DENVER • The state Legislature's 67th General Assembly begins Wednesday, and the question atop every list is, what are we going to do for money?

Amid declining tax revenues caused by the recession, the Legislative Council, a nonpartisan agency, is forecasting a budget shortfall of $631 million this fiscal year, which ends June 30. Since the state constitution forbids it to run a deficit, that means legislators will have to take an ax to $631 million worth of state programs.

The situation could be even worse. Gov. Bill Ritter's office is talking about a 10 percent cut in the state budget to cure a shortfall that the governor's spokesman, Evan Dreyer, reckoned Friday at "close to $800 million."

At a news conference with other legislative leaders Friday, Senate President Peter Groff, D-Denver, said he expects some money to come from grants to states that would be part of an economic stimulus program being prepared by the incoming Obama administration. But no one expects the federal government to make Colorado's deficit go away.

Groff said the Legislature will be looking for cuts that "make some pragmatic sense," and mentioned pre-K education and higher education. But he expressed frustration with constitutional mandates protecting K-12 education funding and legislative restrictions on transportation spending.

Hard-hit Coloradans, Groff said, "are depending on government to be there for them and, unfortunately, the one time they actually need us to really be there, we're going to be cutting programs, we may be cutting programs, that would actually help them.

Sen. John Morse, D-Colorado Springs, said that with whatever money the state has left, the 2009 Legislature will be focusing on "jobs, jobs, jobs."

Rep. Terrance Carroll, the incoming speaker of the House, confirmed at the news conference that the Legislature will "put jobs first," and promised a legislative package that will include a new tax credit for companies that bring jobs to Colorado, a revived program of grants and credits to businesses, and an expansion of green-collar jobs in the state.

But Carroll, D-Denver, didn't say where the money for such programs will come from, and he acknowledged that "it may seem a little strange, a little difficult to say that we want to expand the circle of opportunity in this economic crisis."

House Majority Leader Paul Weissmann, D-Boulder, said that when it comes to cuts, "the easy stuff is already taken." But since Democrats control both houses of the Legislature as well as the governor's office, the budget-cutting process may be less than a bloodbath, and Weissman said he hopes for support from the Republican minority.

"They have just as much interest as we have in creating jobs and building a stable economy," Weissman said. "This sets us up for a more nonpartisan session than we've seen in years because these are common interests."

Political reality suggests otherwise. Last month, when state Rep. Mike May, R-Parker, the House minority leader, proposed cutting the legislative session from 120 days to 90 as a way to save money, Carroll said the idea would only lead to hasty, ill-considered decisions that would cost the taxpayers in the long run.

Friday, Carroll also dismissed Republican calls for a relaxation of restrictions on oil and gas exploration, saying it is a "red herring argument" to assert that the cause of declining drilling in Colorado is environmental regulations rather than the collapse of energy prices.

Still, the notion that this legislative session will have to be different from those that came before seems to have many adherents in the Legislature.

"Are we going to spend a majority of our time just running bills like business as usual?" Rep. Amy Stephens, R-Monument, asked rhetorically. She said "every legislator" is examining legislative priorities with an eye toward back-burnering any bill that would draw on the general fund.

As an example, Stephens mentioned a proposal to create and enforce zones around schools where registered sex offenders would be barred. But the measure would have a law enforcement price tag which, Stephens said, should not be dumped on local police and sheriff's departments that are as cash-strapped as the state. Because the money's not there, she said, predator-free zones are "not going to be the prime issue right now."

Contact the writer: 476-1654 or dean.toda@gazette.com