DENVER Democrats and Republicans struck a deal on the state budget Tuesday, bringing an end to days of closed-door drama.
Democrats won lower cuts to public schools, while the GOP got tax breaks for farm supplies and software, plus payments to businesses that collect sales tax.
Around 20 lawmakers informally agreed to the deal in an impromptu meeting on the Senate floor, and the Joint Budget Committee finalized it in an official meeting in the afternoon.
The deal still means a historic cut for schools, totaling $250 million less than last years level of state support. Gov. John Hickenlooper had proposed a $332 million cut, and Senate Democrats focused their energy on minimizing the cut.
No ones happy, but everyones relieved, Hickenlooper said. They went at it hard with each other. They pushed hard for their respective goals, and everyone compromised. This is the American system.
JBC member Sen. Pat Steadman, D-Denver, reluctantly agreed to the software tax break. Steadman said the deal was made only after senators imposed a series of deadlines and ultimatums on Speaker of the House Frank McNulty, R-Highlands Ranch.
Senate Democrats trimmed $82 million from the original cut to public schools, but students and teachers will still notice the funding reduction, Steadman said.
That is going to be felt, and I cant imagine that we wont see more school districts across the state wrestling with teacher layoffs, building closures, transportation fees, Steadman said.
Republicans got at least four demands met:
Repeal in 2011 of the tax on farm and ranch supplies, like pesticides and fertilizer. Its worth an estimated $4.6 million.
Repeal in 2012 of a tax on downloaded software. Estimates on the price tag vary from a high of $24 million a year to about a third of that.
A reversal of an earlier plan to balance the budget with $8.8 million from the account filled by medical marijuana fees.
The resumption of payments to businesses that collect sales taxes. Before the recession, the state let businesses keep 3.3 percent of the sales taxes they collected. Tuesdays deal lets them keep 2.2 percent. The change is worth $40 million a year.
The money at play in the last-minute negotiations was just a sliver of the $7 billion general fund.
Local governments were left out in the cold in Tuesdays deal. Senate Republicans had attempted to let them keep grant money paid by taxes on gas and oil production, but now the state will rely on that cash to balance the budget.
The exact details of the compromise remained obscure until Tuesday because the Joint Budget Committee had been meeting behind closed doors in Hickenloopers budget office.
Reporters were tipped to an early morning meeting Tuesday, and when they entered the room, the meeting broke up after a few minutes.
Hickenlooper said that even though hes a big believer in transparency, he thought the closed door meetings were appropriate.
I think that theres a tradition of letting people speak freely. I think if people are going to see their words in the newspaper, they speak a little differently than if they are speaking freely, Hickenlooper said.
As late as noon Tuesday, Senate Democrats and Republicans were discussing an alliance to introduce their own budget. But McNulty sent word to senators through his two JBC members that he agreed to the deal, as long as the tax cuts were included.
McNulty said that if the deal holds, it will be the first budget he has voted for in his five years at the Capitol.
What we have in front of us is a responsible budget. Its an honest budget, McNulty said.
Tuesdays agreement involved only senior leaders and Joint Budget Committee members. Other legislators will get a chance to amend the budget in a series of debates the next two weeks, beginning Friday in the Senate.
Reach Joe Hanel at [email protected].
