STAFF BUDGET BRIEFING FY 2019-20 DEPARTMENT OF …leg.colorado.gov/sites/default/files/fy2019-20_natbrf1.pdf · 2018-12-17 · STAFF BUDGET BRIEFING FY 2019-20 DEPARTMENT OF NATURAL

STAFF BUDGET BRIEFING FY 2019-20

DEPARTMENT OF NATURAL RESOURCES

(Executive Director’s Office, Division of Parks and Wildlife, Colorado Water Conservation Board, and Water Resources

Division)

JBC WORKING DOCUMENT - SUBJECT TO CHANGE STAFF RECOMMENDATION DOES NOT REPRESENT COMMITTEE DECISION

PREPARED BY:

TOM DERMODY, JBC STAFF DECEMBER 17, 2018

JOINT BUDGET COMMITTEE STAFF

200 E. 14TH AVENUE, 3RD FLOOR · DENVER · COLORADO · 80203 TELEPHONE: (303) 866-2061 · TDD: (303) 866-3472

https://leg.colorado.gov/agencies/joint-budget-committee

CONTENTS Department Overview ...................................................................................................................................... 1

Department Budget: Recent Appropriations ................................................................................................ 2

Department Budget: Graphic Overview ....................................................................................................... 3

General Factors Driving the Budget ............................................................................................................... 5

Summary: FY 2018-19 Appropriation & FY 2019-20 Request ............................................................... 10

ISSUES Division of Parks and Wildlife Finances and Budget Requests Compendium ......................... 13

Colorado Water Plan Implementation ............................................................................................ 22

Aquatic Nuisance Species Program Funding ................................................................................. 27

APPENDICES A. Numbers Pages .............................................................................................................................. 31

B. Recent Legislation Affecting Department Budget ................................................................... 46 C. Update on Long Bill Footnotes and Requests for Information ............................................. 50 D. Department Annual Performance Report ................................................................................ 51 E. Parks and Wildlife Assumptions for Eight-Year Revenue and Expense Projections ......... 52


DEPARTMENT OVERVIEW The Department of Natural Resources is responsible for developing, protecting, and enhancing Colorado’s natural resources for the use and enjoyment of present and future residents and visitors. The Department is comprised of the following divisions:

The Executive Director's Office (EDO) develops department-wide policies and provides administrative and technical support for Department divisions including: budgeting, accounting, financial management, human resources services, and the coordination of public information and environmental education. The EDO also houses the Colorado Avalanche Information Center (CAIC) that provides avalanche information, education and promotes research for the protection of life and property.

The Division of Parks and Wildlife (CPW) provides recreational opportunities at 41 state parks, manages more than 960 game and non-game wildlife species, issues hunting and fishing licenses, enforces wildlife regulations, and administers more than 350 state wildlife areas.

The Colorado Water Conservation Board (CWCB) works to conserve, develop, and protect the state's water resources to ensure adequate water supply, maximize beneficial use, and reduce the impact of flooding and drought.

The Division of Water Resources (State Engineer's Office) administers and enforces water rights, issues well permits, monitors streamflow and water use, regulates dam construction and safety, and represents Colorado in interstate water compact proceedings.

The three remaining divisions (the Division of Reclamation, Mining, and Safety, the Oil and Gas Conservation Commission, and the State Board of Land Commissioners) were discussed in a separate staff briefing on November 28, 2018.

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DEPARTMENT BUDGET: RECENT APPROPRIATIONS

FUNDING SOURCE FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 *

General Fund $28,742,941 $30,864,532 $32,005,418 $33,326,757

Cash Funds 202,967,586 230,795,872 238,857,665 223,394,936

Reappropriated Funds 7,703,225 6,932,593 7,933,687 7,483,247

Federal Funds 26,641,222 26,699,468 26,568,474 26,683,622

TOTAL FUNDS $266,054,974 $295,292,465 $305,365,244 $290,888,562

Full Time Equiv. Staff 1,462.7 1,458.6 1,464.5 1,475.5

*Requested appropriation.

SELECT DIVISIONS: RECENT APPROPRIATIONS

FUNDING SOURCE FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 *

General Fund $28,742,941 $30,864,532 $32,005,418 $33,326,757

Cash Funds 181,318,674 209,101,326 211,449,002 195,080,403

Reappropriated Funds 7,478,225 6,707,593 7,708,687 7,258,247

Federal Funds 23,023,785 23,109,547 23,076,347 23,109,082

TOTAL FUNDS $240,563,625 $269,782,998 $274,239,454 $258,774,489

Full Time Equiv. Staff 1,243.5 1,239.4 1,240.4 1,246.4

*Requested appropriation.

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DEPARTMENT BUDGET: GRAPHIC OVERVIEW

All charts are based on the FY 2018-19 appropriation.

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All charts are based on the FY 2018-19 appropriation.

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GENERAL FACTORS DRIVING THE BUDGET

DIVISION OF PARKS AND WILDLIFE The Division, also known as Colorado Parks and Wildlife (CPW), makes up just over 46.8 percent of the Department's total budget and, with the exception of a small General Fund appropriation to cover the cost of free park entrance for disabled veterans and free park entrance for all veterans on Veterans Day (Section 33-12-106, C.R.S.), is completely supported by cash and federal funds. CPW was formed by S.B. 11-208, which merged the Division of Parks and Outdoor Recreation and the Division of Wildlife. The bill did not merge the appropriations of the two former divisions or provide any consolidation of line items. In 2014, the General Assembly approved a reorganization of the Division’s Long Bill section to more accurately reflect the post-merger organizational structure. The Colorado Parks and Wildlife Commission has approved a number of fee changes initiated by S.B. 18-143 (Hunting, Fishing, and Parks for Future Generations Act), including changes to hunting licenses, fishing licenses, and park passes. At this time, CPW is projecting flat revenue in FY 2018-19. Changes to hunting license fees will not result in additional revenue until the fall of FY 2019-20 because of the way that CPW manages hunting license revenue. Changes to fishing license fees and park passes will result in new revenue in the second half of FY 2018-19 and CPW is finalizing new revenue projections. Factors including price elasticity and spring and early summer weather could cause significant variability in these projections. The Division will be able to provide revised FY 2018-19 revenue estimates later in this fiscal year.

STATE PARKS The State Parks section of CPW manages 41 state parks and several special purpose programs including: the snowmobile program, the off-highway vehicle program, river outfitters regulation, aquatic nuisance species control and prevention, and the distribution of grants. Workload and some revenue for park operations (e.g. park passes, camping fees etc.) are driven by visitation. The increases shown in the following table are indicative of the long-term trend in visitation, which is driven by population growth and access.

State Parks Visitation

FY 2015-16 ACTUAL FY 2016-17 ACTUAL FY 2017-18 ACTUAL FY 2018-19 ESTIMATE

State Parks Visitation 13,635,112 14,823,153 15,321,417 14,593,227

Percent Change 9.4% 8.7% 3.4% -4.8%

The two largest sources of revenue for State Parks are lottery funds ($24.6 million, 26.7 percent) and from usage fees ($28.8 million, 31.3 percent), followed by other state and federal funds including severance tax. These revenues are detailed in the table below:

State Park Revenues

FY 2015-16

ACTUAL FY 2016-17

ACTUAL FY 2017-18

ACTUAL FY 2018-19

ESTIMATE

Licenses, passes, fees, and permits $24,364,158 $28,793,086 $28,839,784 $28,839,784

Registrations 9,261,437 9,361,656 9,192,703 9,192,703

Federal and state grants 6,202,454 6,575,143 10,818,299 10,818,299

Lottery and Great Outdoors Colorado 28,852,271 26,543,314 24,597,636 24,597,636

Sale of goods, services, and assets 2,109,164 2,387,000 2,218,685 2,218,685

Donations 0 55,249 15,429 15,429

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State Park Revenues

FY 2015-16

ACTUAL FY 2016-17

ACTUAL FY 2017-18

ACTUAL FY 2018-19

ESTIMATE

Interest income 399,187 545,905 819,243 819,243

Other revenues 4,154,115 3,424,831 3,654,355 3,654,355

General Fund and Severance Tax 5,309,836 2,869,670 5,089,609 5,089,609

Revenues Before Transfers $80,652,622 $80,555,854 $85,245,743 $85,245,743

Intra-agency, Inter-fund transfers 13,483,874 12,721,180 6,748,208 6,748,208

Total Revenues $94,136,496 $93,277,034 $91,993,951 $91,993,951

WILDLIFE The Wildlife section of CPW manages the state's more than 960 game and non-game wildlife species by issuing fishing and hunting licenses, enforcing wildlife regulations, protecting habitat and native wildlife populations, and managing more than 350 state wildlife areas. Funding for Wildlife operations and programs is a mixture of cash funds from usage fees, federal funds, grants from Great Outdoors Colorado, and various other sources. Approximately 1.8 million hunting and fishing licenses were sold in FY 2017-18, which provided $80.7 million in revenue. In the same fiscal year, non-resident big game license sales account for just 5.0 percent of all hunting and fishing licenses sold; however, revenue from non-resident big game hunting licenses sales account for 59.3 percent of the total revenue generated by all hunting and fishing license sales. Roughly, 70.0 percent of total hunting license sales are for big game species (mainly elk and deer). The following table shows Wildlife revenues by category:

Wildlife Revenues

FY 2015-16

ACTUAL FY 2016-17

ACTUAL FY 2017-18

ACTUAL FY 2018-19

ESTIMATE

Licenses, passes, fees, and permits $89,655,303 $92,750,800 $96,224,160 $96,224,160

Registrations 0 92,025 208,890 208,890

Federal and state grants 24,588,048 25,855,415 27,190,953 27,190,953

Lottery and Great Outdoors Colorado 10,783,201 12,015,621 9,635,343 9,635,343

Sale of goods, services, and assets 380,085 326,705 397,387 397,387

Donations 1,134,258 1,266,850 1,522,343 1,522,343

Interest income 674,038 1,013,990 1,300,022 1,300,022

Other revenues 917,896 2,793,173 3,045,199 3,045,199

General Fund and Severance Tax 3,639,255 2,033,625 7,054,726 7,054,726

Revenues Before Transfers $131,772,084 $138,148,204 $146,579,023 $146,579,023

Intra-agency, Inter-fund transfers 10,370,511 10,474,711 13,158,321 13,158,321

Total Revenues $142,142,595 $148,622,915 $159,737,344 $159,737,344

LOTTERY PROCEEDS AND GREAT OUTDOORS COLORADO (GOCO) BOARD GRANTS Approximately 13.6 percent of total revenue for CPW comes from lottery proceeds and annual GOCO grants. State Parks currently receives 10.0 percent of net lottery proceeds to develop, maintain, and improve state park properties and facilities. Another 50.0 percent of net lottery proceeds are allocated to the Great Outdoors Colorado Trust Fund, which is split between grants for State Parks and Wildlife.1 Grants for State Parks are used for developing new parks (capital) as well as enhancing and maintaining existing parks (operating). Wildlife grants are used for species protection, habitat development, watchable wildlife, and wildlife education. Pursuant to Article XXVII of the Colorado Constitution, GOCO grants are not subject to legislative appropriation. The following table shows recent GOCO awards:

1 Please note the remaining 40.0 percent of net lottery proceeds goes to the Conservation Trust Fund administered by the Department of Local Affairs.

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Great Outdoors Colorado (GOCO) Board Grants

FY 2015-16

AWARD FY 2016-17

AWARD FY 2017-18

AWARD FY 2018-19

AWARD FY 2019-20

ESTIMATE

Parks Capital Budget $13,954,544 $10,144,985 $11,227,434 $12,431,795 $12,798,707

Parks Operating Budget 5,056,500 5,105,500 5,381,500 5,920,000 5,920,000

Total GOCO Grants - State Parks $19,011,044 $15,250,485 $16,608,934 $18,351,795 $18,718,707

Wildlife Base Capital Budget $4,319,500 $7,660,085 $7,220,000 $7,900,000 $7,970,000

Wildlife Operating Budget 7,480,500 7,590,500 7,965,000 8,440,500 8,440,500

Total GOCO Grants - Wildlife $11,800,000 $15,250,585 $15,185,000 $16,340,500 $16,410,500

COLORADO WATER CONSERVATION BOARD The Colorado Water Conservation Board (CWCB) is responsible for administering two major cash funds—the CWCB Construction Fund and the Severance Tax Perpetual Base Fund—both used for water project loans and grants. COLORADO WATER CONSERVATION BOARD CONSTRUCTION FUND The CWCB Construction Fund (Section 37-60-121 (1)(a), C.R.S.) provides loans and grants for projects that will increase the beneficial consumptive use of Colorado's waters. Section 37-60-121 (1)(b)(IV), C.R.S., limits participation to projects that can repay the CWCB's investment, unless specifically authorized by the legislature, and authorizes the CWCB to approve loans of less than $10.0 million without legislative approval. The Construction Fund also pays for the administrative expenses of the CWCB, approximately $3.9 million in FY 2018-19. Revenues for the Construction Fund are from interest earnings, transfers from the Severance Tax Operational and Perpetual Base Funds, and Federal Mineral Lease revenues. For FY 2018-19, S.B. 18-218 (CWCB Construction Fund Projects) appropriated $24.7 million for various water-related projects and authorized the following transfers:

$30,000,000 from the Loan Guarantee Fund to the Severance Tax Perpetual Base Fund;

$4,000,000 from the Severance Tax Perpetual Base Fund to the CWCB Construction Fund to support appropriations made in other sections of the bill;

$2,000,000 from the CWCB Construction Fund to the Water Supply Reserve Fund to support water basin roundtable approved projects;

$2,000,000 from the CWCB Construction Fund to replenish the continuously-appropriated Litigation Fund;

$500,000 from the CWCB Construction Fund to replenish the continuously-appropriated Flood and Drought Response Fund; and

$500,000 from the CWCB Construction Fund to replenish the continuously-appropriated Feasibility Study Small Grant Fund.

