The data is in – welcoming immigrants to our state and our communities benefits us all, according to new research compiled by the Immigration Policy Center.

 It shows that:

·      Immigrant entrepreneurs generated $1.2 billion in business revenues in Colorado in 2010. Almost 10 percent of Colorado business owners  are immigrants, creating jobs and helping local communities thrive.

·      Nearly a quarter of all graduates in science, technology, engineering and mathematics (STEM) fields from Colorado’s top research universities in 2009 were immigrants, adding to Colorado’s trove of knowledge-based industries and increasing Colorado’s competitiveness.

 ·      Expanding the number of visas for high-skilled workers in the state would add 5,600 new jobs by 2020 and more than $2 billion to Colorado’s economy over the next 20 years.

Luckily, Colorado leads the way in creating initiatives that welcome new immigrants and build cohesive communities, according to IPC. The state recently became the first in the country to repeal its anti-immigrant “show-me-your-papers” law. It made a quality state university or college education a little more affordable for immigrant children by passing a tuition equity bill. And local communities, like Denver, Boulder and Littleton, have started both public and private “welcoming” programs that help support immigrants and foster mutual trust and understanding amid cultural differences.

But Colorado can do more and we should start by committing to immigrant kids. This November, voters should approve Amendment 66, the ballot initiative that will fund the education reforms already passed by the legislature this spring. Those reforms increased support for English-language learners, ensuring that our newest Americans – immigrant children – will get the head start they need to succeed. 

A stronger economy and brighter future for Colorado depend on it.

Learn more about 66 at the Colorado Commits to Kids Campaign. 

By Marlana Wallace

While Colorado has almost recovered all of the jobs it lost during the recession, job growth has not kept up with population growth, and wage gains have mostly benefited those at the top. These troubling trends show the critical need for education policies that help all Coloradans prosper.

At first glance, the news seems good: Colorado’s economic recovery is among the strongest in the nation. This past year, employment rose faster in Colorado than in 46 other states.  And overall, wages are up, increasing faster than in 43 other states. But digging deeper into these seemingly optimistic numbers reveals the disturbing reality that not all Coloradans are benefiting from the recovery.

Yes, employment is growing in Colorado, but so has the population. The number of jobs created in the past six years lags behind the number of jobs necessary to keep pace with population growth.

Yes, wages are up, but these recent gains are not widespread, according to the latest State of Working Colorado Report.  For the bottom 20% of wage earners (those making under $20,262 a year) wages adjusted for inflation grew by only 1% since 1980, while for the top 20% (those earning over $101,582) they grew by 19%.  The bottom line is that middle-class and low-income Coloradans are not experiencing the wage growth benefiting those at the top.

In fact, even as companies’ profits are rising, many workers’ real wages are falling. This disconnect between rising productivity and falling wages is a threat to Colorado’s middle class.

Lots of Colorado families bring home low wages in part because they are still not able to find the full-time jobs they need to make ends meet.  The recession and subsequent weak job market forced many to settle for part-time work. Although the number of involuntary part-time workers has started to decline, it is still larger than prior to the recession.

Some Coloradans face bleaker job prospects than others. More Latinos are working part-time than want to be. Those with the least education are more likely to be unemployed or working fewer hours than they would like.

Fortunately, there are some things we can do to begin turning the situation around and putting more people on the pathway to prosperity.

One of the most important is investing in education, from pre-school to college.  Better educated Americans fared much better during and after the recession than others, and we need to do more to ensure that all Coloradans have access to affordable, high-quality education. Currently, low-income and minority students are less likely to graduate than white students and those from wealthier households.   These disparities start early in life and carry through to adulthood. For instance, Coloradans with a Bachelor’s degree make 60 percent more on average than those who didn’t finish college.

Coloradans have an important opportunity to address some of these problems by supporting the upcoming ballot measure, Colorado Commits to Kids.  It would improve education by generating essential funds for full-day kindergarten, half-day pre-school, smaller class sizes, school districts struggling to generate enough local funding, and English language learners.

