGOING BASIS. SO WHAT I WOULD SAY IS YES, IN THE SHORT TERM, THOSE COSTS ARE STILL GOING TO HAVE TO BE PAID IN THE WAY THAT CAPITAL COMPLEX ALLOCATES ITS COST STRUCTURE. THEY BASE IT ON A SQUARE FOOTAGE. EVEN THOUGH NOBODY IS OCCUPYING IT, THERE'S NOTHING GOING ON IN THERE, THEY STILL ACCOUNT FOR IT IN THAT WAY. SO YES, THAT COST STILL NEEDS TO BE SUPPORTED IN SOME WAY. WHAT I WOULD SAY IS DEFINITELY HISTORY COLORADO SHOULD NOT BE ON THE LINE TO PAY FOR IT. They've never actually taken occupancy of the building.

Thank you, Madam Chair. I move SI5 staff rec, collections, care, and storage.

I'm recommending a name correction to the Office of Archaeology in terms of how it's spelled. And that's simple. This just sort of really disturbed me when I saw it. I just said, really? It's not spelled like this in statute. It is an okay spelling, but it's not the preferred spelling. So we...

It's a tough one. Archaeologist?

Do we have to carry a bill for this?

Okay, great.

Make Mr. Kim feel better.

Are there any objections? That passes on a vote of 5-1 with Bridges objecting. Why are you objecting?

It's what's in statute.

Then change statute.

Okay. All right. You want to do five? Yeah.

All right. Good. Then we'll have to change it back. Next we move on to line item detail for History Colorado.

I am going to go through a couple of these because it is going to require some committee consideration for one in particular. I'm recommending continuation of footnotes 25, 27, 31, and 32. So these have just kind of previously existed. I'm continuing recommending continuation for those items. On page 150, these footnotes 26 and 28 include just updates to kind of roll forward spending authority for these items. Footnote number 29 on page 151 is the tuition cap footnote. This language is going to include the tuition percentage cap that the committee ultimately decides on. However, in addition, there are two special items that I am including in this year. One is an adjustment for the University of Colorado, Colorado Springs. This is related to how they are going to address their current kind of tuition split between lower division and upper division. They're doing away with that split. They have kind of a segmented upper division where they have four types of programs and different pricing levels. They're basically going to move to those four different pricing levels across all the students. It is basically going to kind of be, as I understand, revenue neutral. They are going to keep students who are under the current process in place with the current rates. So it's not going to affect those. However, because of this, this is going to make some adjustments related to what tuition would look like. This is something that the Regents have approved. ON THAT BASIS, I AM COMFORTABLE MAKING THE RECOMMENDATION OF THE COMMITTEE APPROVE THAT PIECE OF THE FOOTNOTE. THE SECOND ONE IS FOR WESTERN COLORADO UNIVERSITY. THEY ARE JUST STARTING THEIR NURSING PROGRAM. SO THIS IS NOT A PROGRAM THAT HAS PREVIOUSLY EXISTED. IT HAS NOT PREVIOUSLY BEEN BUILT INTO THEIR TUITION RATES. SO IT'S KIND OF A NEW PROGRAM, AND IT'S A HIGHER COST PROGRAM. THEREFORE, THEY'RE REQUESTING A DIFFERENTIAL TUITION RATE FOR THEIR NURSING PROGRAM. IT IS AT A HIGHER RATE. nevertheless again the trustees have approved that plan and so I would recommend the committee approve this portion of the footnote as well in terms of the actual tuition cap of course that will be adjusted as necessary when the committee makes their decision but I did want to bring your notice to this item when you vote on footnotes it includes those provisions and if you wish that those be adjusted in any way that we take care of that as well.

Thank you, Madam Chair.

I don't apologize.

We shouldn't be capping it at all. They have to make their own determination, in my humble estimation, just because they are running a business. And if they don't know their marketplace, shame on them. And by us putting a cap, we're saying we know the marketplace better than they do. And I don't agree with that at all.

I don't disagree with that. The reason we put a cap on is because otherwise if we don't put a cap on and they do know their marketplace but they purposely keep their tuition down, then they'll expect more dollars from us. So it's a tradeoff and it's a balance that we're trying to work with to ensure that tuition doesn't go through the roof and at the same time that we're not increasing the amount of funds that we put into it by leaps and bounds either. Is it a cap or is it a Representative Brown? Sorry. I was just going to say I don't I appreciate what my colleagues are saying. I think putting a cap on tuition is the right approach. I think we want to protect people from unreasonable increases in tuition. And I realize that we don't provide enough funding, but we need to make sure that we are working together to fully fund higher education and it doesn't just fall on the backs of students. Senator Mobley. Well, is it a cap or is it a, because Senator Kirkmeyer said we don't want them to charge too little, so is it an upper limit and a lower limit or is it just an upper limit? They could charge less. Yeah. They could.

The way I look at it is it's a deal that we make. if you want to charge whatever tuition you want to charge, you can be a private university, but if you're going to take state funds, then we get to have some kind of say in how much you charge for that tuition. I think that's just the deal. And to be totally frank, if any of the institutions would like to break away and not have our dollars, we're in a budget crunch, let us know. Go independent, charge as much as you want for tuition, and we can cut less in Medicaid. So, uh, thank you.

Vice Chair Bridges. Thank you, Madam Chair. I actually am concerned about an entirely different challenge that I think we have with the way that we're funding public higher education in this state, which is that some institutions I don't think can continue to actually implement the increases that we allow and continue to be competitive in the market. And so if we assume in our calculation that they can keep themselves whole and keep themselves open, continue to serve their communities and the people of the state at the levels that we are funding them by allowing them to increase tuition that we've actually, we're the ones who don't understand the market out there and we should take that into account. So that's my bigger concern here for sure.

Oh, I move Longville footnotes and requests for information.

Staff recommendation, you can tell us more afterwards. It's probably not going to change. I have one recommendation on page 152 for an item that I had recommended eliminating funding. The committee chose to keep that funding. Therefore, I'm recommending keeping that footnote.

Anything of note on the RFIs?

I am recommending a couple of discontinuations. One was intended for one year. The other one is related to the resources or other items needed to kind of restore stability for the fiscal offices at the department I'm just recommending that we discontinue that. I think they're just going to simply include a request for more staff. So I don't see a whole lot coming from that on an ongoing basis. The rest I'm recommending some kind of continuation or modification as included in here. I don't think there's anything I need to point to.

I ALSO INCLUDE IN THE ADDENDUM MEMO ADDITIONAL BALANCING OPTIONS. IF THE COMMITTEE WISHES TO GO THROUGH THAT, WE CAN. IF YOU WANT TO JUST SET IT ASIDE FOR NOW AND COME BACK TO THAT, WE CAN DO THAT AS WELL. BUT THE COMMITTEE MAY WISH TO ASK SOME QUESTIONS ABOUT THESE ITEMS.

I think the one thing I want to point to that I am making that is a kind of a substantively different approach to reducing state funding for institutions is to do a proportional reduction. I've included that. It starts at the bottom of page six, onto page seven. And I estimate that a 5% proportional reduction would generate $42.5 million in savings, a 1% reduction, about $8 million in general fund savings. This is basically a reduction that is proportional, not using the funding formula. My reasoning for that is that I kind of think the funding formula is intended to direct sort of policy outcomes through the funding formula when you're adding money. I don't think it necessarily works in the same way when you're taking money away. So I would just recommend a more simple approach to having kind of just a proportional reduction if the committee chooses to take that.

Thank you.