Legislators received proposed budget cuts including a $65 million whack for public schools and $30 million for higher education - at 10:30 a.m. Monday.

By 2 p.m., debate raged over whether they were the right trims for Colorado.

Now, after two months of knowing that they must close a $625 million budget gap by June 30, the state's elected officials must decide in the next week whether it is best to cut higher education or tourism marketing funds or sell off loans for state water projects, among other things.

"(Former Senate Majority Leader) Norma Anderson used to say that Chinese proverb: May you live in interesting times. It was also a curse," said Sen. Moe Keller, a Wheat Ridge Democrat and Joint Budget Committee chairwoman.

"These are definitely interesting times," she said.

JBC members made few changes from the budget-balancing proposal offered by Gov. Bill Ritter a month ago. They did spare $2 million in senior services that Ritter proposed eliminating and did not back a $26 million increase for school districts he had sought to offset some cuts.

So, legislators are faced with the possibility of cutting about $65 million from K-12 education and $30 million from public colleges and universities.

Last year, lawmakers increased funding for public schools above what they were required to do by the Colorado Constitution; the proposed cuts would reverse that. Part of the money was to be spent on expanding full-day kindergarten.

In addition to the proposed $65 million in cuts, the budget committee rejected Ritter's request to increase funding by $26 million because of an increase in students, normally a routine matter at the Capitol.

Sen. Chris Romer, D-Denver, stoked debate among Senate Democrats by suggesting the state sell $100 million of state loans that were made for water projects and put the money toward education.

Keller questioned if such a sale was realistic.

Several rural legislators, meanwhile, fumed about proposals to bump up the cost of well permits from $100 to $665 and water supply plans for developers from $300 to $2,000.

Rep. Cory Gardner, R-Yuma, called them "massive increases."

Debate continues over a $3.8 million proposed cut to tourism marketing activities - a reduction from the roughly $10 million cut Ritter sought.

Some Democrats have questioned whether it is a core governmental function, but Sen. Rollie Heath, D-Boulder, said Monday that such a move could cost jobs in tourism, the state's second- largest industry.

The 31 bills that comprise the budget-balancing package are scheduled for their first committee hearings this morning.

In plain language

Understanding the state budget can be tricky. Below are some frequently asked questions:

WHAT IS THE 2008-09 GENERAL FUND STATE BUDGET COMPARED WITH LAST YEAR?

It is estimated to be $7.2 billion this year, down from $7.7 billion last year.

WHY DOES COLORADO HAVE TO CUT $625 MILLION OF SPENDING?

The state lost 38,500 jobs from September to December, so income taxes are declining this fiscal year, which began in July. Tax revenue from Coloradans' salaries is expected to be down $47 million, business income could see a hit of $115 million and capital gains income is expected to shrink by more than $300 million.

WHERE ARE LAWMAKERS GOING TO COME UP WITH IT?

The biggest chunk - $230.9 million - will be borrowed from 38 different cash funds, from workers compensation funds to hazardous materials response funds, that have been filled with revenue from fees. The proposal also calls for a $148.6 million reduction of the state reserve fund, an infusion of $107 million of federal stimulus funds and $137.8 million of cuts to spending.

WHAT GROUPS WILL HAVE TO TIGHTEN THEIR BELTS THE MOST?

Families that make just a little too much money to qualify for state-funded insurance programs will be hit, as expansions of the eligibility for such programs were eliminated. School districts will see funding cuts, and college presidents must trim $30 million from their cumulative budgets.

WILL THERE BE LESS MEDICAL CARE FOR THE POOR THIS FISCAL YEAR?

Not necessarily. No cuts are proposed in services to people on Medicaid or the Child Health Plan Plus. However, reductions of reimbursement rates for the medical professionals who treat those residents are in the plan, meaning some doctors could choose to stop treating those patients.

HOW WILL BUSINESS OWNERS BE AFFECTED?

Colorado reimburses business owners 3.3 percent of their annual sales tax collections. But reimbursements are proposed to be capped at $417 per month, meaning any company with more than $431,034 of monthly taxable sales will get less back now.

HOW WILL ELDERLY BE AFFECTED?

Not much right away. Gov. Bill Ritter recommended eliminating $2 million for senior services, but the Joint Budget Committee did not back that cut. But the Homestead Exemption is set to be suspended in fiscal years 2009-10 through 2011-12.

HOW WILL COLLEGE STUDENTS BE AFFECTED?

That remains to be seen. Colleges will lose anywhere from $8 million (University of Colorado system) to $426,000 (vocational schools), but they will decide where the cuts come.

WHAT ABOUT LAYOFFS, HIRING FREEZES AND FURLOUGHS?

No workers will be laid off this year, although elimination of about 500 positions is proposed in next year's budget. A hiring freeze will stay in place this year; furloughs are a part of next year's proposal.

WHAT ARE REPUBLICANS AND FISCAL CONSERVATIVES SAYING ABOUT THE PROPOSED BALANCING PLAN? WHAT WAS THEIR ALTERNATIVE PLAN?

They say many cuts could have been avoided if Ritter didn't grow employee ranks by about 3,000 since 2007 and didn't start so many new programs in health care or his energy office. But alternative plans are slow in percolating.

WHAT HAPPENS NEXT?

The cuts are laid out in 31 proposed bills, scheduled to go before the Senate Appropriations Committee this morning. The package will move to the Senate floor by Wednesday and is expected to advance quickly through the legislature.

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