With time running out to find the money to balance the 2020-21 budget, the Joint Budget Committee Thursday took their biggest cut of all: $724 million from K-12 education.
The vote was unanimous and painful.
For nearly three weeks, the JBC has been trying to find money anywhere they could to cover a $3.3 billion shortfall in general fund revenues for 2020-21.
But with a budget bill due to the General Assembly next week and still short $802.1 million, the committee did what it hoped it wouldn't have to do: cut funding to K-12 education.
Actions taken on Wednesday, such as suspending the senior homestead exemption program and cutting most state employee pay by a total of 5%, brought them down from the $1.1 billion shortfall that began the day Wednesday.
Hearing that they were just $802 million short was something of a relief to committee members. "You got under the billion-dollar mark," said JBC staff director Carolyn Kampman. "Congratulations."
With nowhere else to go, it was time to make the final call on how much the state can spend on K-12 education in 2020-21. That will be contained in the School Finance Act, also on tap for the General Assembly in the next two to three weeks.
The JBC doesn't actually sponsor the School Finance Act. That bill is carried by the chairs of the House and Senate education committees. But the JBC does set the amount available for K-12 education.
Sen. Dominick Moreno, a Commerce City Democrat and the committee's vice-chair, announced the amount that the state would spend on K-12. Moreno also recently served on the Adams County District 14 school board for 16 months.
"I share in your celebration that we are finally under a billion dollars ... but we're still off," Moreno said. The JBC has held out as long as it could, he said, making painful reductions in every department. It was also a bipartisan goal to minimize impacts to K-12 education.
But the reality is that "we simply are incapable of balancing this budget without changes to a department that represents 40% of the general fund."
Calling it painful, Moreno set aside the amount for K-12 at $3,965,881,419. That's about a $724 million cut, but as of Thursday that also assumes the General Assembly takes no other actions to reduce it as they work on the School Finance Act. And lawmakers are likely to look for ways to reduce the hit to K-12.
The $724 million would be added to the debt to K-12 education, known as the budget stabilization factor.
The BS factor is currently at $572.4 million, and with the cut would grow to just under $1.3 billion. The peak of the budget stabilization factor, when it was set in 2010-11, was $1.15 billion.
Rep. Julie McCluskie, a Dillon Democrat, said she hoped the reduction is a one-time event.
Added Sen. Bob Rankin, a Carbondale Republican, said that on behalf of the minority party, it has been a bipartisan priority throughout the process and "to maintain funding priorities for our kids."
The committee also voted to take another $100 million from the marijuana tax cash fund, and to reduce the general fund reserve — something of a state rainy day fund — from 7.25% to 3.8%.
The JBC will meet again Friday and is expected to formally declare their budget process completed. Over the weekend, the JBC staff will finish writing the long appropriations bill in preparations for the May 26 resumption of the 2020 legislative session.
Note: education cut does not reflect possible $147 million that could reduce the reduction to $577 million. Numbers supplied by Kampman and Craig Harper, JBC staff and