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Publish Date: 8/30/2005

Owens says higher ed in need of C, D

LONGMONT — Higher education will be “a huge beneficiary” if Colorado voters approve Referendums C and D but will bear the brunt of further state budget cuts if those measures fail, Gov. Bill Owens said Monday.

If voters reject the statewide ballot measures Nov. 1, the state budget’s annual general-fund support for Colorado public college and university systems’ operating expenses would likely be reduced, Owens said, and those institutions will probably have to become even more dependent on cash from other sources, such as higher student tuition and fees.

The governor, who is campaigning for passage of the pair of ballot questions, made those predictions during a meeting with the Times-Call’s editorial board.

Referendum C asks voters to allow the state to keep and spend a projected $3.7 billion it will collect over the coming five years, money that otherwise will have to be refunded because it exceeds revenue-growth limits set by the Taxpayer’s Bill of Rights section of the Colorado Constitution.

At least 30 percent of that $3.7 billion would have to be spent on community colleges and other higher-education institutions, if voters approve Referendum C.

Referendum D asks voters to let the state issue up to nearly $2.1 billion in bonds for transportation improvements and other projects and programs – including $50 million for repairing, maintaining, replacing, and making safety improvements to state university, college and community college facilities.

Opponents of Referendum C have argued that state government should tighten its fiscal belt to live within TABOR, setting new spending priorities and making cuts instead of keeping TABOR surpluses.

But Owens and other supporters of Referendum C say that if that measure loses, state government has little latitude in where to make such cuts because of federal mandates that annually force up the state’s share of spending on Medicaid programs for the needy and because of a state constitutional mandate to annually increase spending on public kindergarten-through-12th grade education.

Owens noted Monday that in the face of slumping revenues during the recession, the state since 2001 has already made annual budget reductions in tax-supported general-fund support for higher education.

Some of those cuts in state general-fund subsidies for college and university operating expenses were offset by tuition and fee hikes, Owens said.

But he added that at some point, “we start to price the middle-class family out of being able to afford higher education.”

Colorado will be in a position of making TABOR refunds at the same time it is cutting general-fund budget spending if voters reject Referendum C, Owens said.

He said any cuts will have to preserve what he called “the minimal functions of government.”

Higher education, though, would probably have to be moved to a more self-sufficient “cash basis” of covering college and university systems’ operating expenses, the governor said – “making kids pay more and more of the costs themselves.”

Beginning this year, the state started apportioning much of its general-fund budget support for higher education through College Opportunity Fund “stipends” that direct state money to colleges and universities on the basis of the numbers of Colorado high school graduates enrolling in each of those institutions.

Those stipends, often called vouchers, now amount to about $2,400 for each Colorado high-school graduate attending a public college or university in this state.

Owens’ budget office has estimated that the magnitude of cuts that might be needed if Referendum C loses could lower the value of the stipends to $768 per student in 2006-07, a 68 percent reduction.

“This would be in addition to cuts in other areas of higher education, such as graduate programs,” Owens’ Office of State Planning and Budgeting staff said in a July 18 memo.

Owens said if C and D lose, Colorado will also not be able to accelerate its spending on transportation projects, leaving the state with “trying to maintain what we have.”

The governor said if voters reject the referendums, the state’s inability to make investments in higher education, transportation and other services and programs will mean that “the net present value of Colorado drops dramatically.”

Owens said businesses may then decide against locating or expanding in this state, “because year after year the discussion here is going to be: How is Colorado going to pull out of its budget problems?”

Owens’ eight-year tenure as governor is to end when his elected successor takes the oath of office in January 2007. But he said he doesn’t want to leave Colorado’s current fiscal problems up to that successor or future legislatures to have to solve.

“I’d rather do it now than go through three or four or five more years of really bad news for the state (before) it finally can be fixed,” Owens said.

John Fryar can be reached by e-mail at jfryar@times-call.com.

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