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Center for Colorado’s Economic Future
FINANCING COLORADO’S FUTURE
An Analysis o the Fiscal Sustainabilityo State Government
Phase 1 Findings
 
 APRIL 2011
 
Center for Colorado’s Economic Future
Letter From the Chancellor
April 21, 2011Dear Friends:Colorado has been home to the University o Denver since our ounding during territorial days in 1864, and in a sense,both the state and the University have grown up together. Our deep roots in this place have given rise to a strong senseo obligation among us at the University to work or the public good and the well-being o our ellow Coloradans, andindeed this has become a very large part o our institutional mission. This commitment has had its own long history,particularly as it relates to inorming policy makers, elected ocials and citizens as they have considered importantscal decisions related to the health o the Colorado economy. Early examples include scal studies published in 1938and 1959, the latter led by DU and supported by aculty members rom both DU and the University o Colorado.More recently, DU has contributed to the policy-making process through the activities o our Strategic Issues Program(SIP), begun in 2004. In that year, we assembled the Colorado Economic Futures Panel under the aegis o the SIP, andthe report rom this panel (2005) has become one o the touchstones o the economic reorm movement in our state.Last year, in the midst o the worst economic recession and nancial decline since the Great Depression, the GeneralAssembly enacted Senate Joint Resolution 10-002, which requested that the University o Denver undertake a compre-hensive study o the nancing o state and local government in Colorado.This new study, the rst o its kind since 1959, was done over the course o the past year by the Center or Colorado’sEconomic Future at DU, under the leadership o Charles S. Brown. The report o this work is presented here. It will beollowed in the coming months by the report rom our current Strategic Issues Program panel, which has ocused itswork on the uture o state government.This study was made possible by support rom the University o Denver and rom nine Colorado oundations, whichare the El Pomar Foundation, the Bonls Stanton Foundation, the Colorado Health Foundation, the Rose CommunityFoundation, the Boettcher Foundation, the Gates Family Foundation, the Piton Foundation, the Colorado Trust andthe Kaiser Permanente Foundation. We at the University o Denver are very grateul or the generosity o all o thesenonprot organizations, which, like the University, are dedicated to the public good.Sincerely,Robert D. Coombe
 
Center for Colorado’s Economic Future
Figures and Tables1Introduction3The Bottom Line5Colorado’s Revenue System10Forecast Methodology: General Fund Revenues26Budget Drivers30 K–12 Education Finance30 Medicaid40 Corrections46Program Costs and Revenues: A Structural Breakdown51 Acknowledgments59Endnotes60Selected Source List61Sponsors62
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