An estimated $25.0 million will be available for new loans from the Construction Fund in FY 2019-20. The following table outlines fund activity from FY 2016-17 through estimates for FY 2018-19 and FY 2019-20:

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Colorado Water Conservation Board Construction Fund (Cash Flow Summary Report Based on September 2018 Legislative Council Staff Revenue Estimate)

FY 2016-17

ACTUAL FY 2017-18

ACTUAL FY 2018-19

ESTIMATE FY 2019-20

ESTIMATE

Interest (Loans, Treasury, Miscellaneous) $9,566,358 $11,389,593 $9,861,375 $9,920,210

Federal Mineral Lease (FML) Revenues 9,041,071 8,576,056 9,877,992 10,001,817

Other Revenues (including pass-through) 12,634,122 30,342,456 3,657,518 3,657,516

Water Plan Implementation 0 15,000,000 10,000,000 10,000,000

Chatfield Reservoir Reallocation Project 27,851,358 4,000,000 4,000,000 0

Windy Gap Reservoir Bypass Channel Project 0 200,000 0 0

Watershed Grants 0 6,500,000 0 0

Statewide Water Supply Initiative 0 1,000,000 0 0

Bear Creek Reservoir Reallocation Study 0 2,500,000 0 0

Rio Grande Cooperative Project 0 10,000,000 0 0

Transfers from other sources 1,068,887 778,887 0 0

State Gov’t Grant – Other State Depts 2,075,839 4,670,482 0 0

Operating Transfer 0 2,894,439 0 0

Governor’s Executive Order for Forest Fires 352,679 0 736,770 0

Total Revenues $62,590,313 $97,851,913 $38,133,655 $33,579,543 Cash Expenditures/CWCB Operating Costs1 $12,000,018 $11,303,206 $12,772,945 $12,611,376

Non-Reimbursable Expenditures 10,666,177 9,113,951 7,716,894 25,000,000

Transfer to Other CWCB Funds 564,873 5,971,638 1,125,614 3,548,625

Transfer to CDPHE 0 260,000 0 0

Water Plan Implementation 0 375,156 7,000,000 10,000,000

Flood Emergency Funds 1,249,431 6,482,599 0 0

Rio Grande Cooperative Project Expense 44,529 104,605 9,850,866 0

Windy Gap Reservoir Bypass Channel 0 0 2,200,000 0

Transfer to Water Supply Reserve Fund 0 0 2,000,000 0

Chatfield Reservoir Reallocation Project 3,649,913 12,443,768 15,000,000 0

Republican River Matters 0 0 8,000,000 0

Governor’s Executive Order for Forest Fires 352,679 282,054 454,716 0

FEMA Federal Grants 0 25,476,848 5,000,000 5,000,000

Watershed Grants 575,083 954,789 2,000,000 0

Total Expenditures $29,102,703 $72,768,614 $73,121,035 $56,160,001 Net Cash Flow $33,487,610 $25,083,299 ($34,987,380) ($22,580,458) 1Includes cash expenditures for all Long Bill line items less non-reimbursable expenditures.

SEVERANCE TAX PERPETUAL BASE FUND The Severance Tax Perpetual Base Fund receives 50.0 percent of moneys in the Severance Tax Trust Fund (25.0 percent of total severance tax revenues) and provides loans or grants for construction, rehabilitation, enlargement, or improvement of water projects. This fund is a revolving loan account, and as such no permanent programs depend on this fund. The Department estimates $30.0 million will be available in FY 2018-19 for new loans. The table below outlines recent fund activity:

Severance Tax Perpetual Base Fund (Cash Flow Summary Report Based on September 2018 Legislative Council Staff Revenue Estimate)

FY 2016-17

ACTUAL FY 2017-18

ACTUAL FY 2018-19

ESTIMATE FY 2019-20

ESTIMATE

Severance Tax Revenues $15,762,201 $33,106,715 $52,875,902 $45,424,966

Interest (Loans and Treasury) 6,128,353 7,197,033 5,612,929 5,930,109

Transfer from Loan Guarantee Fund 0 30,000,000 0 0

Total Revenues $21,890,554 $70,303,748 $58,488,831 $51,355,075

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Severance Tax Perpetual Base Fund (Cash Flow Summary Report Based on September 2018 Legislative Council Staff Revenue Estimate)

FY 2016-17

ACTUAL FY 2017-18

ACTUAL FY 2018-19

ESTIMATE FY 2019-20

ESTIMATE

Agriculture Emergency Drought Grants $0 $0 $1,000,000 $1,000,000

Transfer to Const. Fund for Water Plan Implementation 0 15,000,000 10,000,000 10,000,000

Transfer to Const. Fund for Watershed Grants 0 6,500,000 0 0

Transfer to Const. Fund for Water Supply Reserve Fund 0 10,000,000 0 0

Transfer to Const. Fund for Rio Grande Coop Project 0 10,000,000 0 0

Transfer to Const. Fund for Windy Gap Project 0 200,000 0 0

Transfer to Const. Fund for Statewide Water Supply Initiative 0 1,000,000 0 0

Transfer to Const. Fund for Bear Creek Res Reallocation Study 0 2,500,000 0 0

Transfer to Const. Fund for Chatfield Res Reallocation Project 0 4,000,000 0 0

Transfer to Loan Guarantee Fund 0 30,000,000 0 0

Transfer to Augment General Fund 0 11,425,000 0 0

Governor's Energy Office 0 0 30,814 30,814

Chatfield Res Reallocation Project (2013 & 2018 Proj Bills) 27,640,163 0 0 0

Other Real Property 0 0 0 0

Misc. Fines and Fees 0 0 0 0

Total Expenditures $27,640,163 $90,625,000 $11,030,814 $11,030,814 Net Cash Flow ($5,749,609) ($20,321,252) $47,458,017 $40,324,261

The CWCB also receives funding from the Severance Tax Operational Fund. Pursuant to Section 39-29-109.3 (1) (d), C.R.S., the CWCB is a Tier I program authorized to receive up to 5.0 percent of Operational Fund revenues for programs within the division. The CWCB's projected FY 2018-19 appropriation of $1.3 million from Tier I of the Operational Fund equals 2.1 percent of total available Operational Fund revenue. COLORADO WATER PLAN The CWCB released a final draft of the Colorado Water Plan on November 19, 2015. To implement aspects of the Colorado Water Plan, the Department has requested the JBC sponsor legislation totaling $30 million General Fund for the Water Plan Grant Program ($10 million) and for a demand management program ($20 million). This bill request is discuss in further detail in the briefing issue titled Colorado Water Plan Implementation.

DIVISION OF WATER RESOURCES (STATE ENGINEER'S OFFICE) The Division of Water Resources (DWR) is responsible for the supervision and control of water resources in the state of Colorado (Section 37-80-102 (1)(h), C.R.S.), including the administration of over 154,000 surface and ground water rights, nine compacts, two U.S. Supreme Court decrees, and other interstate water allocation agreements. Approximately, 91.4 percent of the FY 2018-19 appropriation for the DWR is General Fund, and the division accounts for almost three quarters of the Department's total General Fund appropriation. Cash funds for special programs (e.g. the Water Resources Cash Fund, the Well Inspection Cash Fund, and the Satellite Monitoring System Cash Fund) and federal grants make up the remaining 8.6 percent of the DWR’s total appropriation.

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SUMMARY: FY 2018-19 APPROPRIATION & FY 2019-20 REQUEST


TOTAL

FUNDS GENERAL

FUND CASH

FUNDS REAPPROPRIATED

FUNDS FEDERAL

FUNDS

FTE

FY 2018-19 APPROPRIATION:

HB 18-1322 (Long Bill) $246,522,560 $32,005,418 $183,732,108 $7,708,687 $23,076,347 1,240.4

Other legislation 27,716,894 0 27,716,894 0 0 0.0

TOTAL $274,239,454 $32,005,418 $211,449,002 $7,708,687 $23,076,347 1,240.4

FY 2019-20 REQUESTED APPROPRIATION:

FY 2018-19 Appropriation $274,239,454 $32,005,418 $211,449,002 $7,708,687 $23,076,347 1,240.4

R1 Increase State Parks spending authority 3,661,298 0 3,661,298 0 0 0.0

R2 Additional staffing to address oil and gas backlogs 77,740 0 77,740 0 0 0.0

R3 Wildlife small capital program 2,043,120 0 2,043,120 0 0 0.0

R4 Capital development resourcing 401,653 0 401,653 0 0 3.0

R5 Cameo State Recreation Area resourcing 351,025 0 351,025 0 0 3.0

R6 Increase Wildlife Council spending authority 1,100,000 0 1,100,000 0 0 0.0

Non-prioritized request items 809,072 158,955 618,059 24,792 7,266 0.0

Centrally appropriated line items 4,395,503 975,896 3,786,537 (349,059) (17,871) 0.0

Technical adjustments 87,315 0 87,315 0 0 0.0

Annualize prior year legislation (27,442,382) 50,742 (27,503,168) 9,573 471 0.0

Indirect cost assessment (419,192) 135,747 (547,773) (135,747) 128,581 0.0

Annualize prior year budget action (530,117) (1) (444,405) 1 (85,712) 0.0

TOTAL $258,774,489 $33,326,757 $195,080,403 $7,258,247 $23,109,082 1,246.4

INCREASE/(DECREASE) ($15,464,965) $1,321,339 ($16,368,599) ($450,440) $32,735 6.0

Percentage Change (5.6%) 4.1% (7.7%) (5.8%) 0.1% 0.5%

R1 INCREASE STATE PARKS SPENDING AUTHORITY: The request includes an increase of $3,661,298 cash funds from the Parks and Outdoor Recreation Cash Fund intended to cover increased operational costs associated with increased parks visitation and inflation that State Park Operations has experienced since FY 2009-10. R2 ADDITIONAL STAFFING TO ADDRESS OIL AND GAS BACKLOGS: This request was discussed during the JBC Staff briefing for the Department of Natural Resources held on November 28, 2018. The amount shown in this table represent the centrally appropriated costs associated with this request. R3 WILDLIFE SMALL CAPITAL PROGRAM: The request includes an increase of $2,043,120 cash funds from the Wildlife Cash Fund for the implementation of a Wildlife Small Capital Program to address health, fire, and safety issues and to enact minor repairs at the states 574 wildlife facilities. R4 CAPITAL DEVELOPMENT RESOURCING: The request includes an increase of $401,653 cash funds and 4.0 FTE for the Division of Parks and Wildlife’s Capital Development Program. The additional resources will be used to increase staffing levels in three areas: dam operations and maintenance, central design, and regional field staff.

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R5 CAMEO STATE RECREATION AREA RESOURCING: The request includes an increase of $351,025 cash funds and 3.0 FTE from the Parks and Outdoor Recreation Cash Fund for staffing and operations at the new Cameo State Recreation Area (SRA) in Mesa County. The Division will hire a park manager, a technician, and an administrative assistant. R6 INCREASE WILDLIFE COUNCIL SPENDING AUTHORITY: The request includes an increase of $1.1 million cash funds from the Wildlife Management Public Education (WMPE) Fund for the Wildlife Council to expand its media-based education programs. NON-PRIORITIZED REQUEST ITEMS: The request includes an increase of $809,072 total funds, including $158, General Fund, for items requested by other agencies that impact this department. The table below itemizes each requested non-prioritized item for FY 2019-20. These request items will be addressed in separate staff briefings for the Department of Personnel and Administration and the Governor’s Office.

NONPRIORITIZED REQUEST ITEMS

TOTAL

FUNDS GENERAL

FUND CASH


FUNDS FEDERAL

FUNDS FTE

OIT Securing IT operations $577,094 $94,732 $456,800 $14,797 $10,765 0.0

OIT Essential database support 190,453 55,136 124,966 9,256 1,095 0.0

OIT Application refresh and consolidation 98,988 16,249 78,355 2,538 1,846 0.0

DPA IDS Increased Input Costs 18,307 397 17,843 67 0 0.0

OIT Optimize self-service capabilities 16,228 2,664 12,845 416 303 0.0

DPA Annual fleet vehicle request (91,998) (10,223) (72,750) (2,282) (6,743) 0.0

TOTAL $809,072 $158,955 $618,059 $24,792 $7,266 0.0

CENTRALLY APPROPRIATED LINE ITEMS: The request includes adjustments to centrally appropriated line items for the following line items. This request item will be addressed in separate staff briefings for the Department of Personnel and Administration and the Governor’s Office.

CENTRALLY APPROPRIATED LINE ITEMS

TOTAL

FUNDS GENERAL

FUND CASH


FUNDS FEDERAL

FUNDS FTE

Merit pay adjustment $3,411,741 $594,820 $2,630,847 $108,797 $77,277 0.0

PERA Direct Distribution 3,072,937 485,063 2,491,857 91,512 4,505 0.0

Salary survey adjustment 1,273,280 3,584 1,269,297 399 0 0.0

Health, life, and dental adjustment 828,209 847,488 642,122 (672,833) 11,432 0.0

AED adjustment 324,495 39,750 282,098 1,550 1,097 0.0

SAED adjustment 324,495 39,750 282,098 1,550 1,097 0.0

Leased space adjustment 63,131 10,369 52,748 14 0 0.0

Short-term disability adjustment 9,409 4,527 3,985 549 348 0.0

ALJ adjustment 59 0 59 0 0 0.0

CORE adjustment (2,558,105) (482,476) (1,892,040) (104,369) (79,220) 0.0

Payments to OIT adjustment (1,525,639) (237,835) (1,553,055) 291,705 (26,454) 0.0

Legal services adjustment (324,419) (18,430) (275,693) (34,404) 4,108 0.0

Payment to risk management / property funds adjustment (208,780) (2,922) (207,606) 1,645 103 0.0

Capitol Complex leased space adjustment (181,341) (34,077) (92,110) (35,376) (19,778) 0.0

Workers’ compensation adjustment (107,677) (273,715) 158,222 202 7,614 0.0

Shift differential adjustment (6,292) 0 (6,292) 0 0 0.0

TOTAL $4,395,503 $975,896 $3,786,537 ($349,059) ($17,871) 0.0


TECHNICAL ADJUSTMENTS: The request includes an increase of $87,315 cash funds for technical adjustments to various line items.

