Transportation

Key Responsibilities

CDOT's official mission is "To provide the best multi-modal transportation system for Colorado that most effectively moves people, goods, and information." To do that, the Department:

• Builds, operates and maintains operates Colorado's highway system

• 9,134 miles of highway
• 3,775 bridges
• 28 billion miles/year of vehicle travel

• Helps local local transit systems
• Manages the state’s Highway Safety Plan, including:
• combating drunk driving
• encouraging people to wear seatbelts
• enforcing speed limits
• reducing traffic deaths
• Maintains and manages some funding of the statewide aviation system
• supports aviation safety at local airports
• distributes aviation fuel tax revenue
• makes grants to local airports
  

Factors Driving the Transportation Budget

Colorado's budget for transportation doesn't even come close to meeting the state's transportation needs. For the period between 2007 and 2035, CDOT expects to have $123 billion for transportation. To sustain the current level of service during that period, CDOT says, would cost at least $176 billion. That leaves us $53 billion short of maintaining the current system over the next 30 years.

There are a few key factors that contribute to the shortfall:

• The fuel taxes Colorado historically relied on to pay for transportation are no longer keeping pace with our transportation funding needs.
• Starting in 2000, the state sold $1.5 billion in bonds to pay for TREX and other transportation projects; we're now spending a lot of our transportation money to pay off the bonds
• The legislature in 1999 and 2000 cut taxes that would have brought in revenue to fund transportation
• The federal government is cutting the amount of money it distributes to states
  

Fuel Taxes

For decades Colorado (and the federal government) paid for the transportation using revenue from fuels taxes. It was essentially a user fee, and it worked pretty well: as people drove more, they bought more fuel, which means they paid more fuel tax, which paid for expanding and maintaining the system. Then we got green and started driving fuel-efficient vehicles. That meant people could drive more and buy less fuel.

Keep in mind that our fuel taxes are excise taxes; you pay a fixed amount of tax per gallon (e.g. 22 cents per gallon of gasoline), not a percentage of the price like a sales tax. That means the state collects the same amount of tax on a gallon of gas whether that gallon costs $1.50 or $3.50.

The result of all that has undermined our user-fee-like system for funding the transportation system. (And it's had the same effect on federal transportation funding, but we'll get to that later).

TRANs Bonds

In 1999 the state came up with a plan to quickly complete some "strategic" transportation projects across the state, the so-called 7th Pot projects. It asked for and got voter approval to sell $1.5 billion worth of Transportation Revenue Anticipation Notes (TRANs). The plan was to pay off the bonds using anticipated revenue from the federal government and SB1. Selling the bonds swelled transportation revenue for a few years and let the state complete some big projects like TREX south of Denver.

In 2005 transportation funding took a double hit: all the bonds had been sold, cutting off that stream of revenue, and the state had to start making payments to bond holders. That cut the amount of money we had for transportation from $1.2 billion to $800 million.

We'll be making payments of about $168 million a year through FY 2016-17. The revenue the legislature anticipated would be available to pay off the bonds isn't what they projected. For the next few years we probably won't have any SB1 revenue, and the federal government is cutting its distribution to the state.

Tax Cuts

In 1997 the legislature passed SB97-1, know known as SB1, divert about $250 million a year to transportation. The money was supposed to be above the 6% GF spending limit and below the TABOR revenue limit.

During the 1999 and 2000 sessions the legislature passed 24 bills permanently cutting taxes. They totaled up to about $550 million at the time, which would be more than $850 million this year. The legislature's intention was to eliminate the TABOR surplus (above the TABOR revenue limit), but presumably not the money that flowed into SB1 and HB1310. Just after the tax cuts, the economy dipped. The combination of the tax cuts, the recession and TABOR ratcheted state revenue down by about a billion dollars.

That's money that would be flowing through SB1 and into transportation; it's also part of the money the legislature anticipated would be available to pay back the TRANSs bonds.

