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

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Senate Bill 228 ends the Arveschoug-Birdc provision allowing general-fund spending to increase just 6 percen per year and replaces it with a spending increase limig equal to 5 percent of personallincome growth. Sponsored by Sen. John D-Colorado Springs, it also sets aside part of the genera fund for transportation for the firsy time and increasesthe state's rainy-day beginning in the 2012-13 fiscal year. What that all means is that thegenerak fund, which pays for general state services like higher education and corrections, will no longer have to shrinik permanently when the economy recesses.
Because of the curren t growth limit, programs that see funds cut duringh downturns are not allowedd to recover fully when the fiscal environmeng turnsgood again. . . The new law will not increased overall spending but will assure that money can be directed wherw state leaders see the greatest Ritter emphasized. Laws put into placw over the past 12 years direct any revenue over the 6 percen t limit mostly toward transportatio projects andcapital construction, which have no other guaranteed statwe funds.
But even as the Democratic governor hailed the signingfas "a great day for progress in the efforts of so many who have workedd to bringing sensible, modern budgeting to the statd of Colorado," several legislators said therde is more to be done. Sponsoring Rep. Don R-Loveland, said state officials must now look at the conflictzs betweenAmendment 23, the Gallagher Amendmenr and "that sacred the Taxpayer's Bill of Rights, or Marostica was the only member of his party to support the with other Republicans calling it an end to fiscal limitsd and a taking of the only stream of mone that had been dedicated to roads for Morse added that an interim committee this year will look at not just how much revenuw the state brings in but whers it gets that money.
Questions must be askede if there are ways to get funding from more stabl sources like property taxes and fees rather than the volatilesales tax, he "In the late 1400s, very few people believed the Earth was round. By the early 1500s, we knew what was goinv on," Morse said of the need to convince Coloradans that such changsis necessary. "The same thing's goinbg to happen with this bill ... This is a fight for the soul of Coloradkand it's just beginning.
" Coloradio Fiscal Policy Institute analyst Carol Hedges, who helped to craft the bill, said that because future revenues remain no estimates have been made as to how much moneyh higher education and other areas will gain from the However, next year's general-fund revenud is expected to fall by roughly $700 million from this year, and SB 228 will help budgeft crafters be able to prioritize where that is take from and how that money is replacede in the future, Morse said.