Bill to Protect K-12 Education, Healthcare Funding from Initiative 175 Cuts Clears Committee

DENVER, CO – The Senate Finance Committee today approved legislation sponsored by Senators William Lindstedt, D-Broomfield, and Judy Amabile, D-Boulder, to protect funding for core services, like K-12 education and healthcare, if Initiative 175 is approved in the November election.

“Initiative 175 is a special interest group’s irresponsible solution to a legitimate problem,” Lindstedt said. “We remain committed to doing more to fix our roads and secure sustainable transportation funding, but not at the expense of hospitals and schools. It’s time for the proponents of Initiative 175 to come to the table and work with us to chart a responsible path forward that addresses the state’s transportation needs without defunding education, healthcare, and public safety programs to the tune of $700 million a year.”

“We just finalized a bipartisan budget that required extremely painful cuts, but that ultimately protected core healthcare services and funding for education,” said Amabile. “Facing another budget deficit next year, Initiative 175 would set us even further back and threaten already precarious funding for healthcare and education. By no means is HB26-1430 a bill that we’re excited about, but it is the responsible path forward to protect hospitals, schools and essential services that Coloradans rely on, and I’m glad to see that it has already earned bipartisan support.”

If approved, Initiative 175 would require the state to spend around $700 million a year on road projects without providing any new revenue. This comes on the heels of several consecutive years of $1 billion cuts to the state budget. In order to divert funding exclusively to road construction, Initiative 175 would require $700 million in cuts to K-12 education, higher education and Medicaid, leading rural hospitals and clinics to close, tuition to increase, and to a new budget stabilization factor for K-12. In addition to devastating education and healthcare funding cuts, Initiative 175 would threaten to defund the DMV, the Peace Officer Standards and Training fund, the Emergency Medical Services fund, and DUI prevention efforts. 

If Initiative 175 were to pass in November, HB26-1430 would make a number of changes to transportation funding to mitigate the harms from the initiative. Contingent on Initiative 175’s passage, the bill would temporarily reduce the excise tax on gasoline and special fuel, vehicle registration fees and road usage fees. The reduced revenue would open up more general fund dollars to support critical government functions like education and healthcare, reducing the revenue that would have to be refunded under TABOR. Also known as the Colorado Budget Protection Act, HB26-1430 would create the Support Road Transportation Fund to house the $700 million allocated by the approval of Initiative 175. The money in this fund would replace certain transportation-related general fund transfers.

As amended, HB26-1430 dictates that if Initiative 175 is withdrawn, the bill would establish a working group tasked with making recommendations on how to improve road and infrastructure funding in a way that does not threaten other state services.

In April, the legislature passed a bipartisan budget that protected K-12 education and core healthcare services while making reductions across state departments, lowering the state’s reserve and reducing Medicaid spending to close a $1.2 billion deficit. This deficit was caused by H.R. 1’s tax cuts for corporations and the ultra-wealthy, TABOR, and growing Medicaid costs. Despite these challenges, the Joint Budget Committee was able to prevent bringing back the Budget Stabilization Factor and protect funding for universal preschool and core healthcare services.

More than 40 organizations sent a letter asking proponents of Initiative 175 to withdraw the proposal, stating that the measure would force the General Assembly to make major reductions to Medicaid, K-12 education and higher education. The letter is backed by the bipartisan Joint Budget Committee as well as transportation, education, healthcare, environment, business and labor institutions and community groups.

HB26-1430 now moves to the Senate Appropriations Committee for further consideration. Track its progress here.