March 20, 2026 · Budget Committee · 13,881 words · 7 speakers · 151 segments
. Thank you. Thank you. THE JOINT BUDGET COMMITTEE WILL COME TO ORDER. WE HAVE A LOT OF THINGS TO DO TODAY. WE'LL SEE HOW FAR WE GET ON OUR LIST. I THINK FIRST WE'LL START WITH A DISCUSSION OF THE FORECAST. DIRECTOR HARPER, DO YOU WANT TO PRESENT US YOUR DOCUMENT BEFORE WE DO THAT?
AND YES? Okay. Yes. No. It should be in front of you. There's a memo from Director Harper and one from Mr. Catlett. What's the color on top? Yes. Chartreuse? Harry Winkle, perhaps? You know, chartreuse is interesting. The only color named after a liqueur. Oh, I know that. A liqueur. Chartreuse. Why do you know that? Why do you know that? I am obsessed with churches.
Okay We just chatting up here so take your time and whenever you ready Director Harper Director Harper, save us. Please, Director Harper.
Thank you, Madam Chair. Craig Harper, JBC staff. Here with a memo that you received last night, and I think you've all found it at your places now.
Technically this morning. Fact, yes. It was technically this morning.
But dated today from myself, subject is general fund overview under March 2026 forecasts with actions through March 16, 2026.
It's a mouthful.
This is a general fund overview following up on the forecast presentations that you received from council staff and OSPB yesterday. And I really had two goals with this document as you all are moving towards selection of a forecast. And the first one and the most pressing with that goal is to provide some context and additional information as you consider the forecast selection. The second one is more of a standard general fund overview. I've tried to make some tweaks to give you side-by-side comparisons with both forecasts in the same table, so you can actually see how it plays out in each component of the overview. But it's, so we've got a forecast discussion or a selection discussion, and then we move into sort of a standard general fund overview. You have a lot on your plate today, and I'll try and move quickly, but please don't hesitate to stop with any questions. I want to say up front that as usual, the collaboration with Chief Economist Sobetsky and Director Ferrandino's shop has been huge. The ability to turn around these documents overnight after you receive the forecast is largely due to the ability to collaborate with them, and it's been extremely helpful. In order to avoid or attempt to minimize confusion, I've stuck very close to the assumptions that you heard from Chief Economist Sabetsky yesterday with forecast scenario B. But just as a reminder, what I'm reflecting here in terms of the assumed appropriations, the goal is to reflect the committee's actions to date. And you've taken innumerable votes through the figure-setting process. So we've captured those, and those are in the kind of underlying data for the long bill. Where you haven't taken action, I have generally assumed the staff recommendation, but not always. The two big exceptions are homestead, so now I'm in the bullets, bullets at the bottom of page one. The assumptions here include $183.7 million to fund the senior citizen portion of the homestead exemption. JBC staff has recommended eliminating that for 2627 as a balancing measure. But as Mr. Sebecki noted yesterday, based on the committee's reaction at the time, we've continued to assume that that's funded. But it remains on the table as the JBC staff recommendation for part of your balancing. Second these assumptions include a million general fund increase for school finance as requested and that as you approved it as it stands right now We come back to school finance in a couple of minutes I think actually I can cover this here The motion that you approved with Ms Ewell for school finance appropriations includes the million increase It actually shows up at the back of this document. You'll see Department of Education is not increasing by the full $50 million. That's because school finance is going up by $50 million, but you've cut a large number of grant programs in there that have, so the net increase is more like $39 million. But built into the assumptions here, and this is directly relevant to your forecast selection process, and frankly, in my state last night, I didn't get it into the memo. So the two biggest differences between the forecast are revenues, which you heard about at length yesterday, and then the second is the fact that under the council staff forecast, 1448 transition would be triggered off, and under OSPB, it's not. The numbers that are in front of you align with the motion that you made with Ms. Ewell, which assumes continuing the implementation of 1448 as requested and as assumed in the governor's forecast or in OSPB's forecast. So that's what's baked in here is the $50 million increase built around continued implementation of House Bill 1448 and the new school finance formula. But that's a unique, this is our first rodeo with this kind of trigger on and off for the school finance formula where we're seeing one forecast with the formula triggered on and the other with the formula triggered off. But the numbers you have in front of you assume that the formula is on and include the $50 million. Third bullet, this includes about $34 million of staff initiated increases in DOC based on Mr. Brackey's staff initiated recommendations. for the shift relief factor and a placeholder for kind of community corrections investigations. Those numbers are built in here. It excludes the, I think it's R1, the prison caseload request, the money that you still have not approved for DOC. So there's some offsetting effect there, but the numbers here do include those staff-initiated items. the numbers include total compensation appropriations based on the request in colorado winds agreement that's going to be i'm certain an ongoing discussion for balancing purposes but we didn't have a clear place to fall other than that so it is the numbers that you'll see in terms of the shortfall have the winds agreement fully baked in next we have medicaid forecast adjustments as requested in the february forecast and incorporating the actions that you all have taken in terms of reducing utilization and to the extent that you've affected eligibility or provider rates, those are baked in as well. It does not include, and this is a later bullet, but it does not include any across the board provider rate decreases as proposed by the governor's office because you haven't taken that action yet. And the staff recommendation was to deny the lower reduction. I think it was three quarters of a percent, deny that reduction pending you all's actions in balancing. So we have a three quarters of a percent reduction. We've got one that's closer to 4% proposed by the governor's office. Neither of those are baked in here. So next, higher education is flat as recommended by Mr. Kim in terms of the institutions and governing board funding. Lastly just two more here in terms of assumption it does not include any revenue associated with the pinnacle conversion So that million assumed in the governor request is not included And there million associated with adjustments to the TABOR refund in 2627 that I have not included because we don't have committee actions on those items either. The two big ones are the TABOR over refund decision item, which I presented to you on, based on that collaborative process with the entire legislative branch, nonpartisan staff, and a smaller piece for revenue reclassification, which is introduced and moving in the Senate. So I want to next sort of headline here is you're going to see most of this memo focuses on a 13% reserve. Clearly current law sets the reserve requirement at 15%. The governor has requested 13%. The reason that I didn't continue to offer you both in every scenario is that I have the general fund falling short of the 13% reserve under both forecasts in both years regardless. and if you want to think about the shortfall below the 15% reserve, then as a rule of thumb, you would add $340 million to the shortfall that I'm showing. And you can see that in the charts at the bottom of page two. But most of the discussion that I have here focuses on the 13% reserve because we're already short of that. If we manage to close that gap and you want to shoot for 15, JBC staff certainly continues to strongly recommend aiming for a 15% reserve, but the discussion today is largely built around the 13% assumption. The next stage to try and build into, or if I can help foster your discussion on forecast selection, and this section may be, it's certainly not news to the JBC members, but the hope is that it may prove a useful illustration for your colleagues as well as anyone in the public that wants to check it out. So I've headlined this section, Persistent Shortfall. And to state the obvious, you're facing serious challenges for the general fund in both 2526 and 2627. Relative to the December forecast, what you heard yesterday with the March documents, LCS projections have deteriorated from their expectations in December. OSPB's expectations have actually improved. The drop in LCS is larger than the increase. So if we're looking at December as the baseline, LCS fell farther below their December forecast than OSPB went up above December, but they were fairly close together, in my mind, in December, and they've definitely diverged more since then. largely based on LCS's projections having downgraded. I think the key take home for anyone that wants to understand where we are in the current situation is that regardless of which forecast you pick, the revenues for the current year are well below what we all assumed and built into your budget for fiscal year 25-26. That was based on the March 2025 OSPB forecast. And when we closed the session, you were balanced above the 15% reserve for the general fund for fiscal year 2526. Obviously a lot has happened since then. Revenues have decreased. I think the forecast presentations yesterday were both clear that At least a key driver, or the key driver, is the federal legislation with the tax policy changes.