An economy that is recovering for some and dismal for others is not the recipe for a strong Colorado.  Promoting prosperity for everyone should be our goal.

By Kathy White

Half a million Coloradans will have a harder time putting food on the table this Thanksgiving when a temporary boost to the Supplemental Nutrition Assistance Program, or SNAP, expires on November 1^st.  These cuts are bad for families and bad for Colorado’s economy. (See our new report with the Center on Budget and Policy Priorities)

These cuts will increase hardship for many Coloradans struggling to feed themselves and their kids. The average SNAP benefit will drop by about $29 a month for a family of three. This means that families will now need to make do on roughly $1.40 per person per meal – a real challenge when the price of healthy fruits and vegetables keeps going up.

The cuts will also mean the loss of $55 million in federal money that flows to every community in the state, money that has a powerful ripple effect in local economies. Moody’s Economy.com found that every $1 in SNAP that a family spends generates about $1.70 in total economic activity. Every $1 billion in food purchased by families with SNAP translates to 3,000 U.S. farm jobs, according to one study. Many more jobs distributing, packaging, stocking and selling food rely on SNAP. When we cut SNAP, we all suffer. 

As the economy continues to recover and families get back on their feet, slashing SNAP benefits just doesn’t make sense. Congress should act now to protect SNAP funding and keep us all moving forward. 

By Chris Stiffler

Colorado’s economy isn’t performing as well as it could, and one big reason is the nation’s dysfunctional immigration system prevents thousands of people from realizing their full working potential. 

Although Colorado already depends on the economic activity of the unauthorized immigrant population (about 5 percent of the state’s labor force is undocumented), their contribution could be much greater. For these workers are not just workers –they are consumers, tax payers, neighbors, entrepreneurs, students, with the potential to be higher-spending consumers, higher-paying taxpayers and more productive workers.   

 A path to citizenship will help employ workers in jobs that best suit their skills which will manifest in higher wages.  Naturalized immigrants make more money — 10 to 15 percent more, we estimate – than non-naturalized immigrants with the same demographic and human capital characteristics.  

Why does obtaining citizenship boost wages?  Removing the uncertainty of unauthorized status encourages immigrants and their employers to invest in education and training that eventually leads to stronger skills and higher wages.  Legalization signals employers that workers want to be rooted in American society. And legal immigrants are more likely to open more bank accounts, move to better jobs, buy homes, and start businesses.

Citizenship provides a people with an incentive to improve their English language skills and other forms of education that helps them get better jobs. 

Another reason why legalized immigrants get higher-paying jobs is that the risk to employers for hiring them disappears.  Many employers won’t hire undocumented labor and those that do usually compensate for the risk by paying immigrants less.  And, newly-authorized workers would be granted the same worker protections as others, making them less likely to be victims of unsafe working conditions or being cheated out of pay. 

Legalization makes a huge difference in other ways. Today, undocumented immigrants face deportation if caught.  So, many pursue low-paying jobs often well below their skills because their status is less likely to be discovered.   Legalization would allow workers a better chance to rise as high as their skills and education will take them. 

Legalization also would increase immigrants’ already strong entrepreneurship.  Bringing new ideas and connections to the Colorado economy, immigrants start small businesses at a high rate.  Colorado’s documented immigrant population already contributes significantly to small business activity in the state, adding 9% of Colorado’s entrepreneurship.  Legalization would make it easier for undocumented business owners to obtain loans, rent property, and apply for government permits, making them more likely to start small businesses or expand existing ones. 

 Legal status could boost the wages of 115,000 previously-undocumented workers by up to $4,000 a year.  As newly-legalized workers and families spend new earnings on clothes, groceries, apartments, and restaurant meals, it creates a ripple effect through the economy — stores sell more and hire additional workers

Legal status would also increase the tax contributions of the immigrant population for two reasons.  First, higher wages mean paying more in income and sales taxes.  Second, more people would come out of the shadows and file income tax returns.  Immigration reform would increase the newly-legal immigrants’ tax contribution to Colorado by $43 million, according to the Institute on Taxation and Economic Policy.

