After Floods, Colorado Getting Key Economic Report
DENVER (AP) – In the aftermath of flooding that devastated northern Colorado, state economists have begun to assess the financial impact of the disaster and are predicting a boost for some sectors.
Employment in the construction labor and materials industries, along with lodging businesses, should increase, the Legislature’s chief economist said Friday.
After a sharp immediate economic decline, natural disasters spark “a sharp rebound in economic activity as resources are poured into rebuilding and restoring the infrastructure of homes and other things,” said Natalie Mullis, speaking to lawmakers during a quarterly review.
“Isolated communities will be the hardest hit, and their economies will rebound only after roads are repaired,” she said.
The full economic effect of the disaster is unknown, but Mullis gave lawmakers glimpses of how the state economy could perform.
In addition to a boost in construction employment, Mullis said that in the short term, the food industry and sales and auto repair businesses could also see increases. Long term, Mullis said, there could be new investments in residential, commercial and public infrastructure.
The floods last week damaged or destroyed nearly 2,000 homes. More than 200 miles of state highways and 50 bridges also were damaged.
Mullis said that depending on how many crops were lost, it could affect food and crop prices. While some agricultural producers affected by the floods likely will see losses, Mullis said, “there’s a possibility that those who were not will benefit from the reduced supply.”
The economic outlook being released Friday is crucial because it will influence Gov. John Hickenlooper’s November budget proposal to lawmakers for the coming year.
His economists told lawmakers that it’s “too early to know the scale of the economic and budgetary impacts of the recent tragic flooding in the state.”
Hickenlooper’s economist said the state’s economic forecast remains unchanged from their last report three months ago, when they said tax receipts also continued to increase and the state finished with a general fund surplus of $1.1 billion for the fiscal year that ended June 30.
That money by law goes into a state savings account for education. The governor’s economists also said Colorado will end this year with employment levels back to where they were before the 2008 recession.
Roxane White, Hickenlooper’s chief of staff, told budget writers Friday that state officials hope to conclude the assessment of total damages from the floods in the coming days.
She said Hickenlooper would like lawmakers to approve state funding to help counties pay for half of the 25 percent match required by FEMA for disaster relief. She said the governor’s office believes most counties won’t be able to come up with the full amount of the match on their own.
White said the governor’s office will ask lawmakers to consider requests for state budget add-ons next week.
Colorado Floods: How To Help
The recent floods are impacting families and communities throughout Colorado, so CBS4 has compiled a list of ways you can support the local communities impacted by the floods.
– By IVAN MORENO, Associated Press
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