"Between Utopia and the Apocalypse"
Experts call for collaboration to keep Colorado's economy on track
Colorado has a booming economy, a talented workforce and evenly distributed economic growth. The caution: Elected officials from both sides of the aisle and business leaders will need to work together to address funding gaps and smarter fiscal policy if the good fortune is to continue.
During joint presentations January 18 at CU South in Parker, Henry Sobanet and J.J. Ament relayed that message, articulating challenges in Colorado’s economy and encouraging increased involvement with policymakers at the Capitol to an audience of more than 400 business leaders and elected officials from across the Denver metro area.
“Our state economy has been a major accomplishment,” said Ament, CEO of the Metro Denver Economic Development Corporation, citing data that show employment growth proceeding evenly across Colorado’s largest counties. “But we need civic engagement.”
“You’re not just here to network and meet people, you’re here because you want to make the world better,” said Sobanet, the CFO of Colorado State University.
THE LAY OF THE LAND
Sobanet began by explaining strains on Colorado’s general fund, among them an aging population driving increased health-care spending, mandatory annual increases in education funding and the rising cost of infrastructure maintenance. Despite an almost universally-agreed upon need to fund these priorities, state revenues aren’t rising to meet demand.
Fault for the predicament, he said, lies less with polarized politics than poor policy.
“A lot of what is wrong with public finance is not that people are bad, or mean to each other,” Sobanet said, “it’s that we have bad systems.”
Sobanet cited the Gallagher Amendment, a constitutional requirement that commercial property tax revenues be greater than residential revenues, as one culprit. He cited the Taxpayers Bill of Rights (TABOR), mandating voter approval for any tax increase, as the other “bad system.”
Gallagher deprives the general fund of reasonable revenue, Sobanet continued. Though home values have risen sharply in Colorado over the last decade, tax revenues haven’t, since the amendment requires residential property tax revenues be artificially restricted to stay below commercial revenues.
Changing the amendment would require voter approval because of TABOR, but any elected representatives asking voters to approve a tax hike, he said, would be committing “political suicide.”
Ament followed Sobanet’s assessment by highlighting Colorado’s economic strength, evidenced by a flock of corporations expanding to the state and Amazon’s courting of the metro area for its HQ2 facility.
Municipalities’ commitment to regionally diversifying industry saved the state economy from disaster during the Great Recession, he said, as the oil and gas industry tanked but economic growth remained steady. The same diversity made Colorado more attractive to corporations in the technology, healthcare, aerospace and bioscience and other industries who more recently located here.
Though issues such as Colorado’s high housing costs may make some CEOs reconsider moving or expanding to the Denver metro area, Ament said the market can correct for these issues, provided ill-conceived policies don’t hinder those adjustments.
“Business owners can drive the agenda,” he said, but “we have to hold each other accountable… As government gets more involved in every aspect of your lives, you need to be involved in all of the decisions being made.”
Ament urged business leaders in the room to work with officials and support causes that will improve viability for their own businesses and Colorado as a whole. It may mean giving up a Saturday off to volunteer, he said, but “we’ll just get what we continue to get if we don’t engage.”
"HOLLOWING OUT THE CENTER"
Lone Tree Mayor Jackie Millet moderated a Q & A session following Ament’s presentation, where both speakers expounded on the theme of civic engagement.
Sobanet urged persistence for would-be changemakers, pointing out TABOR didn’t pass until its fourth time on the ballot. He added moral support may help when officials seek to fix shortfalls created by bad systems.
“Let them know you’ll back them up,” he said.
Ament said voters must elect more informed, and less opinionated, representatives if both sides of the statehouse aisle will be able to work together and ensure a bright economic future.
“We have to insert space between utopia and the apocalypse,” he said, adding “percentages aren’t partisan.”
Andrew Graham, chair of the SMDC board of directors, said the message of “hollowing out the center” wasn’t lost on the entrepreneurs and executives who offered their feedback.
“It facilitated a spirit of collaboration among government leaders, economic leaders and chamber members about what we as a community need to do to come together,” he said. “We need to reclaim the center, and the center of those two areas is that collaborative spirit.”
Tom Skelley is an account associate with Evolution Communication Agency.