TECHNICAL ADJUSTMENTS TOTAL

FUNDS GENERAL

FUND CASH


FUNDS FEDERAL

FUNDS FTE

Colorado Healthy Rivers Fund $60,000 $0 $60,000 $0 $0 0.0

Annual Depreciation-lease Equivalent Payment 15,315 0 15,315 0 0 0.0

South Platte River alluvial aquifer monitoring 12,000 0 12,000 0 0 0.0

Combine Parks and Wildlife Aquatic Nuisance Species Funds (S.B. 18-143) 0 0 0 0 0 0.0

TOTAL $87,315 $0 $87,315 $0 $0 0.0

ANNUALIZE PRIOR YEAR LEGISLATION: The request includes adjustments for the second year impact of prior year legislation.

ANNUALIZE PRIOR YEAR LEGISLATION

TOTAL

FUNDS GENERAL

FUND CASH


FUNDS FEDERAL

FUNDS FTE

SB 18-200 (PERA) $274,512 $50,742 $213,726 $9,573 $471 0.0

SB 18-218 (CWCB Projects Bill) (24,716,894) 0 (24,716,894) 0 0 0.0

HB 18-1338 (Sev Tax OP Fund Transfers) (3,000,000) 0 (3,000,000) 0 0 0.0

TOTAL ($27,442,382) $50,742 ($27,503,168) $9,573 $471 0.0

INDIRECT COST ASSESSMENT ADJUSTMENT: The request includes a decrease of $419,192 total funds, including an increase of $135,747 General Fund, to the Department’s indirect cost assessments to its various divisions. ANNUALIZE PRIOR YEAR BUDGET ACTIONS: The request includes adjustments for the second year impact of prior year legislation.

ANNUALIZE PRIOR YEAR BUDGET ACTION

TOTAL

FUNDS GENERAL

FUND CASH


FUNDS FEDERAL

FUNDS FTE

FY19 Additional FTE for PROW program $10,542 $0 $10,542 $0 $0 0.0

FY19 R1 (Additional staffing and equipment for flowline safety) 4,296 0 4,296 0 0 0.0

FY19 Salary survey (540,252) (1) (454,540) 1 (85,712) 0.0

FY19 R3 (SFSP additional resources) (4,703) 0 (4,703) 0 0 0.0

TOTAL ($530,117) ($1) ($444,405) $1 ($85,712) 0.0


ISSUE: DIVISION OF PARKS AND WILDLIFE FINANCES AND BUDGET REQUESTS COMPENDIUM

The Department of Natural Resources submitted several decision items for increased appropriations for the Division of Parks and Wildlife (CPW). This briefing issue is a compendium of these requests and background information providing context for the financial health of CPW.

SUMMARY

S.B. 18-143 (Hunting, Fishing, and Parks for Future Generations Act), which addressed many aspects of CPW’s operations, increased fees for CPW for most hunting and fishing licenses and park passes. It is estimated that the increased fees will increase revenue by approximately $19.4 million in FY 2019-20.

The Department requests a $7.5 million increase in cash funds and 6.0 FTE in FY 2019-20 and ongoing for the Division of Parks and Wildlife. The requested increase is split between two cash funds: $5.5 million from the Parks and Outdoor Recreation Cash Fund and $2.0 million from the Wildlife Cash Fund.

RECOMMENDATION Staff will make a recommendation regarding the decision items affecting the Division of Parks and Wildlife during the Department’s figure setting hearing.

DISCUSSION Pursuant to Section 33-9-105 (1), C.R.S., the Division of Parks and Wildlife and the Parks and Wildlife Commission are established as an enterprise for the purposes of Section 20 of Article X of the State Constitution. As such, CPW can receive no more than 10.0 percent “of its total annual revenues” from both state and local governments. In the FY 2018-17 Long Bill, the Division was appropriated $150,000 General Fund, well below the statutory and constitutional threshold. To generate revenue, CPW assesses fees for hunting and fishing licenses, the registration of recreational vehicles, and for entry into state parks and wildlife areas. These fees, particularly those for hunting and fishing licenses are set in statute, primarily in Section 33-4-102 (1), (1.4), and (2), C.R.S. Overall, CPW revenue has increased by 7.5 percent from FY 2014-15 to FY 2017-18. In the same period, expenditures have increased by 1.5 percent. The increase in revenue is primarily driven by population growth and an increase in the use of the State’s outdoor recreational resources by residents and visitors. Expenditures have risen slowly primarily due to efforts by CPW to control costs. In the last 10 years, CPW has reduced wildlife expenditures by approximately $40 million through a reduction of almost 60.0 FTE, the reduction or elimination of targeted programs, park closures, and deferring capital projects and maintenance.


Division of Parks and Wildlife Revenue and Expenditures, FY 2014-15 to FY 2017-18 REVENUE FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18

Parks $81,327,532 $94,219,755 $93,277,034 $91,993,951

Wildlife 152,947,967 142,142,594 148,622,914 159,737,344

Total Revenue $234,275,499 $236,362,349 $241,899,948 $251,731,295

EXPENDITURES

Parks $79,392,434 $90,071,465 $88,180,135 $90,800,117

Wildlife 150,727,548 140,680,996 136,592,665 142,765,093

Total Expenditures $230,119,982 $230,752,461 $224,772,800 $233,565,210

Net Surplus/(Deficit) $4,155,517 $5,609,888 $17,127,148 $18,166,085

CPW FINANCIAL SUSTAINABILITY During the 2018 legislative session, the General Assembly passed and the Governor signed S.B. 18-143 (Hunting, Fishing, and Parks for Future Generations Act). This bill, which addresses many aspects of CPW’s operations, increased fees for CPW for certain hunting and fishing licenses and park passes. The Division is now required to ensure individuals entering state parks by means other than motor vehicle purchase an entrance pass. The bill allows the Parks and Wildlife Commission to apply a the Denver-Aurora-Lakewood consumer price index for any fee or surcharge increase, per Section 33-4-102 (1.6)(b), C.R.S., which the Commission will consider beginning in 2020. The Division is required to submit an annual report on the impact of fee and surcharge increases starting to its committees of reference in the General Assembly starting November 1, 2019. The Parks and Wildlife Commission, on November 15, 2018, approved the increase of license, camping, and park fees to the statutory maximum. Most resident wildlife license fees have been increased by $8.00. The Commission also approved the creation of a new $8.00 resident youth fishing license for persons age 16 and 17 years old. The Commission approved modest price increases for daily and annual park passes, with the largest increase being a $10 increase for annual vehicle affixed park passes. A new annual hang tag park pass, which is issued to individuals instead of vehicles, was created by the Commission and will cost $120. Additionally, the Commission changed the camping fee structure by eliminating the reservation fee charged for camping permits, choosing to increase the base price of campsites statewide; the price increase is $8-$13, depending of the campsite.2 The Final Fiscal Note for S.B. 18-143, published on August 15, 2018, estimates that the increases to fees will increase CPW revenue by approximately $19.4 million in FY 2019-20. It is in this context of a substantial revenue increase that the Department and CPW have submitted five decisions items for cash fund spending authority increases to the Joint Budget Committee for its consideration.

FY 2019-20 DIVISION OF PARKS AND WILDLIFE DECISION ITEMS The Division’s mission is to "perpetuate the wildlife resources of the state, to provide a quality state parks system, and to provide enjoyable and sustainable outdoor recreation opportunities that educate and inspire current and future generations to serve as active stewards of Colorado's natural resources."3 As such, CPW continues to seek additional appropriations to fund those parks and

2 Additional details on specific fee increases can be found on the Division of Parks and Wildlife’s “2019 Fee Changes” website: https://cpw.state.co.us/aboutus/Pages/Our-Story-2019-Changes.aspx. 3 More details about the Division of Parks and Wildlife can be found here: http://cpw.state.co.us/aboutus/.


https://cpw.state.co.us/aboutus/Pages/Our-Story-2019-Changes.aspx

http://cpw.state.co.us/aboutus/

wildlife programs that it deems necessary. CPW's goal is to manage the state's outdoor recreational resources for the beneficial and sustainable use by the people of Colorado. The Department is requesting a $7.5 million increase in cash funds and 6.0 FTE in FY 2019-20 and ongoing for the Division of Parks and Wildlife. The requested increase is split between two cash funds: $5.5 million from the Parks and Outdoor Recreation (Parks) Cash Fund, created in Section 33-10-111 (1), C.R.S.; and $2.0 million from the Wildlife Cash Fund, created in Section 33-1-112 (1)(a), C.R.S. These decision items will be funded by the increased revenue CPW will realize as a result of S.B. 18-143. The five decision items making up the requested increase are summarized in the table below and discussed in the following sub-sections.

FY 2019-20 Division of Parks and Wildlife Decision Items

DECISION ITEM TOTAL

FUNDS GENERAL

FUND CASH

FUNDS FTE

R1 Increase State Parks spending authority $3,661,298 $0 $3,661,298 0.0

R3 Wildlife small capital program 2,043,120 0 2,043,120 0.0

R4 Capital development resourcing 401,653 0 401,653 3.0

R5 Cameo State Recreation Area resourcing 351,025 0 351,025 3.0

R6 Increase Wildlife Council spending authority 1,100,000 0 1,100,000 0.0

Total $7,557,096 $0 $7,557,096 6.0

R1 INCREASE STATE PARKS SPENDING AUTHORITY The Department is requesting an increase of $5,036,298 cash funds from the Parks Cash Fund and a decrease of $1,375,000 cash funds from the Wildlife Cash Fund. The decrease from the Wildlife Cash Fund is a result of a rebalance of the cost allocation methodology used by CPW to split centralized expenses that are not exclusive to either the State Park or Wildlife. This rebalance calls for a greater share of these expenses to be covered by the Parks Cash Fund than are currently covered. The additional $3,661,298 increase from the Parks Cash Fund is intended to cover increased operational costs associated with parks visitation and inflation since FY 2009-10. The table below shows the 10-year appropriation history for the State Park Operations line item, which has not kept pace with inflation. From FY 2009-10 to FY 2018-19, inflation adjusted appropriations show a decrease of $5.6 million in general purchasing power. As a result, to maintain operations within the current level of spending authority, CPW has reprioritize and utilized non-appropriated funding (e.g., lottery money and federal funds) to balance expenditures and revenue. As shown in the General Factors section of this briefing document, intra-agency and inter-fund transfers have totaled $39.7 million since FY 2015-16.

State Park Operations Line Item 10-year Appropriation History

FISCAL YEAR GENERAL

FUND CASH

FUNDS FEDERAL FUNDS

TOTAL FUNDS

INFLATION ADJUSTED TOTAL FUNDS (FY19 $S)

FY 2009-10 $1,704,815 $26,145,901 $440,980 $28,291,696 $35,927,976

FY 2010-11 1,630,733 22,369,459 445,389 24,445,581 30,240,190

FY 2011-12 0 22,886,470 438,708 23,325,178 28,016,154

FY 2012-13 0 27,321,315 438,708 27,760,023 32,602,938

FY 2013-14 0 26,765,073 438,708 27,203,781 31,073,140

FY 2014-15 0 27,505,281 441,741 27,947,022 31,283,892

FY 2015-16 150,000 28,234,238 444,806 28,829,044 31,539,105

FY 2016-17 150,000 28,936,786 444,806 29,531,592 31,419,525

FY 2017-18 150,000 28,941,636 444,806 29,536,442 30,383,403

FY 2018-19 $150,000 $29,719,308 $444,806 $30,314,114 $30,314,114


The Department reports that operational expenditures (i.e., expenses other than personal services) out of the State Park Operations line item have increased from $10.0 million in FY 2009-10 to $14.3 million in FY 2017-18, the last full fiscal year. In the same time period, park visitation has increased by 24.6 percent, from 12.3 million visits to 15.3 million visits. The Department uses park visitation as an indicator of how expenditures will trend because park operations will need to account for the costs associated with increases or decreases in utilization. The increase in operational expenditures and park visitations were used by CPW and the Department in assessing their FY 2019-20 anticipated expenditures. They assert that the requested $5.0 million increase in cash fund spending authority will be sufficient for their operational needs. CPW conducted a cost allocation methodology analysis this year to determine the correct split of centralized costs between State Park and Wildlife operations. The current cost allocation methodology was implemented in FY 2013-14 after the merger of the Division of Parks and Outdoor Recreation and the Division of Wildlife was completed. This methodology splits centralized costs assuming that 75.0 percent of the costs are associated with Wildlife operations and 25.0 percent are for Parks operations. As a result of the 2018 analysis, the new methodology indicates a 65:35 ratio of Wildlife to Parks cost allocations. This new ratio is the basis for the Department’s request to shift $1,375,000 cash fund spending authority from the Wildlife Operations line item to the State Parks Operations line item. R3 WILDLIFE SMALL CAPITAL PROGRAM The Department is requesting an increase of $2,043,120 cash funds from the Wildlife Cash Fund for the implementation of a Wildlife Small Capital (WSC) Program to address health, fire, and safety issues and to enact minor repairs at the states 574 wildlife facilities. The request also includes a $350,000 transfer of cash fund spending authority from the Wildlife Operations line item to the Asset Maintenance and Repairs line item, which will fund the WSC Program. The Program, which is in its first year, is a companion to a similar program designed to focus on State Parks small capital projects that has operated for about 15 years and addressed about 120 projects per year. The WSC Program is currently funded through various sources of appropriated and non-appropriated funds. The Program’s FY 2018-19 budget is approximately $3.2 million, including a $2.0 million Great Outdoors Colorado (GOCO) grant, about $1.1 million appropriated cash funds, and $135,120 federal funds. The Department is requesting that the WSC Program be funded through the Asset Maintenance and Repairs line item in FY 2019-20 with only Wildlife Cash Fund money.

