Colorado budget proposal averts severe Medicaid, education cuts; transportation among areas trimmed

Nick Coltrain, The Denver Post on Mar 28, 2025

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DENVER — Colorado budget writers have finalized the state government’s proposed spending plan — and they’ve done so without long-feared draconian cuts to Medicaid and education.

The powerful Joint Budget Committee, which wrapped its work Wednesday night, started the process last fall with a $1.2 billion spending hole it needed to fill. State spending, driven primarily by mandatory Medicaid costs for the lowest-income Coloradans, had been outpacing caps set by the Taxpayer’s Bill of Rights, or TABOR.

The size of the shortfall, out of a $16 billion-plus general fund budget, left the bipartisan membership of the committee and others worried they’d have to sever services for some of the most vulnerable Coloradans, or set back education goals. Instead, they preserved — or even gave small increases — to some of the services they consider most vital.

The JBC’s proposal — which now goes to the rest of the legislature — sets aside $150 million to boost education spending and gives Medicaid providers a small increase to their reimbursement rates.

“I think that this is a budget that everyone will be upset by and that everyone can be proud of,” said Sen. Jeff Bridges, a Greenwood Village Democrat and the chair of the budget committee. “We had to cut $1 billion, and we did it in ways where we are still maintaining our commitments to Colorado.”

To underscore the point, Bridges emphasized that the six-member, bipartisan committee voted unanimously to approve the budget proposal. He contrasted it with the partisan rancor and wanton budget slashing at the federal level in Washington, D.C.

But the cuts the committee did make — touching on alternative transportation programs, youth mental health screenings, and money for food banks — as well as delays for other programs would likely leave lawmakers filling another spending hole next year, members said.

“We’re going to have some really hard decisions next year,” Sen. Judy Amabile, a Boulder Democrat on the spending committee, said. “We took a lot of one-time money this year. We also took a lot of ongoing savings, but it’s going to be harder to find the one-time savings next year than it was this year.”

The committee’s finalizing of the budget package is only its first step to approval.

Officials plan to formally introduce the spending package next week in the Senate, where the full body will have a say on it. After it passes the chamber, it will go through the same process in the House before landing on Gov. Jared Polis’ desk.

A balanced budget is one of the few must-pass pieces of legislation every year. The spending plan covers the next fiscal year, which begins July 1.

Sen. Barbara Kirkmeyer, a Brighton Republican on the committee, likewise warned that she’s “concerned” for next year. This year’s proposal ultimately protects her strongest priorities of Medicaid, education and child welfare, she said, but it’s also “gliding” into next year’s budget crunch, versus crashing into it.

While Democratic members on the committee say the TABOR cap artificially constrains state spending — and that the time may be approaching to ask voters to modify the spending limit somehow — Kirkmeyer argues “you cannot spend your way out of a structural deficit.”

“It’s the overspending that is constraining our budget,” Kirkmeyer said. “And while maybe we weren’t outrageously overspending, we did a lot of one-time cuts. They’re not ongoing general fund cuts, which is what’s going to make a huge difference. So next year, we’re going to be back in the same position of (having) to find cuts in our general fund budget.”

The budget committee is also watching federal spending decisions keenly. Medicaid makes up about a third of the state general fund budget, and it is matched by federal dollars. The program provides health care for about 1 in 5 Coloradans. It could also be on the chopping block as Republicans in Congress look for ways to cut spending to pay for a new tax cut and spending package.

If that were to happen, Colorado lawmakers warned, they may need to take drastic action with state spending.

“It seems clear that Republicans in Congress will need to severely cut Medicaid to pay for their tax cut,” Rep. Emily Sirota, a Denver Democrat on the budget committee, said. “If that is the case, it makes most of the changes that we are doing this year moot as we will likely have to restructure the whole program.”