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Economy

Colorado Office of Economic Development will not be spared from budgetary ax – The Denver Post

Given that more than 475,000 Colorado residents have filed for unemployment benefits the past two months, and with the state facing a projected $3 billion revenue shortfall because of the COVID-19 outbreak, major cuts are looming everywhere, Betsy Markey, executive director of the Colorado Office of Economic Development and International Trade told the Colorado Economic Development Commission on Thursday morning during a video meeting.

OEDIT received a $58.7 million appropriation this fiscal year, according to its FY 2020 Performance Plan. The Joint Budget Committee is looking to trim 27% from OEDIT’s allotment for the next fiscal year.

Markey detailed some of the specific cuts being proposed, noting that things could change by June. The Colorado Tourism Office is looking at a 37% cut in its budget. That includes money to fund marketing campaigns to bring tourists back to the state in the summer of 2021 and beyond.

Colorado Creative Industries, which to foster the arts and cultural activities in communities across the state, is facing a 75% cut in funding. The JBC plans to provide the minimum needed to win a match in federal dollars.

The state’s Office of Film, Television & Media, which has already had its allotment severely slashed in recent years, is looking at a 62% cut in funding, which could spell the death knell for the state’s nascent film production industry.  And the Outdoor Recreation Office, a relatively new program, is looking at a 33% cut to its budget.

Global Business Development, which helps recruit companies to the state and promote trade, should see much of its funding preserved, Markey said. It oversees the state’s Small Business Development Centers, which have helped business owners navigate the downturn and obtain CARES Act assistance.

Business Funding & Incentive is expected to take a hit, especially for programs dependent on cash funds, like the Advanced Industries program, which is funded through taxes on gaming revenues that have all but dried up.

“We are working hard to make sure the legislature understands the importance of the economic tools we have. They will be instrumental in helping us recover from the pandemic,” Markey said.

If cuts do come down, OEDIT will try to manage them in ways that don’t damage economic recovery programs and perpetuate future revenue shortfalls.

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World News

Coronavirus in Colorado: Hundreds rally outside capitol, demand state reopen

DENVER — When a Colorado veteran organized a rally to reopen Colorado, he said he was thinking about the freedoms he fought to protect.

“Just seeing the people struggling and what they’re going through. I’ve got other friends as well. They’re having a hard time now feeding their families, paying their bills because the bills ain’t stopping just because the country shuts down,” said John Tiegen.

Hundreds descended on the State Capitol during the rally Sunday afternoon. Tiegen joined a group of motorcyclists as they circled the building. Others stayed in their cars and honked horns, but a large crowd also gathered on the Capitol lawn.

“Yeah, it’s starting to slowly open, but it needs to just open up,” said Tiegen.

COVID-19 concerns led Governor Jared Polis to issue to a stay-at-home order at the end of March, but that order expired on April 26. Tiegen and others share frustration over the Colorado’s plan to reopen as part of a set of guidelines called Safer at Home.

Get more on this report about a rally to reopen Colorado on TheDenverChannel.com.

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Economy

Colorado entrepreneurs started pulling back in February

New business filings were starting to decline in Colorado weeks before the pandemic created a state of emergency, and once closure order came down, they dove sharply, according to a quarterly economic update from the Colorado secretary of state.

“You have to say the economy was weakening before the coronavirus put the kibosh on it,” said Rich Wobbekind, senior economist and faculty director of the Leeds Business Research Division at the University of Colorado Boulder, which prepared the report, during a video press conference.

New business and nonprofit filings dropped to 33,858 during the first quarter compared to 35,837 during the same quarter a year earlier. That represents a 5.6% decline.

New business formations are an important indicator of future job growth. The state has seen more than 300,000 workers file for unemployment assistance the past five weeks, and the drop in new business starts could contribute to weaker hiring for months to come.

“No industry can expect to make it through this pandemic unscathed,” said Colorado Secretary of State Jena Griswold during the call. “This health care crisis has been devastating for small businesses and everyday people, many of whom are struggling to pay their bills and feed their families.”