In short, federal immigration reform would help unleash economic productivity in Colorado, to the benefit of everyone. 

The Colorado Fiscal Institute provides credible, independent and accessible information and analysis of fiscal and economic issues facing Colorado. Our aim is to inform policy debates and contribute to sound decisions that improve the well-being of individuals, communities and the state as a whole. As a new organization, we are building a list of supporters and activists and would like to regularly share with you news about our issues and our work.  Just click on the Join our Email list button to the right and we will keep you up to date on the fiscal and economic policy debates shaping our state and nation.

Carol Hedges–Director

By Chris Stiffler

Imagine that on your way to work tomorrow, you are arrested by law enforcement and detained by Unites States Immigration and Customs Enforcement (ICE).  You don’t know how many days the detention will last.  What happens at your job?  Who watches your children?  How do you put a dollar figure on the time missed from work or the time away from your family?

Thousands of Colorado immigrants each year face these uncertainties as the result of a Colorado law, known as SB90, which requires local peace officers and agencies to report anyone arrested for a criminal offense, who they reasonably believe to be undocumented, to ICE

In an earlier report, CFI found that as a result of this 2006 law, thousands of immigrants were being arrested, held and detained in county jails for long periods of time for low-level offenses, costing Colorado taxpayers and communities millions of dollars each year in jail and detention expenses.

The costs of local immigration enforcement, however, go well beyond the police work hours, administrative booking fees, and incarceration costs.  When we detain immigrants for low-level offenses that typically would not result in any jail time, we remove an employee from an employer, a parent and caregiver from a child, and a taxpayer and consumer from the community. When people are detained, they miss work during the days incarcerated (missed days worked) and also face indirect consequences (e.g., losing their job because of the missed week of work).

According to the dataset, 85 percent of those detained on an ICE notification missed at least one day of work.  We calculated that $91.75 on average is lost in wages each day that an individual is held in Colorado facilities on an ICE notification.  With over 24,200 ICE notifications a year in Colorado averaging 4.2 days in jail, this means that $9.5 million is lost in spending from the Colorado economy and $855,000 in lost tax revenue due to the lost employment that results directly from the time spent holding Colorado immigrants – often times for low-level infractions – for ICE

Check out the full report available here as well as the personal stories of individuals experiencing ICE holds. 

By Kathy White

Unlike many states, Colorado’s process of developing a state budget is very similar to the process followed by Congress and the President at the national level. First, like Congress, Colorado budgets every year for the following year. Some states like Texas or Minnesota write a budget that carries them through a two-year period. These states believe that biennial budgeting helps keep the process cleaner, meaning it’s less likely for the budget to be held hostage to more controversial pieces of legislation.

Also like the federal process, where the President first offers a budget that Congress can either follow or disregard, the Governor of Colorado introduces his or her budget in November each year, prior to the official start of the legislative session in January. Most states vest more budget power to the executive branch than Colorado does. In Colorado, the Governor’s budget outlines his or her policy priorities and reflects executive department requests, but the state legislature, like Congress, can then perfect it or pitch it as they see fit.

What did Hick say? Take a peek at the Governor’s request here:
http://www.colorado.gov/ospb

This legislative budget process starts with Colorado’s powerful Joint Budget Committee, a six member, bi-partisan legislative committee that meets year-round. The Joint Budget Committee (JBC) balances power between the House and Senate and minority and majority parties. It is comprised of three members of Colorado’s House of Representatives and three members of the Senate. The Chairs of the House and Senate Appropriations committees must serve, plus one member of the majority and one member of the minority from each house. Historically, members are either appointed to the JBC by leadership (House) or elected by their respective caucuses (Senate). The Chair of the Joint Budget Committee alternates between the Chairs of the Senate and House Appropriations committee each year. Once on the JBC, these six members take their charge to oversee the fiscal affairs of the state very seriously. And more than any other, these six people “control the purse” in Colorado.

