Commission Discussion - What Have We Leaned?
INTERIM COMMISSION TO STUDY FISCAL STABILITY
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10:54 AM -- Commission Discussion - What Have We Leaned?
Senator Heath announced a break and explained that he would like to continue until 12:15 p.m. and take a shorter lunch.
Senator Heath called the commission back to order. He said he would like the commission to talk about what they learned from all the presentations in the first four days of the commission. Senator Heath asked each commissioner to explain what they have learned and started with Mr. Coors. Mr. Coors stated that the big things he heard was everyone wants a reoccurring steady stream of income and most groups say that they are under funded, but at the same time those groups seem to be doing well with the resources they are given.
Representative Court agreed with Mr. Coors, except that she did not feel those groups are doing well. She added that the budget is complex and there are a wide variety of services provided by the government. Representative Court said the main challenge is balancing the needs and expectations of the public with the amount of state revenue available.
Mr. Fagan stated that he has observed that the budget is created using formulas rather than basing it on need. He also observed that when the sentences were doubled in 1985, the prison population increased dramatically, and the balance of the share between the local governments and the state relating to school funding has reversed over time. Lastly, he talked about different ways of providing services, including public/ private partnerships and nonprofits.
Senator Brophy said he talked about the fact that Colorado's revenue stream increases faster than the economy during good times and decreases faster than the economy in bad times as presented by Charlie Brown from the University of Denver in an earlier meeting. He said he feels there needs to be a rainy day fund in the good times to cover the down times. He also talked about the Amendment 23 mandates and said the commission should look at a temporary time out from the amendment. Senator Brophy said the state should also look at long term planning rather than yearly budgeting.
Ms. Lynne talked about the complexity of Colorado's budget and how disaggregated the budget process is in Colorado. She suggested looking at other state services outside of the general fund also. Ms. Lynne talked about having a yearly budget in conjunction with a four-year finance plan. Another observation Ms. Lynne had is that outcomes are not linked with spending very well in Colorado. She talked about creating an entity in state government that looks at outcomes. Ms. Lynne said she also agrees with Mr. Fagan regarding public/ private partnerships.
Ms. Cooke said she has learned that there is a limit on how the budget can be allocated. She also talked about creating a rainy day fund because it is hard to have a stable revenue source. Ms. Cooke suggested using priority-based budgeting rather than zero based budgeting.
Senator Morse agrees the state should be outcome based, but feels there is no money to fund that. Senator Morse said the more the government is held accountable, the more bureaucratic government becomes.
Mr. Conway said he looked for suggestions that would allow the commission to address issues that have put the state in the position it is in. He mentioned that a comprehensive tax study has not been done in Colorado since the 1950s. He talked about the small amount of money the state gives to the state's research universities. Mr. Conway said that the universities should be allowed to have more freedoms to try new things. Mr. Conway agreed with the fact that there are many restrictions on the use of money in Colorado. Mr. Conway said the most disturbing thing he heard was that every group, in order to protect their piece of the pie, will go to the ballot and receive constitutionally-mandated funds, which undermines the representative form of government. He also said he agrees with having a rainy day fund and tapping into public private partnerships.
Ms. Boigon said she agreed with looking at the issue of the initiative process and representative government. She talked about incurring debt, which she said allows Denver to fund projects that can stimulate the economy. Ms. Boigon said in addition to TABOR reserves, Denver holds a 10 to 15 percent reserve. She also talked about the city versus state revenue structure, indicating that 50 percent of Denver's budget is spent on safety whereas 50 percent of the state's budget is spent on education. Ms. Boigon talked about the importance of retooling for the future. She said outcomes are an investment that allows your outcomes to improve and gave the example of data-driven policing. She also talked about Colorado being a disaggregated state and the importance of local control, but that it does come with a cost.
Mr. Hume said one thing that is agreed on is that the current path is not sustainable and that there needs to be change. He said there is going to be a struggle convincing the general public that change is necessary. Mr. Hume talked about the need for a rainy day fund and a fiscally responsible state government.
Representative Gerou said she feels it is important to look at the government's philosophy when the constitution was created and where it is now and said she is a strong believer in states' rights and a limited government. Representative Gerou agreed with Senator Brophy's comments regarding Mr. Brown's presentation. She said that she also believes the state does not always need to accept federal dollars. Representative Gerou said they need to look at what necessary government functions are. Lastly, she pointed out to the commission that it is important to realize that all the information they have received comes with an agenda.
Ms. Neilson stated that the government does not have control over where it spends its money. She says she agrees that there needs to be a rainy day fund and that there should be more cost/benefit analysis done in the government. Ms. Neilson said budgeting needs to be prioritized and also agrees with privatizing some areas. She thinks Amendment 23 does need to be addressed. Ms. Neilson said the government cannot be all things to all people and the commission needs to look at what the core functions of government should be.
12:20 PM -- Lunch