Determining Colorado’s Future Report and Recommendations of TBD Colorado December 2012 TBD Colorado is a nonpartisan, collaborative effort to create informed and constructive conversations among Coloradans about some of the biggest issues facing the state. Core Finding: Colorado's Path Unsustainable Without Major Fiscal and Constitutional Reforms TBD Colorado participants, following many hours of informed conversation over the year, arrived at an important conclusion: the state is on an unsustainable fiscal course. Of particular concern are three relatively recent constitutional amendments – TABOR, Gallagher and Amendment 23 – whose combined effects have created an unsustainable fiscal structure. These measures have constrained the flexibility of elected officials to adjust the state’s tax structure to respond to revenue needs for essential, highly-valued services. For example, the measures have: Created an imbalance between commercial and residential property taxes, which has shifted the responsibility for funding K-12 education from local school districts to the state, diminishing local control of school districts Made it difficult to fund transportation options so that the infrastructure can be maintained and expanded to serve a growing state Required the impossible—increased spending (Amendment 23) while reducing revenue (Gallagher and TABOR) Our state has endless positive potential. Important, forward-facing actions and decisions must be made to ensure a vibrant future. Analysts from across the political spectrum may disagree on the proper course for the state, but they agree that the current fiscal structure is unsustainable. In recent years, the state’s revenues have not kept pace with the underlying growth in the Colorado economy because many of the fastest-growing sectors are either exempt from tax or are taxed at a lower rate than other sectors. Even though Colorado’s revenues are now increasing as the economy begins to recover, the state will be unable to grow its way out of the coming fiscal gridlock unless structural changes are made. Projected demographic shifts, such as an aging population and the increased medical costs that flow from those changes, will only accelerate the stresses on the state’s budget. Respecting the role of Colorado voters, who have ultimate authority on increasing taxes, revenue options must be weighed against public services Coloradans wish to receive. Coloradans need to have an honest, informed conversation about what the state’s future should look like and how to realistically achieve it. TBD Colorado’s 2012 initiative offers a foundation upon which Coloradans can undertake a process to sync Colorado’s public policies with Coloradan’s values and aspirations. i Determining Colorado’s Future Report and Recommendations of TBD Colorado Executive Summary ............................................................................................................................1 Introduction ......................................................................................................................................1 Background and Recommendations ...................................................................................................7 Education ................................................................................................................................................... 7 Health ...................................................................................................................................................... 17 State Budget ............................................................................................................................................ 20 State Workforce ...................................................................................................................................... 25 Transportation ......................................................................................................................................... 27 Additional Issue: State Constitution ........................................................................................................ 33 Conclusion ....................................................................................................................................... 35 Notes ............................................................................................................................................... 