By Peter Marcus, DENVER DAILY NEWS

Gov. Bill Ritter on Friday announced a $262 million budget-balancing plan that largely relies on one-time fund transfers.

Ritter’s proposal comes following a September revenue forecast that predicted the $262 million shortfall for the current fiscal year. The forecast also predicted a shortfall of as much as $1.1 billion for Fiscal Year 2011-2012, meaning more cuts are likely.

Republicans have maintained that the Democrat governor is not cutting enough from the budget, but Ritter points out that the Democrat-controlled Legislature has cut more than $4.3 billion from the budget over the past three fiscal years, including a $260 million cut to public schools in the current fiscal year.

The budget plan announced on Friday calls for reducing the state’s funding for K-12 education by $156.3 million. Schools, however, will receive federal funds to assist, including funding for hiring teachers and staff.

Ritter on Friday defended his actions balancing the budget as governor.

“Over the past two years, we have made tough, unpopular and unenviable decisions in order to keep our budget balanced,” Ritter said in a statement. “We have preserved essential services, protected the safety net and minimized pain. We have done more with less and made state government more efficient than ever.”

Ritter’s plan comes as the Department of Labor and Employment announced on Friday that Colorado’s unemployment rate increased to 8.2 percent in September from the August rate of 8.1 percent. Colorado is in the top five for job loss over the past 12 months, according to the report. Compared to last year, Colorado’s unemployment rate jumped from 7 percent to just over 8 percent.

Republicans used the opportunity to bash Democrats. Aurora City Councilman Ryan Frazier, the Republican candidate for the 7th Congressional District, blamed a Democrat agenda for the increasing unemployment rate.

“The people of the 7th Congressional District deserve a representative who will rein in out-of-control spending, and put Coloradans back to work,” Frazier said in a statement, who is challenging Democrat opponent Congressman Ed Perlmutter, D-Lakewood. “The question is simple — are Coloradans better off now than they were four years ago?”

Ritter’s budget-balancing plan also calls for:

» Transferring $55 million from the Local Government Severance Tax Fund, which provides grants to communities impacted by energy development, to the General Fund;

» Transferring $10 million from the perpetual base account of the Severance Tax Trust Fund, which will decrease the amount of funding available for loans to water users in the current fiscal year, with $21 million still being available for loans;

» Delaying by one month managed-care payments to Medicaid providers at the end of the current fiscal year for a General Fund savings of $15.2 million;

» Delaying Medicaid fee-for-service payments for a savings of $55.1 million; and

» Transferring $2.5 million from the Colorado Travel and Tourism Promotion Fund to the General Fund.

The budget proposal includes an additional $35 million cushion that allows the state to maintain a 2.5 percent reserve that carries into the next fiscal year.

“We have taken a very strategic, very targeted and very fair shared-sacrifice/shared-solution approach,” Ritter said in his statement. “And because this strategy is working, you will see the same principles in today’s plan and in the Fiscal Year 2011-2012 budget I will submit to the Legislature next month.”