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Center for Colorado's Economic Future

The Center for Colorado's Economic Future provides nonpartisan information and analysis of issues impacting the economic future of Colorado. The goal of our research is to help Colorado's citizens and leaders make decisions that strengthen the state’s economy and quality of life.

Unbalanced scale

Financing Colorado's Future:

State Government's General Fund Unbalanced by Billions of Dollars in FY 2024-25

Last year, a two-part study by the Center for Colorado's Economic Future concluded that even with a healthy economic recovery state government General Fund expenditures will exceed revenues by $3.5 billion in FY 2024-25 because the growth rates of Medicaid and K-12 education spending will far exceed the growth rates of sales and income tax collections.

Without policy changes, the state's obligation to pay for these programs plus the state corrections system will inevitably crowd out funding for higher education, courts and other General Fund programs.

An updated forecast shows:

  • The projected gap between revenues and expenditures in FY 2024-25 will be slightly smaller – closer to $3.3 billion – due to revised trend data on demographics, pupil counts, assessed valuations, prison populations, Medicaid enrollment rates and health care inflation.
  • While some of the revised trend data drove down the projected cost of public schools and Medicaid, incorporating these changes into the forecast also lowered the projection for tax collections. This effect reinforced the Center's conclusion that the long-term General Fund imbalance is a structural problem that will not disappear even with a robust economic rebound.
  • The recent Lobato vs. State of Colorado court decision could increase the size of the FY 2024-25 General Fund gap by a minimum of 70 percent or as much as three times the amount currently projected.

Read our Phase 2 report and the March 2012 update.

View and listen to our narrated slide show.

Download our slide show as a pdf.

Thank you to our funders.