2020 was an extraordinary year. Infectious disease, virus, COVID and global pandemic became phrases used all too often. Colorado suffered. The nation suffered. The world suffered.
For many, the economic uncertainty that accompanied the pandemic was as devastating as the virus itself. As we approach the midpoint of 2021, there is a light at the end of the tunnel. The good news: recovery is in reach. The challenging news, we’re lagging behind.
We applaud lawmakers for listening to the priorities of Coloradans across the state. If we are all laser focused on economic recovery, we can as Gov. Jared Polis says, “build back stronger.”
New data from WalletHub places Colorado at 48th in their list of states that have the highest potential to recover from the pandemic. We have a long way to go.
Our starting point for recovery is reflected in one of the most important statistics, jobs. Through the end of 2020 the Colorado economy suffered as the statewide unemployment rate increased by the 2nd highest percentage in the nation, going from 2.5% to 6.6%, and the state went from ranking fourth to 37th in terms of unemployment rates. We simply cannot recover without jobs.
Instead of leading the country, we are lagging behind. At the end of 2020, Colorado had an unemployment rate worse than Illinois’. Worse than West Virginia’s and even worse than Mississippi’s. We cannot call ourselves leaders when so many Coloradans are unemployed.
The solution is the same as the challenge: jobs. Creating jobs absolutely must be our top priority. How do we do it? We unleash the job creators to do what they do best — drive our economy and create jobs.
Unfortunately, we’re doing just the opposite. The growing list of taxes, fees and regulatory red tape is stalling our recovery and crushing small businesses just as they begin to recover from the devastation of 2020. According to a Common Sense Institute analysis, the cumulative cost of new taxes and fees over the last several years will be $1.8 billion annually within the next three to five years, and the list is growing. This is a bill Colorado business simply cannot afford.
Our number one recommendation for lawmakers on the Build Back Stronger tour: Ask yourself, “Is this proposed tax or fee — no matter how well-intentioned — more important than Colorado’s post-pandemic economic recovery?”
If we give business a chance, growth and prosperity will be the result for everyone. Consider our history; the pioneering spirit that built this state is the same spirit that has spurred industries as diverse as aerospace and outdoor recreation. It’s the same spirit that made our economy the No. 1 economy in the nation in 2019. If we give the job creators a chance, we can build back stronger.
Second, we must put our financial house in order, or we risk running ourselves into a debt we cannot pay. After receiving $67.2 billion in federal relief funding, Colorado can take steps now to ensure that we are in a stronger position in the future. We urge the following spending priorities for incoming federal dollars:
• Repair the Unemployment Insurance (UI) Trust Fund. We should invest the windfall of federal dollars to shore up the projected $1 billion shortage. If we don’t, the tax bill for employers will grow 22% per year.
• Pay down some of the Public Employee Retirement Association’s (PERA) unfunded liability. This move will prevent future rate increases that reduce funding for schools and lower take-home pay for teachers.
• Save for the future and increase the state reserve fund. Prior to the pandemic, the state’s General Fund reserve requirement was 7.25%. Support the bipartisan effort to more than double that requirement to 15% by 2023.
• Invest in infrastructure. Leverage federal dollars as matching funds to jumpstart new one-time capital infrastructure projects. It’s no secret that our transportation system is failing. The Colorado Department of Transportation projects $9 billion in needs for congestion relief and repair. Our water infrastructure is also lagging. Investing in infrastructure also has the added benefit of creating jobs.
We can build back stronger. We have the people, the spirit and the experience. It just takes a little common sense.
Earl L. Wright is co-founder & chairman of the Board of Directors of AMG National Trust Bank. Walter “Buz” Koelbel, Jr. is president/CEO of Koelbel and Company.