Senator Kirkmeyer.
Thank you, Madam Chair. I'm sorry, just real quickly, on page two, that chart, figure one, is that a 53? Because it's like the black is covering up part of the number, and I just want to make sure I have it correct. 53 million?
Director Harper.
Madam Chair, Senator Kirkmeyer, yes. I should have slid that label out to the right. it is a $53 million shortfall in the current year under OSPB.
Vice Chair Bridges.
Thank you, Madam Chair. I just want to make sure I heard you right, that the key driver in both of these for being under that 15% reserve, whether that difference is the LCS prediction of about $850 million under that 15% reserve for 25-26, or the OSPB like roughly $400 million under the 15% reserve in both of those. I thought I heard you say the key driver there is federal tax policy changes that are automatically adopted into the state's tax code.
Director Harper.
Madam Chair, Mr. Vice Chair, that was what I heard from both presentations yesterday. That was what I heard. That was my interpretation. Somewhat hesitant to wade into those waters, but that was what I heard from both. and as both noted, particularly council staff, there's a lot of other stuff going on. We've seen changes at the state level. We've seen, I mean, there's a lot going on in the background of all of the economic data that I really can't speak to, but it's been clear since you all had to convene for the special session in the fall that the tax policy changes from the federal level were going to contribute to general fund challenges for sure. In response to those decreases, the governor and the General Assembly have acted in, I feel like, nearly every conceivable way to convened a special session to raise revenues and address reductions. The governor has issued a series of executive orders with cuts. You all have taken action on many of the cuts that were in those executive orders and enacted them as supplementals. so since September it has been I feel pretty all hands on deck trying to take a number of actions to balance the current year and yet we still find ourselves in the situation with this committee having taken a number of obviously painful reductions in a variety of departments and yet the shortfall in the current year and for the next year continues to persist. The charts at the bottom, I'm hoping, are a useful way to illustrate this. This was a bit of an exercise to figure out how to make it happen, but you can see that the chart on the left is for fiscal year 25-26, and this really boils down the difference between the two forecasts. LCS is on the left, and the blue portion of the bar or the darker portion of the bar, if it's in black and white, is the general fund revenue expectations of that particular forecast. You can see, or this is the shortfall below the reserve. So it's not actually the amount of revenue we're collecting. It is the shortfall below the reserve requirement. You can see that if the line at the top demarcates the $2.5 billion, and it's right around that level in both years that it would take to hit the 15 reserve for the general fund So if you set the 15 reserve as your goal you need to get at just about 2 billion in both years It a little higher in figure two because appropriations are growing year over year. We are about under the council staff forecast. If you add the 527 and the 336 million together, we're obviously north of $850 million short of balancing to the 15% reserve. And again, we were above the 15% reserve in the current year with the budget that you passed in 2025. So as you can see in that left bar, the next line down is the 13% reserve. So under the council staff forecast, you would need to find an additional $527 million in the current year to hit a 13% reserve this year. And then on top of that, an additional $336 million to hit the As Senator Kirkmeyer noted, the bar on the right is OSPB, and the unfortunately bordering on invisible number there is $53 million. So what's driving that difference is, and Chief Economist Sabetsky discussed this at some length yesterday, but LCS is about $480 million lower for general fund revenue collections in the current year than OSPB. So that's your gap there. You don't have, we'll get into some TABOR complications in a couple of minutes, but you don't have any TABOR complications with cash funds in the current year because we are below the cap. So this is just straight up revenue comparison between the two forecasts. Figure two, on the other hand, shows the shortfall below the 13 and 15 percent reserve in 26-27. If I take the actions that you've made to date and overlay them on top of both forecasts, you can see under LCS, we're about a billion dollars short of the 13% reserve and then an additional $345 million short of the 15% reserve. For OSPB, the numbers are smaller, $740 million and an additional $345, so you would still need over a billion dollars to hit the 15% reserve under both forecasts. you need to find about $740 million to hit the 13% reserve under OSPB. I found, and if we go to page three.
Rep Taggart.
Thank you, Madam Chair. Director Harper, I wonder if you could give us, and I know we're not going to do this, but if I could get the percentages, if nothing were done to reduce this deficit, where the black and gray come together, what is that percentage? Do you have those? Was it in here?
I have it in.
Oh, it was in yesterday's. Is it the same as yesterday's?
Madam Chair, Representative Taggart, it is similar to yesterday's. and I do have them, I think it's in a couple of pages.
Okay, that'd be great.
So if we go to page three, you all are facing a very, the forecast selection is always a tough call for this committee, and the farther apart the forecasts are, I think the harder the decision is. So I wanted to try to, and I want to be clear, JBC staff does not provide any recommendations on forecast selection, and I'm certainly not attempting to do so. But I did want to try to provide some points to consider in hopes of fostering your discussion today. The first is that this situation is kind of inherently confusing The forecasts as both shops talked about yesterday in percentage terms are really not very far apart That $481 million gap is less than 3% of projected general fund revenues in the current year. So it's a very large number when you're trying to find an additional $480 million to balance the budget. but in percentage terms, they're not all that far apart, which is always an eye-opening conversation when the economists come in. That said, while they're not very far in percentage terms, the divergence is clearly complicating you all's life as you select a forecast and try and figure out how to balance this budget. And that $481.5 million is obviously extremely challenging in the current year. What makes this confusing, and this goes into the first bullet, is that one would expect, just at a glance, the divergence between the two forecasts to be larger than they are. And I'll admit to a formula error in my spreadsheet yesterday, I had the divergence larger than it is because I hadn't adequately captured the interaction with TABOR between the two forecasts. So to boil this down a little bit, LCS is about $481 million lower for general fund collections in the current year. They're also $259 million lower in 26-27. So the revenue collection difference for the general fund is actually $740 million over the two-year period. So I think many people would expect that to look like the shortfall when you get into the second year. but it doesn't work out that way and it's really for two reasons that interact in very complicated ways. One is that you have a TABOR limit that means that in that second year they're both above the cap. Both forecasts have us above the cap in 26-27 which means for your purposes for budget balancing and budget balancing alone the divergence in year two and fiscal year 26-27 doesn't affect your balancing because it's going out as refunds. So you would expect the $481 million to stick as the difference between those two, I think, is what most people would expect if they were trying to put this into a spreadsheet. But the underlying data between the two forecasts, OSPB is significantly higher in cash funds in both years, and they're higher in cash funds in 26-27. The fact that they're higher in cash funds in 2627 means that they're pushing out more general fund as a refund than LCS is just because of that. They're both above the cap. OSPB has higher cash funds. That means more general fund is going out as a refund than would happen under the LCS forecast. As a result, that actually collapses the two forecasts a little bit closer together. And this is why I'm trying to walk through this because I think it's inherently confusing. You end up with, even though you have this $481 million gap in the current year, because in this year it's the collections that matter. And that's all, to Mr. Sebecki's point yesterday, that's really all that matters this year. If we're below the cap, every dollar that comes in as general fund is available for appropriation, and every dollar that is missing because of forecast error or otherwise is truly not available. 26, 27, that's not how it plays out. So you end up with a gap next year shrinking to 300 million between the two forecasts So if you play out the same appropriations across both forecasts you have a million difference in the reserve at the end of fiscal year 26 because it's narrowed from the 481. Then if we get into the forecast discussion, and this is, again, the goal is just to foster conversation here. I would note that historically the JBC would generally balance to the more conservative forecast and the lower number. That clearly presents a greater challenge. And in the year with this large of divergence, it's a significantly larger challenge. And I also want to note specifically Representative Brown's point yesterday that if you balance to the lower forecast, and we all saw this with COVID, I'm sure that members felt it, and I know staff felt it, because we came in with recommendations to cut a lot of things that were important to members and that were high priorities for the General Assembly, but we cut deeply out of a lot of those. And then when revenues came in higher, that's clearly not a great feeling. And you've inherently had impacts on people that if you're providing health care services to vulnerable populations or insert your priority, then if you've reduced those services and then the money actually came in, then that's obviously a challenge and can have real impacts on people. And not to enter a debate, but you all saw how late it was when I was writing. So I did want to note kind of on the other end of this, just as you all are weighing this decision that I'll admit I'm glad I'm not having to make, The current year really highlights the risk of balancing to the higher forecast, and that's that cutting at mid-year is really hard. Thinking back to the beginning of my career here, I started here in 2007. 2008 session felt pretty normal. 