Who are those people? Find out who your Joint Budget Committee members are here:
http://www.tornado.state.co.us/gov_dir/leg_dir/jbc/jbchome.htm

Soon after the Governor presents his or her budget, the JBC and its nonpartisan staff schedule meetings with state departments – education, corrections, higher education, transportation, etc. Each department goes before the JBC to brief the members on its budget request. It is during these department briefings that the JBC has the opportunity to learn about the mission and goals of each department, as well as any major cost drivers. For example, the Department of Education might present on the expected increase in student enrollment or the Department of Corrections might highlight the impact new mandatory sentencing requirements will have on the number of inmates they’re required to house.

Why does that cost so much? Get briefing documents here:
http://www.tornado.state.co.us/gov_dir/leg_dir/jbc/2012-13/jbcstaffdocs.htm

After all state departments have had an opportunity to make their case before the JBC, the Committee and its staff will begin constructing a line-item budget for every program of every department. The Committee considers and votes on each appropriation and the number of employees (full-time equivalents or FTE) each department needs to carry out its mission. This process is called “figure setting.” The public can observe department briefings and figure setting hearings, but they may not testify or provide input in any formal way.

Once the General Assembly certifies the amount of revenue that the state can appropriate (there are limits in Colorado), the JBC drafts the Long Bill. It’s called the Long Bill because, well, it’s long.  The bill contains funding for every program in every department by revenue source (general tax revenues, fees, federal funds, etc.) and provides policy guidance through footnotes and headnotes. The JBC then harmonizes the mass of these decisions within the constraints of available revenue, and other statutory and constitutional requirements, and that document becomes the Long Bill.

Did you know that Colorado, like most states, has a constitutional requirement for a balanced budget?
Or that Colorado has some of the strictest constitutional limits on raising taxes?
Read our constitution here: http://www.lexisnexis.com/hottopics/Colorado/

About mid-way through Colorado’s 120-day legislative session, the Long Bill drops.  If the Chair of the JBC is a Senator, the Long Bill is a Senate bill. If the Chair is a Representative, the Long Bill is a House bill. However, unlike other bills, which begin in a committee of reference (e.g. education bills go to Education committee) and provide an opportunity for public testimony, the Long Bill goes to the party caucuses (Republican and Democrat). The Long Bill does receive a perfunctory hearing in the Appropriations Committees, but public testimony is typically not encouraged nor do people usually take the opportunity to speak their minds. All the action happens in the caucuses.

See this year’s Long Bill SB13-230 here:
http://www.leg.state.co.us/CLICS/CLICS2013A/csl.nsf/BillFoldersSenate?openFrameset
Remember it’s long!

As the parties debate the budget, JBC members explain their budget decisions and, for the most part, defend the budget document. It’s at this point in the process where JBC members seem more like pragmatic policymakers and less like partisan politicians. Again, individual members of the caucuses can be lobbied, but public input is not allowed in any formal way during the caucus debates. The caucuses can adopt proposed changes and legislators can offer amendments to the bill when it moves the floor for debate. Once the separate chambers adopt the Long Bill, the JBC acts as a conference committee to reconcile any differences between the two versions of the bill.

After both chambers adopt the conference committee report’s reconciled version of the bill, it heads to the Governor’s desk for approval and signature. The Governor has 10 days during the session to veto a bill or a portion of the Long Bill. The Governor in Colorado has line-item veto authority only, meaning he or she can give a thumbs up or thumbs down to the entire line. The Governor does not have the ability to change or amend appropriations, footnotes or headnotes and the legislature can always also override the Governor’s vetoes with a super majority vote.  They almost always allow themselves time within statutory guidelines to override vetoes.

Follow the status of the Long Bill or any bill under Status Sheets, here:
http://www.leg.state.co.us/clics/clics2013a/csl.nsf/StatusAll?OpenFrameset

Once adopted and the legislative session ends, the JBC staff prepares the Long Bill Report, or the Appropriations Report, and publishes it on July 1. The Governor is charged with implementing the budget throughout the year, while legislators are off session. If the budget becomes “out of whack,” say, with declining revenues, the Governor can direct executive agencies to make budget cuts. This has happened in the past, but typically, changes to the budget are made through “supplemental appropriations” after the legislature gets back to work in January.

