The rainy day fund legislation, brought to the forefront by Grand Junction representatives Josh Penry and Bernie Buescher was killed Friday in the Senate State, Veterans and Military Affairs Committee.
Representative Penry says with the economy seeing a surge thanks to the passing of Referendum C, lawmakers are spending instead of saving.
Aside from Referendum C money, the state is also seeing money from Colorado's tobacco settlement.
Penry's bill, passed by the house of representatives the week before would've set aside money from the settlement to establish the fund for when the state's tax revenue doesn't increase over the previous year's spending.
While the state does have many areas that need repair, Penry says lawmakers should've learned their lesson following the recession of 2001.
Penry plans on bring the issue back to the table when the next legislative session begins in January 2007.