2009 went off the rails. And you all, the General Assembly, ended up needing to take some really deep cuts that year. If you look back in historic documents for K-12, the year before the budget stabilization factor or the negative factor started, there was a huge rescission where the General Assembly had to claw money back from school districts at midyear. Very disruptive. It's really challenging. You hear it from the higher ed institutions as well. Providers, the provider rate changes at midyear, I'm assuming, would be very difficult for a number of people. So you've got real challenges to implementing them. And then the other piece that I would note is, and this used to come up a lot, it actually came up during the COVID discussions on a regular basis. If you're cutting it mid-year, then by the time you all are meeting as the General Assembly in January, half the fiscal year is lapsed. which means that if you're going to cut a program by half at midyear, that means you're eliminating it for the rest of the year. Because if you wanted to take half of the annual appropriation and you're taking it for six months, that means you have to wipe it out for six months. The later we get into the year, the more that that's magnified. And it can make it very hard for both. I can speak from discussions with a number of folks. You can make it very hard on the departments to figure out how to make that work. And if it's services that are being provided directly to the public, then obviously the service level impact is going to be magnified as well. So that's, I think that's your trade-off. You've got real risk to impacts to people in both cases. And again, having watched us as a state, in the end, effectively overcut for COVID, and then see the repercussions that that had when the revenue came in, and it was like, well, here we are, and we've made all these cuts. I think the impact of that is very real, and that one, in most cases, federal funds managed to backfill it. but we're not in that situation now. So if you take more aggressive cuts now and we're not expecting any sort of money to fall from the sky this year, and then we end up with a higher forecast, higher revenues than you expected, then that's obviously a challenge. I just wanted to note that the counter to that is also difficult because I've watched the pain that this committee has gone through this year trying to take the cuts at mid-year and sort of bumping up against the wall. The other piece that I just want to emphasize, and this was clear from Mr. Sabatsky's presentation yesterday, and Mr. Kurtz and I had a long conversation about this yesterday as well, we're really in fairly unfamiliar territory for, I would say, large numbers of my staff and large numbers or a large percentage of the General Assembly where we've had a lot of years where we're above the Tabor cap, and the forecast selection really gets down to minutiae around Tabor. where it's like, well, we're above the cap, so then it really comes down to how much cash funds we think we're going to collect, what their inflation expectations are, and you get this sort of morass where the differences end up not being that far apart because it's really driven by that background data. If we were above the cap this year, then you would have less money available under OSPB. If we were above the cap in both years, you would have less money available under OSPB simply because of their higher cash fund estimates. But that's not the world that we're in right now. Right now we're in this place where we're below the cap and you're really dealing with just straight revenue impacts. As your staff director, I will admit that the security blanket of being above the cap is very helpful because that means that revenues can fall before we're having to dip into the reserve and you're having to make cuts. You have a buffer there. And in the current year in particular, that buffer is gone. And so that's part of why this environment is feeling so different than it has at least for the past four years. I think the last thing that I'll note, and this is a statement of the obvious, but I think bears repeating, is regardless of the forecast that you pick, as we deplete the reserve, And I do want to note, I've said this in each overview presentation since November, the unexpected revenue drop this year, setting aside any particular causes for it, this is what the situation where revenues are far lower than you expected when you balance the budget is what the reserve is for. Most people would assume that it's generally a recession, but we have some different implications this time. And I think the idea that with this degree of drop in revenues that you would avoid spending any of the reserve this year seems very unlikely to me. I think that would be a very difficult goal, partly because of the degree of the drop and partly because of the difficult actions that you all have taken since September. And we still in this situation and under one forecast the revenues are still dropping THAT SAID GOING INTO NEXT YEAR IF WE ABOVE THE CAP DEPLETING THE RESERVE FURTHER WILL MEAN THAT WE HAVE LESS That said going into next year if we above the cap depleting the reserve further will mean that we have less available when the next recession comes So I can pause there, or if people would like, we can jump into the tables that frankly give a lot of the data that is underlying the charts.
Tables.
All right. General fund overview tables, bottom of page three. I've tried to do something different here to keep the tables accessible as required by the law but give you a little bit more information to digest in one place so and representative Taggart to your question is up at the bottom here we've got relative to the December forecast LCS's expectations have deteriorated if you if these reserves if the appropriations play out as I have assumed them here and I want to note that's not what's going to happen you have a lot of decisions you haven't made yet but we're doing the best we can Mr. Svetsky and I to provide a scenario B that's defensible when you get to I think we've discussed the current year at some length but when you get to fiscal year 26-27 The projected reserve under kind of either forecast, well, under LCS, the reserve falls to 6.7%. So started this year with clear assumptions that we were balanced to a 15% reserve in 25-26. deplete that down to going to deplete that down in the current year. I think regardless of how we move forward, we're going to end up depleting it down to at least 13%, regardless of forecast, as seems likely. At the end of 26-27, I have it falling to 6.7% of appropriations under the LCS forecast and about 8.5% under OSPB. So that's the challenge that you have in front of you, again, if we let this scenario just play out the way that it is in front of you. I want to note at the top of page four that we do have a new wrinkle. The committee is well aware of it because it was a committee bill, but we have $500 million of the general fund reserve that transferred to PARA in the fall of 2025 under Senate Bill 25310. it's still designated as part of the general fund reserve but as the committee's aware that accessing that is a very complicated question you really can't get that money back in one piece it would require some reductions to payments to para through either the employer contribution or the ulap payments i think for your purposes if you're thinking about a liquid reserve that you can actually access. You want to think about the reserve as including that number, and you also want to think about the reserve excluding that number. So table one, I've highlighted the numbers that I would say are particularly challenging. If you look at line three, you've got the year-end reserve in general fund. It drops from $2.4 billion in 2024-2025 to $1.1 billion in 2526 and again this is the projected year end reserve in 2526 under both forecasts and then 2627 under both. It's not that you're actually under this scenario that you're spending billion of the reserve under that scenario It that million comes out So the amount that actually held in the general fund you got million that went out to para and then the increment is the amount that would be spent under the forecast and under the appropriations that I've presented here. When you get to 2627, the amount that's actually held in the general fund falls below $1 billion under both forecasts. It's $664 million under the council forecast and $963 million under OSPB. so if you wanted to look at the amount of the reserve that's actually held in the general fund then the percentage relative to appropriations is significantly different you get down closer to three percent that's actually available for appropriation in 26-27 under the council staff forecast it's 3.8 of the reserve 3.8 percent of reserve that's actually available Again, as the committee is aware and talked about at length in the context of 25-310, it's not that there's no mechanism to kind of reaccess that money, but it's going to take time because you can't reduce payments to para by enough to get the 500 back in one year if you needed to. So that's your overview, and you can see the shortfalls that were visible in the chart on page 2. You can see at the bottom of table one on page three that, and again, these are relative to 13% reserve. So you're $526 million short in 2526 under council staff. That increases to $1 billion in 2627. OSPB, the $53 million, increases to $740 million in 2627. The next set of tables is drawing very heavily on the forecast. So if you look at the available general fund, bottom of page four, this is table two. The key factors here are bolded line five. You can see total available general fund. Now, the total available general fund includes the amount that's in the reserve. So is it available? Yes. Do you want to spend all of it? Definitely not. So that's the total general fund available. And these numbers do exclude the $500 million that's sitting with PARA. So $19.4 billion in 2526 under council staff, $19.9 billion under OSPB. So that's where you're looking at the big difference between those two numbers, roughly $480 million. There's some background differences here for transfers to the general fund that add some wrinkles. but you've got the same starting balance in both years for 25-26. You can see the starting balance in line one is significantly different in 26-27 based on the impact on the reserve up above in table one. But that's your total general fund available. You all have approved lines. Let's see, it's line four here, approved transfers to the general fund. Page five shows you all of the ones that have been approved to date, at least for drafting. It's table three. These are the transfers and diversions that you have approved or at least sent to draft. And I want to flag the top one there. It's the biggest dollar amount. You sent it to draft back in November. That one is still awaiting a decision for whether you want to introduce it. When you sent it to draft in November, and the reason I'm flagging it as sort of a point of uncertainty, it was in significant part as a legal exploration because there's big questions here. if we did end up above the Tabor cap in the current year, whether you would want to make that transfer was an open question in November and I think would require legal advice if we end up if you evaluating it in that context Right now we especially under council staff we far enough below the Tabor cap that I think the the Tabor question is largely off off the table. We are closer to the cap under the OSPB forecast though so if if we were upside of OSPB then it would be possible that we would end up above the cap. That 110 million you have not seen the bill draft yet and have not taken action on it, but because it was approved to draft, I did include it here. That is the big difference between what I'm presenting to you and what Mr. Sabatsky presented. He excluded that particular transfer. But going down the list, the Oedit diversion of Prop 123 funds, top line. I should have put line numbers on this. Oh, right, page five. Page five. Sorry about that. Table three on page five. This is detailing all the transfers that you've approved. You can see the big one is $110 million in diverted funds from Oedit, and then you've got some that are so small, halfway down the page, the last one in 2526, repealing the high-risk families cash fund doesn't round to $100,000. So you've been scraping the couch cushions, as has our staff. I'm sorry.
