View From a Height

You Go to Budget Negotiations With the Elected Officials You Have

There's good and bad here, and then there's setup for next year and the election cycle.

The securitization makes sense from a fiscal point of view. You can't try to outsmart the market, which means that the greater the uncertainty, the higher the interest rate that third-party will use to discount the revenue stream. Since the risk-dependent rate gets added onto the risk-free rate, and the risk-free rate is at historic lows, there probably won't be a better time to strike that deal than now.

While Owens talked about putting very severe limitations on when the rainy-day funds could be used, legislatures do have a tendency to start spending that money on predictions of cold fronts moving through Utah. While ultimately, the fate of that money rests with the citizens, it's better to start off with all the restrictions we can come up with.

As for the TABOR changes, at first blush the base may think that we had to destroy it in order to save it. But it's not destroying it. Owens correctly points out that this is with the consent of the public, and has always been a built-in contingency. If the main goal is to keep the state out of receivership without giving the Democrats too much leeway to take on new long-term obligations, then all we're arguing about is the points.

On a side note. If higher education is going to complain about being squeezed, it's only fair that it be subjected to accounting supervision at least as rigorous Sarbanes-Oxley imposes on private concerns. That this bill is bipartisan gives me hope.

Ben is all over the Senate Dems who want to spend even more money they've made sure we don't have. We don't have it, in large part, because of Amendment 23. (Kestrel's right about the moral hazarf of getting everything you want, anyway.) If the governor is going to make essentially revenue-side concession this year, he's going to have to make the case repeatedly that these choices are because of Amendment 23. Over and over. So that whoever the nominee is doesn't have to start from scratch. So that our chances of getting a modification on the ballot - which would need 2/3 to pass - will be improved. This is the sort of pro-activity that I don't think we saw enough of last year, but can still come in time to save the game for next year.

Most of what the majority is proposing to do is statutory, and the referenda involved need only a majority to pass, and can make it onto this year's ballot. Most of what we'd really like to do requires Constitutional change, would need to pass more restrictive timelines, and wouldn't make it until next year.

The title of the posting isn't intended to dis the Governor, but to show that when you don't have a majority, especially in Colorado's budget process, your options are limited.