Federal Funding Cuts

The federal government is cutting it's transportation funding, including money it indicated it would distribute to Colorado. They're having the same problem with fuels taxes that we are. And they're not managing it any better. In fact, the last time Congress reauthorized the bill that distributes money to state, the sponsors missed the deadline by two years. By then, they were so desperate to pass something, that thay promised all kinds of projects to anyone who would vote "yes." (Alaska's "bridge to nowhere" was just the tip of the iceberg). Within a couple of years it became clear that Congress has promised more than the federal highway fund could afford. Now

Regional Centers

The Regional Centers serve people who can't live in the community, even with support. In general, they serve people with developmental disabilities who also have:

• a history of sex offenses
• severe behavioral or psychological issues
• severe medical problems
  

Many of the people in the RCs would otherwise be in prison.

The Regional Centers

Colorado has 3 regional centers. They're in:

• Grand Junction
• Wheat Ridge
• Pueblo

The Regional Centers offer two kinds of services:

• Institutional services called Intermediate Care Facilities for the Mentally Retarded (ICFs/MR)
• state-operated group homes that serve 4-6 people

All three of the centers have state-operated group homes. Grand Junction and Wheat Ridge also have institutional ICF/MR facilities.

High-needs Patients

The Department measures capacity, the number of people it can serve in Regional Services, in "beds." For licensing purposes, the beds in Regional Centers fall into different categories:

• Home- and Community-Based Medicaid waiver (HCBS-DD) (295 of these beds)
• Intermediate Care Facility for the Mentally Retarded (ICF/MR) (108 beds)

Over the past few years, the level of services required for people at the centers has gone up. That's forcing the Departent to adjust its staffing ratio (the number of staff per patient) to the more severe patients.

No one knows for sure why we suddenly have so many people with severe problems. It spiked in the Spring of 2007 and has stayed high ever since. It may just be a statistical anomaly.

They're concentrated at the Regional Centers partially because it's hard to keep them in the community and partially because of changes in policy:

• Since April 2003, the regional centers have used the following admissions criteria:

• extremely high needs requiring very specialized professional medical support services
• extremely high needs due to challenging behaviors
• pose significant community safety risks to others and require a secure setting

• Since April of 2008 the Regional Centers have required CCBs to remove someone from a center in order to send a new person in, which means the CCBs have been swapping lower-need patients for higher-need patients.

Regardless of the reasons, the Regional Centers have a larger number of people who need intensive services. Normal staffing is 3-to-1; three patients per employee. Some high-need patients require 1-to-1 supervision 24 hours a day, 7 days a week.

One-to-one staffing for one patient requires 5.4 full time employees; that's 3 people per 24-hour day over 7 days, plus reserve staff to cover sick/vacation days.

Adjusting the Staffing Ratio

The Regional Centers are trying to adjust their staffing ratios to match the new needs. They're doing it in three ways:

• increasing the number of staff
• reducing the number of patients
• converting existing beds to ICF/MR and building new ICF/MR facilities
  

This year the Department is asking for 43 new employees. Over five years, it intends to reduce the number of patients in the Regional Centers from 403 to 307.

Opposition to the Plan

The ARC of Colorado says effects of the Department's plan are "intolerable.

Increasing the staffing level at the Regional Centers by reducing the number of patients they accept means turning away people. That leads to an obvious question: what's happening to people who would otherwise be in the regional centers?

Prison is one obvious alternative. The ARC of Colorado says at least a dozen people are behind bars because they can't get into a regional center. People with behavioral problems often break the law, repeatedly. Without proper care, they wind up in a cycle of increasingly-long stints in jail or prison. It's an uncomfortable fact the putting high-need disabled people in prison is cheaper than caring for them in a regional center.

Others will wind up in hospitals. The ARC says it knows about two such cases already. That's not a good situation for the people with disabilities, and it puts unnecessary pressure on the health care system.

DHS says to get the right staffing ratio while keeping the same number of beds available would take 200 new employees. That would cost -- ballpark -- about $7 million.

The Governor is recommending that we spend $6 million this year to reduce the DD wait list. We could put some, or all, of that money into staffing the regional centers. It's a tough choice. Spending themoney on community services adds services to hundreds of people; spending it on regional centers would help far fewer.

