Top Democratic and Republican state lawmakers on Wednesday joined Gov. Jared Polis to unveil the broad strokes of a roughly $700 million state economic stimulus plan, most of which is set to go to “shovel-ready” infrastructure projects, including repairs to the Eisenhower-Johnson Memorial Tunnels and Interstate 70 bridges
The shovel-ready projects will total $170 million, or about a quarter of all the spending. Hundreds of millions more is set to be spent on other, longer term infrastructure projects, like expanding broadband access and revitalizing main streets in Colorado cities and towns.
The remainder of the spending includes initiatives to invest in rural Colorado, support the recovery of small businesses, workforce training and development, affordable housing development and mental health. There’s also money for child care and support for schools and students.
House Speaker Alec Garnett, D-Denver, called the stimulus package “the main event” of the 2021 legislative session. “Get ready,” he said at a news conference at the governor’s mansion in downtown Denver, “because this is the launch of the Colorado comeback.”
The announcement comes as President Joe Biden is expected to sign a $1.9 trillion federal stimulus plan, which Congress approved Wednesday. State leaders were awaiting the details of that aid package — which includes billions of dollars for child care, education, unemployment and other needs in Colorado — before finalizing their own spending plan.
“This product that is being presented today is the work of long hours, many sleepless nights that our legislative leaders, their staff, my staff worked hard on to help Colorado build back quicker and stronger,” Polis said.
The money Colorado lawmakers are using to pay for the state stimulus plan comes from unexpected tax revenue.
The legislature slashed the state’s budget last year by about $3.5 billion in anticipation of an economic downtown because of the coronavirus pandemic. While there was a downturn, the economy has fared better than expected, leaving the General Assembly with more than $1 billion to allocate.
“This is money that we saved in our budget because we cut things so dramatically,” House Minority Leader Hugh McKean, R-Loveland, said.
Under the stimulus plan, up to $131 million would go toward boosting agriculture and rural communities, including $20 million to $35 million in competitive grants for rural agriculture infrastructure investments and millions toward forest and watershed restoration projects to protect communities against wildfire.
“We’re investing directly in rural Colorado and the industries that create jobs on the Western Slope,” said House Majority Leader Daneya Esgar, D-Pueblo.
Other spending priorities include:
- $30 million on projects to revitalize community main streets
- $60 million to $80 million in matching funds for downtown revitalization efforts and to create more affordable housing options in urban areas
- $50 million to $75 million to expand broadband internet access
- $30 million to $40 million for existing clean energy programs
- Small business support
- $40 million to $50 million in sales tax relief for small restaurants and bars
- $20 million to $30 million toward lending institutions that cater to “historically underserved” entrepreneurs
- $10 million to $15 million in one-time grants to small businesses, with a priority for rural, women, minority and veteran-owned businesses
- Community and school support
- $10 million to $15 million to rent, lease or buy hotel rooms for unhoused individuals
- $8 million to $10 million in seed funding for a program to incentivize local governments to adopt affordable housing development policies
- $5 million to $10 million to support child care businesses
- $8 million to $9 million for mental health screenings in schools
- Rural investments
- $10 million to $25 million for forest restoration and wildfire recovery projects and another $10 million to $25 million toward watershed restoration grants
- $10 million to $15 million to create new job opportunities as part of the transition away from coal
- Workforce development
- $15 million to $25 million in grants to local workforce boards
- $10 million to $15 million to help provide scholarships for people with some college but no degree
“We want these dollars to help businesses weather the current storm — and some of the storms that are probably still ahead — and help them establish a foundation for growth and long-term recovery,” said Senate Majority Leader Steve Fenberg, D-Boulder.
Each proposal will come in the form of an individual bill. That legislation has yet to be released, so the details remain unclear.
Fenberg said he expects stimulus measures to start being introduced in a matter of weeks. Polis is pressuring the legislature to act quickly so that Colorado’s economic revival can begin as soon as possible. He wants the stimulus money to be spent in the next 18 months.
The $300 million difference is because the legislators that make up the powerful Joint Budget Committee wanted to use that money to boost the state’s reserves and restore funding cuts made in 2020, said Sen. Bob Rankin and Sen. Dominick Moreno, both members of the committee.
“This is money we have, that we feel comfortable allocating and still being able to have a healthy reserve, being able to restore a lot of those budget reductions that we had to, unfortunately, we had to make last year,” said Moreno, a Commerce City Democrat and the JBC’s chairman.
Rankin, a Carbondale Republican, said he wants to ensure that when Colorado gets out of the coronavirus crisis the state is able to build a sustainable budget for future years.
“It’s a bipartisan effort to pull together, to use these monies wisely so that we not just stimulate the economy, but when we get through (the pandemic), our budget, our state finances, are in much better shape,” Rankin said.
It’s possible the stimulus package could grow larger than $1.3 billion, Fenberg said, if Colorado’s economic picture gets rosier as the pandemic wanes. Additionally, state lawmakers could decide to use the billions of dollars in federal aid that’s coming to increase stimulus spending.
A new state tax revenue forecast will be unveiled next week, and Moreno is hopeful it will show there’s even more excess money for the legislature to spend.
“If there’s more money that’s apparent later in session we’ll work with (the legislature to spend it),” Polis said.