Wildlife Small Capital Program Budget

LINE ITEM/FUNDING SOURCE FY 2018-19

APPROPRIATED FY 2019-20

REQUESTED

Asset Maintenance and Repair $606,880 $3,000,000

Wildlife Operations 350,000 0

Capital Outlay 103,000 0

FY 2018-19 GOCO grant* 2,000,000 0

Federal funding* 135,120 0

Total $3,195,000 $3,000,000

* Non-appropriated funds.

Program spending is spread across six allocation categories based on existing capital assets. Hatcheries, of which there are 19 in the state that breed, hatch, rear, and stock over 90 million fish


per year, account for the highest allocation (30.8 percent) of the WCS Program’s FY 2018-19 budget. Each region receives a roughly equal share, with the variance attributable to the number of Wildlife Areas and capital assets in each region. The smallest portion of the budget goes to Administration, which includes projects such as building and grounds maintenance, fencing and animal facility upgrades, and equipment purchases. The Administration category includes the Denver Headquarters, the Foothills Wildlife Research Center, the Aquatic Toxicology Lab, the Parvin Lake Research Center, and the Bellvue Fish Research Hatchery. The Department anticipates a similar budget allocation in FY 2019-20 and are in the processes of evaluating projects for the upcoming fiscal year.

FY 2018-19 Wildlife Small Capital Program Allocations ALLOCATION CATEGORY AMOUNT BUDGETED % OF BUDGET

Northeast Region $472,000 14.8%

Northwest Region 530,000 16.6%

Southeast Region 490,000 15.3%

Southwest Region 520,000 16.3%

Hatcheries 983,000 30.8%

Administration 200,000 6.3%

Total $3,195,000 100.0%

Project work will be absorbed by existing staff at the Wildlife Areas and regional offices. Each administrative regional office has at least one staff member dedicated to capital development and maintenance. The projects are generally small in scope and can be completed by Wildlife Area staff members. For those projects that require contractors, area staff provide oversight. The Division has developed internal guidance for the types of projects that are allowed under the WSC Program. Personal services costs and operational costs, such as travel and utilities, are excluded from the Program. R4 CAPITAL DEVELOPMENT RESOURCING The Department requests an increase of $401,653 cash funds and 4.0 FTE for the Division of Parks and Wildlife’s Capital Development Program. Funding for this request will be split, with approximately $134,795 and 1.0 FTE funded by the Parks Cash Fund and $266,858 and 3.0 FTE funded by the Wildlife Cash Funds. The additional resources will be used to increase staffing levels in three areas: dam operations and maintenance, central design, and regional field staff. The Department assumes that each of the planned FTE will be engineers with project design and management experience. The additional staff will add capacity for project design and management, project implementation and construction, and ongoing safety inspections. The table below summarizes the requested appropriation by personal services and operating expenses.

R4 Capital Development Resourcing PERSONAL SERVICES FY 2019-20 FY 2020-21

Professional Engineer I salary $251,928 $335,904

PERA 26,201 34,934

AED 12,596 16,795

SAED 12,596 16,795

Medicare 3,653 4,871

STD 479 638

Health-Life-Dental 23,782 31,709

Subtotal $331,235 $441,646

FTE 3.0 4.0

OPERATING EXPENSES FY 2019-20 FY 2020-21

Regular operating expenses $1,500 $2,000


R4 Capital Development Resourcing OPERATING EXPENSES FY 2019-20 FY 2020-21

Telephone 1,350 1,800

PC 4,920 0

Office furniture 13,892 0

Supplies 16,000 0

Overnight travel 12,000 16,000

Licensing/Certification and Training 4,000 4,000

Vehicle variable mileage 11,556 15,408

Vehicle lease costs 5,200 15,600

Subtotal $70,418 $54,808

Total $401,653 $496,454

The Department will assign one FTE to its central design office to assist with project design, coordination, and evaluation, as well as managing design consultants. This position will be based in the Department’s Denver Headquarters, but will travel frequently. The primary focus of this position will be on CPW’s hatcheries. There are 19 in the state that breed, hatch, rear, and stock over 90 million fish per year, and most of these facilities are 70-100 years old. With aging infrastructure, regular maintenance and replacement of components (e.g., water collection systems, pipelines, raceways, etc.) is necessary to ensure their continuing operation. Technological improvements and innovations in hatchery practices have been developed in the years since the construction of many of these facilities, which means they are antiquated and inefficient compared to newly constructed facilities. CPW is developing a plan to overhaul and modernize their entire hatchery system in order to meet the needs of the state’s anglers and to continue efforts for the recovery of threatened and endangered aquatic species. The Department will allocate one of the new FTE to dam operations and maintenance, which is responsible for statewide planning, monitoring, maintenance, and construction work on CPW’s inventory of 110 dams. This position will be based in the Department’s Denver Headquarters, but will travel frequently. The dams in CPW’s inventory are fairly old, with most ranging in age from 50-100 years old. From FY 2016-17 through FY 2018-19, CPW funded and initiated 15 dam projects in state parks and wildlife areas at a cost of approximately $27.8 million. These efforts have focused on those dams with the greatest need and those in the most critical areas. Despite this work, the Division’s Dam Safety Program reports a maintenance and repair backlog of approximately $44.8 million. The remaining two FTE will be assigned to regional offices to help with project planning, design, and construction management. These positions will help in addressing the maintenance, rehabilitation, and general capital projects at the regional level. CPW is geographically dispersed across the whole state. As such, it employs a hub-and-spoke model for locating capital development staff. This request follows that model by splitting the requested engineer positions between its central and regional offices. The table below shows the capital development budget for CPW starting in FY 2016-17.


Division of Parks and Wildlife, Capital Development Budget

ACTUAL PROJECTED

FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21 FY 2021-22

Wildlife

Dam projects/maintenance $1,400,000 $1,420,000 $2,600,000 $1,670,000 $6,920,000 $6,920,000

Hatchery projects 765,000 771,000 697,000 812,000 2,812,000 2,812,000

Regional projects 1,634,502 1,017,200 3,537,315 876,000 2,876,000 2,876,000

Central projects 0 425,000 25,000 170,000 170,000 170,000

Cameo SRA shooting range 0 0 0 0 750,000 750,000

Subtotal $3,799,502 $3,633,200 $6,859,315 $3,528,000 $13,528,000 $13,528,000

Parks

Dam projects/maintenance $9,550,000 $8,000,000 $4,800,000 $970,000 $1,770,000 $1,770,000

Regional projects 9,033,320 6,707,200 7,881,130 14,836,240 14,836,240 14,836,240

Central projects 0 100,000 250,000 150,000 150,000 150,000

Trails in State Parks 1,254,000 800,000 1,209,100 800,000 800,000 800,000

New park acquisition/development 0 1,000,000 2,364,795 0 1,875,000 1,875,000

Cameo SRA shooting range 0 0 0 0 1,000,000 1,000,000

Subtotal $19,837,320 $16,607,200 $16,505,025 $16,756,240 $20,431,240 $20,431,240

Total $23,636,822 $20,240,400 $23,364,340 $20,284,240 $33,959,240 $33,959,240

R5 CAMEO STATE RECREATION AREA RESOURCING The Department requests an increase of $351,025 cash funds and 3.0 FTE from the Parks Cash Fund for staffing and operations at the new Cameo State Recreation Area (SRA) in Mesa County, which provides shooting sports amenities. The Division will hire a park manager, a technician, and an administrative assistant. The park ranger will be responsible for over-all facility management and day-to-day operations; this position will be a POST-certified law enforcement officer. The technician will be responsible for maintaining the facilities equipment, which will be specialized or relatively uncommon from the rest of the CPW system (e.g., clay target throwers). The administrative assistant will manage front-desk operations, including reservations, payments, tours and educational activities, and volunteer coordination. The additional staff will supplement and replace current CPW staff on temporary assignment to the Cameo SRA. The Cameo State Recreation Area has already hired a Shooting Range Program Manager. The following table summarizes the requested personal services and operating expenses.

R5 Cameo State Recreation Area Resourcing PERSONAL SERVICES FY 2019-20 FY 2020-21

Staff salary $154,524 $154,524

PERA 16,070 16,070

AED 7,727 7,727

SAED 7,727 7,727

Medicare 2,240 2,240

STD 293 293

Health-Life-Dental 23,781 23,781

Subtotal $212,362 $212,362

FTE 3.0 3.0

OPERATING EXPENSES FY 2019-20 FY 2020-21 Regular operating expenses $1,500 $1,500

Telephone 1,350 1,350

PC 3,690 0

Office furniture 10,419 0

Supplies 22,500 22,500

Vehicle variable mileage 6,164 6,164

Vehicle lease costs 3,440 10,320

Temporary staff 72,000 72,000


R5 Cameo State Recreation Area Resourcing OPERATING EXPENSES FY 2019-20 FY 2020-21

Utilities 9,600 9,600

Training 2,000 2,000

Purchased services 6,000 6,000

Subtotal $138,663 $131,434

Total $351,025 $343,796

Temporary staff support is a common and essential aspect of CPW’s business model. It allows facility managers to increase staffing during high volume periods, typically in the summer and fall, while being able to easily scale staffing levels back when no longer needed. The Division assumes that they will need 6,000 temporary staff hours at an hourly rate of $12.00. Given that the Cameo SRA is a shooting range, staff training will be required to ensure that all those working and volunteering at this facility are properly informed of basic firearm safety and first aid. The buildout of the Cameo SRA will take place over several years, perhaps even decades. Phase 1A of construction began in 2017, with the grand opening of the facility occurring August 25, 2018. Phase 1A built essential infrastructure (e.g., rifle and pistol bays, archery lanes, toilets, etc.) to ensure the facility could open. However, while the facility is open, it is operating at a limited capacity and there several more phase of construction to build it out. Phase 1B commenced in early FY 2018-19 and will add more basic amenities, such as: 3,000 linear feet of fencing, the placement and installation of 54 clay target throwers, shooting benches, and point of sale equipment. The Phase 1A budget is $1.7 million and Phase 1B budget is $1.6 million. Funding for these phases has been provided by local and federal grants. Future funding will likely be a mix of federal grants, Great Outdoors Colorado grants, and Colorado Lottery funds. R6 INCREASE WILDLIFE COUNCIL SPENDING AUTHORITY The Department requests an increase of $1.1 million cash funds from the Wildlife Management Public Education (WMPE) Fund (Section 33-1-112 (3.5)(a), C.R.S.) for the Wildlife Council to expand its media-based education programs. The Wildlife Council, created in 1998 and authorized by Section 33-4-102, C.R.S., is tasked with designing a “comprehensive media-based public information program” that educates the public about the “benefits of wildlife, wildlife management, and wildlife-related recreational opportunities in Colorado, specifically hunting and fishing.” Perhaps the most well-known of the Council’s outreach campaigns is the “Hug a Hunter/Hug an Angler” campaign that is designed to demonstrate that sportspersons and non-sportspersons share the same concerns for Colorado’s wildlife resources. The FY 2018-19 Long Bill (H.B. 18-1322) appropriates $1.1 million in cash fund spending authority from the WMPE Fund to the Wildlife Operations line item for expenditures by the Council. This request would double that appropriation to $2.2 million cash funds. The WMPE Fund receives revenue from a $0.75 surcharge on each hunting and fishing license sold in the state. This surcharge will increase to $1.50 beginning January 1, 2019, due to the enactment of S.B. 18-143 and approval by the Parks and Wildlife Commission. Since FY 2012-13, this surcharge has generated an estimated $7.7 million, though it should be noted that the FY 2019-20 revenue shown in the table below is underestimated due to the upcoming surcharge increase. The Council maintains a $400,000 reserve fund balance. The fund is exempt from the uncommitted fee reserve balance pursuant to Section 24-75-402 (5)(c), C.R.S., because the surcharge is set by the Parks and Wildlife Commission which is an enterprise.


Wildlife Council Revenue and Expenditure History Fiscal Year Surcharge Revenue Total Revenue Total Expenditures Net Cash Flow

FY 2012-13 $859,337 $864,588 $740,904 $123,684

FY 2013-14 890,279 894,616 1,027,126 (132,510)

FY 2014-15 927,268 932,377 864,344 68,033

FY 2015-16 978,017 982,711 1,096,939 (114,228)

FY 2016-17 1,009,706 1,011,992 864,768 147,224

FY 2017-18 998,743 1,000,433 1,015,690 (15,257)

FY 2018-19* 998,743 1,505,373 1,100,000 405,373

FY 2019-20* 998,743 1,952,933 2,200,000 (247,067)

Total $7,660,836 $9,145,023 $8,909,771 $235,252

* Estimated figures from WMPE Fund Schedule 9 submitted Nov. 1, 2018.

The Council has, in recent years, experienced cost increases in both traditional and digital advertising. Traditional advertising includes broadcast television, radio, and “out-of-home” media (e.g., billboards, bus shelters, etc.). These advertising methods have experienced an across the board cost increase since 2010. Measured in cost per point (CPP), a ratio based on how much it costs to buy one rating point, the inflation adjusted CPP has increase by a range of 28.6 percent to 96.8 percent, depending on the segment type. As a result, the Council has limited its Hug a Hunter/Hug an Angler campaign to two 8-week time frames, running ads exclusively on broadcast television.

Denver Cost Per Point Change, 2010-2018 CPP SEGMENT 2010* 2018 PERCENTAGE INCREASE

Prime time $675 $1,329 96.8%

Daytime 313 588 87.8%

Late fringe 367 682 85.8%

Early news 349 596 71.0%

Prime access 449 741 64.9%

Late news 506 747 47.7%

Early Fringe 394 512 29.9%

Early morning $335 $431 28.6%

*Shown in 2018 inflation adjusted dollars.

Digital media has become the preferred way consumers get their information and the Council has allocated more paid media funds to digital platforms in an effort to keep pace. Digital media advertising cost are increasing due to the demand for such tools, but there is also attendant backend costs. The digital media industry is experiencing cost increases in order to ensure advertisements are serving in brand safe environments, not being clicked on by bot fraud, and are using the highest quality data to ensure accurate audience targeting. All these factors are driving a cost increase in digital media advertising. The requested $1.1 million cash fund spending authority increase will allow the Wildlife Council to increase its media placements, allocate a greater share of its revenue to creative production, and to conduct more research and planning to ensure its message is compelling and resonates with the target audience. With more money for creative production, the Council will be able to diversify its campaign material and to tailor its work products to specific media platforms. Audiences are more interested and engaged when the same message is presented in different manners and using different methods. Increased spending on research and planning will allow the Council to double the sample size, from 400 to 800 individuals, used for tracking studies that assess the effectiveness of their campaigns.


