GRAND JUNCTION, Colo (KKCO) - State leaders announced another $271 million worth of budget cuts as state revenues continue to dwindle in the down economy.
While officials say this latest round of cuts should balance this year's budget, lawmakers on both sides of the aisle say even tougher cuts may still lie ahead.
Governor Bill Ritter says while there are some good things happening with Colorado's economy, "I think it's fair to say that we believe the economy is expanding or the turnaround, if it's not happening now, it's very near," he says.
But there's still plenty of bad. "We know that we still have revenue problems in this state and we're gonna have some revenue problems going forward," Ritter says.
Wednesday, he presented his plan to slash an additional $271.4 million from the state budget -- which includes docking medicaid reimbursement rates by one percent, withholding $37.4 million in severance tax dollars paid out to energy impacted communities, and cutting $145 million from the state's higher education fund, using federal stimulus dollars to backfill those losses.
"We take those [stimulus] dollars because we believe that higher education is an important investment for us and the people in the state," says Ritter. "The people in the state very much utilize the higher education system to change their station in life."
Republican leaders say a move like that just sets the state up for bigger problems down the road when those stimulus dollars run out.
"I think that's just another smoke and mirrors, let's not deal with it, let's put it off, let's figure out a way and hope things get better rather than showing the leadership Colorado needs," says State Representative Steve King, (R) Grand Junction.
They say they're disappointed the governor did not make cuts to what they call a state government that's grown out of control.
"Until we make fundamental changes in government, things will not get better," KIng says.
Ritter says 97 percent of the state's budget goes to just five areas of service -- K-12 education, health care policy and financing, human services, public safety, and higher education -- some of which legally require the state to increase spending each year.
Ritter says his administration has made the tough choices and his critics just don't understand how difficult and delicate of a process making cuts is.
"Every once in a while, they make a suggestion about how to solve a one-hundred million dollar problem with a one-hundred thousand dollar suggestion," says Ritter.
But one thing both sides do agree on, is that tougher decision lie ahead and the worst of the state's budget problems are far from over.
"State revenue will lag the turnaround by a fiscal year, so our worst fiscal year is still ahead of us," says Ritter. "There will be some touch choices and we'll have a lot of decisions to make. But the fact of the matter is the people of Colorado will know that we balanced the budget."
"In the next legislative session, there are gonna be some hard decisions and there's gonna be some harsh words," King says. "We didn't save, now we have to pay the piper and it hurts. Hopefully we learn from this experience and set money aside so we won't have to make these drastic cuts."
Officials say to date, the state has had to shore up $2.1 billion in budget shortfalls this year.