Gov. Jared Polis, surrounded by more than half of the General Assembly Democrats, Polis administration members, State Treasurer Dave Young and the four Democrats from Colorado's delegation in the U.S. House of Representatives, announced Monday how the state will spend a $3.8 billion stimulus from the American Rescue Plan signed into law by President Biden in March.
The funds will come to the state in one big check within the next 60 days, a result of declining unemployment numbers that allows the funds to come in one allocation rather than two a year apart.
Interim Treasury rules say that the money has to be spent in four areas:
- To respond to the public health emergency or its negative economic impacts, including assistance to households, small businesses and nonprofits, or aid to impacted industries such as tourism, travel and hospitality
- To respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers
- For the provision of government services to the extent of the reduction in revenue due to the COVID–19 public health emergency relative to revenues collected in the most recent full fiscal year prior to the emergency
- To make necessary investments in water, sewer or broadband infrastructure
The Colorado plan, as outlined in a eight-page brochure, identifies $2 billion in spending that could take place in the waning days of the 2021 session. That includes $1 billion directly to the state budget. How to spend the last $1.8 billion will be decided by interim committees during the summer and put into legislation in the 2022 session, according to Senate President Leroy Garcia of Pueblo.
Of the $2 billion that will be spent this session, $1.3 billion will go toward bulking up the state budget. Sen. Dominick Moreno of Commerce City, who chairs the Joint Budget Committee, told reporters during an hour-long press conference Monday that the money will put the state on a fiscally sustainable future. Part of that includes prepaying obligations, which could include prepaying controlled maintenance projects or state compensation. Moreno said he will sponsor the first bill from the package, one that will outline how those dollars will be invested, such as in mental and behavioral health and housing.
Polis pointed to a "virtual listening tour" conducted in March and April that asked Coloradans how those federal dollars should be spent. This is "a once in a generation opportunity to improve the quality of life" in Colorado, the governor said. "We've been held back too long."
U.S. Rep. Diana DeGette of Denver said the four Democrats in Colorado's House delegation all fought hard to ensure there was aid for state and local governments in the American Rescue Plan. "This is the first time all of us have been together without masks," she said, to a handful of cheers. "Stay tuned, we're now working on an infrastructure bill."
Two of the most consequential votes he's ever taken are to accept the Electoral College vote on January 6 and for the American Rescue Plan, said U.S. Rep. Ed Perlmutter of Arvada. The American Rescue Plan delivers exactly what the country needs, Perlmutter said, with recovery taking place at both the state and local government levels.
COVID-19 has impacted every corner of the state, Garcia said, and even though the economy has rebounded faster than expected, the pandemic exacerbated many existing problems. "We have committed to use this $3.8 billion for relief for those struggling the most." The listening tour pointed to greater need for broadband access, solar energy and to recover from the economic impacts of the pandemic.
The plan outlines $150 million in the 2021 session to build housing supply, address homelessness and "remove barriers to increase housing affordability. Another $400 million would be spent on these same areas in the 2022 session.
ABout $100 million in the 2021 session will go towards mental and behavioral health programs, including substance abuse assistance, with $450 million in the 2022 session.
College students would also get help from the American Rescue Plan money, about $100 million in the 2021 session for helping them work toward degree completion. That also includes workforce development, with another $100 million toward the same goals in 2022.
Business development and job creation would be targeted for $80 million in the 2021 session and $717 million in 2022, to ensure small business recovery and full employment. That's where the broadband and solar energy investment comes from, as well as money to address some of the $1 billion hole in the unemployment insurance trust fund, according to the brochure.
Finally, transportation, infrastructure, parks and agriculture will get a $387.5 million bump in the remaining days of the 2021 session, which will "jump start urgently needed investments in public lands maintenance, state park expansion" and agriculture events, including the National Western Stock Show.
"Help is here," said U.S. Rep. Joe Neguse of Lafayette, stating that Colorado is "stronger today than when the pandemic started."
The plan will place a major focus on getting back to work, said House Majority Leader Daneya Esgar of Pueblo. "Our responsibility now is to work toward an equitable recovery." Previous recessions have seen unequal recoveries, she said, where those doing well before the recession recovered faster than those in the low- and middle-income sectors. That includes making housing more affordable and finding ways for those out of work to have a path forward to meaningful work, including learning new skills. "It's time we invest in workers across this entire state."
Majority Leader Steve Fenberg of Boulder also addressed the housing issue. A major portion of the plan will increase affordable and attainable housing, he said, including new opportunities for homeownership. That could include down payment assistance, building affordable housing, public-private partnerships for "land banking" and increasing the short-term housing supply for the homeless.
When Polis and legislative leaders announced how the state would spend $700 million (later increased to $800 million) in one-time funds leftover from the 2019 tax year, he was joined by leaders from both sides of the aisle. No Republicans attended Monday's news conference. Sage Naumann, the spokesman for the Colorado Senate Republicans, said that Minority Leader Chris Holbert, R-Douglas County, was invited but had a prior commitment and was not aware of what was being announced. Naumann also said that "none of us had seen the 'plan' being rolled out," and just told about interim committees being assembled without authority for drafting bills.
Polis, in response to a question during the press conference, said he believed some of the bills would gain bipartisan support, as well as for the interim processes during the summer.
One guideline that has been left out: bonus payments for healthcare or grocery workers or others who risked their lives to keep businesses running during the pandemic.
Polis said that many who have worked through the economic challenges also are the main beneficiaries on behavioral and mental health assistance, housing help and workforce training. "This is tailored to meet the needs" identified in the listening tour, he said. Perlmutter later told Colorado Politics that those bonus payments could still be made by local governments or school districts.