ISSUE: COLORADO WATER PLAN IMPLEMENTATION

The Department of Natural Resources requests that the Joint Budget Committee sponsor legislation appropriating $30 million General Fund for the implementation of the Colorado Water Plan. The $30 million would be split between the Colorado Water Conservation Board’s Water Plan Grants Program ($10 million) and a demand management program under consideration as part of Upper Colorado River Basin Drought Contingency Plan ($20 million).

SUMMARY

As a signatory to the 1922 Colorado River Compact and the 1948 Upper Colorado River Compact, the State of Colorado is obligated to manage the state’s water in a fashion that ensures compliance with these multi-state, multi-jurisdictional agreements.

The Colorado Water Plan, published in 2015, calls for the state to take proactive measures to ensure and protect the long-term beneficial and consumptive use of the state’s water for water rights holders and the residents of Colorado.

RECOMMENDATION

Staff recommends the Committee consider the Department’s request for legislation and advises the following:

The creation of a stand-alone, statutorily authorized Water Plan Grant Program with its own cash fund.

The creation of a sub-account in the CWCB Construction Fund for the Upper Basin Demand Management Program that sequesters appropriated funds for the specific purpose of addressing Colorado River Compact compliance.

Staff requests permission to engage the Department on the specific requirements of this legislation.

DISCUSSION The Colorado River Basin is currently experiencing a decades long drought. Historical analysis of precipitation and other drought indices show that drought is a frequent occurrence in Colorado. Short duration drought, as defined by the three-month Standardized Precipitation Index, occur somewhere in Colorado in nearly nine out of every ten years. However, severe, widespread multiyear droughts are much less common. Since the 1893, Colorado has experienced six droughts that are widely considered “severe.” These droughts affected most of the state, involved record-breaking dry spells, and lasted for multiple years. On May 2, 2018, in response to persistent and prolonged precipitation deficits in portions of the state, Governor Hickenlooper activated the Colorado Drought Mitigation and Response Plan for the agricultural sector in 34 counties. 4 All of these counties are experiencing severe, extreme, or

4 These counties are: Montezuma, La Plata, Archuleta, Conejos, Costilla, Las Animas, Baca, Prowers, Bent, Otero,

Huerfano, Alamosa, Rio Grande, Mineral, Hinsdale, San Juan, Dolores, San Miguel, Ouray, Montrose, Saguache, Custer, Pueblo, Crowley, Kiowa, Cheyenne, Lincoln, El Paso, Elbert, Gunnison, Mesa, Delta, Garfield, and Rio Blanco.


exceptional drought as classified by the U.S. Drought Monitor, and many have already received some level of drought designation from the U.S. Department of Agriculture. If present trends continue, other regions and sectors of the state's economy may also be affected. The Colorado Water Conservation Board (CWCB) published the Colorado Water Plan on November 19, 2015. The Plan provides an extensive discussion on the current state of water supply and demand in Colorado, an assessment of the future water needs and availability of the State, and a roadmap for addressing critical water needs. Since the FY 2016-17, the General Assembly has appropriated $17.0 million cash funds through the annual CWCB projects bills for the implementation of the Plan specifically. The 2016 CWCB Projects Bill (S.B. 16-174) established an annual transfer of $5.0 million from the Severance Tax Perpetual Base Fund to the CWCB Construction Fund. This transfer established a baseline level of annual funding for implementing the Water Plan. The 2017 CWCB Projects Bill (H.B. 17-1248) appropriated $10.0 million from the CWCB Construction Fund and the 2018 CWCB Projects Bill (S.B. 18-218) appropriated an additional $7.0 million from the Fund. These appropriations have mostly been utilized to administer the Water Plan Grant Program, which has been annually authorized by the CWCB Projects Bill. WATER PLAN GRANT PROGRAM The Water Plan Grant (WPG) Program is intended to fund projects, programs, and activities that address the critical actions identified in the Colorado Water Plan. The WPG Program was authorized by H.B. 17-1248 but does not have specific statutory authorization as a standalone program. In FY 2017-18 and FY 2018-19, the WPG Program was appropriated $9.0 million and $10.0 million, respectively. In FY 2017-18, $8.8 million was awarded across all categories. Eligible applicants for the WPG Program are governmental entities and private entities, including mutual ditch companies, non-profit organizations, and partnerships. Grants fund technical assistance, water project studies and analyses, project structural design, and outreach. There are five separate grant categories, with applicants able to qualify for funding under more than one category. These categories are:

water storage and supply projects;

conservation and land use projects;

engagement and innovation activities;

agriculture projects; and

environmental and recreation projects. WPG Program grants require the applicant to provide at least 50% matching funds, with in-kind matches not to exceed half of that match. The Department reports that during FY 2017-18 this matching requirement leveraged over $40 million in total project funds. Grant applications are evaluated on how well it conforms to the Framework for State of Colorado Support for Water Projects, as set forth in Section 9.4 of the Colorado Water Plan 5 , and how well it meets the applicants Basin Implementation Plan’s goals and measurable outcomes. Applicants must provide a letter of support from their Basin Roundtable. There are two grant cycles per year.

5 Colorado Water Conservation Board, Colorado Department Natural Resources. November 15, 2015. Colorado’s Water Plan. https://www.colorado.gov/pacific/cowaterplan/plan.


https://www.colorado.gov/pacific/cowaterplan/plan

STAFF RECOMMENDATION The Department has indicated an interest in growing the size and scope of the WPG Program. While their legislative request only seeks to create a stable funding foundation, JBC staff believes it advisable to consider the long-term goals and lifespan of this grant program. Staff recommends that the WPG Program be created in statute as a standalone program with its own cash fund. This will provide greater budgetary transparency by allowing the General Assembly to directly appropriate funding for the Program, while not precluding future transfers into the Program’s cash fund from the General Fund or other cash funds. Creating a standalone program will afford greater stability in program operations, as it would no longer be authorized on a yearly basis. UPPER BASIN DEMAND MANAGEMENT PROGRAM The State of Colorado is a signatory to the 1922 Colorado River Compact (CRC) and the 1948 Upper Colorado River Compact (Sections 37-61-101 et seq. and 37-62-101 et seq., C.R.S., respectively). These compacts are multi-state, multi-jurisdictional agreements that ensure the proper and equitable use of the water in the Colorado River System and Basin. The Colorado River System and Basin as defined by the CRC are the “portion of the Colorado River and its tributaries within the United States of America” and “all of the drainage area of the Colorado River System and all other territory within the United States of America to which the waters of the Colorado River System shall be beneficially applied.” There are seven states that are signatories to the Colorado River Compact, they are: Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyoming. The “Upper Division” states are Colorado, New Mexico, Utah, and Wyoming. The “Lower Division” states are Arizona, California, and Nevada. In December 2017, the Bureau of Reclamation instructed the signatory states to the Colorado River Compact to continue developing Drought Contingency Plans (DCPs) 6 in response to ongoing historic drought conditions in the Basin. These DCPs are intended to address the need to reduce the likelihood of Colorado River reservoirs further declining to critical elevations, especially those of Lake Mead and Lake Powell. As of October 5, 2018, all seven Colorado River Basin states have submitted Final Draft DCP agreements that would implement Drought Contingency Plans in the Upper and Lower Basins. Approval of the DCPs is ongoing. The Upper Basin DCP is designed to protect critical elevations at Lake Powell, assure continued compliance with the CRC, and authorizes storage of conserved water in the Upper Basin that could help establish the foundation for a future demand management. Per the Final Draft Upper Basin DCP, the Upper Basin Demand Management (UB-DM) Program is intended to allow the state to:

“…temporarily reduce Consumptive Uses in the Upper Basin or augment supplies with Imported Water, if needed in times of drought, to help assure continued compliance with Article III of the Colorado River Compact without impairing the right to exercise existing Upper Basin water rights in the future.”

6 U.S. Bureau of Reclamation. October 5, 2018. Agreement Concerning Colorado River Drought Contingency Management and Operations. https://www.usbr.gov/dcp/.


https://www.usbr.gov/dcp/

The UB-DM Program allows states to “conserve” and store water at one of several designated storage sites,7 also known as CRSPA Initial Units. These sites were designed as storage by the Colorado River Storage Project Act of 19568 (CRSPA). CWCB intends to compensate water users for the intentional and voluntary reduction of their use of Colorado River water; thereby, allowing that water to be conserved and stored to avoid, delay, or mitigate a Colorado River Compact curtailment. Mandatory consumptive use curtailments are considered a last resort to maintaining CRC compliance and a demand management program is a means to avoid that scenario. The idea of demand management has been actively pursued for the Colorado River System and Basin for years. The Upper Colorado River Commission (URCR), created by the Upper Colorado River Compact, administers the System Conservation Pilot Program that has tested the implementation of a demand management program in the Upper Colorado River Basin. Beginning in 2015, the Pilot Program engaged water rights holders in an effort to assess whether a “voluntary, temporary and compensated” consumptive use reduction program could be feasible in the Upper Basin. The results of this Pilot Program have been promising: 45 conservation projects funded, a 22,116 acre-feet reduction in consumptive use, and $4.6 million spent. The average cost per acre-foot reduction is $206. However, as part of URCR’s analysis, several program deficiencies were identified. Administratively, the Pilot Program has highlighted the need for a more detailed and selective application process, as well as the need for more robust staffing resources if a large scale program is established. Operationally, the URCR found that data collection and verification, project type and flexibility, and the ability to legally protect conserved water from downstream use must be addressed for any large scale demand management program to be successful. The Pilot Program had participants from all four Upper Basin States and received funding from both Upper Basin and Lower Basin municipal water providers, include Denver Water.9 The implementation of a demand management program must be done on a regional level, with consensus and buy-in from our Colorado River Compact partners. When dealing with the consumptive use of water from the Colorado River System and Basin, no state can act unilaterally. In order to for CWCB to implement a statewide demand management program, the following must first occur (in order): 1 The approval of the Upper Basin Drought Contingency Plan;

2 The approval of the Upper Basin Demand Management Agreement;

3 A feasibility study conducted by the Upper Colorado River Commission;

4 The design of the UB-DM Program based on the criteria set out in the Demand Management

Storage Agreement, which includes agreement and consultation between the Commission and

the Secretary of the Interior;

5 The Commission must approve the UB-DM Program; and

6 Each Upper Division State, acting through its Commission representative, must approve the

UB-DM Program.

7 These storage sites are: Glen Canyon Dam, Flaming Gorge, Curecanti (a.k.a., Aspinall Unit), and Navajo Reservoir. 8 This federal act authorized construction of the Colorado River Storage Project (CRSP) which allowed for comprehensive development of the water resources of the Upper Basin states by providing for long-term regulatory storage of water for purposes including: regulating the Colorado River, storing water for beneficial use, allowing Upper Basin States to utilize their Colorado River Compact apportionments, providing for the reclamation of arid lands, control of floods, and generation of hydroelectric power. 9 Upper Colorado River Commission. February 2018. Final Report: Colorado River System Conservation Pilot Program in the Upper Colorado River Basin. http://www.ucrcommission.com/RepDoc/SCPPDocuments/2018__SCPP_FUBRD.pdf


http://www.ucrcommission.com/RepDoc/SCPPDocuments/2018__SCPP_FUBRD.pdf

The required completion of these steps means that any CWCB demand management program is at least a year away from implementation, if not more. As such, the Department’s request for $20 million General Fund should be considered in the context of making financial preparations for a water resources scenario that is likely to occur. The Department argues that setting aside some funding now, while the state’s economy is strong, is prudent. It shows the state’s commitment to proactively addressing water compact issues and is a clear signal of intent to compact stakeholders that the state intends to pursue a robust demand management program. STAFF RECOMMENDATION While staff agrees with the premise of taking steps to financially prepare for future constrained water resources, it is advised that any funds appropriated for this purpose are sequestered. Setting aside funding for future compact compliance needs is noble, but establishing proper triggers and guidelines for when and how the Department and CWCB can access and utilized those funds is important. As such, staff recommends that a sub-account be created in the CWCB Construction Fund into which money can be transferred. Access to the fund in this sub-account should be restricted for use only to address Colorado River Compact and Upper Colorado River Compact compliance issues. These restrictions should be as specific as possible to ensure the responsible and purposeful use of any funds.


ISSUE: AQUATIC NUISANCE SPECIES FUNDING The Department of Natural Resources, through the Division of Parks and Wildlife, administers the states Aquatic Nuisance Species Program. The Program is designed and intended to prevent the introduction and spread of invasive species into the waters of the State.

SUMMARY

House Bill 18-1008 (Mussel-free Colorado Act) created an Aquatic Nuisance Species stamp to be purchased by boaters in the State, which will provide a revenue stream for the Aquatic Nuisance Species Program that will partially cover expenses. This bill also consolidated two cash funds used by the Division of Parks and Wildlife to fund the Program.

Pursuant to Section 33-10.5-108 (1)(a)(I), C.R.S., the Division of Parks and Wildlife Aquatic Nuisance Species Fund (ANS Fund) is granted continuous spending authority for all money in the Fund.

RECOMMENDATION Staff recommends the Committee consider legislation to:

strike Section 39-29-109.3 (m), C.R.S., eliminating the transfer of Severance Tax Operational Fund money to the ANS Fund; and

appropriate $2,200,000 General Fund to the ANS Program as an adjustment to the FY 2019-20 Long Bill.

Staff assumes the $2.2 million General Fund appropriation is ongoing and a direct appropriation to the ANS Program, not a transfer to the Division of Parks and Wildlife Aquatic Nuisance Species Fund. Staff requests permission to engage the Department on the specific requirements of this legislation.

