The Economy: Current Economic Conditions &
General Fund Overview
May 17, 2013
Office of State Planning and BudgetingLaura Blomquist303-866-2979
www.colorado.gov/ospb
Drop in Economic Output and Income – Worst Since Great Depression
Office of State Planning and Budgeting 2
1980Q1 1982Q3 1985Q1 1987Q3 1990Q1 1992Q3 1995Q1 1997Q3 2000Q1 2002Q3 2005Q1 2007Q3 2010Q1 2012Q3$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
Gross Domestic Product, 1 Decimal (GDP), Billions of Dollars, Quarterly, Seasonally Adjusted Annual Rate
$ in
bill
ions
Source: U.S. Bureau of Economic Analysis
Bright Spots: • Housing and Stock Market• Household Balance Sheets
• Europe• Federal Budget
Challenges:• Unemployment• Uncertainty
Important Ingredient for Growth: Investment
Office of State Planning and Budgeting 3
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20129%
10%
11%
12%
13%
Nonresidential Private Investment as a % of GDP
Average Business Investment as a portion of the Economy
(1965 to 2000)
Source: U.S. Bureau of Economic Analysis
Office of State Planning and Budgeting 4
Challenges and Changes in Job Market
1995
Q1
1995
Q4
1996
Q3
1997
Q2
1998
Q1
1998
Q4
1999
Q3
2000
Q2
2001
Q1
2001
Q4
2002
Q3
2003
Q2
2004
Q1
2004
Q4
2005
Q3
2006
Q2
2007
Q1
2007
Q4
2008
Q3
2009
Q2
2010
Q1
2010
Q4
2011
Q3
2012
Q2
2013
Q195,000
100,000
105,000
110,000
115,000
120,000
$450
$550
$650
$750
$850
$950
$1,050
$1,150
$1,250
Private Sector Payroll Jobs - Left Axis
Business Spending on Equipment and software - Right Axis
in th
ousa
nds $ in billions
Source: U.S. Bureau of Labor Statistics and Bureau of Economic Analysis
Change in Jobs Nationally and in Colorado, 2000 to March 2013
Office of State Planning and Budgeting 5
1 7 13 19 25 31 37 43 49 55 61 67 73 79 85 91 97 103
109
115
121
127
133
98
100
102
104
106
108
110
The graph compares the change in the number of jobs nationally and in Colorado since January of 2000. Index: March 2000=100 Source: U.S. Bureau of Labor Statistics.
Change in Number of
Colorado Jobs
Change in Number of
Jobs Nation-ally
Inde
x
Colorado: 11,000 Jobs Below Peak
(0.5%)
Nation: 3.0 million Jobs Below Peak
(2.2%)
• Colorado Outpaces nation
• Pre-recession Peak
• Why?
Colorado’s Favorable Mix of Industries; Many Sell to Markets Outside State
Office of State Planning and Budgeting 6
Agricu
lture
Oil and
Gas
/Min
ing
Man
ufac
turin
g
Info
rmat
ion
Touris
m a
nd L
eisu
re
Profe
ssio
nal/T
echn
ical S
ervic
es
Finan
ce/In
sura
nce
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
86%83%
59%
51%
32%27% 26%
% of Industry’s Sales to Mar-kets Outside State
Source: Economic Modeling Specialists International
Office of State Planning and Budgeting 7
Changes in Job Market – Slower Matching Process
1,600
2,100
2,600
3,100
3,600
4,100
4,600
3,200
3,700
4,200
4,700
5,200
5,700
Private Sector Job Openings, in Thousands, Three Month Moving Average, Seasonally Adjusted - Left Axis
Job
Op
en
ing
s Hire
s
Source: U.S. Bureau of Labor Statis-tics
General Fund Revenue, Actual and Forecast, FY 2000-01 to FY 2013-14
Office of State Planning and Budgeting 8
FY 2000-01
FY 2001-02
FY 2002-03
FY 2003-04
FY 2004-05
FY 2005-06
FY 2006-07
FY 2007-08
FY 2008-09
FY 2009-10
FY 2010-11
FY 2011-12
FY 2012-13
FY 2013-14
$4.0
$4.5
$5.0
$5.5
$6.0
$6.5
$7.0
$7.5
$8.0
$8.5
$9.0
$6.6
$5.6 $5.5$5.8
$6.2
$7.0
$7.5$7.7
$6.7$6.5
$7.1
$7.7
$8.3$8.4
$ i
n b
illi
on
sFore-cast
Actual
Source: Office of State Planning and Budgeting, March 2013 Forecast
Individual Income Tax Revenue, Actual and Forecast, FY 2000-01 to FY 2013-14
Office of State Planning and Budgeting 9
FY 200
0-01
FY 200
1-02
FY 200
2-03
FY 200
3-04
FY 200
4-05
FY 200
5-06
FY 200
6-07
FY 200
7-08
FY 200
8-09
FY 200
9-10
FY 201
0-11
FY 201
1-12
FY 201
2-13
FY 201
3-14
$2,500
$3,000
$3,500
$4,000
$4,500
$5,000
$5,500
$6,000
Ind
ivid
ual
Inco
me T
ax
Reve
nu
e
($ i
n m
illi
on
s)
Ac-tual
Fore-cast
Source: Office of State Planning and Budgeting, March 2013 Forecast
Jan-
10
Apr-1
0
Jul-1
0
Oct-1
0
Jan-
11
Apr-1
1
Jul-1
1
Oct-1
1
Jan-
12
Apr-1
2
Jul-1
2
Oct-1
2
Jan-
13-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
National Real Disposable Personal Income Per Capita, Monthly Percent Change
Since the Beginning of 2010
Individual Income Tax Revenue And Real Disposable Personal Income
Composition of Governor’s FY 2013-14 General Fund Budget Request, ($ in Millions)
Office of State Planning and Budgeting10
K-12 Edu-cation,
$3,029.7, 37%
Health & Human
Services, $2,710.0,
33%
Public Safety and Courts, $1,127.0,
14%
Higher Education, $656.7, 8%
Other, $513.7, 6%