It is understandable why people who might have wanted to start a new business pulled back once the pandemic became apparent in March, Wobbekind said. What is tougher to decipher is why they were pulling back already in early February.

One possible explanation is that the labor market was so tight that some entrepreneurs held back over concerns about finding workers. Also, oil and gas prices were already softening earlier his year, which might have had an impact. Wobbekind notes that revisions to the state’s job numbers showed that hiring was much weaker than first estimated.

On a positive note, the number of businesses and nonprofits that renewed their filings with the state during the quarter came in at 172,267, an increase of 7.8% from the first quarter of 2019. The number of entities in good standing was up 3.7% on the year.

“This likely reflects the strength of the Colorado economy entering this downturn,” Wobbekind said.

Brian Lewandowski, executive director of the Leeds Business Research Division, said U.S. GDP dropped 4.8% in the first quarter, which confirms the country is in a recession. Much larger declines are expected in the second quarter, and he expects that Colorado’s economic decline will track with the U.S. averages.

Those looking to launch a business will hold off for the next few months, he predicted, but as the economy reopens, more entrepreneurs will step forward into the recessionary void.

“With any recession, you get some people who wind up being the creators of the next wave of jobs. That is the silver lining I’m looking for,” Lewandowski said.

There are already some signs of improvement. Homebase, a provider of payroll services to small and medium businesses, reported that 65% of its Colorado customers who were open in January had shut down as of April 12. By April 19, half were still closed and by Tuesday, 39% were still closed.

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World News

Union calls on Colorado governor to protect teachers, families

Colorado’s teachers union sent a petition to Gov. Jared Polis’ office Wednesday urging him to bypass the local control school districts typically assume and issue statewide mandates on pay and other issues as teachers and students deal with an unprecedented situation.

Their requests:

  • Direct superintendents to work in good faith with their local teachers unions to bargain or mutually
    agree on distance learning practices and policies.
  • Tell school districts to reimburse educators for money spent out of their own pocket related to implementing distance learning.
  • Mandate school districts continue to pay all employees for the entire school year and prohibiting the
    legislature from negatively impacting current year school district budgets.
  • Direct ICE to cease all arrests and release non-violent offenders.
  • Halt evictions and foreclosures for the duration of the crisis.
  • Expand unemployment benefits and expedite access.

During a Wednesday virtual news conference, Colorado Education Association President Amie Baca-Oehlert said more than 3,000 Colorado educators signed the petition.

Polis spokesperson Conor Cahill didn’t say whether the governor would take the actions requested but said Colorado’s educators are among the linchpins of the state’s COVID-19 response.

“Every day — even more than usual — educators are being asked to go above and beyond for their students, whether that is teaching a virtual lesson, helping a family locate their nearest emergency meal location, or just reaching out to a student to let them know they are thinking about them,” Cahill said. “Our administration has strongly encouraged school districts to continue paying educators throughout this crisis to support them in this critical work, and is focused on doing everything we can to expand access to key services to support families during this time.”

Kelly Osuna, a high school Spanish teacher in the Cherry Creek School District, said one of her students is supporting her family through her fast food job because family members fear leaving their home and encountering ICE.

“As this pandemic continues to take over our society, our young people need to feel secure in the fact that their parents will come home,” Osuna said.

Carlos Meikel, an elementary school art teacher in Fort Collins’ Poudre School District, said he has already spent about $200 of his own money preparing for remote learning. Meikel wants to see the state step up to make sure teachers are being reimbursed for their expenses while making the drastic switch to at-home learning.

Monte Hollander, a school bus driver in Jeffco Public Schools, worries about his pay as Jeffco and several other Denver metro school districts announced last week that in-person wouldn’t resume this academic year.

“We need to know we are going to be paid and our benefits continue during this critical time,” Hollander said. “We need to know we can support our families.”

The request for the state to step into what is normally school district territory is due to the unprecedented times the pandemic has left communities in, Baca-Oehlert said.