And you said from the Oedit one, the 123 money.
that we did or didn't agree to in 2627 and we're now taking a position.
Thank you, Madam Chair.
That was proposed and approved to draft as a 2526 diversion only. 2627, I would note, if we're above the cap, then that money does present real TABOR questions. If it comes as TABOR, if it counts as TABOR revenue and we're above the cap, then it would force out general fund in the refund. To give you the bottom line here, literally you've approved $244 million in transfers. Obviously nearly half of that is the Oedit money for 25-26 and additional 72 million in 26-27. I have a bolded recommendation at the bottom of this page if the committee is comfortable making a motion either now or later. Given the shortfall that we have in 25-26, I would recommend that you authorize staff to work with the departments and accelerate as many of the 26-27 transfers as possible into 25-26. It's fungible between the two years, but if that money is available at the end of 25-26, it will in fact help your balancing challenges in 25-26.
So we just say accelerate these things and then the staff makes that happen?
Thank you, Madam Chair. It would be framed something along the lines of a motion to take the amounts that you have approved for 26-27 and where possible adjust the legislation to move those transfers into 25-26. Okay.
Vice Chair Bridges.
Thank you, Madam Chair. I move to take the transfers that we have authorized for 26-27 and wherever possible move them into the 25-26 budget year instead.
Are there any objections? Thank you, Madam Chair. This committee has done some pretty tough work already. And I
guess this is a really helpful document, Director Harper. I wonder if you could, is there a, am I just missing the number of like, how much have we already cut? Does that make sense? Very high level perspective. Where do I find that number? I know it's incorporated into your charts and things.
Thank you, Madam Chair. Representative Brown, that's an excellent question.
And we are scraping for information. Senator Kirkmeyer had asked for similar data. I think I would note two things. One, what represents a cut is in the eye of the beholder in the frame of reference that you're using. Is it a cut if you don't approve an annualization? Is it a cut if does it need to be a year-over-year reduction? Obviously, a lot of the particularly emotionally charged decisions that the committee has made have been reductions to the Medicaid forecast, which is a reduction from, and I don't mean this pejoratively, but a reduction from an imaginary number that we don't know if it's right. So we are actively working on developing that. It's going to be a long list, and it's not very friendly to this kind of document, but we are in the process of, we have a twin track process going on, actually. One is trying to nail down that we have a list of every option that we've presented or that the governor has offered that you haven't taken, which is going to be really important as you get into the discussions of the next balancing actions, and the other one is trying to identify what you have done. But the challenges that I've noted are real in terms of what a cut to you all may not necessarily feel like a cut to us, or it may be presented for a different reason.
Thank you very much, Madam Chair, and that is a fair point.
I just remember from your stress test document, I think, that, you know, it seemed like there were, you were in that document, you were assuming sort of current levels of spending, as I recall, in many cases. And maybe the better comparison is, like, if we were going into this given current levels of spending, what it would look like versus where we are since the work that we have done. Maybe cuts is the wrong word, but maybe it is sort of the changes in expenditures that we have done. So I'm thinking about that figure two that you have on page two and sort of what that would look like now if we hadn't done anything. I guess I'm just trying to figure out, and maybe it doesn't ultimately matter, but I guess I am sort of interested in just understanding how far we've come and maybe, and this, because this is clearly how far we have left to go. Does that make sense?
Thank you, Madam Chair. Representative Brown, I think, not to be glib, but it clearly matters. You all have taken a lot of reductions. A lot of those have been very difficult. You've received very powerful public testimony. in relation to a number of the reductions that you've had to take. So the list of decisions that you have made is clearly important. I think the challenge for our purposes, and the stress test is an interesting frame of reference because the stress test is our best approximation with a very blunt tool of what we think expenditures would have looked like. I HAVE SOME TABLES AT THE BACK THAT WE GET TO AT THE VERY END THAT SHOW YOU KIND OF WHERE YOU ARE FOR EACH DEPARTMENT YEAR OVER YEAR AND THAT SHOW THE ACTIONS THAT YOU TAKEN THROUGH THE SUPPLEMENTAL AD FOR THE CURRENT YEAR show you kind of where you are for each department year over year And that show with the actions that you taken through the supplemental add for the current year Getting that down to the line item basis, you've obviously, because at the department level, you're going to have increases. This came up in House Appropriations this morning for the legislative appropriation bill. Every staff agency took reductions. Health Life Dental actually outweighed those reductions in nearly every agency. So it shows up as increases for most departments, and we'll get to that at the back. But again, the frame of reference there is a hard thing to define. Thank you.
Thank you, Madam Chair. So I can get a grasp on that discussion, should I just then make the assumption the only modification, significant modifications, right now are the transfers and that no reductions that we've discussed or even approved at this point are in these tables?
Madam Chair, Representative Taggart, I've clearly confused the issue. know every reduction that you have taken and voted on is in the underlying data that I'm presenting here. It's just defining reduction relative to what is the challenge. That's the, because if we're assuming a certain level of growth and we're below that, then that's a cut. Cutting below the Medicaid forecast, you all have, as we'll see at the back of this document, and I don't mean to take so much of your time with this, but you all have taken a lot of very difficult cuts in Medicaid, but Medicaid is still growing by hundreds of millions of dollars. We can be inclusive of everything that we have done, excepting for these major assumptions that you outlined. Correct.
So, Senator, if I may, the way I'm reading page 9, and I know I'm jumping ahead, though, is saying that based on what you've just said, is that the increases are outweighing the reductions by quite a bit and we're still at a 3.1% increase in appropriations for the next fiscal year at this point, which is a problem.