Construction Freeze

"No, really, we've been working on this
already-started project for, like, ever."If you saw department directors or university presidents running around with shovels today, here's why: we're delaying the start of any new capital construction projects (new meaning not started by Oct. 1st) while we assess the state's financial situation. That puts the pressure on the get projects into the "started" category.

Governor Ritter announced the freeze today. It applies to $75 million worth of projects in the FY 2008-09 budget that haven't started and aren't necessary for public health and safety.

A lot of projects are built in phases which means they'll shut down after the current phase is completed. Projects that are already underway or were funded in previous years' budgets will continue. So will controlled maintenance projects.

The projects are officially delayed until January 31st of 2009. Department directors and higher ed CEOs can ask OSPB for an exception to the freeze.

Here's a list of the delayed projects:

Agency	Title	Cost
UCCS	Science/Engineering Building	$7,000,000
FLC	Berndt Hall Reconstruction	$15,699,453
CSU-Fort Collins	Clark Building	$2,000,000
CU-Boulder	Ekeley Renovation	$11,559,536
CU-Boulder	Ketchum	$8,435,946
CSM	Hall of Justice Demo/Classrooms	$3,516,697
PCC	Learning Center	$2,971,482
DMVA	Grand Junction Readiness Center	$3,994,432
Human Services	CMHIFL Cottage A/C	$1,806,035
Human Services	Kipling Village Remodel	$400,340
UNC	Butler Hancock Interior	$3,000,000
CSU-Pueblo	Academic Resource Center	$2,797,436
CSM	Brown Hall Addition	$2,000,000
CNCC	Craig Academic Center	$1,990,056
Corrections	Fort Lyon Expansion	$7,162,494

For a more detailed look at the capital projects, click here.

Hiring Freeze

The state isn't going to be hiring new employees while we figure out how much the financial meltdown is going to lower state revenues.

Gov. Ritter announced the freeze today. It technically takes effect on Oct. 1, but it applies to any jobs that haven't been offered and accepted by Sept 29th.

No General-Funded and Cash-Funded positions can be filled unless OSPB grants an exemption.

The freeze doesn't apply essential personnel including jobs critical to protecting health, life and safety.

The Governor's order only applies to the executive branch, but other parts of the state will probably go along to some extent. Other parts are those run by independently-elected officers, like the Secretary of State, the Attorney General and the Treasurer, the Judiciary and Higher Education.

C SAFE Run

Local governments try to get the most out of their money, but they don't want to take risks with public money. So they keep their day-to-day spending money in checkable money market accounts. The accounts earn some interest, the districts can write checks right out of the funds and, most of all, they're safe. Or were save until the financial wizards of Wall St. started drowning in their own greed.

One of the country's largest (and oldest) money market fund just froze its assets to protect itself against an “It's a Wonderful Life” - type run on its assets.

Of course in this version of the movie Jimmy Stewart would be saying:

“I don't have your money, it's in Mr. Sullivan's $47 million severance package, in the Bear Stearns bailout and a hundred other schemes for protecting rich and powerful people from their own ineptitude and malfeasance.”

Local governments in Colorado keep their spending money in two privately-managed funds. One is called the Colorado Trust and the other is called the Colorado Surplus Asset Fund Trust (CSAFE).

About 360 local governments (including school districts, water districts, etc.) put their money in CSAFE. CSAFE, in turn, invests, some of the money in three money market funds. Two of them have frozen their assets and the third is probably thinking about it. It totals up to about $1 billion out of the fund's total of $2.5 billion assets.

The money itself is probably safe. “We don't have concerns about losses here,” said State Treasurer Cary Kennedy. The problem is liquidity. Credit markets are tight and the money market funds can't get their hands on enough cash to cover all of the immediate requests for withdrawals. That means CSAFE can't withdrawal as much money as it needs to meet the requests it's getting from the local districts.

CSAFE is managing the crisis by limiting local governments to withdrawing no more than 5% of their assets per day. It's handling critical needs for more money on a case-by-case basis.

Kennedy says that's OK for now, but if it goes on too long, some districts are going to have trouble paying their bills.