“In a crisis when you have the potential of 178 different ways of addressing or deal with a situation, that just adds to the level of chaos already existing in the system,” Baca-Oehlert said. “That’s why we’re calling on the governor to take on some of these things that could really ease that burden. We’re not saying local control should go out the window on every single issue educators are facing right now, but there are certain things that could be a statewide directive or guidance that could lessen the chaos right now.”

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World News

Colorado snowpack levels remain in good shape in April, but not quite at 2019 levels

Colorado snowpack figures are continuing to run a tick above average, an especially vital statistic heading into the typical early April peak for statewide snowpack.

Based on official data from the Natural Resources Conservation Service on Monday, Colorado statewide snowpack is at 104% of its season-to-date average. Early April is traditionally the peak time of the year for Colorado’s snowpack, following winter and early spring storms and just ahead of the big mid- to late-spring melt.

The above-average levels are particularly important this time of year, signaling that the 2019-20 winter will likely finish with an average or above-average snowpack.

“Overall, we’re in decent shape,” Colorado assistant state climatologist Becky Bolinger said of this season’s snowpack levels. “No region has to worry about early peak (snow runoff) now.”

Also key is the relatively even geographic spread of the snowpack. Of the eight major statewide river basins, none had less than 94% of their typical snowpack, and none of them had more than 113%. That said, southern Colorado has generally leaned a little lighter on the snowpack compared to northern parts of the state.

While the 2019-20 winter has generally been a solid one in terms of statewide snowfall, Colorado snowpack figures aren’t at last winter’s off-the-charts levels. That could potentially lead to a few patchy drier spots for the summer, depending in part on additional seasonal snowfall and the speed of the spring melt.

“I have a feeling, though, that lower-elevation snowpack was not quite as good as it was last year,” Bolinger said. “So, we won’t have quite as much water and meltoff as we had last year. Water supply forecasts are a bit lower than average this spring/summer. But overall, we’re in decent shape.”

Parts of southern Colorado remain in a moderate to severe drought, mostly owing to a dry 2019 summer and fall. However, snowfall runoff may help ease some of those drought conditions, depending in part on this spring’s weather.

Healthy Colorado snowpack is especially important for a number of reasons. For one, the melted snowfall is a vital source of water for reservoirs. Also, melted snowfall can stay in otherwise dry soil well into summer, providing a potential partial safeguard against wildfires.

And of course, water from melted Colorado snowfall serves as the headwaters for several major rivers, providing critical water resources for Colorado and several other drier Western states.

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Business

Colorado regulators pause hearings on oil, gas rules due to coronavirus concerns

The state agency that is writing and approving rules to carry out an overhaul of how oil and gas are regulated in Colorado is pausing the work while in-person hearings are off the table because of the coronavirus outbreak.

The Colorado Oil and Gas Conservation Commission said for now it will postpone hearings on proposed rules to implement Senate Bill 181, signed into law last year. The COGCC and the state Air Quality and Control Commission have passed new regulations, but the bulk of the work remains.

The COGCC staff and the commissioners decided to delay the hearings after talking to the various people and organizations they know will want to be involved, COGCC director Jeff Robbins said Friday. He said there was “universal consensus” about the importance of having face-to-face discussions instead of hashing out issues via video conference.

“These rule-makings are very important. They’re very complex. They have stakeholders that have vastly different perspectives about the right place to land with regards to issues around the rule-makings,” Robbins said.

The feeling was that a face-to-face public setting is more conducive to ensuring that different points of view are heard and that robust debate is held, Robbins said.

On April 13, the COGCC will see how things are going and determine the next step. Initial meetings and procedures that were set for this week to lay the groundwork for formal hearings, scheduled to start April 29, were called off.

“For right now, there’s nothing calendared and we’re just in a wait-and-see period,” Robbins said.

Jeremy Nichols, the climate change energy program director with WildEarth Guardians, said he has mixed feelings about the postponed hearings.

“They want to help us through this crisis, but they’re still approving (drilling) permits,” Nichols said. “Let’s not keep the permit machine going even as they delay rule-making on public health safeguards for Colorado.”

In a letter sent to the COGCC on Friday, seven environmental and community groups said they support a temporary pause but are concerned by calls from the oil and gas industry and some rural local governments for a more broad delay. During the two-week delay, the groups asked the COGCC  to “consider other platforms that would allow online hearings to take place.”

