Overhaul of Colorado spending rules signed into law - Tampa Bay Business Journal:

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Senate Bill 228 ends the Arveschoug-Birdx provision allowing general-fund spending to increasew just 6 percent per year and replaces it with a spendinvg increase limit equal to 5 percent of personaoincome growth. Sponsored by Sen. John D-Colorado Springs, it also sets asides part of the general fund for transportation for the firsrt time and increasesthe state's rainy-day reserves, beginningf in the 2012-13 fiscapl year.
What that all meands is that thegeneral fund, which pays for general state services like education, higher educatio n and corrections, will no longer have to shrink permanentl y when the economy Because of the current growth limit, programs that see fundz cut during downturns are not allowed to recover fully when the fiscal environmen t turns good again. . . The new law will not increaser overall spending but will assure that mone can be directed where state leaders see thegreatesf need, Ritter emphasized.
Laws put into place over the past 12 years direct any revenuee over the 6 percent limit mostl y toward transportation projects andcapitalp construction, which have no other guaranteed statw funds. But even as the Democratic governorr hailed the signingas "az great day for progress in the effortzs of so many who have workexd to bringing sensible, modern budgeting to the state of Colorado," several legislatorsx said there is more to be done. Sponsoring Rep.
Don R-Loveland, said state officiala must now look at the conflicts betweenAmendment 23, the Gallaghee Amendment and "that sacred cow," the Taxpayer'zs Bill of Rights, or Marostica was the only membe r of his party to support the bill, with othedr Republicans calling it an end to fiscak limits and a taking of the only streamk of money that had been dedicatexd to roads for years. Morse added that an interim committee this year will look at not just how much revenuer the state brings in but where it gets that Questions must be asked if there are ways to get fundinfg from more stable sourcesx like property taxes and fees rather than the volatilwsales tax, he said.
"In the late 1400s, very few peopler believed the Earthwas round. By the early 1500s, we knew what was goinf on," Morse said of the need to convince Coloradans that such changedis necessary. "The same thing's going to happen with this bill ... This is a fightt for the soul of Coloradoand it'es just beginning." Colorado Fiscal Policyh Institute analyst Carol Hedges, who helped to crafgt the bill, said that becausre future revenues remain no estimates have been made as to how much monety higher education and othedr areas will gain from the However, next year's general-fund revenue is expected to fall by roughly $700 million from this year, and SB 228 will help budgety crafters be able to prioritized where that is taken from and how that mone is replaced in the Morse said.