Senator Kirkmeyer, that's correct. Table 8 on page 9. You can see if you go down the... I've tried to, and I think for maybe the first time, I've gotten the color coding better, but I at least don't have any in the wrong direction. Darker blue are larger increases. Lighter blue is kind of set a threshold of about $3 million to color code them. Those are your large increases. There are actually seven departments that are going down in general fund year over year. They are the smaller departments in terms of general fund. You can see Department of Agriculture is taking a 6.5% cut. Regulatory agencies is taking a 17% cut under the decisions that you've made in General Fund. Department of State is showing up as 100% reduction. Unfortunately, it's only $4,200. But all of it's gone. We cut it all. Yep. But to your point, Senator Kirkmeyer, the general fund appropriations are still going up year over year. And we can we go back to table seven in just a second but the 2526 number that you seeing here the 17 billion that is 2526 as adjusted by the long bill add that you approved and those are actually shown in table seven So we'll go back to that one in just a minute. But your current appropriation as you've approved it, so current law is shown in Table 7, but as you've approved changes for 25-26, we have you at $17.2 billion. 26-27 is going up to 17.7. So you're actually year over year across all departments have the 532 million in there. I do want to note there are those important caveats that I put up front, though, that total comp is fully funded at the WINS agreement in that number. That's not a small number. That includes the health-life dental increase with all premium increases paid by the state, et cetera. So it includes Mr. Brackey's staff-initiated items. It does not include any across-the-board provider rate cuts. All of those caveats are underlying this data. But as it stands right now, the year-over-year increase in the long bill would be $532 million. Senator Griffin.
Thank you. And I guess an easier way of saying it is we made cuts to the increase, but we haven't made cuts to the actual last year's appropriation to get us down. That's what's happening.
We're decreasing the increase. Director Harper. Thank you, Madam Chair. Senator Kirkmeyer, the ones that I've highlighted in blue definitely identify that, particularly as, and I have in text at the bottom of page eight, that four departments, we have the seven that are showing a net reduction year over year, which means that you took cuts that were large enough to outweigh the general fund increases associated with total comp, etc. etc. Everyone else is going up year over year. In many cases, it's relatively small amounts. But the big increases are exactly where you would expect them to be. And for departments, which would be corrections, again, there's, we have the audit, budget audit driven findings in in that corrections number. So it may be somewhat overstated. On the other hand, It does not include the governor's capacity request, and it does not include anything associated with a new prison. So it may be understated. That's yet to be seen. But corrections is going up by $90 million. Education, $39 million. The big one here, as it has been for several years and as the committee has discussed at length with myself, the HICPF team here, and Director Ferrandino, is health care policy and finance. Despite all of the reductions that you all have taken in health care policy and finance, it's still growing year over year by $300 million. And that's above a base that has also increased. If you look at table 7 on page 8, you're adding $67 million or $68 million to health care policy and financing through add-ons to the, in 25-26, through add-ons to the 26-27 long bill. and that's building on a large increase that was in the supplemental package for healthcare policy and financing. So you end up with healthcare policy and financing, if we look just at the current year, was 83 of the increase in the supplemental package and is 93 of the increase in the add which then leads to exactly as the Senator phrased it you have taken difficult and painful reductions in health care policy and financing that have reduced the increase, but the increase is still in fact driving more than half of the year-over-year increase across all state agencies.
A strong sense of deja vu.
Madam Chair, I can try and plow through the rest of this and wrap up, or it's totally up to you all. I think if we go back to page six, there's a table here that summarizes general fund obligations. I don't need to walk through it in detail. but you can see the table a couple tables ago told you how much general fund was available. This is showing how much you're actually obligating. The important lines here that the committee would generally focus on would be line six, which is total appropriation subject to the reserve, and then everything below that line, so general fund over expenditure in 2425, for example, those are not subject to the reserve requirement. Then you've got rebates and expenditures, transfers to transportation funds. Transfers are never subject to the reserve. Then you've got line 10 is the bill that you have approved to eliminate the transfer to the multimodal options fund. Transfers in line 11 are based on the CDC and JTC recommendations. We don't have action on those yet. Transfers to other funds, those are forecast driven. and then at the bottom you get into the TABOR refund complications. And here you can see council staff forecast in 26-27 has a refund of $276 million. OSPB has that refund at 711. To date, you have approved three bills that would decrease the refund obligation by about $37 million. Two of those are in labor and employment. We have a table later that I don't need to go take you through, but two of those are in labor and employment. That's related to the CEDU proposal. And the other one is the inflation calculation bill that the governor proposed for calculating the inflation rate for calendar year 2025. So you're starting with total general fund appropriations, puts and takes based on everything from lines 1 through lines 2 through 14. Total obligations end up at $18.3 billion. In 25-26, under both forecasts, the differences there are forecast-driven. And in 26-27, the big gap between the $18.7 billion under Council staff and the $19.2 billion under OSPB is obviously the TABOR refund difference. You all have also approved a number of appropriations to be included in other bills. I put those in Table 5 on Page 7. lines 1 through 13 show the bills that you've approved as JBC bills to be included in the long bill package that have general fund direct general fund appropriations so this doesn't include any other transfers it doesn't include other dynamics that you may have going on these are for appropriations in separate legislation and you can see the net result of these is a reduction of about $100,000 in 25-26 and $54 million in 26-27. The big reductions being Ms. Ewell's recommendation, which you all have approved for the statewide repeal ADLE payments. That was the subject of a comeback. And the second largest one being in healthcare policy and financing for the coverall Coloradans benefits. Those are partially offset, more than offset in 25-26 and partially offset in 26-27 by placeholders that you've currently approved for other legislation. Big one in both years being the competency legislation. So $9.6 million in the current year, jumping to $23 million next year. The last...
Thank you, Madam Chair. Just as far as the purpose of this table, this table is just the bills. This isn't the decisions that we've made within the long bill to just reduce appropriations. This is just bills.
Thank you, Madam Chair. Mr. Vice Chair, that's correct.
Okay, good.
They get collapsed into two lines in the obligations table on page four, so trying to split that out into the detail so that you and anyone who wants to read it can see what actually makes up those numbers. Okay. The last section here is table six, and that's items impacting the table refund obligation already referred to it. You can see the three bills that you've approved that are reducing the refund obligation in 26-27. It's the same under there's no impact in 25-26 because A, the bills are 4-26-27, and B, were below the cap. So you can see the impact under each forecast. Again, top line there, line one is the projected refund with no additional action under each forecast, the 276 and 7-11. Then you have a $19 million reduction to the refund obligation based on the change to the inflation calculation. $10 million reduction, and I've misspoke, they're not both related to the CDU proposal. A $10 million reduction related to the CDU proposal in labor and employment, and then a $7 million reduction to eliminate the double count of revenue and vocational rehab in labor and employment. I do want to note you've approved other legislation that would have similar impacts. particularly related to Ms. Pope and the double count in DHS with the money flowing through the raise. We are not, thus far I think numbers have been hard to come by to try and nail those down. So there will be future changes to this table based on legislation that you've approved, but I didn't have data to put in yet. There's three outstanding proposals that you have not taken action on from the governor. The first one is, these are placeholders, a fuel deduction, a change to the fuel deduction related to the loss of fuel in transit, I believe, that I believe is introduced as legislation. That one is expecting to increase the refund obligation by $3.3 million because it will increase revenues. Then you've got the big one, which is the one that I presented on the statewide Tabor over refund correction, statewide R2, would represent $148 million reduction if it were approved with all of the just stipulating the caveats that I gave in that long presentation. But roughly million in 26 the same thing would happen in 27 The last one is a million change that is included in legislation already introduced in the Senate to reclassify aviation revenues as Tabor exempt So that would reduce it by million The thing I want to note here, which is particularly relevant as we sort of flirt with the Tabor cap on either side. In 25-26, if we were to get closer to the Tabor cap and you approved that Oedit transfer, you could end up moving it to the general fund and having it just wash out as Tabor refund because, again, the Tabor status of that money is an open question, I think. On the flip side of that, the council staff has us pretty close to the Tabor refund in 26-27. So you can see based on the decisions that you've made to date, if you were to approve going with the council forecast, then my projections would have the Tabor refund decreasing from $276 million to $239.5. That's getting pretty close to the cap, but I would note the important piece here is that that's still enough to fund Homestead in 27-28. Once you incorporate the last three that you haven't taken action on, if you went with all three of them, then the Tabor refund actually under the LCS forecast would drop to $65 million, which then would leave a pretty significant homestead obligation in 27-28. If you assume roughly $190 million per year, that gap between $65 million and $190 million would be a general fund obligation in fiscal year 27-28. That takes us through all the tables because I think we covered pages 8 and 9 in response to Senator Kirkmeyer's questions.
