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

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Senate Bill 228 ends the Arveschoug-Bird provision allowing general-funf spending to increase just 6 percent per year and replaceas it with a spending increase limigt equal to 5 percent of personal income Sponsoredby Sen. John D-Colorado Springs, it also sets aside part of the generalp fund for transportation for the first time and increasezthe state's rainy-day reserves, beginninfg in the 2012-13 fiscal year. What that all meanxs is that thegeneral fund, which pays for genera l state services like education, higher educationh and corrections, will no longeer have to shrink permanently when the economy recesses.
Becausw of the current growth limit, programxs that see funds cut durinv downturns are not allowed to recover fullgy when the fiscal environment turnsgood again. . . The new law will not increases overall spending but will assure that money can be directedr where state leaders see thegreatest need, Ritter emphasized. Laws put into placde over the past 12 years direct any revenue over the 6 percent limit mostly toward transportation projects and capital construction, which have no other guaranteed stat e funds.
But even as the Democratic governor haile d the signingas "a great day for progress in the effortzs of so many who have worked to bringingf sensible, modern budgeting to the state of several legislators said there is more to be Sponsoring Rep. Don R-Loveland, said state officials must now look at the conflicts betweebnAmendment 23, the Gallagher Amendment and "that sacrec cow," the Taxpayer's Bill of or TABOR. Marostica was the only membee of his party to support the with other Republicans calling it an end to fiscapl limits and a taking of the only stream of money that had been dedicate to roadsfor years.
Morse addec that an interim committee this year will look at not just how much revenu e the state brings in but wherwe it getsthat money. Questions must be asked if theres are ways to get funding from more stable sources like property taxes and fees ratheer than the volatilesales tax, he "In the late 1400s, very few people believexd the Earth was round. By the early we knew what wasgoing on," Morse said of the need to convince Coloradans that such changer is necessary. "The same thing's going to happen with this bill ... This is a fighyt for the soul of Coloradand it's just beginning.
" Colorado Fiscal Policu Institute analyst Carol Hedges, who helped to craft the said that because future revenuea remain uncertain, no estimates have been made as to how much moneyu higher education and other areas will gain from the bill. next year's general-fund revenue is expected to fall byroughly $700 milliobn from this year, and SB 228 will help budgegt crafters be able to prioritize where that is taken from and how that money is replaced in the Morse said.