DISCUSSION The Aquatic Nuisance Species (ANS) Program was established in 2008 by S.B. 08-226 (Aquatic Nuisance Species Prohibition) to prevent, control, contain, monitor and eradicate ANS, both wildlife and plants, from state waters. The program coordinates a network of state, federal, local, and private watercraft inspection and decontamination stations. Watercraft on trailers are required to be inspected for ANS and decontaminated, if needed, prior to entering Colorado waters. The Program has operated with an average of $4.2 million in expenditures annually since 2008. The ANS Program was originally funded with Tier II severance tax funding and a transfer of $1,250,000 cash funds transferred from the Wildlife Cash Fund. Aquatic Nuisance Species are aquatic plants and animals that invade lakes, reservoirs, rivers, and streams. The ANS most concerning to the Division of Parks and Wildlife (CPW) are: zebra and quagga mussels, New Zealand mudsnails, rusty crayfish, and waterfleas. In 2017, the ANS Program intercepted 26 boast infested with adult mussels coming from out of state. A total of 144 boats


contaminated with adult mussels have been intercepted since 2008. The Program includes mandatory watercraft inspection and decontamination by professional inspectors, who are trained and authorized by CPW. These mandatory inspections are for all boast coming into Colorado from out of state, those leaving waters in Colorado that are known to be positive for the presence of ANS, and those entering a high risk water where inspections and decontaminations are required by the managing agency. The State of Colorado benefits from the ecological protection that is afforded by the ANS Program. CPW a has network of approximately 72 boat inspection and decontamination stations that are operated by state, local, federal and private entities. These stations are all certified by CPW and conduct over 450,000 inspections annually. These inspections emphasize face-to-face educational contact with a sportspersons or boaters. Healthy water ensures Colorado can support a thriving outdoor recreation industry, which creates 229,000 direct jobs, $9.7 billion in wages and salaries, $28.0 billion in consumer spending, and $2 billion in state and local tax revenue.10 Protecting the water of Colorado from ANS also protects the state’s water infrastructure. Aquatic nuisance species like zebra and quagga mussels attach to, clog, and impair water storage, treatment, and distribution systems. ANS PROGRAM FUNDING With the passage of H.B. 18-1008 (Mussel-free Colorado Act), the Aquatic Nuisance Species Program is now partially funded through a stamp assessed on motorboats and sailboats in Colorado. (Section 33-10.5-104.5, C.R.S.) Beginning January 1, 2019, residents must register their motorboat or sailboat with CPW and are charge $25 for the stamp. Non-residents must purchase a $50 stamp for boats that are in Colorado waters for more than 60 consecutive days. The price of the stamp can be increased to account for inflation based on the Denver-Boulder-Greeley11 consumer price index. Pursuant to Section 33-10.5-108 (1)(a)(I), C.R.S., the Division of Parks and Wildlife Aquatic Nuisance Species Fund (ANS Fund) is granted continuous spending authority for all money in the Fund. The following table summarizes the cash flow of the ANS Program since its inception in FY 2008-09. ANS Program revenue includes: Tier II severance tax transfers, federal and state grants, intra-agency and inter-fund transfers, and interest. The Program’s average revenue in the five fiscal years starting in FY 2015-16 is approximately $3.0 million, excluding recent General Fund appropriations. In the same time period, the average expenditures are about $4.5 million. In the last two fiscal years starting in FY 2017-18, the ANS Program has been appropriated $7.2 million General Fund. The ANS Fund anticipates a FY 2019-20 year beginning cash balance of approximately $11.0 million, which is a result of recent annual surpluses and the combination of the Parks’ and the Wildlife’s ANS cash funds, pursuant to H.B. 18-1008.

Aquatic Nuisance Species Program Cash Flow History

GENERAL FUND REVENUE EXPENDITURES NET CASH FLOW

FY 2008-09 $0 $5,956,636 $2,888,506 $3,068,130

FY 2009-10 0 4,029,489 4,037,758 (8,269)

FY 2010-11 0 4,062,676 3,791,992 270,684

FY 2011-12 0 4,556,284 3,884,058 672,226

10 Outdoor Industry Association: https://outdoorindustry.org/state/colorado/. 11 Please note that this CPI has been replaced by the federal Bureau of Labor Statistics with the Denver-Aurora-Lakewood consumer price index.


Aquatic Nuisance Species Program Cash Flow History

GENERAL FUND REVENUE EXPENDITURES NET CASH FLOW

FY 2012-13 0 4,102,221 4,144,425 (42,204)

FY 2013-14 0 4,474,784 4,428,173 46,611

FY 2014-15 0 4,513,537 4,436,221 77,316

FY 2015-16 0 3,822,112 5,006,472 (1,184,360)

FY 2016-17 0 1,431,399 4,200,080 (2,768,681)

FY 2017-18 3,636,364 3,386,364 4,194,373 2,828,355

FY 2018-191 3,636,364 7,046,116 4,412,402 6,270,078

FY 2019-201 0 6,468,368 4,412,402 2,055,966

Total $7,272,728 $53,849,986 $49,836,862 $11,285,852

Program average2 3,881,438 4,153,072

5-year average2 $2,976,326 $4,449,910

1 Projected cash fund revenue. 2 Excludes General Fund appropriations.

The revenue from the sales of stamps is not anticipated to cover the annual expenditures of the ANS Program, resulting in an ongoing annual deficit. In FY 2018-19, the ANS Program anticipates $2.3 million in revenue from the sale of stamps. In FY 2019-20, the Program anticipates $2.4 million in revenue. These revenue projections are based on the assumption that 85,327 resident stamps and 5,200 non-resident stamps will be sold each full year. In each of the aforementioned fiscal years, the Program anticipates $4.4 million in expenditures. This results in an annual deficit of approximately $2.15 million. STAFF RECOMMENDATION The annual deficit is the basis for Staff’s recommendation that the JBC sponsor legislation to change the structure of annual funding for the ANS Program. Currently, the ANS Program receives a maximum of $4,006,005 from Tier II transfers from the Severance Tax Operational Fund. (Section 39-29-109.3 (m)(II), C.R.S.) However, as the table below shows, the amount of money actually transferred is highly variable. The average annual Severance Tax transfer to the ANS Program since 2008 is about $3.2 million. The five-year average starting in FY 2015-16 is $1.8 million, which is the result of two years (FY 2016-17 and FY 2017-18) of no funds being transferred because proportional reductions of Tier II transfers were required. The variable and volatile nature of severance tax has filtered down into the ANS Program’s funding.

Severance Tax Operational Fund Tier II Transfers FISCAL YEAR TRANSFER FUNDS

FY 2008-09 $5,956,636

FY 2009-10 4,006,005

FY 2010-11 3,980,046

FY 2011-12 4,006,005

FY 2012-13 2,867,387

FY 2013-14 4,042,714

FY 2014-15 4,006,005

FY 2015-16 3,646,903

FY 2016-17 0

FY 2017-18 0

FY 2018-19* 2,974,071

FY 2019-20* 2,580,424

Total $38,066,196

Program Average 3,172,183

5-year average $1,840,280

* Projected cash fund revenue


Removing the ANS Program from the list of Tier II eligible programs has two beneficial consequences. First, by appropriating General Fund directly to the Program, the volatility of its revenue stream is significantly reduced. Instead of having two revenue streams that are subject to market forces, only the stamp sales would be affected by fluctuation in boat registrations. Second, the removal would reduce the number of programs reliant on Tier II funds, increasing the availability of funding for other Tier II programs. Appropriating General Fund directly to the ANS Program offers a stable funding foundation. The staff recommended level of General Fund is intended to make up the difference between ANS stamp sales revenue and anticipated program expenditures. The cash balance of the ANS Fund, currently $11.0 million, will allow the ANS Program to withstand any minor fluctuations in annual expenditures and stamp sales revenue for several years. In the past, the Program has been funded by transfers of money from the Severance Tax Operational Fund and through legislation transferring General Fund. By appropriating General Fund to the Program directly through the Long Bill, the General Assembly will gain greater transparency into the appropriations for this program and have the ability to adjust those appropriations more efficiently in the future.


Appendix A: Numbers Pages

FY 2016-17Actual

FY 2017-18Actual

FY 2018-19Appropriation

FY 2019-20Request

Request vs.Appropriation

DEPARTMENT OF NATURAL RESOURCESBob Randall, Executive Director

(1) EXECUTIVE DIRECTOR'S OFFICEThis division provides budeting, accounting, financial management, human resources, infpramtion technology, public information, and environmental edcuationcoordination for all divisions. Cash fund sources include various funds as reflected in individual division descriptions. Reappropriated funds is comprised of statewideand departmental indirect cost recoveries.

(A) AdministrationPersonal Services 3,685,729 3,835,086 3,901,595 4,010,447 *

FTE 37.4 38.2 41.3 41.3Reappropriated Funds 3,685,729 3,835,086 3,901,595 4,010,447

Health, Life, and Dental 13,095,267 14,157,819 15,155,329 16,071,101 *General Fund 1,978,358 2,665,836 2,146,703 3,129,938Cash Funds 9,952,512 10,773,085 11,585,159 12,314,844Reappropriated Funds 822,186 382,739 1,112,475 303,895Federal Funds 342,211 336,159 310,992 322,424

Short-term Disability 179,003 182,489 168,774 179,514 *General Fund 28,046 29,655 26,798 31,325Cash Funds 141,187 142,767 132,513 137,829Reappropriated Funds 5,014 4,986 5,230 5,779Federal Funds 4,756 5,081 4,233 4,581

*This line item includes a decision item.



FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


S.B. 04-257 Amortization Equalization Disbursement 5,156,204 5,410,905 5,591,406 5,952,676 *General Fund 807,711 879,485 887,519 927,269Cash Funds 4,067,023 4,233,366 4,390,476 4,709,349Reappropriated Funds 144,575 147,874 173,223 174,773Federal Funds 136,895 150,180 140,188 141,285

S.B. 06-235 Supplemental Amortization EqualizationDisbursement 5,102,493 5,410,905 5,591,406 5,952,676 *

General Fund 799,297 879,485 887,519 927,269Cash Funds 4,024,658 4,233,366 4,390,476 4,709,349Reappropriated Funds 143,069 147,874 173,223 174,773Federal Funds 135,469 150,180 140,188 141,285

PERA Direct Distribution 0 0 0 3,072,937General Fund 0 0 0 485,063Cash Funds 0 0 0 2,491,857Reappropriated Funds 0 0 0 91,512Federal Funds 0 0 0 4,505

Salary Survey 50,669 2,063,897 3,633,789 1,273,280General Fund 10,716 335,391 576,986 3,584Cash Funds 33,877 1,614,654 2,853,030 1,269,297Reappropriated Funds 6,076 56,393 112,625 399Federal Funds 0 57,459 91,148 0




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


Merit Pay 0 728,888 0 3,411,741General Fund 0 129,970 0 594,820Cash Funds 0 565,621 0 2,630,847Reappropriated Funds 0 22,113 0 108,797Federal Funds 0 11,184 0 77,277

Shift Differential 41,899 42,863 41,331 35,039Cash Funds 41,899 42,863 41,331 35,039

Workers' Compensation 1,383,287 1,270,162 1,555,469 1,447,792General Fund 40,547 41,113 338,354 64,639Cash Funds 1,335,239 1,221,238 1,201,783 1,360,005Reappropriated Funds 7,319 7,621 14,122 14,324Federal Funds 182 190 1,210 8,824

Operating Expenses 701,436 870,977 184,331 184,398 *Cash Funds 530,522 684,772 0 0Reappropriated Funds 166,203 181,735 184,331 184,398Federal Funds 4,711 4,470 0 0

Legal Services 4,624,007 5,433,175 5,508,277 5,183,858General Fund 1,242,684 1,393,575 1,363,983 1,345,553Cash Funds 3,272,309 3,912,690 4,020,098 3,744,405Reappropriated Funds 35,917 55,640 54,363 19,959Federal Funds 73,097 71,270 69,833 73,941




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


Administrative Law Judge Services 0 0 556 615General Fund 0 0 0 0Cash Funds 0 0 556 615Reappropriated Funds 0 0 0 0Federal Funds 0 0 0 0

Payment to Risk Management and Property Funds 778,683 1,024,433 1,410,962 1,202,182General Fund 76,975 86,349 76,851 73,929Cash Funds 680,562 915,073 1,316,047 1,108,441Reappropriated Funds 11,927 13,247 10,199 11,844Federal Funds 9,219 9,764 7,865 7,968

Vehicle Lease Payments 3,520,843 3,807,379 4,344,852 4,279,733 *General Fund 221,002 270,629 315,774 305,551Cash Funds 3,196,704 3,433,585 3,920,537 3,874,666Reappropriated Funds 45,690 45,590 45,721 43,439Federal Funds 57,447 57,575 62,820 56,077

Capital Outlay 0 0 1,062,343 1,062,343General Fund 0 0 0 0Cash Funds 0 0 1,057,006 1,057,006Reappropriated Funds 0 0 0 0Federal Funds 0 0 5,337 5,337

Information Technology Asset Maintenance 206,491 207,127 263,159 263,159General Fund 31,628 31,628 31,628 31,628Cash Funds 84,562 85,555 140,993 140,993Reappropriated Funds 90,301 89,944 90,538 90,538




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


Leased Space 1,302,954 1,385,393 1,552,682 1,616,689General Fund 578,170 602,371 656,063 666,432Cash Funds 691,565 746,951 864,916 918,540Reappropriated Funds 10,669 13,041 7,144 7,158Federal Funds 22,550 23,030 24,559 24,559

Capitol Complex Leased Space 1,357,180 1,587,773 1,458,663 1,277,322General Fund 291,684 304,537 274,106 240,029Cash Funds 690,464 807,789 740,905 648,795Reappropriated Funds 227,014 302,277 284,556 249,180Federal Funds 148,018 173,170 159,096 139,318

CORE Operations 2,611,690 2,968,967 3,538,654 980,549General Fund 392,824 436,451 520,198 37,722Cash Funds 2,020,857 2,354,326 2,806,075 914,035Reappropriated Funds 114,395 97,464 116,165 11,796Federal Funds 83,614 80,726 96,216 16,996

