Gov. Ritter closes $270M shortfall in FY09-10
Gov. Bill Ritter presented the legislature’s Joint Budget Committee with an updated balancing plan that closes a $271.4 million, recession-induced shortfall in the state’s current Fiscal Year 2009-10 budget. Over the past year, the Governor and legislature have now addressed budget gaps of $2.1 billion.
| Component |
Amount |
| Higher Ed (with 100 percent ARRA backfill) |
$145M |
| Recovery Act State Fiscal Stabilization Fund |
$45.1M |
| Severance Tax Grant Funds |
$37.4M |
| Medicaid Payment Adjustment |
$16.3M |
| Suspend Clean Energy Fund Transfer |
$14.2M |
| Refinance Certificates of Participation |
$10.8M |
| Fitzsimons Trust Fund Cash Fund Transfer |
$6.0M |
| Medicaid Provider Rate Reduction |
$3.1M |
| TANF Refinancing |
$3.0M |
| County Tax Base Subsidy |
$2.5M |
| Dept. of Corrections Canteen Cash Fund |
$2.5M |
The plan includes about a dozen actions, the single largest of which is a $145 million General Fund reduction to higher education. This reduction will be completely offset and backfilled by the American Recovery and Reinvestment Act, helping to preserve Gov. Ritter’s commitment and record investments to higher education. The plan also utilizes $45 million in Recovery Act State Fiscal Stabilization Funds to help offset the overall budget shortfall.
"We’re managing the state’s finances in the worst economy since the Great Depression," Gov. Ritter said. "This isn’t a one-time hiccup or temporary blip. This is a massive correction and a new economic reality. And we’re adapting and adjusting the state’s budget accordingly by being fiscally responsible, surgical and compassionate.
"We’ve tried to minimize pain, protect the safety net and preserve key services. We’ve been fair and balanced, nimble and flexible, and we’ve listened to input and made changes where necessary. And we’re all making sacrifices, with more to come in the months ahead."
The Governor said the updated balancing plan, most of which takes effect Nov. 1, must be viewed within the full context of the past year. Shortfalls of $1.8 billion already have been closed, and the Governor will submit his FY10-11 budget proposal to the JBC on Nov. 6.
"The FY10-11 budget will be even more challenging than the current 09-10 budget, because the revenue recovery always lags the economic recovery," Gov. Ritter said.
The Governor said the number of budget-balancing options is dwindling because of numerous spending mandates, while many expenses and service demands are actually increasing. Forty-five percent of the General Fund is obligated to K-12 education and 25 percent to Medicaid. Medicaid caseloads are up expected to be up 45 percent in FY10-11 compared to three years ago.