'Biggest, Steepest Drop We've Ever Seen': State Revenue Expected To Plummet $3 Billion This Year
DENVER (CBS4) - Coronavirus is taking a huge toll on the Colorado state budget. The governor's budget director projects that state revenue will drop by nearly $7 billion over the next four years.
Democratic and Republican leadership from the House and Senate met Wednesday to discuss when and how the legislature will get back to work. They have tentatively set May 18 to resume the session and remote hearings appear unlikely.
New revenue projections are expected May 12, and the legislature is constitutionally required to pass a budget and School Finance Act by the end of June.
Speaker of the House KC Becker says there will be major cuts that will impact every corner of the state.
"It is the biggest, steepest drop I think we've ever seen. Things are changing every day. When we were just out of session on March 16 and got the forecast, they were saying maybe $700 million drop. So what we're learning now is it's a much bigger drop, much steeper drop," she said. "It's likely not going to be just one year."
The Vice Chair of the Legislative Joint Budget Committee says they are trying to protect K-12 education funding but, he says, there will be cuts to existing programs.
The state has about $1 billion in its reserve fund, and Colorado will receive about $2.2 billion in federal aid, but much of that will go to local governments. Budget Director Lauren Larson projects a $3.2 billion drop in state revenue over the next fiscal year alone.
She says the drop will depend in part on how quickly businesses and consumer spending rebound. In China, she says, businesses have held back production even after workers returned. On the up side, she says, there has been unprecedented fiscal intervention by the federal government.