Species Conservation Trust Fund 4,844,042 4,613,306 3,000,000 0General Fund 0 0 0 0Cash Funds 4,844,042 4,613,306 3,000,000 0

Payments to OIT 8,472,678 11,466,417 14,959,627 14,316,751 *General Fund 1,321,611 1,802,797 2,498,414 2,429,360Cash Funds 5,821,675 8,844,447 11,494,623 10,614,534Reappropriated Funds 1,187,270 704,084 822,577 1,141,289Federal Funds 142,122 115,089 144,013 131,568




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


SUBTOTAL - (A) Administration 57,114,555 66,467,961 72,923,205 71,774,802 (1.6%)FTE 37.4 38.2 41.3 41.3 0.0%

General Fund 7,821,253 9,889,272 10,600,896 11,294,111 6.5%Cash Funds 41,429,657 49,225,454 53,956,524 52,680,446 (2.4%)Reappropriated Funds 6,703,354 6,107,708 7,108,087 6,644,300 (6.5%)Federal Funds 1,160,291 1,245,527 1,257,698 1,155,945 (8.1%)

(B) Special ProgramsColorado Avalanche Information Center 1,097,886 1,018,181 1,084,633 1,111,019

FTE 10.4 9.9 10.9 10.9Cash Funds 462,052 379,975 465,062 478,101Reappropriated Funds 589,490 587,655 600,600 613,947Federal Funds 46,344 50,551 18,971 18,971

Indirect Cost Assessment 31,403 48,554 61,818 55,577Cash Funds 27,746 46,266 61,818 55,577Federal Funds 3,657 2,288 0 0

SUBTOTAL - (B) Special Programs 1,129,289 1,066,735 1,146,451 1,166,596 1.8%FTE 10.4 9.9 10.9 10.9 0.0%

Cash Funds 489,798 426,241 526,880 533,678 1.3%Reappropriated Funds 589,490 587,655 600,600 613,947 2.2%Federal Funds 50,001 52,839 18,971 18,971 0.0%

TOTAL - (1) Executive Director's Office 58,243,844 67,534,696 74,069,656 72,941,398 (1.5%)FTE 47.8 48.1 52.2 52.2 (0.0%)

General Fund 7,821,253 9,889,272 10,600,896 11,294,111 6.5%Cash Funds 41,919,455 49,651,695 54,483,404 53,214,124 (2.3%)Reappropriated Funds 7,292,844 6,695,363 7,708,687 7,258,247 (5.8%)Federal Funds 1,210,292 1,298,366 1,276,669 1,174,916 (8.0%)



FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


(5) DIVISION OF PARKS AND WILDLIFEThe division manages Colorado's State Parks, the State's wildlife resources, and various special purpose programs. Primary funding for the Division comes from parkspasses and fees, hunting and fishing licenses, Great Outdoor Colorado Board grants, federal funds, severance tax funds, and various other cash funds.

(A) Colorado Parks and Wildlife OperationsState Park Operations 33,942,105 29,215,893 30,314,114 36,897,982 *

FTE 254.6 257.2 256.1 260.1General Fund 0 150,000 150,000 150,000Cash Funds 33,390,827 28,967,632 29,719,308 36,303,176Federal Funds 551,278 98,261 444,806 444,806

Wildlife Operations 78,703,882 90,024,488 83,513,877 84,402,704 *FTE 619.3 620.3 619.6 621.6

Cash Funds 58,656,300 69,745,139 64,339,194 65,228,021Federal Funds 20,047,582 20,279,349 19,174,683 19,174,683

SUBTOTAL - (A) Colorado Parks and WildlifeOperations 112,645,987 119,240,381 113,827,991 121,300,686 6.6%

FTE 873.9 877.5 875.7 881.7 0.7%General Fund 0 150,000 150,000 150,000 0.0%Cash Funds 92,047,127 98,712,771 94,058,502 101,531,197 7.9%Federal Funds 20,598,860 20,377,610 19,619,489 19,619,489 0.0%

(B) Special PurposeSnowmobile Program 841,872 756,224 1,010,686 1,015,295

FTE 1.8 1.0 1.3 1.3Cash Funds 841,872 756,224 1,010,686 1,015,295




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


River Outfitters Regulation 74,537 25,969 147,952 150,541FTE 0.1 0.0 0.5 0.5

Cash Funds 74,537 25,969 147,952 150,541

Off-highway Vehicle Program 244,822 421,028 557,340 570,631FTE 2.0 3.0 3.0 3.0

Cash Funds 244,822 421,028 557,340 570,631

Off-highway Vehicle Grants 4,702,704 3,575,411 4,000,000 4,000,000Cash Funds 4,702,704 3,575,411 4,000,000 4,000,000

Federal Grants 736,806 0.3 601,122 0.8 750,000 750,000Federal Funds 736,806 601,122 750,000 750,000

S.B. 03-290 Enterprise Fund 306,462 291,170 200,000 200,000Cash Funds 306,462 291,170 200,000 200,000

Information Technology 1,559,190 1,655,272 2,605,016 2,605,016Cash Funds 1,559,190 1,655,272 2,605,016 2,605,016

Trails Grants 3,078,257 3,456,880 2,200,000 2,200,000Cash Funds 1,178,528 1,471,561 1,800,000 1,800,000Federal Funds 1,899,729 1,985,319 400,000 400,000

S.B. 08-226 Aquatic Nuisance Species 2,985,562 1,176,357 3,899,590 3,916,497FTE 0.0 4.0 4.0 4.0

Cash Funds 2,985,562 1,176,357 3,899,590 3,916,497



FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


Game Damage Claims and Prevention 1,176,295 1,028,629 1,282,500 1,282,500Cash Funds 1,176,295 1,028,629 1,282,500 1,282,500

Habitat Partnership Program 1,732,271 2,975,428 2,503,420 2,517,245FTE 2.9 5.0 3.0 3.0

Cash Funds 1,732,271 2,975,428 2,503,420 2,517,245

Grants and Habitat Partnerships 183,461 602,911 1,625,000 1,625,000Cash Funds 183,461 602,911 1,625,000 1,625,000

Asset Maintenance and Repairs 3,286,472 3,404,805 2,706,880 5,100,000 *Cash Funds 3,286,472 3,404,805 2,706,880 5,100,000

Annual Depreciation-lease Equivalent Payment 0 0 16,365 31,680Cash Funds 0 0 16,365 31,680

Beaver Park Dam Repayment 0 0 333,333 333,333Cash Funds 0 0 333,333 333,333

Chatfield Reallocation Project Loan Repayment 0 0 276,700 276,700Cash Funds 0 0 276,700 276,700

Indirect Cost Assessment 7,890,521 7,888,652 4,819,380 4,527,546Cash Funds 3,873,801 2,894,376 4,217,991 3,826,037Federal Funds 4,016,720 4,994,276 601,389 701,509

SUBTOTAL - (B) Special Purpose 28,799,232 27,859,858 28,934,162 31,101,984 7.5%FTE 7.1 13.8 11.8 11.8 0.0%

Cash Funds 22,145,977 20,279,141 27,182,773 29,250,475 7.6%Federal Funds 6,653,255 7,580,717 1,751,389 1,851,509 5.7%

TOTAL - (5) Division of Parks and Wildlife 141,445,219 147,100,239 142,762,153 152,402,670 6.8%FTE 881.0 891.3 887.5 893.5 0.7%

General Fund 0 150,000 150,000 150,000 0.0%Cash Funds 114,193,104 118,991,912 121,241,275 130,781,672 7.9%Federal Funds 27,252,115 27,958,327 21,370,878 21,470,998 0.5%

*This line item includes a decision item.17-Dec-18 39 NAT-brf


FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


(6) COLORADO WATER CONSERVATION BOARDThis division is responsible for water conservation, development, protection, planning, and management. The primary cash fund source is the Colorado Water ConservationBoard Construction Fund.

(A) AdministrationPersonal Services 2,691,008 2,736,410 3,257,759 3,355,784

FTE 29.0 30.1 31.0 31.0Cash Funds 2,691,008 2,736,410 3,257,759 3,355,784

Operating Expenses 471,808 478,192 536,828 536,926 *Cash Funds 471,808 478,192 536,828 536,926

River Decision Support Systems 408,680 383,841 479,379 492,071FTE 3.4 2.9 4.0 4.0

Cash Funds 408,680 383,841 479,379 492,071

SUBTOTAL - (A) Administration 3,571,496 3,598,443 4,273,966 4,384,781 2.6%FTE 32.4 33.0 35.0 35.0 0.0%

Cash Funds 3,571,496 3,598,443 4,273,966 4,384,781 2.6%

(B) Special PurposeIntrastate Water Management and Development 413,564 217,375 470,464 470,464

FTE 0.0 0.0 0.0 0.0Cash Funds 413,564 217,375 470,464 470,464




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


Federal Emergency Management Assistance 4,502,316 3,459,757 160,005 165,912FTE 2.0 2.0 2.0 2.0

Cash Funds 0 0 13,732 13,732Federal Funds 4,502,316 3,459,757 146,273 152,180

Weather Modification 22,115 24,215 25,000 25,000Cash Funds 22,115 24,215 25,000 25,000

Water Conservation Program 270,318 287,884 387,589 397,740FTE 3.6 3.8 4.0 4.0

Cash Funds 270,318 287,884 387,589 397,740

Water Efficiency Grant Program 577,747 434,051 604,956 604,956FTE 1.0 1.0 1.0 1.0

Cash Funds 577,747 434,051 604,956 604,956

Severance Tax Fund 1,258,187 1,230,257 1,275,500 1,275,500Cash Funds 1,258,187 1,230,257 1,275,500 1,275,500

Interbasin Compacts 538,174 703,194 1,158,091 1,168,169FTE 3.8 3.4 3.7 3.7

Cash Funds 538,174 703,194 1,158,091 1,168,169

Platte River Basin Cooperative Agreement 196,291 185,941 242,438 246,212FTE 1.0 0.7 1.0 1.0

Cash Funds 196,291 185,941 242,438 246,212

S.B. 02-87 Colorado Watershed Protection Fund 20,082 1,234 30,000 90,000Cash Funds 20,082 1,234 30,000 90,000



FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


CWCB Projects Bill 4,136,715 8,139,015 24,336,894 0Cash Funds 4,136,715 8,139,015 24,336,894 0

Indirect Cost Assessment 409,982 520,748 808,091 669,339Cash Funds 338,836 447,507 758,714 597,145Federal Funds 71,146 73,241 49,377 72,194

H.B. 15-1178 Emergency Pumping of High Groundwater 276,192 80,443 0 0Cash Funds 276,192 80,443 0 0

H.B. 15-1006 Invasive Phreatopyhte Grants 892,104 1,522,128 0 0Cash Funds 892,104 1,522,128 0 0

H.B. 16-1256 South Platte Water Storage Study 152,007 0 0 0Cash Funds 152,007 0 0 0

SUBTOTAL - (B) Special Purpose 13,665,794 16,806,242 29,499,028 5,113,292 (82.7%)FTE 11.4 10.9 11.7 11.7 (0.0%)

Cash Funds 9,092,332 13,273,244 29,303,378 4,888,918 (83.3%)Federal Funds 4,573,462 3,532,998 195,650 224,374 14.7%

TOTAL - (6) Colorado Water Conservation Board 17,237,290 20,404,685 33,772,994 9,498,073 (71.9%)FTE 43.8 43.9 46.7 46.7 0.0%

Cash Funds 12,663,828 16,871,687 33,577,344 9,273,699 (72.4%)Federal Funds 4,573,462 3,532,998 195,650 224,374 14.7%



FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


(7) DIVISION OF WATER RESOURCESThis division is responsible for the supervision and control of water resources in the State. The division is funded primarily by the General Fund but also includes variouscash funds deposited in the Water Resources Cash Fund, CWCB Costruction funds, well inspection and satellite monitoring system funds, as well as some federal funds.

