Colorado is the only state without a rainy day fund. Now the coronavirus means it will pay the price.
In early February, the governor’s office and state treasurer issued a warning to lawmakers: Colorado is the only state in the nation without a rainy day fund to buffer against a recession. Now is the time the state should save for a downturn, they said, before it’s too late.
“We all know that the economy, at some point, may turn,” Treasurer Dave Young said at the time. “It usually does. We don’t know when.”
The Feb. 6 presentation to the legislative budget committee made no mention of the coronavirus. But only weeks later, the spread of COVID-19 became a pandemic that crippled the economy and made the premonition about Colorado’s weak fiscal safety net all too real.
“No one could have imagined at that point in February that we were going to be in this kind of economic and health crisis today,” Young said in a recent interview. “It didn’t give us enough time to actually enact the plan and start to carry it out.”
Even if a pandemic is difficult to imagine, the state’s lack of preparation for an economic slump is entirely predictable. The warnings about the state’s limited savings date back at least a decade to the end of the Great Recession, according to a series of interviews and review of legislative documents.
Read more via The Colorado Sun.
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