1. The Economy: Current Economic Conditions & General Fund Overview May 17, 2013 Office of State Planning and Budgeting Laura Blomquist 303-866-2979 www.colorado.gov/ospb

2. Drop in Economic Output and Income – Worst Since Great Depression Office of State Planning and Budgeting 2 Source: U.S. Bureau of Economic Analysis Bright Spots: Housing and Stock Market Household Balance Sheets Europe Federal Budget Challenges: Unemployment Uncertainty

3. Important Ingredient for Growth: Investment Office of State Planning and Budgeting 3 Source: U.S. Bureau of Economic Analysis

4. Office of State Planning and Budgeting 4 Challenges and Changes in Job Market Source: U.S. Bureau of Labor Statistics and Bureau of Economic Analysis

5. Change in Jobs Nationally and in Colorado, 2000 to March 2013 Office of State Planning and Budgeting 5 Colorado: 11,000 Jobs Below Peak (0.5%) Nation: 3.0 million Jobs Below Peak (2.2%) Colorado Outpaces nation Pre-recession Peak Why?

6. Colorado’s Favorable Mix of Industries; Many Sell to Markets Outside State Office of State Planning and Budgeting 6 Source: Economic Modeling Specialists International

7. Office of State Planning and Budgeting 7 Changes in Job Market – Slower Matching Process

8. General Fund Revenue, Actual and Forecast, FY 2000-01 to FY 2013-14 Office of State Planning and Budgeting 8 Source: Office of State Planning and Budgeting, March 2013 Forecast

9. Individual Income Tax Revenue, Actual and Forecast, FY 2000-01 to FY 2013-14 Office of State Planning and Budgeting 9 Source: Office of State Planning and Budgeting, March 2013 Forecast National Real Disposable Personal Income Per Capita, Monthly Percent Change Since the Beginning of 2010 Individual Income Tax Revenue And Real Disposable Personal Income

10. Composition of Governor’s FY 2013-14 General Fund Budget Request, ($ in Millions) Office of State Planning and Budgeting 10 Source: Office of State Planning and Budgeting, March 2013 Forecast and the Jan. 25th Budget Amendment Transmittal to the JBC FY 2012-13 General Fund Request FY 2013-14 General Fund Request FY 2012-13 Change over FY 2011-12 Request FY 2013-14 % Change K-12 Education$3,015,440,512$3,029,717,443$14,276,9310.5% Corrections$654,695,631$659,534,398$4,838,7670.7% Health Care Policy and Financing $1,864,223,672$2,033,500,538$169,276,8669.1% Higher Education$619,261,908$656,729,783$37,467,8756.1% Human Services$639,540,134$673,651,442$34,111,3085.3% Other Departments$772,031,461$856,118,929$84,087,46810.9% Subtotal Departments $7,565,193,318$7,909,252,533$344,059,2154.5% Controlled Maintenance Trust Fund $13,000,000$23,097,266$10,097,26677.7% Other GF Expenditures -$6,288,700$29,312,476$35,601,176NA Rebates and Expenditures $177,403,545$215,072,369$37,668,82421.2% Total General Fund $7,749,308,163$8,176,734,644$427,426,4815.6%

11. General Fund Capital Construction Projects for FY2013-14 Office of State Planning and Budgeting 11 ProjectFY 2013-14 Project FY 2013-14 Lease Purchase of Academic Facilities at Anschutz Medical Campus (Fitzsimons) $7,137,966Wastewater Pre-Treatment Plant, Arkansas Valley $1,448,260 Lease Purchase of Colorado State Penitentiary II $18,431,100Ute Indian Museum Expansion$2,406,789 Lease Purchase of Academic Facilities Pursuant to Section 23-19.9-102 (FML) $18,587,975CSU General Classroom Building$16,179,939 CO Territorial Wastewater Pre-Treatment Plant; Grease Traps and Manhole Upgrades $1,648,885Richardson Hall Renovation$18,885,628 GTLRR Locomotive$300,000E.S. French Renovation$13,128,000 Ute Indian Museum Expansion$2,406,789Academic Classroom II Colorado Mesa University $9,791,760 Digital Trunked Radio Renewal $3,726,190Systems Biotechnology Building, Academic Wing $6,021,946 Level I Controlled Maintenance$21,977,822Nursing/Science Improvements$1,978,300 Level II Controlled Maintenance$22,948,867Visual and Performing Arts$4,684,334 Capitol Complex Master Plan $2,000,000Alamosa Campus Expansion$1,950,000 DPA-DOR Tax Pipeline Project$2,068,832Highway Construction Projects$500,000 OIT Tax Pipeline Project$1,266,900State Capitol Dome Restoration$5,000,000 Capitol House and Senate Chambers Renovation $2,000,000Auraria Library Renovation$4,000,000 Capital Construction Funds $190,476,282.00

12. FY2014-15 Capital Construction Requests Office of State Planning and Budgeting 12 Life Cycle Costs (LCC) are the cost alternatives, over the economic life of a facility, including its initial cost, the cost of energy consumed, replacement costs, and the cost of operation and maintenance of the facility. The life cycle cost form (LCC-Form) will require identification of feasible alternatives and the cost of these alternatives, establish common assumptions and parameters, discount of future costs to present value, compute and compare LCCs for each alternative, and estimate of non-monetary savings or costs. Evaluation Criteria Capital Construction Prioritization FY2014-15 General Fund, Capital Construction Fund, Federal Fund and Cash Fund Impact Projects that are partially funded projects by cash funds and federal funds will receive greater priority COP Certificates of participation (COP) annual payments for existing projects Significant Health, Life Safety, and Code Issues Projects with clear and urgent life or safety implications Continuation ProjectRequest is a continuation project appropriated in FY 2013-14 Cost AnalysisLife cycle cost analysis and reasonableness of costs Other Fund Sources Other fund sources include projects that are funded partly by non-state funds and non-student fee funds Space Needs Analysis Space needs analysis reflects how much space the institution or department has in its inventory, justification on how well the space needs are filled by the request, and how much space it needs based on the Master Plan, FTE projections, or Student enrollment projections Clear Identification of Beneficiaries The request must clearly identify the individuals that will be served and how they will be better served by the project requested Phase-able ProjectsPhases must be stand-alone projects Achieves Goals Integral to Achieving Statewide Policy Goals/Integral to Institutional Planning Goals Program Plans Projects will be review against the program plans for appropriateness, necessity, and sufficiency of the project with respect to institution programs, applicable state policies, plans, and standards.