Categorized | Budget, Featured Stories

Another Tough Budget Year, Another State Fiscal Emergency


The potential benefits of declaring a state fiscal emergency were laid on the table last week as state lawmakers learned what their options are for crafting a workable balanced budget for 2011-12.

“We’ve done this in the last two years and I believe that the General Assembly will have to do it again in order to move some of the tobacco-tax moneys to back-fill the General Fund,” Joint Budget Committee staffer Melody Beck told the budget-writing panel during a staff briefing on the Department of Health Care Policy and Financing.

Declaring a state fiscal emergency is accomplished by passing a resolution with a two-thirds majority in both the House and Senate along with a nod from the governor, who must sign the resolution for it to take effect. For the past two years the legislature and governor have successfully declared such an emergency in response to dismal revenue forecasts against the backdrop of a constitutional mandate for a balanced budget.

With passage of the resolution, a portion of tobacco tax revenue would be freed up to patch up fiscal holes in the state’s Medicaid program through a provision in Amendment 35, approved by voters in 2004. The amendment allowed the state to increase an excise tax on tobacco products in order to fund expansions in Child Health Plan Plus and Medicaid, primary care serving the uninsured and medically indigent, prevention and treatment of cancer, cardiovascular and pulmonary diseases; and tobacco cessation programs.

Sen. Kent Lambert, R-Colorado Springs, said the introduction of such a resolution appears to be likely and quite possibly could become inevitable once December’s revenue forecast is known.

“I’m sure this will be brought forward this year,” said Lambert. “However, I think there’s going to be some debate on it trying to figure out where we are in all of this.”

House Minority Leader Sal Pace, D-Pueblo, said today that he will be taking a wait-and see-approach on the necessity of declaring a state fiscal emergency until more is known on the numbers front.

“I’d have to see what the budget is looking like and what kind of money we’re talking about,” said Pace. “There’s a down side any way you look at it.”

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