(A) Division OperationsWater Administration 20,590,226 21,130,244 21,749,217 22,409,279 *

FTE 239.6 240.6 247.0 247.0General Fund 20,527,257 20,606,084 21,059,554 21,687,678Cash Funds 360,341 524,160 689,663 721,601Reappropriated Funds (297,372) 0 0 0Federal Funds 0 0 0 0

Well Inspection 265,938 359,877 379,038 379,038FTE 3.0 3.0 3.0 3.0

Cash Funds 265,938 359,877 379,038 379,038

Satellite Monitoring System 404,309 574,645 955,204 575,204FTE 2.0 2.0 2.0 2.0

General Fund 194,968 194,839 194,968 194,968Cash Funds 209,341 379,806 760,236 380,236

Federal Grants 190,566 270,352 230,000 230,000FTE 0.0 0.0 0.0 0.0

Federal Funds 190,566 270,352 230,000 230,000

River Decision Support Systems 193,951 210,831 212,467 212,467FTE 2.0 2.0 2.0 2.0

Cash Funds 193,951 210,831 212,467 212,467




FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


SUBTOTAL - (A) Division Operations 21,644,990 22,545,949 23,525,926 23,805,988 1.2%FTE 246.6 247.6 254.0 254.0 0.0%

General Fund 20,722,225 20,800,923 21,254,522 21,882,646 3.0%Cash Funds 1,029,571 1,474,674 2,041,404 1,693,342 (17.1%)Reappropriated Funds (297,372) 0 0 0 0.0%Federal Funds 190,566 270,352 230,000 230,000 0.0%

(B) Special PurposeDam Emergency Repair 0 0 50,000 50,000

Cash Funds 0 0 50,000 50,000

Indirect Cost Assessment 68,762 58,110 58,725 76,360Cash Funds 66,851 55,212 55,575 67,566Federal Funds 1,911 2,898 3,150 8,794

CWCB Projects Bill 273,021 505,075 0 0Cash Funds 273,021 505,075 0 0

SUBTOTAL - (B) Special Purpose 341,783 563,185 108,725 126,360 16.2%FTE 0.0 0.0 0.0 0.0 0.0%

Cash Funds 339,872 560,287 105,575 117,566 11.4%Federal Funds 1,911 2,898 3,150 8,794 179.2%

TOTAL - (7) Division of Water Resources 21,986,773 23,109,134 23,634,651 23,932,348 1.3%FTE 246.6 247.6 254.0 254.0 0.0%

General Fund 20,722,225 20,800,923 21,254,522 21,882,646 3.0%Cash Funds 1,369,443 2,034,961 2,146,979 1,810,908 (15.7%)Reappropriated Funds (297,372) 0 0 0 0.0%Federal Funds 192,477 273,250 233,150 238,794 2.4%



FY 2016-17Actual

FY 2017-18Actual


FY 2019-20Request


TOTAL - Department of Natural Resources 238,913,126 258,148,754 274,239,454 258,774,489 (5.6%)FTE 1,219.2 1,230.9 1,240.4 1,246.4 0.5%

General Fund 28,543,478 30,840,195 32,005,418 33,326,757 4.1%Cash Funds 170,145,830 187,550,255 211,449,002 195,080,403 (7.7%)Reappropriated Funds 6,995,472 6,695,363 7,708,687 7,258,247 (5.8%)Federal Funds 33,228,346 33,062,941 23,076,347 23,109,082 0.1%


APPENDIX B RECENT LEGISLATION AFFECTING

DEPARTMENT BUDGET

2017 SESSION BILLS S.B. 17-026 (STATE ENGINEER STATUTES CLEANUP): Removes obsolete provisions and modernizes the language of state statutes related to the State Engineer and the Division of Water Resources. S.B. 17-202 (SPECIES CONSERVATION TRUST FUND PROJECTS): Authorizes the Department of Natural Resources to obligate and expend $3.9 million from the Species Conservation Trust Fund in FY 2017-18 for programs to conserve native species listed as threatened or endangered under state or federal law, or are likely to become candidate species as determined by the United States Fish and Wildlife Services. S.B. 17-254 (LONG BILL): General appropriations act for FY 2017-18. S.B. 17-259 (GENERAL FUND TRANSFERS TO PROTECT NATURAL RESOURCES): Makes transfers totaling $10.0 million General Fund to support four Severance Tax Tier 2-funded programs as described in the following table:

TRANSFERS OF FUNDS TO SUPPORT SEVERANCE TIER 2 PROGRAMS

FY 2017-18 TRANSFERON JUNE 30, 2018 CASH

FUNDS GENERAL

FUND

FOREST HEALTH AND WILDFIRE PREVENTION AND MITIGATION PROGRAMS

Health forest and vibrant communities program $1,186,363 ($1,186,363)

Forest restoration and wildfire risk mitigation grant program 954,545 (954,545)

Wildfire preparedness program 86,364 (86,364)

Wildland-urban interface training program 45,455 (45,455)

Species conservation trust fund 4,090,909 (4,090,909)

AQUATIC NUISANCE SPECIES

Division of Wildlife--Aquatic nuisance species 2,452,193 (2,452,193)

Division of Parks--Aquatic nuisance species 1,184,171 (1,184,171)

TOTAL $10,000,000 ($10,000,000)

S.B. 17-260 (SEVERANCE TAX CASH FUND TRANSFER TO GENERAL FUND): Transfers $45.7 million funds originating as severance tax revenue to the General Fund. H.B. 17-1030 (UPDATE 1921 IRRIGATION DISTRICT LAW): Updates the 1921 Irrigation District Act. The bill made the following changes: increases the compensation of board members and election judges; clarifies the definitions of agricultural land and landowner; allows an irrigation district to lease its surplus water for any beneficial use permitted by decree or applicable law; clarifies how irrigation district assessments are to be collected, held, and reported; eliminates the bonding requirement for district board members; and modernizes election procedures and procedures for selling surplus property.


H.B. 17-1248 (CWCB CONSTRUCTION FUND PROJECTS): Appropriates $30,134,000 funds from the CWCB Construction Fund to the Department of Natural Resources in FY 2017-18 for various water-related projects. Authorizes the following transfers:

$30,000,000 from the Severance Tax Perpetual Base Fund to the Loan Guarantee Fund for repayment of loans made for water projects;


$10,000,000 from the Severance Tax Perpetual Base Fund to the Water Supply Reserve Fund to support water basin roundtable approved projects;

$1,500,000 from the CWCB Construction Fund to replenish the continuously-appropriated Fish and Wildlife Resources Fund;


$500,000 from the CWCB Construction Fund to replenish the continuously-appropriated Flood and Drought Response Fund;

$300,000 from the CWCB Construction Fund to replenish the continuously-appropriated Feasibility Study Small Grant Fund; and

$260,000 from the CWCB Construction Fund to the Public and Private Utilities Sector Fund to support appropriations made in other sections of the bill.

H.B. 17-1250 (RENEW AND EXPAND TAX CHECK-OFF TO BENEFIT WILDLIFE): Extends and modifies the Colorado Nongame Conservation and Wildlife Restoration voluntary checkoff program and establishes the Colorado Nongame Conservation and Wildlife Restoration Cash Fund Authority that is overseen by a board of directors. The bill also creates the Nongame Conservation and Wildlife Restoration Cash Fund. Money in the fund is used by the Division of Parks and Wildlife to support a variety of activities that aid nongame and endangered species work. In addition, a percentage of the checkoff revenue may be given in the form of grants for wildlife rehabilitation in Colorado. Grants will be overseen by the board of directors. H.B. 17-1289 (STATE ENGINEER RULES HISTORICAL CONSUMPTIVE USE): Directs the State Engineer in the Department of Natural Resources (DNR) to adopt rules taking into account local conditions that an applicant can use to calculate the historical consumptive use of a water right. The use of the methodology, approach, or local factors developed by the State Engineer is voluntary, and the resulting calculation of historical consumptive use carries no presumptive effect in the determination by the State Engineer, water referee, or water judge.

2018 SESSION BILLS S.B. 18-143 (PARKS AND WILDLIFE MEASURES TO INCREASE REVENUE): Increases fees for the Colorado Parks and Wildlife Division (CPW) for certain hunting and fishing licenses and park passes. In addition, the bill:

Authorizes CPW to apply a consumer price index to hunting and fishing licenses;

Creates a new annual resident youth fishing license;

Authorizes CPW to create a license for young adult hunters and anglers;

Requires CPW to prepare an annual report on the impact of the fee increases by March 1, 2022; and


Requires CPW to require individuals entering state parks by means other than motor vehicles to purchase an entrance pass.

S.B. 18-170 (RESERVOIR RELEASES FOR FISH AND WILDLIFE MITIGATION): Establishes a water court process by which a storage water right owner may dedicate releases from new capacity in a reservoir to the CWCB in order to reasonably avoid, minimize, or mitigate impacts on fish and wildlife within a qualifying stream reach, if certain conditions are met. S.B. 18-218 (CWCB CONSTRUCTION FUND PROJECTS): Appropriates $24,716,894 cash funds from the CWCB Construction Fund in FY 2018-19 for various water-related projects. The bill also authorizes the following transfers:

$30,000,000 from the Loan Guarantee Fund to the Severance Tax Perpetual Base Fund;


$2,000,000 from the CWCB Construction Fund to the Water Supply Reserve Fund to support water basin roundtable approved projects;


$500,000 from the CWCB Construction Fund to replenish the continuously-appropriated Flood and Drought Response Fund; and

$500,000 from the CWCB Construction Fund to replenish the continuously-appropriated Feasibility Study Small Grant Fund.

H.B. 18-1008 (MUSSEL-FREE COLORADO ACT): Creates new financing mechanisms for the Aquatic Nuisance Species (ANS) Program and increases cash fund revenue to the program beginning January 1, 2019, and thereafter from fees on boats. Combines the balances of two existing ANS cash funds. H.B. 18-1322 (LONG BILL): General appropriations act for FY 2018-19. H.B. 18-1338 (MEASURES TO ADDRESS REDUCED REVENUE SEVERANCE TAX REVENUES): Makes a number of transfers to support programs historically funded with Tier 1 or Tier 2 severance tax revenue from the Severance Tax Operational Fund. General descriptions of each transfer are provided below. The fiscal impact of the bill is dependent upon revenue forecasts. The fiscal impact in this bill summary is based on the Governor’s Office of Planning and Budgeting March Revenue Forecast, which estimated severance tax revenue in FY 2018-19 will total $113.0 million. The bill contains the following provisions.

Transfers a total of $2,973,869 out of Tier 2 cash funds administered by the Department of Natural Resources back into the Severance Tax Operational Fund, effective upon enactment. This reverses or "claws back" the transfers made to the Department's Tier 2 programs in July 2017. These transfers were based on the June 2017 LCS Forecast which did not fully account for the state's outstanding refund liability associated with BP America Supreme Court of Colorado decision. The transfers would not have occurred without the favorable forecast and the revenue would have been allocated to Tier 1 agencies.


Eliminates the statutory transfer of $11.4 million required by S.B. 17-260 (Section 39-29-109.3 (1.7), C.R.S.). A transfer of this magnitude would guarantee the Operational Fund would go bankrupt at the end of FY 2017-18.

Accounts for severance tax refunds attributable to the operational account by diverting income tax revenue to a reserve used to pay these refunds. Refunds count as a reduction in state revenue (thus not fiscal year spending).

Transfers General Fund into the Operational Fund on July 1, 2018, in an amount equal to total Tier 1 appropriations in FY 2018-19 Long Bill.

Transfers General Fund into the Operational Fund on January 1 and July 1, 2019, in an amount equal to total Tier 1 appropriations in FY 2019-20 to fulfill the Tier 1 reserve requirement. The transfer on July 1, 2019, is estimated to total $14,214,854 but is dependent on funding decisions made for Tier 1 programs in the 2019 Long Bill. This estimated figure also serves as the maximum amount that may be transferred for this purpose.

Transfers General Fund into specific cash funds continuously appropriated to Tier 2 severance tax programs:

TIER 2 PROGRAMS TARGETED WITH TRANSFERS TIER 2 PROGRAM TRANSFER INCLUDED

Aquatic Nuisance Species $3,636,364

Species Conservation Trust Fund 3,000,000

Forestry and Wildfire Grants 2,272,727

Soil Conservation Districts Matching Grants 450,000

Forfeited Mine Site Reclamation 127,000

TOTAL TIER 2 TRANSFERS $9,486,091

Diverts all severance tax revenue that would otherwise be distributed to the Operational Fund between February 1, 2018, and June 30, 2019, to the General Fund up to a cap of just under $41.0 million. If revenue exceeds the cap during the period specified, the excess should be directed back to the Operational Fund. This functions as a "repayment" mechanism to minimize the impact of the legislation on the General Fund. Some severance tax revenue will be realized but it is unclear how much or the timing of it.

Includes authorizations for species conservation projects submitted by the Director of the Department of Natural Resources that are designed to conserve native species that have been listed as threatened or endangered under state or federal law, or are likely to become candidate species as determined by the United States Fish and Wildlife Service. The funds appropriated are available in FY 2018-19 and remain available for the designated purposes until they are fully expended.


APPENDIX C FOOTNOTES AND INFORMATION REQUESTS

UPDATE ON LONG BILL FOOTNOTES 78 Department of Natural Resources, Executive Director’s Office, Administration -- In

addition to the transfer authority provided in Section 24-75-108, C.R.S., the Department may transfer up to 5.0 percent of the total appropriation between the line items for Personal Services and Operating Expenses.

COMMENT: This footnote authorizes the Department to use appropriations from either EDO’s Personal Services or Operating Expenses line item to cover over expenditures in the two line items.

84 Department of Natural Resources, Division of Parks and Wildlife, Special Purpose, Off-

highway Vehicle Direct Services -- This appropriation shall remain available until the completion of the project or the close of FY 2020-21, whichever comes first.

COMMENT: This footnote authorizes three years of spending authority in order to allow the Division enough time to select grant recipients and to account for weather events that may extend the project completion time to more than a year.

85 Department of Natural Resources, Division of Parks and Wildlife, Special Purpose, Grants and Habitat Partnerships -- This appropriation shall remain available until the completion of the project or the close of FY 2020-21, whichever comes first.


86 Department of Natural Resources, Division of Parks and Wildlife, Special Purpose, Asset Maintenance and Repairs -- This appropriation shall remain available until the completion of the project or the close of FY 2020-21, whichever comes first.



UPDATE ON REQUESTS FOR INFORMATION 1 Department of Natural Resources, Division of Parks and Wildlife -- The Division of Parks

and Wildlife is requested to provide the Joint Budget Committee with a report on Parks and Outdoor Recreation and Wildlife sources of revenue, as well as the expenditures of revenues by revenue type. The report should provide an analysis of lottery funds Great Outdoors Colorado Board Grants used for operations and capital projects. The report is requested to be submitted by November 1, 2018. COMMENT: The Department provided a response for this request for information, which was consolidated and displayed in the General Factors Driving the Budget section on page 6 of this document.


APPENDIX D DEPARTMENT ANNUAL PERFORMANCE REPORT

Pursuant to Section 2-7-205 (1)(a)(I), C.R.S., by November 1 of each year, the Office of State Planning and Budgeting is required to publish an Annual Performance Report for the previous fiscal year for the Department of Natural Resources. This report is to include a summary of the Department’s performance plan and most recent performance evaluation for the designated fiscal year. In addition, pursuant to Section 2-7-204 (3)(a)(I), C.R.S., the Department of Natural Resources is required to develop a Performance Plan and submit the plan for the current fiscal year to the Joint Budget Committee and appropriate Joint Committee of Reference by July 1 of each year. For consideration by the Joint Budget Committee in prioritizing the Department's FY 2019-20 budget request, the FY 2017-18 Annual Performance Report dated November 2018 and the FY 2018-19 Performance Plan dated November 2018 can be found at the following link: https://www.colorado.gov/pacific/performancemanagement/natural-resources


https://www.colorado.gov/pacific/performancemanagement/natural-resources