Well, I think given our time available, I would entertain a discussion of the forecast selection, and then, well, let's do that. Does anyone have a preference?
Representative Brown. Thank you, Madam Chair. I mean, I appreciate all of the work that has gone into both of these forecasts. I think they are both very difficult. At this point, I think I'm comfortable with the OSPB forecast. I know that it has differences in the way that it calculates some of the fees, or sorry, the fee projections differ a bit and make it somewhat harder in some ways, and that the difference is a little bit. I appreciate what Director Harper was saying about the sort of challenges of both forecasts, but I think that's the forecast that I'm probably the most comfortable with at this point.
CHAIRPERSON WONG. Well, Rep. Taggart.
REP. THANK YOU, MADAM CHAIR. I THINK YOU KNOW WHERE I'M COMING FROM. I'M ALWAYS GOING TO LOOK AT THE MORE CONSERVATIVE NUMBER JUST BECAUSE I DON'T SURPRISES AT MIDYEAR SCARE ME TO DEATH, BUT I RESPECT WHATEVER DECISION WE MADE, BUT I'M ALWAYS GOING TO GO WITH THE MORE CONSERVATIVE NUMBER.
CHAIRPERSON WONG.
Thank you, Madam Chair. My understanding of part of what driving the difference here certainly cash funds are part of what driving the difference And frankly I think that the governor office OSPB has a better sense on where cash funds are going to be than OSPB because that's sort of their bread and butter. They're the ones that watch those and charge those and implement those. So I think that the number from OSPB on cash funds is probably more accurate. But as far as the tax filings go, I think that's another driver. As we heard yesterday, it's another driver of the difference. Again, Department of Revenue is inside the governor's office. I think that I am inclined to go with OSPB's understanding of where they think those filings are going to head as opposed to OSPB. I think there's great expertise. I think that both are very good, solid projections of where we might end up. Both have said that they could be entirely and completely and totally wrong if things don't change overseas in Iran. And I think my inclination for those reasons, in addition to what Representative Brown outlined yesterday about, If we cut when we don't have to, then there are, you know, kids and folks across the state who feel that in their health care, in their schools, in their quality of life, that wouldn't have to feel that if we get it wrong the other way. So I think there is real risk to cut more than we need to, especially in the year where we're already cutting so much. I am inclined to go with the OSPB forecast for those reasons.
Senator Korkmeyer.
I'm just concerned because last year we knew the situation we were in and we didn't make enough cuts. And we ended up with going in a mid-year time where we had to make cuts and it wasn't easy. Because we didn't. I mean, we know we didn't make enough cuts. And I know what we were trying to do last year and we worked together on it. but if we don't make substantial cuts this year, and I can appreciate nobody wants to potentially have severe impacts on Coloradoans this year. I think we all would agree with that statement. I think it's making major reductions mid-year. It's not difficult. It just sucks. I mean, it's horrible for everybody. We're all in that same position, and I think the lack of understanding across the street, You know, it just kind of still amazes me, but I don't know. I'm more inclined to go with LCS, but I'm with Representative Taggart. You know, I think as we go through this, and it's not like as we're looking at this even more over the course of the next week or so, that we couldn't maybe change our minds if we decide to. I'm not saying you're all going to, but we can still keep looking at what it means from both sides and see if there's something that we can do. I don't know. but I'm more inclined to go with LCS at this point.
Vice Chair Bridges.
Thank you, Madam Chair. The reason that we had to make cuts in supplementals, the reason that we had to make cuts in the special session is because of a drastic change to revenue coming into the state caused explicitly and directly by federal action, not by any decisions that we on this committee made. Director Harper said this. Chief Sebecki said this. Speaker Ferrandino said this. The reason that we have a shortfall this year is not that we spent too much last year. The key driver is federal tax policy changes We were above a 15 reserve with the budget that we passed and then shortly thereafter the federal government passed massive tax cuts that have not resulted in massive increases in the revenue that we bring in. They have simply resulted in fewer dollars that we are able to spend in our budget because of those cuts in this year. Next year, it is, again back to that Tabor rationing limit. That's what's holding us back next year. But we had a budget that had a 15% reserve, and if not for the federal cuts, we would not be trying to make up for a shortfall in 2015, or sorry, in the 25-26 budget. We wouldn't be trying to make up for that shortfall if not for that federal tax change.
Senator Kirkmeyer.
I just don't agree with that at all, given what the conversation we had last June. Do you remember that conversation in June where it came in and we were told on June 23rd, I think it was, or June 18th, one of those days, the end of June, where we were $700 million because of the one-time funds that we kept doing. And what about the briefing that we had from Ms. Bickle that showed we had the $500 million one-time again funds that we were spending over in ongoing general fund in 24, and we did it in 25. So last June, prior to the July 4th, you know, HR1, we knew that we were starting off this budget year about 700 million trying to figure out where we were going to have to make cuts. It's not a cut when you transfer money from the cash funds over to ongoing general funds. Those aren't cuts. Those just push it down, push, kick the can farther down the road. And we all knew we were doing that. I'm just going to disagree with the assessment of where we were at in June.
When we came back in June, there was maybe a $30 million difference of, I cannot remember what was the cause of that,
but that was OSPB's assessment about where we ended up. And we heard from our nonpartisan staff yesterday that we are in this situation in the current budget year because of the reductions caused by H.R.1. And that LCS forecast, if that's the one you want to choose, that is your sort of confirmation that, yes, in fact, that is the case, that H.R.1 is what is gutting the budget this year. That is what happened.
Thank you, Madam Chair.
My humble estimation both can be true. HR1 has had an impact. And for us not to acknowledge when there's additional deductions both at a corporate level and an individual level, that rolls forward to us at a state level. But we also have to acknowledge that we had well over $200 million, no fault of our own, of additional caseload that came by way of supplementals, which put our budget out of balance. So that's why I say there's truth to both of what you folks are saying. And we just have a hell of a predicament.
We do. MS. We do, Rep Taggart. I, Vice Chair Bridges? MR. That's fine. MS. Okay. I absolutely agree. We are in a healthy of a predicament, and I think, you know, there are no good choices here. Neither of these forecasts are good, and I think that is what they are, their forecasts, and all we can do is our best to balance to these guesses that are being made this month, and we will have to true that up one way or another, as we did in February, TO THE BEST OF OUR ABILITY. AND I THINK I AGREE WITH THE ASSESSMENT THAT CUTTING TOO DEEPLY NOW, IF THAT IS NOT IN FACT WHAT IS NEEDED IN ANOTHER THREE MONTHS, WILL DO MORE HARM. At the same time, choosing the OSPB forecast doesn't put us in a, it's still going to be extremely difficult. We still have some very, very hard choices that we have to make in the coming days, regardless of the forecast we choose. But I, too, think that the OSPB forecast is what I would choose, given the information presented to us. Does anybody else want to add anything to the discussion?