Big Growth at CSU-Pueblo

CSU-Pueblo is going through a growth spurt that's both a consequence of and cause for cash-funded capitol construction.

Over the past few years, CSU-Pueblo had added a student recreation center, completely funded with student fees, and a stadium to bring the football team back on campus using money from private donors.

It's making the school more attractive and enrollment is up nearly 12% this year. The surge in students is overwhelming the dorms and the university is housing some freshmen in a nearby hotel. It's a temporary situation because the campus is adding student housing.

In the Fall of 09, Phase 1 of it's student housing expansion will open with 250 beds. Next Monday CSU will ask the JBC to OK Phases 2 & 3 of the housing project. They're both 202 projects, so JBC approval shouldn't be much more than a formality.

Thunderbowl Stadium
The Neta and Eddie DeRose Thunderbowl Stadium just hosted it's first college football game. The project cost $13.6 million.

State Employee Raises

Most Colorado state employees will get raises ranging from 3.25% to just over 7% this year (that's the state fiscal year which starts July 1st).

The raises are based on the type of job and the employee's performance. Employees who do their jobs well will get a salary survey adjustment plus a performance pay increase of 1%.

The actual raises are based on an employee's occupational group. Here's the range:

• ENFORCEMENT & PROTECTIVE SERVICES: 3.69%
• Trooper Subgroup: 7.12%
• FINANCIAL SERVICES: 5.06%
• HEALTH CARE SERVICES (includes Medical): 4.18%
• LABOR, TRADES & CRAFTS: 3.33%
• ADMINISTRATIVE SUPPORT & RELATED: 4.43%
• PROFESSIONAL SERVICES (TEACHERS): 5.13%
• PHYSICAL SCIENCES & ENGINEERING: 3.25%
  

Exceptional employees will get a 2% performance pay bonus on top of the base increase. The performance pay bonus is non-base-building and will be paid in a lump sum.

State employees' are rated based on their performance. The rating system has 3 levels.

• Level 1 employees get no salary increase.
  
• Level 2 employees get salary survey and performance pay
• Level 3 employees get salary survey, performance pay plus the performance pay bonus

Paying Off the Investment

Most students today graduate from college owing money on loans they used to pay for the education. As part of our JBC briefing on higher ed, we got these numbers on what students in Colorado owe on graduation day.

Bad News

America's economy is tanking and it's taking Colorado with it. The good news is that Colorado is doing a bit better than other states. The bad news is that we're still hurting. How bad?

Over the next five years, it cuts nearly $500 million from our General Fund and $200 million from Cash Funds. In one sense, nothing has actually changed. It just means that we're now predicting we'll have less money than we were predicting a few months ago.

By we, I mean the legislature's economists and the governor's economists. Their predictions are in the Legislative Council and OSPB revenue forecasts. They both came out today and they mostly agree on the numbers. (Not that it matters -- they're both projections. Some amount of money will actually come it and it won't be the amount in either projection).

The forecast pretty much wipes our capital construction spending. That's the money we put into new buildings and equipment and some maintenance on existing buildings and equipment.

The forecast cuts capital in the current pending to about $45 million for next year, then eliminates it for the following years. If you want to see the effect of that, look at the list of projects the Capital Development Committee has come up with. The CDC has proposed funding projects down to line 35 (the numbers on the far left are the CDC priority. The next column is the OSPB priority). The $45 million we have now would cut the list at line 17, though we could probably stretch it through 18.

That's not the likeliest thing to happen. The CDC is meeting to reprioritize the list in a way that reflects the new reality. Or new expected reality.

That's the most immediate effect of the new forecast, but it might not be the worst. The $500 million dollar change comes from a 1.3% adjustment to the revenue projection. That's not much, especially when you consider the accuracy of economic forecasts.

Legislative Council Economist Mike Mauer warned that more bad news could easily eat into our SB-1 transfer to transportation and even our GF under the 6% limit.

When money comes into our general fund it first gets set aside in a reserve account. After that's filled, it goes into what we generally think of as the general fund, the money we spend running the state. That GF is capped by TABOR at 6% over the previous years GF. If enough money comes in to let the GF grow by 6%, any excess goes to transportation, what we call the SB-1 transfer. That transfer is capped at around $250 million.

