Colorado’s $tate Budget Process

by Carolyn Kampman, Kate Watkins, and Patti Dahlberg

Editor’s note: This article was originally posted on March 23, 2018, and has been edited as appropriate.

Most people associate the state budget process with a couple of long weeks during the legislative session. True, the annual General Appropriations Bill or “Long Bill” must be introduced and passed between the 76th and 94th days of session per the legislative rules, but that is only part of the state’s annual budget story. The annual passage of the Long Bill marks the completion of an extensive and collaborative effort on the part of legislators, legislative staff, executive and judicial branch departments, and the governor’s office to pass a balanced budget for the citizens of Colorado.

Each year, Colorado’s budget process begins long before the legislative session convenes. In the summer, most executive branch departments submit budget proposals to the Governor’s Office of State Planning and Budgeting (OSPB). The OSPB reviews the proposals and makes adjustments based on the governor’s priorities and the anticipated amount of money available.

These executive departments then submit the approved budget requests to the General Assembly’s Joint Budget Committee (JBC) by November 1. The eight judicial agencies and the executive branch departments that are overseen by an elected official (the Attorney General, the State Treasurer, and the Secretary of State) also submit their budget requests to the JBC by November 1. The JBC staff review these requests and prepare written briefings that they present to the JBC in November and December. The JBC conducts formal public hearings with each department a week or two after the JBC staff briefing to discuss department budget priorities, operations, effectiveness, and future planning.

All JBC budget briefings, hearings, and other meetings are open to the public, broadcast over the internet, and recorded and archived. [Please note that due to the current public health emergency, JBC meetings are open to the public through audio broadcast only.] The JBC does not accept public testimony during budget hearings, but they may allow public testimony in other hearings. The JBC encourages other legislators to participate in briefings and hearings. In addition, the JBC meets with each committee of reference during the first month of the legislative session to discuss department budget requests.

From December through mid-February, the Capital Development Committee (CDC) and the Joint Technology Committee (JTC) review capital construction and information technology project requests and priorities from OSPB and hold hearings with departments on their requests. The CDC and JTC prioritize requests, finalize recommendations, and notify the JBC. The JBC ultimately reviews these recommendations and incorporates them into the proposed Long Bill.

From January through March, JBC analysts present department budget requests at JBC meetings and make recommendations regarding budget amounts, funding sources, and possible legislation needed to implement certain budget actions. The JBC votes on each department’s budget request and then invites departments to submit “comeback” requests to ask the JBC to reconsider specific budget decisions. Throughout the first half of the legislative session, the JBC meets almost daily to review, adjust, and reset line item appropriations to each department. Economic forecasts and other reports, department budget requests, and budget recommendations from the governor’s office help the JBC and its staff develop a “balanced budget” proposal, which includes the Long Bill and legislation included with the Long Bill, as well as bills introduced by other legislators. To do this, the JBC picks a budget forecast in March, either the Legislative Council staff’s or the OSPB’s, to budget to.

Introduction of the Long Bill alternates between the House of Representatives, in even years, and the Senate, in odd years. The bill is typically 300+ pages and often the JBC introduces several additional bills as part of a “long bill budget package.” This is necessary because, under the state constitution (Article V, Section 32), the Long Bill can only include appropriations; it cannot include substantive changes to the statutes. So, if the JBC makes budgeting decisions that require a change to a statute, they have to introduce a separate bill to accomplish that change. For example, if the JBC decides to appropriate a certain amount for a program, but wants to improve the efficiency with which the money is distributed, the committee will introduce a bill to change the statutory distribution method.

Once the Long Bill and any associated bills are introduced, all work in that chamber revolves around passing those bills. Committee of reference meetings and other floor work is minimized so that the legislators can meet in their party caucuses to listen to JBC presentations on the Long Bill, ask questions, and discuss amendments to the bill. It usually takes about one week for the Long Bill and its associated bills to pass each chamber. Because the second chamber almost always amends the Long Bill, a third week is required for a conference committee, which is traditionally composed of the JBC members, to meet and recommend a report that resolves the differences between the two chambers. Each chamber must then adopt the report and readopt the final version of the bill.

After the Long Bill passes both chambers it goes to the governor to sign into law. The governor can exercise the line-item veto to veto an entire appropriation; the governor cannot use the line-item veto to increase or decrease an amount. If there are vetoes, the bill returns to the General Assembly to consider the vetoes and possibly override one or more of them.

Once the Long Bill passes both chambers, the funding for existing programs and services is finalized and the General Assembly knows how much money is available for bills to create new programs or offer additional services. The House and Senate appropriations committees start meeting in earnest to pass or postpone indefinitely (PI) bills, many of which have been languishing in those committees awaiting passage of the Long Bill. The General Assembly tries to ensure that the total amount appropriated through the Long Bill and all enacted bills that fund new programs or services does not exceed the amount of revenue that the state is expecting to have available in the coming fiscal year.

A more comprehensive explanation of Colorado’s budget process is available on the Joint Budget Committee Staff homepage through the budget process and budget documents links.

Last Spring, Legislative Council staff, in conjunction with JBC staff, launched a new webpage dedicated to the state budget and the state budget process, “Explore the Colorado State Budget“. In addition to explaining the budget process and timelines, this new webpage also illustrates the state’s operating budget, budget sources, major funding requirements, state revenue sources, TABOR’s interaction with the state budget, and other budget resources and considerations. This new webpage is updated, as needed, with pertinent budget details.

For more background on the Joint Budget Committee and Colorado’s budget process, please see “Joint Budget Committee to Write State’s Budget for the 58th Time”, posted October 26, 2017.