The Long Bill is arguably the most important bill considered by the General Assembly each year, because, after all, it’s a budget. And no document expresses policy priorities or reflects values more than a budget. But, unfortunately, the Long Bill follows the least transparent process of any bill considered by the legislature. All members of the General Assembly do not benefit from the months of briefings and debate that JBC members have. More importantly, the public is not allowed to testify or comment during department briefings, caucus debates or floor debates. Individuals, corporations, associations and other interest groups can lobby individual Senators or Representatives and have an influence on the budget, but their efforts and their influence are “off the record” to the general public today and forever.

The Long Bill process in Colorado provides a fascinating look into our homegrown version of democracy. As with any budgeting process – whether done at the federal, state, city, business or even family level – the Long Bill is worth following.  And like all budget processes, it’s worth asking…no, imperative that we ask: What priorities does this budget reveal? Who’s influence does it mask? What values does it express? And do I share those values? And if I don’t, what do I want to do about it?

The Senate has passed this year’s budget and it’s on to the House for consideration.

By Kathy White

According to a new analysis by the Center on Budget and Policy Priorities, the budget resolution developed by House Budget Committee Chairman Paul Ryan and recently passed by the U.S. House of Representatives makes deep cuts in federal support for health care and other services that the state of Colorado and local communities provide. This cost shift to states will force local communities to eliminate or reduce services and threaten the economic recovery just taking hold in Colorado.

Estimated Cuts of 20.1 Percent to Grants to Colorado in 2014
$334 Million

Estimated Cuts to Colorado over 2014-2023 Under the Ryan Budget
$3.3 Billion

The Ryan budget dramatically cuts Medicaid funding. The Ryan budget would repeal the Medicaid expansion under health reform and cut federal funding for the program by another 31 percent by 2023. The budget block grants Medicaid and the Children’s Health Insurance Plan and restricts growth in funding to below projected growth over the next 10 years, ensuring year-after-year cuts in health care services for struggling Coloradans.

The Ryan budget proposes deep cuts in discretionary funding, 20 percent below cuts already included in the Budget Control Act. These cuts will result in major reductions in high-priority services like transportation, early childhood education, special education, housing assistance, rental assistance for low-income people, energy assistance, nutrition support for expecting mothers and young children, mental health and substance abuse services, community health centers, workforce development and public safety.

The Ryan budget contains cuts far worse than sequestration reductions. Sequestration cuts to affected programs are expected to be 7.3 percent, on average, in 2014, including most discretionary grants to states and localities. These cuts, which went into effect this month, and are set to continue for nine years, will gradually decline.

Leachman, Michael, Richard Kogan, Vincent Palacios and Kelsey Merrick, “Ryan Budget Would Shift Substantial Costs
to States and Localities.” Center on Budget and Policy Priorities, March 27, 2013.

By Chris Stiffler

In the continuing saga to adequately fund public education in Colorado, the graduated income tax has emerged as a front runner proposal.  Of course, the idea of having those with the most income pay the highest percentage of income tax has set off a series of claims about how destructive a graduated income tax is to long-term business activity.  The debate about the economic impact of a flat income tax compared to a graduated income tax is worth having, if the discussion is grounded in facts.  Before it occurs I suggest that we establish a few ground rules.

Ground Rule 1: The first step in the debate is to answer the question “How do you measure state economic performance?”  By GDP?  Median income?  Unemployment rates?  Poverty Rates?  Measures of inequality?  The Colorado Fiscal Institute believes that traditional indicators like GDP only address economic transactions and ignore social costs.  A complete debate will address an income tax’s effect not only on broad economic factors but also on factors that capture quality of life. 

Ground Rule 2:  Teasing out the complex impact of tax policy on state economies is not simple.  It cannot be done by simply saying “this state has highly progressive income taxes and its economy is stalling, therefore progressive taxation causes economic stagnation.”  This would be like claiming someone is bad at basketball because they are short while ignoring speed and shooting percentage. The fact is, credible academic literature that includes control variables often finds that state income tax structure—rates and levels—have little impact on growth.  There are just too many other factors that influence economic health.  