If the hearing on rules is delayed beyond the original date of April 29, the organizations asked the COGCC to delay action on drilling permits.

Most of the proposed rules the COGCC has in the queue are related to what it calls “mission change,” basically significant changes to how oil and gas are regulated to carry out the mandates of SB 181. The new law requires a shift from balancing the development of oil and gas with other concerns to prioritizing public health, safety and the environment.

To carry out that mandate, state agencies are reviewing and writing new rules for a number of different areas, including air quality, underground oil and gas lines, the structural integrity of wells and who gets to weigh in on proposed oil and gas development.

Dan Haley, CEO and president of the Colorado Oil and Gas Association, said in an email that he thinks it’s appropriate to delay the hearings until they can be held in person.

“We think the process will work better, and be more transparent to the public, if it’s done in person, and not through a virtual rulemaking. I think we’ve all experienced the shortcomings of conference calls and video calls in recent days,” Haley said.

The law that requires revamping the oil and gas regulations sets July 1 of this year as the time when a full-time, professional oil and gas commission will replace the current volunteer commission. Robbins said if the new rules aren’t in place by then, the new commission will complete the work.

And Robbins said any permits approved while rule-making is on hold will be approved with criteria intended to align with the goals of SB181.

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Business

More Colorado hotels lay off workers due to coronavirus

Even though the state’s shelter-in-place order allows them to remain open, several Colorado hotels are shutting down and letting their workers go, according to filings made with the Colorado Department of Labor.

Great Wolf Lodge, a Chicago-based group that combines hotels with indoor water parks, said it would let go of 446 workers in Colorado Springs, making it the largest layoff so far reported to the state because of the coronavirus outbreak under the Worker Adjustment and Retraining Notification Act (WARN).

Denver-based Sage Hospitality Group last week closed four of its signature hotel properties in Denver, including The Oxford Hotel, The Curtis, The Crawford Hotel at Union Station and the newer Maven Hotel at Dairy Block. The closures are expected to last through May 11

Sage informed the state it was letting go of 186 workers at the Oxford, 182 workers at the Curtis and 97 at the Maven. A figure wasn’t available for the Crawford on the state’s website.

“Sage Hospitality Group has made the very difficult decision to temporarily suspend business operations at a portion of our hotels and restaurants in order to protect the health and safety of our guests, our associates and our communities. While we live and work every day to enrich the lives of our guests and associates one experience at a time, we believe that this decision is in the best interest of the communities in which we work and live,” Walter Eisenberg, CEO of Sage, said in a letter posted on the company’s website.

The Elizabeth Hotel, part of the Autograph Collection, informed the state it would lay off off 111 workers in Old Town Fort Collins. And last week, the Four Seasons Resort and Residences in Vail said it was releasing 243 staff members. Vail Resorts has shut down all of its properties.

Among the positions the hotels said were impacted were the wait staff, bartenders, parking attendants, cooks, front desk workers, baristas, room attendants and others.

A public WARN isn’t available for Colorado’s largest hotel, the Gaylord Rockies Resort & Convention Center in Aurora, but Colin Reed, chairman and CEO of Ryman Hospitality Group, which owns the properties that make up the Gaylord convention hotel network, informed investors Tuesday that the company was working with Marriott to close its five locations.

Ryman said customers had canceled 68,924 room nights at the Gaylord Rockies as of March 22, which represented $42.5 million in lost revenue. The company also said it would put a 317-room expansion worth $80 million in Aurora on hold to conserve resources. The Aurora Sentinel reports that Gaylord Rockies informed the city it had laid off 800 workers Thursday.

Earls Restaurants, a Canada-based chain with locations on the 16th Street Mall and in Lone Tree, notified the state it was letting go of 134 workers, while Pappas Restaurants, owner of the Pappadeaux Seafood Kitchen in Greenwood Village, said it had dismissed 145 staffers.

