DENVER — As Colorado's economy continues improving, lawmakers are beginning to talk about constitutionally mandated refunds to taxpayers in the coming years.
State lawmakers received the quarterly Colorado economic forecast Tuesday, including more details on the state's new recreational marijuana industry. Overall, the forecast shows an upward trend. In fact, Colorado has had 27 straight months of job growth, said Henry Sobanet, the budget director for Gov. John Hickenlooper.
"I think our tax revenue stream reflects that," Sobanet said.
The governor's economists projected that general fund revenue for the 2014-15 fiscal year will be $9.5 billion, with about $560 million being allocated to the state's reserves. The current fiscal year revenue projection is $8.8 billion.
Hickenlooper's economists revised tax projections upward since December by $93 million for the current fiscal year, and $61 million for the 2014-15 fiscal year, which is the budget year lawmakers will debate and vote on next month.
Some of those surpluses are already spoken for with the state's savings account for education, but the economic figures will play a role when lawmakers vote next month. Budget writers are cautioning lawmakers that not every project they want to see funding will get the money.
"People went kind of hog wild on introducing bills with big fiscal notes this year and we're going to have to figure out how to prioritize and deal with that once we get the budget set," said Democratic Sen. Pat Steadman, a member of the powerful Joint Budget Committee.
Legislative economists released similar projections as the governor's economists. During the recession, lawmakers were faced with dire economic projections and had to make cuts to programs. These days, the forecasts have been less dramatic.
"Well, not exciting can be good," Republican Sen. Kent Lambert said with a chuckle. Lambert is also a member of the JBC.
Refunds under the Taxpayer's Bill of Rights are not expected next year, but economists say they're possible soon. Refunds happen when state tax collections exceed those constitutional spending curbs, which are based on inflation and population growth. The last refunds happened about a decade ago.
The tax forecast was rosy, but lawmakers got conflicting and confusing information about recreational pot.
Recreational marijuana sales began Jan. 1, producing an additional $2 million that month. Voters approved up to $70 million for new pot taxes, and opinions differ on whether Colorado ends up making more or less than that.
A forecaster who works for Gov. John Hickenlooper projected the new pot taxes will produce some $107 million next year. Meanwhile, economists for the Legislature project the tax haul is about half that size, about $54.7 million next year.
Several lawmakers laughed when economist Larson Silbaugh told them, "You can basically use that January number to justify any forecast you want."
Taking a more serious tone, economists warned that Colorado's marijuana market remains extremely volatile. Lawmakers seemed to agree with the advice not to rush out and devote pot taxes to projects that will need continuous funding.
"We don't know exactly what we're facing," said Rep. Cheri Gerou, R-Evergreen.