(The Center Square) – The Colorado Senate approved and sent to the House a $38.5 billion state budget on Thursday, an increase of $1.2 billion or 3 percent compared to last year’s budget.

The budget was approved by a 28-7 vote with all 23 Senate Democrats voting in favor.

GOP Sens. Barbara Kirkmeyer, Larry Liston, Cleave Simpson, Jim Smallwood and Perry Will also voted in favor.

A media release from Senate Democrats stated two-thirds of the increase will pay for Medicaid matching payments. Funds will make up for federal funding being discontinued when the COVID-19 public health emergency ends.

A new 5 percent across-the-board increase for state employees is included in the budget, ensuring a $15 per hour minimum wage for all state employees.

One-time expenditures from the state’s general fund for the fiscal year 2024 budget include:

• $221 million for housing-related legislation, including property tax relief, land use and public-private partnerships. It will fund implementation of Prop. 123, a 2022 voter-approved initiative to provide $300 million annually to fund affordable housing projects.
• $103 million is designated for workforce-related legislation, including free credentialing, math scholarships, adult education and concurrent enrollment initiatives.
• $16 million is budgeted for the Rural Opportunity Office, the line of duty loss fund and wildfire resources. It also will pay for implementation of a voter-approved measure decriminalizing cultivation, possession, use and gifting of several psychedelic compounds for adults 21 years of age and older.

The Colorado Constitution requires a State Emergency Reserve to pay for natural disasters, such as floods or wildfires. The budget provides $543 million in cash for the fund.

The budget maintains a general fund reserve of $2.3 billion – 15 percent of the budget – to pay for government services and operations in an economic downturn.

State and local funding for public schools will increase by $485 million, an increase of $900 per student. Funds also will launch the Office of Early Childhood and the new universal pre-kindergarten program.

Higher education will receive an additional $137 million – a 10 percent increase in year-over-year funding. Tuition increases will be capped at 5 percent.

The budget also provides $18 million for school facilities and expansion of services for students with extremely severe and special needs. An additional $1 million was designated for the School Transformation Grant Program, which trains leaders in turning around academic performance in the state’s lowest-performing schools.

“Balancing the state’s budget in a responsible and thoughtful manner is one of our most urgent priorities as a legislature, and I am pleased to say that this year’s budget hits the mark,” Sen. Rachel Zenzinger, D-Arvada, and chair of the Joint Budget Committee, said in a statement. “We’re delivering for Colorado families by making record investments in K-12 education, supporting our health care workers, and creating safer communities – all while keeping our state on solid financial footing. We’ve worked hard to create a balanced, thoughtful budget that funds the infrastructure we need to meet our obligations to our families and communities while helping ensure every Coloradan has what they need to thrive.”