Killing the ‘Golden Goose’? Conservative report blasts state’s economic policies; liberals disagree

By Peter Marcus
Denver Daily News

Colorado's fiscal and economic future is in "serious jeopardy" because of increased government control, according to a report released Monday by a conservative-leaning group.

But critics of the Americans For Prosperity Colorado report (published below) say the group is attempting to push a conservative agenda rather than honestly examine the state's economic future. Critics also call the "Colorado in Transition: Killing the Golden Goose" report to be "misleading," especially in the areas of health care and transportation.

The report states that health care reform currently being pushed by Democrats would have a negative impact on Colorado's economy. Jeff Crank, state director for Americans For Prosperity, said the state must limit its Medicaid enrollment to only those who "really need it." He added that Coloradans should be allowed to purchase from multi-state insurance pools.

The report makes mention of a law signed by Democratic Gov. Bill Ritter last year that established a hospital provider fee to be matched by the federal government. The idea is to raise an estimated $600 million to be matched by the federal government for a total of around $1.2 billion. Colorado hospitals incur more than $375 million annually in uncompensated costs by serving Medicaid patients, according to the Colorado Hospital Association.

The AFP report states that the Colorado Healthcare Affordability Act will cost the average Colorado family of four about $500 a year.

But Rich Jones, director of policy and research for the liberal-leaning Bell Policy Center, said hospitals pass the uncompensated costs along to private insurance companies, who in turn pass the costs along to its customers. He said that ends up costing Coloradans more in the long run.

"By reducing these uncompensated care costs and by increasing the reimbursement rate, hospitals shift less of this cost on to private insurance, and so essentially our insurance premiums will either - probably not go down - but go up at a lesser amount because the hospitals aren't transferring these uncompensated care costs on," said Jones.

Crank and AFP are also calling for a steady stream of funding for transportation, arguing that the state can't attract businesses without a proper transportation system. Crank and his group offer no suggestions for how to develop the funding stream, instead only providing direction.

But the report is critical of legislation last year that eliminated the state's 6 percent general fund spending cap known as Arveschoug-Bird, stating that transportation lost a dedicated funding source as a result of the repeal.

Jones believes the report is "misleading" on the topic of transportation, arguing that by eliminating Arveschoug-Bird, lawmakers were given more freedom to allocate money to specific departments, including transportation. He said Senate Bill 228 has actually provided a five-year dedicated funding source for transportation.

"It frees the Legislature's hands to do more," said Jones. "Rather than eliminating the source of funding for transportation, it in fact made a better source of funding for transportation and a guaranteed, dedicated source."

The AFP report also calls for shifting to a "consumption-based" tax policy, instead of taxing income and property. It states that money lost on income and property taxes would be recouped through a higher sales tax.

Crank and his group are also calling for protections for the Taxpayer's Bill of Rights and easing restrictions on the state's oil and gas industry.

"Colorado is at a critical point and is close to becoming another California," said Crank, referring to California's soaring budget deficit. "Until state policy makers reinvent legislation to favor consumption-based taxes over income and property taxes, fundamental reform of Medicaid instead of government overhaul of health care, and give control of TABOR back to the voters, the state will be mired in a hostile economic environment that kills job growth."