Otherwise, I didn't entertain. Senator Kirkman. I would definitely agree with your comment, regardless of which forecast we pick. There are going to have to be cuts, and it's not going to be fun over the course of the next few weeks. Definitely agree with you on that.
All right.
Vice Chair Bridges. Thank you, Madam Chair. I move to adopt the OSPB forecast.
Are there any objections? That passes on a vote of 6-0. Okay. I don't think we have time for Mr. Catlett's MTCF presentation, but everybody has the memo in front of you, so you can take it and consider it over the weekend. I know that the House is waiting on us to return, but we do have our bill drafters here, and there are some drafts that we've been delivered, and a number of them look easy to me. If any of them are going to engender any sort of significant discussion, I would punt on them, but if we could try to get as much as we could in 15 minutes, I would love to give that a shot of our bill drafts. In the binder. Not that one. So I think we would start on tab four. Packet seven. Yes, potential legislation packet seven. That doesn't get color-coded. Maybe it needs a shape or a... That one's me. I want to go look at that one. Which packet are we going? It's tab four. Oh, tab. I'm like, which packet? Thank you. If you do my mistake. No. Because it won't. I want to detail. I think we put 1.5 now. Tab four. Oh yeah it in here 1 million and it wasn in the list I don know why but you did say you would go to that It on the list but it on the list Oh okay You haven't voted on the list? The accelerator. That's the 8.4. Yeah. You haven't voted on it yet. It's not. We haven't done that yet. You reviewed it, but they... Kyle asked us to pause on it, I think. Was it paused on what's that? No. Considering the bill. We did approve it as a decision, but we haven't approved the bill yet. Oh, okay. Okay, I'm good. And OSPB did a comeback on it. We haven't taken it up since. Correct. All right, Ms. Bickle.
Amanda Bickle, JBC staff. Hopefully this is one of the really easy things you get to do today. There's this technical correcting a citation related to a bill you ran last year. It's, as I said, it was requested by the judicial branch to correct it, and it is here on a little two-page description for you. Okay.
Yes.
All right, Vice Chair Bridges. Thank you, Madam Chair. I move for correctness and justice in America today, introduction of LLS 0950, Fix Incorrect Citation Judicial Stabilization Fund. Are there any objections?
I have houses on a vote of 6-0. This bill will start in the House and run with the long bill. House sponsors will be Brown and Taggart. I want this legacy.
Bridges and Kirkmeyer in the Senate, Sirota and Amabile will co-sponsor. For freedom.
Thank you, Ms. Bickle. Very good, thank you.
Ms. Shen. Thank you, Madam Chair.
Kelly Shen, JVC staff. So I do have a question with this bill draft for you all. this was a bill that you authorized to repeal the comprehensive sex ed program so I think there was a little bit of conversation if you wanted to eliminate the whole thing or just the appropriation either way it does require a bill so currently the bill is drafted to eliminate the whole program and the requirement to make an appropriation but if you wanted to you could also change it so it just eliminates the requirement to make an appropriation and also there was a comeback on this right related to the payday shift I think they said they needed another $30,000 to account for that.
My preference would be to actually pass this bill as a repeal. I believe in comprehensive sex ed. This grant program doesn't actually provide for statewide comprehensive sex ed. My understanding is the department will still provide a repository for curriculum available for districts to access. and if at a later date there is a different program that folks can put forth that I think would actually provide that comprehensive sex ed, I would be very supportive of that. Thank you, Madam Chair.
I don't want to get rid of the program. Okay. So it looks like we just want to take the money. Well, not we. He. Singular.
LONESOME SENATOR MOBLEY I JUST SAY I WITH MADAM CHAIR ON THIS ME on this I hanging out all on my own So just another thing hanging out in statute.
Rep Brown.
I will just note that this, you can take this either way, but the language that we are striking doesn't actually have many, does not really indicate much about what kind of program needs to be granted money or what the parameters of that grant is. So I think I could see that as, to me, it's not like we've got this giant program out there. We just have a tiny little thing. But anyway, I'm fine either way, I think.
All right, so if we don't have agreement on that, then we can fix the $30,000 later when we deal with comebacks, Vice Chair Bridges.
Thank you, Madam Chair. No, I'm good moving ahead taking the money. I'm just not comfortable eliminating the program.
So we can, in this bill, fix the $30,000 question that came to us in comebacks, correct?
I can't have it in a bill.
Do we need a bill?
So, Madam Chair, you do need a bill. So there's a requirement to appropriate a million dollars annually for the General Assembly to do that. So you need a statute to remove the money either way. In terms of the amount, like the appropriations clause is currently drafted to the full amount, but could be adjusted depending on what your decision is.
But we don't want to do it every year, the $30,000.
No, that's just the one time. Yeah.
Ms. Shen.
Thank you, Madam Chair. Yeah, we can make it one time and certainly adjust that appropriation to make it fit. But regardless, if you wanted to basically leave $30,000 this year and then strike the remaining funding ongoing, you still need a bill to do that. And the bill would just basically remove the requirement to annually appropriate a million dollars. That's all it would do.
Can you get on board with that?
Yep.
Okay. Vice Chair Bridges.
Thank you, Madam Chair. I move to pursue staff option number two, except for that $30,000 that is needed. Change is made per discussion for LLS 0903.
Okay. Are there any objections? That passes on a vote of 6-0. This will start in the House and run with the long bill. House sponsors will be Zerota and Brown and in the Senate Amable and Kirkmeyer and in the House Taggart will co-sponsor and Bridges will co-sponsor okay thank you Okay, tab 5. Ms. Pope.
Thank you, Madam Chair. I think we're on to the next packet, packet 8. I have the first bill, which is the repeal of three substance use-related programs in the BHA. It over million in savings so it a pretty simple bill to just repeal the building capacity substance use grant the recovery services grant and a requirement contract for a support for safety net providers I think the only question for this bill is during figure setting you discussed whether or not you would want to include the rural voucher program in this bill as well. And you didn't want to do that during figure setting, but we're sort of leaving it on the table as a decision you might might make later. So we wouldn't want to move to introduce the bill if you're not sure where you're at on that decision, but I think we want to move this forward if you're ready.
I don't remember where the committee left off with that. Who did or didn't want to put that in?
It's $50,000. I'm good with that, too.
WHERE IS THIS? IT'S NOT IN HERE, IS IT, MS. POPE? SO IT'S THIS CONVERSATION. WE APPROVED, THE COMMITTEE APPROVED THE BILL LAST YEAR TO REPEAL THIS RURAL HEALTH, MENTAL HEALTH GRANT. THE HOUSE KILLED IT. THE QUESTION WAS, DO WE PUT IT BACK IN THIS YEAR?
YES.
OKAY. WOULD YOU LIKE TO SEE THAT BILL DRAFT AGAIN OR JUST APPROVE IT TODAY WITH THAT CHANGE?
I think we're good with it, it sounds.
Vice Chair Bridges?
Thank you, Madam Chair. I moved to plate again, Sam. Just to reintroduce what we did last year. Well, it's in this bill.
It's not, but it will be.
Yeah, to put it in that bill. And the only other thing I wanted to clarify, this is a very broad title, if you look at it, and you said you were okay with that. So just something to think about, maybe.
Well, I mean... Senator Mobley.
