Joint Budget Committee  2021 Moreno McCluskie Rankin Ransom Hanson Herod.png

From left to right, top row: Chair Sen. Dominick Moreno, D-Commerce City; Vice Chair Rep. Julie McCluskie, D-Dillon; Sen. Bob Rankin, R-Carbondale

Bottom row: Rep. Kim Ransom, R-Littleton, Sen. Chris Hansen, D-Denver and Rep. Leslie Herod, D-Denver.

The Joint Budget Committee, preparing for the legislative session that resumes Feb. 16, on Thursday approved legislation that will hold K-12 school funding constant, instead of making downward adjustments in the 2020-21 budget to account for a 3.3% decline in enrollment tied to the pandemic.

Holding funding constant will allow the JBC to reduce the budget stabilization factor, the $1.173 billion debt owed to K-12 by the state, by $120.8 million, according to JBC analysts.

The bill approved Thursday will be part of a broad package of supplemental budget bills that will realign state agency budgets for 2020-21. The adjustment to K-12 is among the largest dollar-figure adjustments in that package.

Rural schools, including rural charter schools, will get a funding bump of $25 million, the result of legislation adopted in the 2020 session.

Another adjustment of $41 million in general fund support will be provided to school districts to offset a decline in local revenues. Combining those actions, funding for school districts will remain constant for 2020-21.

In a statement prior to the hearing, JBC Democrats, who make up four of the committee’s six members, said the General Assembly was forced to reduce state funding to districts and charter schools for the 2020-21 budget year, with the recognition that schools across the state would receive several hundred million dollars from the federal CARES Act.

But due to the pandemic, school districts and charter schools anticipate lower student counts than previously estimated in preparing the state budget for the 2020-21 year. “Districts are understandably concerned that reduced pupil counts could result in a reduction in the state share of total program funding for this budget year based on the School Finance Formula,” the statement said.

JBC Chair Sen. Dominick Moreno, D-Commerce City, said that despite the financial pressures the pandemic has placed on the state, the JBC looked in every corner of the state budget for ways to preserve education funding. “As we assess our priorities for this legislative session, we know how much our students and teachers are hurting, so we are pledging to do everything we can to make sure their funding is prioritized in our budget.”

The JBC also heard a plea from the Auraria Higher Education Center for assistance with 10 bond and debt service payments that are due in April and May that AHEC will not be able to cover. With institutions moving to online classes because of the pandemic, Auraria found its auxiliary services, including multiple parking garages and lots, the Tivoli Student Center, its bookstore and child care facility, were not being used. That’s revenue they depend on to cover bond payments, according to JBC analyst Amanda Bickel, and AHEC is now at risk for default. The total decline in revenue is 36%, which is substantial, she told the committee. “This is really dramatic, and I really think it is completely reasonable for the General Assembly to kick in some support here,” she said.

AHEC, which houses the University of Colorado Denver, Metropolitan State University of Denver and the Community College of Denver, asked for $5.2 million. The position of the governor’s office has been that the three institutions should kick in some of their CARES Act money, which Bickel said was “not unreasonable.” But the institutions, which do not have a legal responsibility for those payments, have not stepped up, she said. Auraria, because it is not a higher ed institution, did not get money from the CARES Act, Bickel explained.

Sen. Chris Hansen, D-Denver, pointed out that Colorado State University in Fort Collins did exactly that, using federal CARES Act money to cover their drop in auxiliary services revenues. "There’s no way we can allow [AHEC] to default," he said.

The JBC voted to run a bill that will change current law that allows Auraria to use only auxiliary revenues to cover those payments, a temporary change for the next two years. But the committee did not approve an appropriation to cover the bond and debt payments.

Moreno told Colorado Politics that details on how to cover those payments, likely shared between the three institutions and the general fund, are still to be worked out.

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