Source: Colorado Sun
Colorado Gov. Jared Polis on Friday unveiled a proposed state spending plan that would freeze reimbursement rates for most Medicaid providers, change how the state counts K-12 students and slow the rollout of a new school finance formula in order to close a state budget gap that’s now expected to exceed $1 billion.
His budget proposal for the 2025-26 fiscal year, which starts July 1, also calls for cutting transportation fees, privatizing the state’s workers’ compensation insurer and restructuring a number of cash funds in order to free up money to spend on general state services.
The budget crunch was caused by a number of factors dating back to 2023.
State lawmakers cut school and local government property taxes three times in the past 12 months, cuts that affect the state budget indirectly by increasing the state’s required contributions to K-12 funding.
Medicaid has also grown faster than state health officials expected, adding about $150 million in unexpected costs to last year’s state budget, which ended June 30. Budget officials now expect higher health care spending to continue, as Medicaid serves a growing population of elderly and disabled Coloradans.