As restaurants around the state closed or switched to take-out-only service, those at Denver International Airport remained open. But even they are reducing hours and shutting down. Among those that are reporting layoffs to the state are Que Bueno, Colombo Frozen Yogurt and the  Sara Lee Sandwich Shoppe, Einstein Brothers, Timberline Steaks and Grill, Root Down, and Etai’s Cafe and Bakery. Specific job losses were not reported.

A study from the Pew Research Center on Friday stated that about one in four U.S. jobs are in industries considered at high risk for layoffs, including retail, food service and leisure and hospitality. Workers in those industries are more likely to be younger, with 16- to 24-year-olds making up just under a quarter of those employed, Rakesh Kochhar,  a senior researcher at Pew Research Center, said in a note.

Across all industries, the average weekly earnings in January were $975. But workers in food services and drinking places earned only $394 per week on average, Kochhar said.

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World News

Colorado Gov. Jared Polis’ handling of coronavirus crisis earns mostly praise so far

Policy leaders and politicians are largely giving Gov. Jared Polis high marks for his response to COVID-19 as the virus-borne disease continues its relentless march across Colorado, prompting long-term closures of businesses and cancellations of events that could have devastating impacts on workers’ livelihoods and abilities to support their families for months to come.

Trying to halt the spread of the highly contagious coronavirus while minimizing damage to workers — especially low-wage employees without the option to work from home — has placed Polis in an untenable position, said Rob Witwer, a Republican former state lawmaker.

“This public health emergency is a problem from hell,” said Witwer, who has taken to Twitter to lavish praise on the Democratic governor for making difficult decisions such as ordering ski resorts to close for a week to help slow the virus’ progress.

“I did not vote for @GovofCO last time, but I will most certainly do so next time,” he said in a tweet over the weekend. “His leadership right now is exemplary. These aren’t easy calls.”

Even his nemesis in the 2018 gubernatorial contest, Republican Walker Stapleton, got behind the governor Monday.

“Let’s support ⁦@jaredpolis⁩ and our Fed Gov in the coming days as they make decisions that will keep Coloradans safe and our hospitals functioning,” Stapleton wrote on Twitter.

From the other side of the aisle, Rep. Jonathan Singer, D-Longmont, compared Polis’ choices in managing the unprecedented health crisis to an old-fashioned alleyway mugging: “Instead of a choice between your money or your life, it’s a choice between your livelihood or your life.”

Singer said Polis, by relying on counsel from state and federal health professionals, is making the right decisions even as he has to navigate Colorado’s unique political culture that puts a premium on local decision-making over central control.

“I do think he has been working very diligently and responsibly to set the right tone for our local governments to step up,” Singer said. “He’s doing a good job of threading the needle.”

In addition to ordering ski resorts to close, Polis has put restrictions on nursing homes and ended on-site dining at all restaurants. And the state opened one of the first drive-up testing centers in the nation last week.

Joe Hanel, a spokesman for the Colorado Health Institute, said he has been “impressed” with the Polis administration’s approach to the crisis, starting with the governor’s declaration of emergency on March 10.

“They are making tough calls several times a day,” Hanel said.

Jim Pfaff, chief of staff for the state House Republican caucus, has opposing social distancing measures and called the closures of bars and restaurants “socialist” on Facebook, but his criticisms weren’t directed specifically at Polis.

The leaders of some other states have moved faster and gone further. Republican Ohio Gov. Mike DeWine has ordered school districts closed, and Democratic New York Gov. Andrew Cuomo ordered a containment zone around a coronavirus hotspot.

“I think Jared is doing what he thinks the public will accept,” said Chris Nicholson, a Democratic strategist with Venture Politics and a member of the state’s Democratic central committee. “But in two weeks, will we have said that it was enough?”

Nicholson said a more instructive comparison for Colorado is not other states’ actions but what other countries — like China and Italy — are doing by imposing some of the most draconian measures ever seen to contain the virus.

“This is a moment where we have to make incredibly tough choices,” Nicholson said. “Winning in this moment means saving as many lives as we can. That means overreacting as much as we can.”

