Colorado Legislature begins debate on $38.5B state budget

The Colorado Legislature began its deliberation on Wednesday over the state budget for the next fiscal year.

The budget bill, Senate Bill 23-214, also known as the Long Bill, was introduced Monday by lawmakers from the Joint Budget Committee. It proposes a $38.5 billion budget for the 2023-24 fiscal year, including a $14.7 billion general fund, that lawmakers say is focused on maintenance and implementation of programs.

“This is not a flashy budget this year. We are not propping up brand new shiny objects. Instead, we are implementing those bright, shiny policies that you all passed last year,” Sen. Rachel Zenzinger, an Arvada Democrat and JBC chair, told her colleagues on the Senate floor Wednesday.

All six JBC members are sponsors of the budget bill.

The proposed budget is an 8.9% increase from last year, but about two-thirds of that increase is heading to the Department of Health Care Policy and Financing. As an increased Medicaid match from the federal government due to COVID-19 comes to an end, the state will need to pick up the obligation. Money is also heading to HCPF to cover a projected Medicaid enrollment increase.

“It’s very typical that when you enter into a slowing economy or possible recession, Medicaid rolls tend to tick up,” Zenzinger said.

HCPF, at $15.5 billion, has the largest proposed budget of any department. Education comes next, at about $7 billion — about the same as last year — followed by higher education at $5.8 billion and human services at $2.3 billion. The lowest proposed appropriations are to the Legislature, at about $7 million.

A School Finance Act set to be introduced in the coming weeks will also affect the education budget. That bill will have adjustments for the budget stabilization factor, which is the amount of money that lawmakers owe schools based on a funding formula, but choose not to prioritize. The Long Bill does include, however, an increase of $485 million in funding over last year, which comes out to about $900 per pupil.

One of the major new programs the state will implement is universal preschool, set to start in the fall. The proposed budget has nearly $540 million for the Department of Early Childhood and $322 million for the preschool program. There is also a $2.5 million placeholder for provider bonuses.

The budget also includes a 3% increase in provider rate pay across the board for state agencies and departments. That was a priority for the JBC, Zenzinger said, in the face of workforce shortages.

“We wish we could have done more. But we also had to budget in a practical matter, and we felt that was the maximum amount we could possibly do,” she said.

The budget has a $103 million placeholder for workforce-related legislation that includes free professional credentials, scholarships, adult education and concurrent enrollment. There is also a $221 million placeholder for housing-related legislation that involves land use, public-private partnerships and property tax relief.

The Senate will likely have a final vote on the budget this week. Then the bill will head over to the House. Democrats have large majorities in both chambers of the Legislature.