36 Board of Directors Greg Maffei, Chair Kristin Richardson, Vice Chair Heather Carroll, Secretary/Treasurer Letty Bass Maria Garcia Berry Russell George David Ethan Greenberg Roxane White Staff Kae Rader, Executive Director Program implementation was provided by Engaged Public (Chris Adams and Brenda Morrison) and Institute on the Common Good at Regis University (Paul Alexander) ii Framing Committee Members/Advisors P-12 Education Health State Budget Nate Easley Patty Fontneau Don Elliman Anna Jo Haynes Donna Lynne Cole Finegan John Hefty Denise O'Leary Gail Klapper Barbara O'Brien Sally Schaefer Don Kortz Kent Thiry Mark Wallace David Miller Anne Warhover Higher Education State Workforce Ray Baker Transportation Christine Kneeland Tillie Bishop Maria Garcia Berry Ted Trimpa Senator Hank Brown Tom Gougeon Scott Wasserman Al Yates John Huggins Mary Lou Makepeace Robert Uhler Advisory Group Members Izzy Abbass Tami Door Jim Isgar Tony Milo Bruce Alexander Lee Driscoll Kim Jordan Dick Monfort Mateos Alvarez Terry Dye Bob Jornayvaz April Montgomery Rick Ambrose Lindy Eichenbaum Lent Rob Katz Julie Mordecai Tim Andersen Renny Fagan Tom Kern Trygve Myhren Norma Anderson Steve Farber Ray Kogovsek Ralph Nagel Christine Benero Terry Farina Frances Koncilia Andrew Neinas Kelly Brough Mike Fries Becky Kourlis Jimmy Newton, Jr. Norm Brownstein Beth Ganz Charlie Kurtz George Orbanek Julie Brubaker Cathy Garcia Robert Ladenburger Chris Osborn Wade Buchanan Ken Gart Dick Lamm James Osborne Sheila Bugdanowitz Katherine Gold Eric Lee Bill Owens Joy Burns Nita Gonzales Bill Lindsay Christina Oxley Jim Burton Susan Graf Dave Liniger Alyssa Parker Jim Carpenter Mary Gunn Jack Llewellyn Theresa Peña Terrance Carroll Sandy Gutierrez Jim Lochhead Bonnie Petersen Steve Clapham Robert Hammond Bill Long Brandon Peterson Jeff Comstock Su Hawk Sarah MacQuiddy Bob Randall Kim Cordova Gary Hayes Paul Major Joe Rice Sally Covington Manuel Heart Tim Marquez Dan Ritchie Dave Csintyan Carol Hedges Crestina Martinez Bill Ritter Alicia Cuaron John Hereford Caz Matthews Trinidad Rodriguez Stephen Cunningham Barry Hirschfeld Erik Maulbetsch Roy Romer Audrey Danner Michelle Holbrook David May Dwayne Romero Denise De Percin Kyle Hybl Lee McIntyre Tony Salazar Peter Dea Walter Isenberg James Mejia Hassan Salem iii Steve Schuck Lola Spradley Ken Tuchman Lee White Diane Schwenke Gloria Stultz Ruben Valdez Dave Williams Cathy Shull Ed Tauer Bill Vidal Dot Wright Janice Sinden Marion Taylor Brian Vogt Earl Wright Ian Siverii Richard TenBraak Charlie Walling Art Zeilly David Skaggs Mary Tomky Tamra Ward Funders Anadarko Petroleum Corporation Institute on the Common Good, Anonymous Regis University Anthem Blue Cross Blue Shield Joseph Henry Edmondson Archstone Apartments Foundation George K. Baum JPMorgan Chase Bohemian Foundation Kaiser Permanente Colorado B. P. Foundation Kenneth King Foundation Brownstein Hyatt Farber Level 3 Communications Schreck, LLP Lockheed Martin Joy Burns Greg Maffei CH2M Hill Brad Maraccini Education Fund Chambers Family Fund Timothy and Bernadette Marquez Colorado Access Foundation Colorado Forum Microsoft Corporation The Colorado Health Foundation Moye White The Colorado Trust Noble Energy, Inc. Comcast David and Lucile Packard The Community Foundation Foundation (Boulder) The Piton Foundation Community First Foundation Kae Rader DaVita, Inc. Kristin and Blair Richardson Delta Dental Rose Community Foundation The Denver Foundation Safeway El Pomar Foundation Starz/Liberty Media Encana Oil & Gas Telluride Foundation Fries Family Foundation Kent Thiry and Denise O’Leary Gates Family Foundation Tuchman Family Foundation Gill Foundation United Airlines Grand County Entities United Healthcare (via Grand Foundation) UBS Financial Services Grant Thornton US Bancorp Foundation Frederic C. Hamilton Roxane White Hewlett Packard The Women’s Foundation of Hexagon Investments, Inc. Colorado IMA Foundation Xerox Corporation iv Executive Summary TBD Colorado engaged more than 1,200 Coloradans in an unprecedented effort to learn about, discuss, “With public sentiment, nothing can fail; and provide input on some of the most important Without it, nothing can succeed.” issues facing this state. Fortified by clear, accurate -Abraham Lincoln data vetted by diverse panels of subject matter experts and supported by a process designed to foster discussion and identify ways forward, Coloradans engaged in a process to determine the future of their state. Like most important conversations, TBD Colorado started with values. Even in a state as diverse as ours, there are fundamental principles that transcend geography, political party, race and ethnicity, and income status. Coloradans hold education, the outdoors and environment, efficiency and effectiveness, diversity, community and family, and personal responsibility as shared values. The 2012 phase of TBD Colorado focused on five issues: education, health, state budget, state workforce, and transportation. For each, participants reviewed data, considered a variety of options, and then worked to identify those they