Thank you, Madam Chair. I WOULD ACTUALLY LOVE FOR YOU TO, THIS LOOKS LIKE WE'RE GOING TO REPEAL ALL OF BEHAVIORAL HEALTH SERVICES, WHICH IS ACTUALLY SOMETHING WE COULD DO. SO MAYBE THERE IS A NARROWING OF THE TITLE THAT YOU COULD COME UP WITH. I MEAN, I WOULD ENTERTAIN ANY IDEAS, BUT I SUPPOSE IF WE WANT TO PUT ALL OF THESE THREE THINGS, OR FOUR, TOGETHER, DID ANYONE COME UP WITH ANYTHING TIGHTER? I THINK WE'LL WORK ON THAT.
Thank you, Madam Chair.
If we could just add an and a connection there with at the end of it, that would be you understand that and I understand that, but it would be helpful.
Isn't that in there?
That's fine.
Sure. How about a little trailer of what's in the bill?
Yeah.
Okay. Would you like to make a motion?
Thank you, Madam Chair. I move to add the effort we attempted last year but lost in the House into this bill, and introduce it with that addition. It is LLS 0895, Repeal Behavioral Health Services.
Are there any objections? That passes on a vote of 6-0. This bill will start in the House and run with the long bill. House sponsors will be Sir Roda and Taggart, and in the Senate, Bridges and Kirkmeyer. Co-sponsors will be Brown and Imable. Okay, thank you. Mr. Bracke.
Thank you, Madam Chair. Justin Bracke, Joint Budget Committee staff, I have LLS 260922, DOC Infrastructure Cash Fund. What this bill does is it authorizes the DOC And the existing balance of about $1.2 million from this cash fund on new projects at Trinidad, Arc Valley, and Arrowhead, and also extends a repeal date by one year for a bit of breathing room.
The other broad option here is to just sweep the balance to the general fund for balancing purposes, if that's your choice. I'm going with the bill.
Anybody else? Okay. Vice Chair Bridges.
Thank you, Madam Chair. I move to introduce LLS 0922, Changes to Broadband Infrastructure Cash Fund. Are there any objections? That passes on a vote of 6-0.
This bill will start in the House and run with the long bill. House sponsors will be Brown and Taggart, and in the Senate, Amable and Bridges. Co-sponsors will be Sirota and Kirkmeyer. Thank you. How's our tallying? Good. We're pretty close. Ms. Bickle. All right.
Amanda Bickle, JBC staff. I don't know if you'll want to vote on this draft right now. I actually have a second draft in another packet for you, but I'll kind of give you an update on what's going on. Thank you. Thank you, Madam Chair.
JUST CONFIRMING THAT THESE BUDGET PACKETS ARE POSTED ONLINE.
GREAT. THANKS.
SO THIS IS REPEALING THE LOCAL ACCOUNTABILITY GRANT PROGRAM, WHICH IS SOMETHING WHERE LOCAL SCHOOL DISTRICTS CAN GET SOME GRANT FUNDS AND FLEXIBILITY IN HOW THEY'RE EVALUATED WHEN THEY DO KIND OF SORT OF THE ACCOUNTABILITY PROCESS. THE ORIGINALLY YOU SAID YES, REPEAL THE GRANT PROGRAM, SO THAT'S WHAT THIS BILL DRAFT DOES. THE ESTIMATED SAVINGS I THOUGHT WERE ABOUT $500,000. THE DEPARTMENT DID A COMEBACK FROM THE STATE BOARD OF ED TO YOU AND SAID WE'D REALLY LIKE TO FINISH OUT THE LAST YEAR OF THE CURRENT GRANTEES AND JUST TAKE A $100,000 REDUCTION. I HAVE ALSO HEARD FROM THE DEPARTMENT THAT IF YOU DO WANT TO GET RID OF THE PROGRAM THEY WOULD PREFER THAT YOU ACTUALLY REPEAL THE WHOLE SECTION AND NOT JUST THE PROVISIONS RELATED TO THE GRANT PROGRAM BECAUSE OTHERWISE IT WILL BE NOT ENTIRELY prefer that you actually repeal the whole section and not just the provisions related to the grant program because otherwise it will be not entirely clear who should be given flexibility in the accountability system And apparently thus far they've been limiting it to grantees of this program. So that is how it's been operating. So, again, from the department's perspective, they would prefer that you either delay full repeal for an extra year and just take a cut in the first year, in 26-27, or that you eliminate it entirely. And so you don't need to necessarily decide this right now, because I do have a different version of this bill draft to bring back to you that would eliminate the entire local accountability program. But that, and you could do that as written, it would eliminate it for 26-27,
or you could delay that to 27-28. I don't feel the need to delay the reduction, but I don't know what that means to repeal the whole section.
Yeah, what does that mean? So, um...
We come out as a bill draft, but I'm still for the 500K. Yeah. Right? If the department said if we're going to take the 500K, they want to eliminate the whole section, then go work with them and come back and we'll look at that. But I still want the $500K.
Okay, great. So we'll take a look at your second bill draft. Okay. And I mean, what that second bill draft does, is repeals the whole section. Yeah. And you can actually see in this bill draft more of what the, what it actually looks like right now, what that statute looks like. Okay. Thank you.
Mr. Kem.
Thank you, Madam Chair. Alfredo Kem, JBC staff. First up I have for you LLS 260944. This eliminates the limited gaming fund transfer of $2.1 million to the innovative higher education research fund that goes to fund CHECRA. Very straightforward.
This money otherwise just is redirected back to the general fund. Vice Chair Bridges.
Thank you, Madam Chair. I move introduction of LLS 0944, eliminate limited gaming fund transfer. Are there any objections?
That passes on a vote of 6 This bill will start in the House and run with the long bill House sponsors will be Rota and Taggart and in the Senate Amable and Bridges That sounds great. Amable and Bridges. Co-sponsors will be Brown and Kerkmeyer. Thank you, Mr. Kemp.
And next up for you I have LLS 260945. This repeals the contract for the online platform for public benefits. Again, very straightforward. Thank you, Madam Chair.
Move for introduction of LLS 0945, repeal of contract for online platform use. Are there any objections? That passes on a vote of 6-0. This bill will start in the House and run with the long bill. House sponsors will be Brown and... Taggart. And in the Senate, Kirkmeyer and Mobley. All co-sponsored. Co-sponsored by Sirota and Bridges. Thank you. Vice Chair Bridges.
Thank you, Madam Chair. I move for the introduction of LLS 0951, Repeal Office of Judicial Discipline Ombudsman. Are there any objections?
That passes on a vote of 6-0. Vice Chair Bridges.
Oh, you're just already raising your hand. Yeah, I'm in line.
This bill will start in the House and run with the long bill. It will be sponsored by Brown and Taggart, and in the Senate, Bridges and Kirkmeyer, co-sponsored by Sirota and Amable. Thank you, Mr. Thompson.
Scott Thompson, Joint Budget Committee staff. The second bill draft I have for you is 0952. This is related to a requirement that $400,000 be in this judicial discipline special cash fund at the beginning of each year. I'm also recommending that the committee approve adding a provision that actually makes the transfer of $400,000 to the general fund from this fund. It makes sense to have it in the same bill instead of the big transfer bill.
Okay.
Vice Chair Bridges. I think Madam Chair I move to the introduction of LLS 0952 Eliminate Cash Fund or Cash Balance Requirement in Judicial Cash Fund with the transfer included as outlined by Mr Thompson Are there any objections That passes on a vote of six to zero
This bill will start in the House and run with the long bill. Sponsors in the House will be Brown and Sirota, and in the Senate, Amable and Bridges. And co-sponsors will be Kirkmeyer and Taggart. Thank you. That's the packet. All right, that's the packet. All right, I think the House is waiting on us, so I don't think we, unless there are other bill drafts not intending to do. We've skipped six. I know, but, yeah. Packet six. Okay. All right, thank you, everybody, for another cheerful day at the Joint Budget Committee. We will stand in recess. Thank you. Thank you.