Capital Const./Main, $140.5, 2%
Source: Office of State Planning and Budgeting, March 2013 Forecast and the Jan. 25th Budget Amendment Transmittal to the JBC
FY 2012-13
General Fund Request
FY 2013-14 General Fund
Request
FY 2012-13 Change over FY 2011-12
Request
FY 2013-14 % Change
K-12 Education $3,015,440,512 $3,029,717,443 $14,276,931 0.5%
Corrections $654,695,631 $659,534,398 $4,838,767 0.7%Health Care Policy and Financing
$1,864,223,672 $2,033,500,538 $169,276,866 9.1%
Higher Education $619,261,908 $656,729,783 $37,467,875 6.1%
Human Services $639,540,134 $673,651,442 $34,111,308 5.3%
Other Departments $772,031,461 $856,118,929 $84,087,468 10.9%
Subtotal Departments
$7,565,193,318 $7,909,252,533 $344,059,215 4.5%
Controlled Maintenance Trust Fund
$13,000,000 $23,097,266 $10,097,266 77.7%
Other GF Expenditures
-$6,288,700 $29,312,476 $35,601,176 NA
Rebates and Expenditures
$177,403,545 $215,072,369 $37,668,824 21.2%
Total General Fund
$7,749,308,163 $8,176,734,644 $427,426,481 5.6%
General Fund Capital Construction Projects for FY2013-14
Office of State Planning and Budgeting 11
Project FY 2013-14 Project FY 2013-14Lease Purchase of Academic Facilities at Anschutz Medical Campus (Fitzsimons)
$7,137,966 Wastewater Pre-Treatment Plant, Arkansas Valley
$1,448,260
Lease Purchase of Colorado State Penitentiary II
$18,431,100 Ute Indian Museum Expansion $2,406,789
Lease Purchase of Academic Facilities Pursuant to Section 23-19.9-102 (FML)
$18,587,975 CSU General Classroom Building $16,179,939
CO Territorial Wastewater Pre-Treatment Plant; Grease Traps and Manhole Upgrades
$1,648,885 Richardson Hall Renovation $18,885,628
GTLRR Locomotive $300,000 E.S. French Renovation $13,128,000 Ute Indian Museum Expansion $2,406,789 Academic Classroom II Colorado
Mesa University$9,791,760
Digital Trunked Radio Renewal$3,726,190 Systems Biotechnology Building,
Academic Wing$6,021,946
Level I Controlled Maintenance $21,977,822 Nursing/Science Improvements $1,978,300 Level II Controlled Maintenance $22,948,867 Visual and Performing Arts $4,684,334 Capitol Complex Master Plan $2,000,000 Alamosa Campus Expansion $1,950,000 DPA-DOR Tax Pipeline Project $2,068,832 Highway Construction Projects $500,000
OIT Tax Pipeline Project $1,266,900 State Capitol Dome Restoration $5,000,000
Capitol House and Senate Chambers Renovation
$2,000,000 Auraria Library Renovation $4,000,000
Capital Construction Funds$190,476,282.00
FY2014-15 Capital Construction Requests
Office of State Planning and Budgeting 12
Life Cycle Costs (LCC) are the cost alternatives, over the economic life of a facility, including its initial cost, the cost of energy consumed, replacement costs, and the cost of operation and maintenance of the facility.
The life cycle cost form (LCC-Form) will require identification of feasible alternatives and the cost of these alternatives, establish common assumptions and parameters, discount of future costs to present value, compute and compare LCCs for each alternative, and estimate of non-monetary savings or costs.
Evaluation Criteria Capital Construction Prioritization FY2014-15
General Fund, Capital Construction Fund, Federal Fund and Cash Fund Impact
Projects that are partially funded projects by cash funds and federal funds will receive greater priority
COPCertificates of participation (COP) annual payments for existing projects
Significant Health, Life Safety, and Code Issues
Projects with clear and urgent life or safety implications
Continuation Project Request is a continuation project appropriated in FY 2013-14
Cost Analysis Life cycle cost analysis and reasonableness of costs
Other Fund SourcesOther fund sources include projects that are funded partly by non-state funds and non-student fee funds
Space Needs Analysis
Space needs analysis reflects how much space the institution or department has in its inventory, justification on how well the space needs are filled by the request, and how much space it needs based on the Master Plan, FTE projections, or Student enrollment projections
Clear Identification of Beneficiaries
The request must clearly identify the individuals that will be served and how they will be better served by the project requested
Phase-able Projects Phases must be stand-alone projects
Achieves GoalsIntegral to Achieving Statewide Policy Goals/Integral to Institutional Planning Goals
Program Plans
Projects will be review against the program plans for appropriateness, necessity, and sufficiency of the project with respect to institution programs, applicable state policies, plans, and standards.