What's next in line for money? We used to call it “excess general fund reserve.” It was a good name, because it implied that the money was just padding our savings account.

In 2002 the legislature passed HB-1310. That essentially spent any excess general fund reserve. It divides whatever money is there 1/3^rd to capital construction and 2/3rds to highways.

It's that last pot of money we're losing now. But it wouldn't take much to drain money from SB-1 and the main GF account.

Higher Education Funding

State Contribution
We're adding $50 million to our budget for colleges and universities this year and another $20 million for financial aid. The money will help schools keep good faculty, maintain their labs, buildings and equipment and help hold down costs down for students. This year we're using a new way of distributing the money. About half of it goes to helping schools with the general increase in their costs; things like salaries, benefits and utilities. That means each schools General Fund revenue will go up by at least 2.2%

The rest of the money will help each college or university move closer to the state funding similar schools around the country get.

Tuition
Colorado's colleges and universities are still a bargain. They offer a top-notch education and low tuition. Here's an example. This chart compares the cost of going to CU-Boulder with the cost of going to comparable universities around the country:

The tuition data is from the CollegeBoard.

It's the same situation for nearly all of our higher ed institutions. Their tuition is low compared to their peers in other states.

But our low tuition still buys good quality. Here's how CU stacks up in the U.S. News rankings:

Rank	University
44	University of Texas -- Austin
75	Indiana University -- Bloomington
79	University of Colorado -- Boulder
85	University of Kansas
85	Iowa State University
91	University of Missouri -- Columbia
91	University of Nebraska -- Lincoln
96	University of Massachusetts -- Amherst
112	Florida State University

The JBC authorized resident undergraduate tuition increases of 9.5% for research universities, 7.5% for state colleges and 5.5% for community colleges. Those are caps. The schools don't have to increase tuition.

For the research universities, CU, CSU, Mines & UNC, tuition can't go up more than 5% for in-state students with financial need.

A substantial portion of the tuition increases will go toward financial aid, helping to offset the expense for many students.

Financial Aid
We're adding more than $10 million in financial aid aimed at the students who need it the most. It includes a general increase in need-based aid, restoring work-study funding to it's pre-budget crisis level and doubling the size of our pre-collegiate grant program. It's a big increase, but we have a long way to go before we catch up to where we used to be.

Need-Based Aid
The JBC approved a $7,270,600 increase in need-based grants. This money goes to both graduate and undergraduate students attending public and some private schools Colorado. To get the grants, students have to prove that they need the financial help. In 2006, nearly 29,000 students got grants; the average amount of the grants was just over $1,500.

Studies show that students who work part-time on campus do better in school than students who don't.

Institutional Aid
Most colleges and universities offer a substantial amount of financial aid to students using money from their own budgets. They have to put more than 2% of the money get get from tuition increases into financial aid.

Special Programs
Two specialized schools -- CU's medical school and CSU's veterinary school -- have been especially hard hit by the state's tight budgets. They never got much funding and the budget cuts pushed them to the bottom ranks of med and vet schools in the country. This year we're trying to help help them a bit.

CU Health Sciences Center
We're adding $1.5 million to the HSC to make up for the lack of GF support and help ensure that we're training enough doctors and nurses for Colorado.

College of Veterinary Medicine and Biomedical Sciences
CSU serves as the main veterinary program for most of the Rocky Mountain West. It's consistently a national leader in ved med and biosciences despite getting far less state support than similar programs in other states.


Want more information on our Higher Ed budget? Click here.

Legislative Department Budget

Most of the money for operating the legislature is in a separate bill, but these items are in the Long Bill.

(1) LEGISLATIVE COUNCIL

Property Tax Study

$638,500 GF

This is an annual audit of property values across the state. County assessors set property values in each of Colorado's 64 counties, but those values are supposed to be both accurate and equitable across the state. To make sure it works out that way, the state audits 1% of the properties in each county. The results go into a study comparing the assessed values of different classes of property. The results go to the State Board of Equalization which can order changes if it finds inequities.

