We sympathize with Gov. Bill Ritter and the Colorado Legislature as they seek to close a massive budgetary shortfall. But solving that problem should not come at the expense of key industries that can help lead us out of the economic downturn.

To be sure, the fiscal picture is bleak: an estimated $600 million shortfall in this year's budget, ballooning to $1.5 billion in the next fiscal year. The state is examining a variety of revenue increases and expense reductions to make up the shortfall. But not every possible solution is a good idea.

One idea that should go into the computer trash can is a proposal by the Office of State Planning and Budgeting that would eliminate a sales-tax exemption for software, known as Special Regulation 7. The exemption, implemented in 2006, defines software as taxable only if:

• It is packaged for repeat sale.

• It is subject to a non-negotiable license agreement.

• It is delivered on a tangible medium (excluding software downloaded via the Internet).

This exemption puts Colorado in line with the practices of 40 other states, and has leveled the playing field for the state's many software developers.

State officials estimate that eliminating the exemption would pump a minimum - yes, minimum - of $15 million annually into state coffers.

The change would have a devastating impact on the state's software sector, which employs an estimated 125,000 people at 5,500 information-technology companies. CSIA, which represents the state's IT sector, is understandably concerned about the proposed change. The group adopted a formal resolution in opposition to elimination of the exemption.

"CSIA adamantly opposes any regulatory or legislative change to the current special regulation (SR-7) because it would prohibit the growth of this very important industry that is also critical to the current and future economic strength of our state," CSIA stated.

We concur. Let's not balance the state's budget on the backs of a key industry that helps to drive our economic growth. We urge the state to delete this idea.