Ground rule 3:  No cherry-picking allowed. Both opponents and proponents of a graduated income tax can selectively choose data to support their case.  Opponents of a graduated income tax often cite California whose progressive income tax allegedly drove away business as a warning.  While proponents of a graduated income tax can simply counter showing that Oregon has the 4th highest personal income tax burden and one of the most progressive income taxes in the country, yet it has experienced one of the highest growth rates in real GDP per capita in the country the past decade.   The debate must compare a variety of factors, including issues of equity.

Ground rule 4: A truly genuine discussion about income tax must also address both incidence and adequacy.  The discussion of tax system structure is incomplete without considering the economic impact of public investments in both education and infrastructure as well as the economic cost of shifting more taxes onto middle and low income families.  Counting total jobs and broad GDP measures doesn’t reveal how the typical family is fairing.

A robust discussion of income tax structure is long overdue in Colorado.   Our single rate structure is unique; only seven other states use a single rate structure. Unique doesn’t necessarily mean better.

Let the discussion begin about the best way, economically and socially, to provide the education system our kids need to be prepared for the challenges of a world economy; let’s just do it based on facts not fear.

By Ali Mickelson

It’s hard to believe but starting March 1, schools, mental health facilities, housing providers and national parks will have to start laying off or furloughing workers and reducing services in Colorado communities The continuing Congressional stalemate on the deficit reduction has resulted in blunt, across-the-board budget cuts that will have a detrimental impact on jobs and public investments across the country and here in Colorado. These budget cuts, known as sequestration, impact schools, small business, food safety, research and innovation and mental health care. In Colorado, they mean another blow to services that are just being to recover from the Great Recession.

Specifically, Colorado sequestration cuts in 2013 include:

Teachers and Schools: Colorado will lose $8.4 million in funding for K-12 education. This will result in the loss of  approximately 120 teachers. In addition, Colorado will lose $81 million in funds for special education, resulting in the loss of 100 teachers, aides and staff who help children with disabilities.

Preschool: The Colorado Head Start and Early Head Start preschool spots will be eliminated for roughly 700 students.

Higher Education: Roughly 1,170 fewer low-income students will receive financial assistance for college and 430 fewer students will be able to get work study jobs.

Child Care: Up to 300 low-income children could lose access to child care.

Vaccines for Children: Around 2.240 fewer Colorado children will receive critical vaccines that prevent diseases such as measles, mumps, rubella, tetanus, whooping cough, influenza and Hepatitis.

Meals on Wheels: Colorado will lose $720,000 that provides meals for seniors.

Job Training and Assistance: 14,810 fewer Coloradans will receive support and training needed to find employment.

Substance Abuse: Colorado will lose $1.3 million in grants that help treat and prevent substance abuse resulting in 3,500 fewer spots available in substance abuse programs.

Environment: Colorado will lose $2 million in environmental funding to ensure clean air and water and prevent pollution, as well as $1.2 million in grants for fish and wildlife protection.

Defense: In Colorado, 12,000 Department of Defense employees will be furloughed, resulting in a $68.5 million reduction in income moving in the economy. Additionally, Army funding in Colorado will be reduced by $57 million and Air Force funding by $8 million. 

Our economy is in a fragile recovery so it is more important than ever that Congress avert additional cuts that cost us jobs. Our economy and communities need a balanced approach to deficit reduction. That balance begins with reforms to the tax code that generate new revenue from corporations and wealthy taxpayers. A solution that includes additional revenue is the best path to future prosperity. Now is the time for our Congressional leaders to move beyond stalemate for the sake of our economic future.

For more information on both the Colorado and national cuts, please see:
http://www.whitehouse.gov/sites/default/files/docs/sequester-factsheets/Colorado.pdf

Ali Mickelson, Tax Policy Attorney, 720-379-3019 ext. 222, mickelson@coloradofiscal.org