By Michael Fields
Somebody as soon as stated, “There’s nothing extra weak than entrenched success.” Right here in Colorado, our economic system has had a terrific run over the past decade. After the 2008 monetary disaster, our state bounced again faster and higher than some other state — which is why our economic system has been ranked No. 1 for a number of years in a row.
However now, as we face one other nationwide recession, Colorado’s success is certainly weak. And our state’s response up to now, the indicators are clear: We’re headed within the improper path.
A current examine ranked Colorado fiftieth when evaluating which state’s unemployment charge is bouncing again most throughout the pandemic. Sadly, our unemployment charge jumped all the best way as much as 8.4% final month. On the identical time, nonetheless, neighboring states like South Dakota (3%) and Utah (3.6%) noticed their unemployment charges drop. At present, over 300,000 Coloradans are out of labor, and virtually half of Colorado households report that they’ve much less revenue than earlier than the pandemic began.
One concept is that that is only a blip — and our economic system will get better higher than ever as soon as the virus is gone. But when we glance just a little nearer underneath the hood, there are some main issues for small companies — and for our economic system on the whole.
The obvious concern is the small companies which have completely closed throughout the pandemic. Whereas a majority of those closures have come within the restaurant and hospitality sectors, many different industries have additionally been deeply impacted. Due to the problem of beginning new companies, the impacts of those everlasting closures will likely be felt for a very long time.
One other consequence of the pandemic is that Colorado’s unemployment belief fund will finally need to be refilled. Which means Colorado companies should pay extra as a way to replenish it. On the identical time, the brand new household go away program will likely be carried out — which will increase taxes on companies with 10 or extra workers. And as soon as that program inevitably heads towards insolvency, taxes will likely be pushed even larger.
On prime of that, Colorado already has the best industrial property tax charges in our area. It’s why our group is proposing a poll subject to drop the property tax evaluation charge for each companies and households in 2022. However legislators are nonetheless at all times searching for extra income — and this yr is not any exception. After “closing loopholes” (elevating taxes) on companies with SB-1420 final yr, they’re planning on doing extra of it this yr.
And solely months after voters permitted the “Vote on Charges” poll subject, legislators are already planning to disregard it by passing a “fuel price” with out voter approval. Rising fuel taxes not solely hurts Coloradans on the pump, but in addition hurts Colorado companies that obtain or ship items and provides. If Democrats need to push this unhealthy concept, Republicans ought to don’t have anything to do with it.
The hostility that the Legislature has for the oil and fuel business can also be beginning to have a huge impact on jobs and training. Oil and fuel income is a big native piece of the funding for colleges in lots of elements of the state. And talking of faculties, we now have but to totally perceive the long-term results of distant studying on college students — which could have an financial impression on prime of the social and psychological impacts that we’re already seeing.
Evidently, from small enterprise closures to tax hikes to threats on our oil and fuel business, Colorado is on observe to face drastic financial results as we get better from the coronavirus outbreak. The elemental query is: How significantly will Gov. Jared Polis and the Legislature take these issues? Their objective ought to be to ease the burdens on small companies, not enhance them.
With the legislative session arising quickly, the ball is of their court docket.
Michael Fields is the chief director of Colorado Rising State Motion and holds a J.D. from the College of Colorado Boulder.