State lawmakers are getting their first look at millions of dollars in recommended budget cuts for next year after the introduction of the annual budget bill today.

The Joint Budget Committee has recommended more than $700 million in cuts, transfers and accounting moves for the fiscal year that begins in July to make up for an expected decline in tax revenue because of the recession.

State colleges and universities stand to lose $300 million, but some lawmakers want to reverse that cut by taking $500 million from the surplus accumulated by Pinnacol Assurance, the state-created workers’ compensation insurance company.

The Senate Appropriations Committee was expected to hold hearings on the budget package later this afternoon. Other senators are set to begin budget discussions Tuesday and vote on the package later this week before sending it to the House.

All recommended changes, such as the controversial plan to take Pinnacol’s surplus, must be approved by the full Legislature.

One of the budget balancing proposals would eliminate the fee that retailers now get to keep for collecting state sales tax. That will give the state $31 million.

The plan would also divert fees from driver’s licenses that now are used to pay for highways. The state would instead take those fees to help pay for operating driver’s license offices.

That raises the possibility that lawmakers will have to come up with a new way to make up for the money lost to transportation, such as by raising fees for drivers.

Lawmakers are considering the cuts and transfers because legislative economists predict a deeper and longer recession in Colorado than originally expected. State tax revenue is expected to drop a total of $900 million between this year and next, according to a forecast by legislative economists released last month.

Lawmakers are also preparing in case their next economic forecast in June is even worse.

About $200 million of the $500 million lawmakers are considering taking from Pinnacol would be put in a reserve fund to plug any additional holes if revenues are forecast to drop off even more. If not, the money could also be used to reverse some of the cuts lawmakers are now considering.

Archived comments

Raiding the Pinnacol reserve fund to help balance the budget is unconstitutional. The Pinnacol surplus was paid as workers compensation insurance premiums by businesses large and small. It is not taxpayer money. These funds are held in reserve in order to pay claims for workers hurt on the job. If the legislature can take this money that has no relationship to taxpayer funds, what’s next?

theprairieprankster

4/6/2009 2:38:42 PM

“If the legislature can take this money that has no relationship to taxpayer funds, what’s next?”

How is this any different than raiding Social Security to pay for Vietnam and Iraq?

Just close your eyes and chant: Trust Fund, Locked Box, Trust Fund, Locked Box.

annoying@annoying.com

4/6/2009 2:51:31 PM

no special tuition for illegals.

Bout time.

thesurfriders

4/6/2009 4:37:36 PM

Budget Cuts?Why not increase the budget and the size of the government and saddle our children with the bill?

Why not pass a stimulus bill that will double the state’s deficit in six years and include spending for such things as paying $198mm to Filipino residents for injuries they incurred in fighting for their land in WWII and billions of dollars for renewable energy that will never have any short term impact on the economy, like Congress just did?

456ded

4/6/2009 4:47:56 PM

The politicians will steal everything from the working & middle classes in order to keep the rich elites from sharing in the sacrifice.

It’s not called bourgeois democracy for nothing.

cordymac@hotmail.com

4/6/2009 6:57:30 PM