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World News

Colorado dispensaries say coronavirus pandemic is making case for marijuana delivery

As the coronavirus pandemic disrupts daily life and commerce in Colorado, many in the state’s marijuana industry believe it makes the case for allowing dispensaries to begin delivering to customers’ homes now.

Legislators legalized cannabis delivery with the passage of House Bill 1234 in 2019. The law permits medical marijuana deliveries to start in 2020 followed by recreational cannabis deliveries in 2021, but left it to municipalities to individually decide if they will allow the services.

So far just one dispensary in Colorado, The Dandelion in Boulder, has obtained a license to deliver products to patients. Shannon Gray, communications specialist for the Marijuana Enforcement Division, declined to comment on whether the timeline for recreational delivery is being reconsidered in light of the pandemic.

Advocates believe delivery should be adopted more quickly and rolled out more widely, especially during a crisis. Colorado considers marijuana dispensaries “critical” retail businesses, meaning they’re allowed to stay open, with some restrictions, under the state’s stay-at-home order.

“Whether it be a pandemic, whether it be a natural disaster, there’s always people who can’t get to the store,” said Ben Prater, manager of Cannabis Station by Rocky Mountain High dispensary in Denver. “Now that (Gov.) Jared Polis is in office, he should definitely make moves to make delivery a thing sooner than later.”

Peter Marcus, communications director for Terrapin Care Station, agrees. While teams at the company’s six dispensaries throughout the Front Range are confident in social distancing practices and curbside pickup to mitigate the spread of diseases, Marcus said delivery could only bolster best safety practices.

“In a time of crisis like this, the more options to comply with a stay-at-home order all the better,” he said.

Licensing regulations have been upended in the state’s quest to stop the spread of coronavirus and COVID-19, the respiratory illness it causes, without sinking the economy. For example, dispensaries are temporarily allowed to sell recreational cannabis online for pickup, thanks to an executive order enacted by the governor. That option has proved popular among consumers looking to limit in-person interactions.

Truman Bradley, executive director of the Marijuana Industry Group, stopped short of calling for immediate action on delivery, saying he wants local governments to be prepared for a change of that magnitude.

“We just want to make sure there’s a safe and orderly rollout,” he said.

Movement on the local level doesn’t appear timely. Though Boulder allows medical delivery, officials are not considering the same allowance for recreational cannabis, said Mishawn Cook, the city’s licensing manager.

“Instead, the way that we have in a safe manner further accommodated our marijuana dispensaries, both medical and recreational, is by allowing curbside pickup,” Cook said.

Denver has yet to opt-in to offer medical delivery, but regulators are collecting data to determine if it’s a fit for the local community, Eric Escudero, director of communications for the city’s excise and licensing division, said in a statement.

“The city and county of Denver has no plans at this time to implement any emergency cannabis delivery program,” he said. If delivery does come to Denver, the city’s rollout will include a social equity component, he added.

Delivery business has been booming in states like California, where orders climbed 46% during the third week of March compared to the same time a month prior, according to e-commerce platform Jane Technologies. In the Bay Area, delivery company Sava experienced an eight-fold increase in sales over the same week.

Building a delivery program, however, requires many considerations on the part of a dispensary. Employees at the Dandelion, which expected to begin offering delivery for medical orders Friday, must drive company vehicles, each equipped with a video-monitored lockbox for product and GPS that can be tracked remotely, said Shannon Fender, director of public affairs for parent company Native Roots.

Drivers are expected to verify identification, medical card status and the address at each patient’s home while also processing payment. The Dandelion is encouraging customers to pay with debit cards instead of cash to limit the amount of money delivery drivers carry, she said.

“It would be great to allow (third-party) transporters to begin working with stores to provide the infrastructure for delivery,” Fender said. “By law, transporters may not begin delivery until 2021 when recreational delivery comes online.”

Still, she’s hopeful more jurisdictions will opt-in soon because of demand from residents. Native Roots, which operates 21 dispensaries across Colorado, surveyed its patients and found more than 90% support delivery.

“In current times we are ensuring social distancing in our medical stores which remain open, and this option will further allow people to stay home and reduce the number of trips they have to make outside their homes for essential products,” Fender said.

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