Ballot Analysis

$492,000 GF

The Colorado Constitution (Article V Section 1) requires the legislature's non-partisan staff to analyze each issue that will be on the ballot and publish and unbiased explanation of them (the Blue Book). And the constitution says we have to pay for it -- including the cost of sending it out to every voter in the state.

There are more ballot issues in odd years so the Leg Council work costs more, but we even out the funding by appropriating roughly the same amount each year. The money goes into the Ballot Information Publication and Distribution Revolving Fund. we build up a balance in even years and spend it down in odd ones.

There's $1,021,180 in the fund right now. This year's recommended appropriation would bring that up to $1,513,180 which should get us through the November election.

(2) GENERAL ASSEMBLY

Workers’ Compensation

(Will get set according to JBC common policy).

Legal Services

This money covers the cost of representing the legislature in court. We can probably do with 188 hours -- the same as last year. The actual amount depends on where we set legal services rates.

Purchase of Services from Computer Center

We don't use the General Government Computer Center as much as we used to -- we use our own local area network. The actual figure will depend on the common policy amount.

Payment to Risk Management and Property Funds

(Pending the JBC's common policy)

Capitol Complex Leased Space

The legislature uses 111,981 sq. ft. The cost will depend on the JBC's common policy.

New Plan

The JBC agreed to let DPA switch $1.3 million in capital construction money from plans for a new office building to plans for the overall Capitol Complex. That plan, the Capital Complex Master Plan, will eventually layout thousands of square feet of office space in downtown Denver. .

A year ago we appropriated $1.7 million for a new mixed-use office building. The building was going to have stores on the first floor, state offices above and an attached parking garage.

It was supposed to go on an L-shaped site that stretches between Lincoln and Sherman, between Colfax and 16th. Right now there's a parking lot on the Lincoln side and an empty lot where a parking garage used to be on Sherman (the garage is still standing in the image from Google maps).

The state would issue COPs to pay for the project. The money was for planning and design, COPs were going to pay for construction. Rent from the store fronts and parking fees were going to help pay off the COPs.

DPA spent a little over $300,000 planning the project when a bigger issue came up.

Problems with the state courts building sparked the issue. That's the upside-down-U-shaped building on 14th Street between Lincoln and Broadway. It may have been a sleek design when it was built, but it's not very practical today. For one thing, the bulk of the books and files in the building have to be kept at the ends because the unsupported middle can't support the weight. The design of the overall site makes security difficult.

The odd design also leaves a lot of unused space on the lot. That's becoming a bigger problem as the courts expand and have to lease space in other buildings. The other end of the lot is home to the Colorado History Museum. The museum has its own problems. The sloped shape of the building limits the useable space. A lot of the space that is available is underground and subject to water leaks. It's also getting cramped; as the state's history grows, artifacts accumulate.

The Judicial Dept. hired the Urban Land Institute (ULI) to recommend a new design for the site. The ULI suggested moving the museum somewhere else and putting up a new 660,000 sq. ft. building for the Judicial Department. The Judicial Dept. can pay for the new building from court fees; it can even help pay to move the museum. The problem is finding a new place to put the museum. That's a separate story.

This little subplot plays out within the bigger story of the state's use of land in downtown Denver. We lease space all over -- more than half a million square feet. We pay a wide range of rents. Departments have to grab additional space when it's available, then let it sit empty until they need it. Sometimes, when they need more room they can't find it near their existing offices.

With the new administration, there's a new spirit of cooperation among the state departments. That's opening up opportunities for a more efficient and better designed Capitol Complex. The Capitol Complex Master Plan will examine the needs of all departments, find the most efficient way of grouping them, then build to meet their needs.

The reason for the rush is the growing need to plan the way we use space in the Capitol Complex. Departments are outgrowing their office space, lease rates are going up and state-owned buildings are getting run down. We've seen how things work out when we push ahead without a plan.

DPA estimates it will take a year or so to finish the plan, but that it will have enough information to make a progress report during the 2009 legislative session.

JBC Bills

Here's a list of JBC bills the committee is carrying or considered carrying.