Colorado Budget Offers Wins, Disappointments for Small Businesses

“The Joint Budget Committee (JBC) was tasked this year with closing a $1.2 billion budget shortfall that is largely the product of revenue and expenditure limits mandated by the Taxpayer’s Bill of Rights. As a result, the process of drafting the Long Appropriations Bill (SB25-206: 2025-26) required lawmakers to make many difficult decisions. From the small business perspective, the result of the legislative process is a FY 25-26 budget that contains a mix of gains and setbacks for Colorado’s entrepreneurs.

Among the positives: 

• The Long Bill is accompanied by supplemental bills that move through the legislative process alongside the budget, including an investment of $15 million in FY 24-25 to increase support for the Colorado Child Care Assistance Program, a vital resource for low-income families to ensure access to quality child care which has been facing waitlists and frozen enrollment in many counties due to funding restrictions.

• Colorado’s Universal Preschool Program, which offers free preschool to all 4-year-olds in the state, will receive an additional $6 million next year.

• Protection for recent eligibility expansions to Colorado’s Medicaid program and access to oral healthcare through Medicaid.

Among the negatives:

• Total across-the-board cuts to the Office of Economic Development and International Trade (OEDIT) in the amount of $235,406. This is slightly higher than the initial $227,377 in Gov. Polis’ proposed budget in November, and means slight cuts for the majority of programs that are most relevant to underserved small businesses,  including those housed in the Rural Opportunity Office. 

• Cuts to the Advanced Industries Cash Fund ($11M reduction in FY 2025-26) and the Skills Advance grant program ($3M reduction in FY 2024-25 and FY 2025-26), which support small businesses across Colorado when it comes to business assistance and workforce retention. OEDIT did, however, work to ensure that the funds remaining in the program were sufficient to keep the program operational despite the cuts.

Additionally, we’re disappointed that the following requests from Gov. Polis’ proposed budget in November were rejected by the JBC and not included in the Long Bill: 

• $225,000 for FY 2025-26 only and $50,000 in ongoing support for OEDIT’s Minority Business Office (MBO). This funding would have been used for bilingual consulting, bilingual courses for entrepreneurs, MBO roundtables and network building, diversity consultant training, and expanding technical assistance. 

• Gov. Polis’ budget also included a request for an additional $25,000 of ongoing funding for the state Small Business Development Center’s LEADING EDGE program, which provides business development resources. This funding would have created at least six additional LEADING EDGE training courses offered to small businesses and entrepreneurs.

As threats to agencies aimed at supporting minority entrepreneurs continue at the federal level, it is vitally important for Colorado to step up and fill the void in this space. The problem is that our budget situation limits Colorado’s ability to increase support in a time of growing needs for small businesses. If Colorado lawmakers do not prioritize fiscal reform and enact forward-thinking budget proposals that ensure continued delivery of essential resources to the small business community and promote inclusive small business growth, our budget situation will only worsen in future years, and Colorado’s small businesses will pay the price. ”