By Josie Albrecht
Every session the question facing the legislature is how to fit Iowans’ priorities within the constraints of state revenue.
For years, state government in Iowa operated much like it does in Washington, D.C. – spend more than they have, send taxpayers into debt, and pass hard decisions off to future lawmakers. Each year another legislature came to Des Moines, spent every last dime of taxpayer money – even money they KNEW wouldn’t be there the following year. The breaking point came when Gov. Culver and legislative Democrats not only had spent more than the state had, they leveraged the state into debt…and then the economy dropped out. Scrambling, Gov. Culver took an ax to the budget – indiscriminately slashing it by 10 percent. By far the biggest casualties of this action were Iowa’s schools.
As a result of this gross mismanagement, Iowans changed leadership in the governor’s office and the House. Since that day House Republicans outlined simple, commonsense budgeting principles. Republicans made a commitment to pass a budget which spends less than the state collects, doesn’t use one-time money to fund on-going needs, doesn’t balance the budget by intentionally underfunding programs, and returns unused tax dollars to taxpayers. This isn’t rocket science – it’s exactly how Iowa families and businesses operate.
The Revenue Estimating Committee (REC) outlined a specific revenue projection at their meeting on March 19th. The legislature is required to use that estimate which is now $7.175 billion for Fiscal Year 2016. Last year (FY 15) the state spent $6.995 billion. Simple math tells us there’s $180.9 million of revenue above what was spent last year. While the state budget is complicated, the constraints legislators must operate within isn’t.
The first decision House Republicans’ made was to make K-12 education the top funding priority. The first bill approved by the House in 2015 was a 1.25% increase in money for schools. Combined with previous education commitments, that’s a $100 million. And remember, the state has $180.9 million in new revenue, meaning Republicans committed over half of new revenue to K-12 schools.
The rest of Iowans’ priorities like Medicaid, economic development and public safety have to fit within the remaining $80.9 million in new revenue. The increase in Medicaid alone is projected at over $200 million. It’s easy to see the problem.
Legislative Democrats have suggested a 4 percent increase in funding ($210 million), with no regard for the state’s projected revenue numbers. House Republicans have a history of passing 4 percent allowable growth, but only when revenue is there to fulfill that commitment. Democrats’ short-term thinking with no regard for what the state can afford is the same type of haphazard budgeting that led to the decimation of school funding in the Culver era.
House Republicans have ensured K-12 funding is getting the first (and biggest) bite of the apple. The problem is the apple isn’t as big as we’d hoped. Our plan balances the needs of Iowa’s schools with the needs of Iowa taxpayers, in a responsible and pragmatic way.
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In regard to Rosemary\'s point of everyone living in a deficit, most homeowners, unlike the Federal Government, are paying DOWN on their debt, not adding to it. Suggesting that we should continue to borrow because \'everyone else is doing it\' is akin to \'if George jumps off the bridge....\'. I think the government could learn from some financial literacy courses. Debt is NOT a good thing to strive for.
A couple of items in your letter need to be more fully examined. One is the conservative/Republican idea batted around all the time that government should balance their checkbooks as families do.
Most families live with debt thus have deficits. If you are buying a house, you are in debt, if you a buying a vehicle and making monthly payments, you are in debt, if you have credit card debt that you make a payment to each month, you are in debt. If at the end of the month you have made all your payments with the money you have, that is all you have done. You are still IN DEBT and will be until whatever you are paying for is paid off and you do not owe anyone anything.
Just because you are current with your bills does not mean you do not have a deficit, which you do. That is exactly how government works. The government has debt and unless the Republicans chose to shutdown the government, payments are made on that debt each month. Just as families who are still in debt after they make their monthly payments, the government remains in debt until it is paid off, (which will not ever happen, I am sure). The end result is that the government is acting the same as families—making payments on the debt a little a time. So stop with the analogy that just because families are current with the payments on their debt, that fact does not mean that they do not have debt.
The other area I will challenge is that the Culver administration led the state into debt. Yes, they did but for a very good reason. After the massive tornadoes in the Parkersburg area and followed only a couple weeks later with the devastating floods of 2008, the citizens, cities, and businesses of those areas needed funds to pick up the pieces. Governor Culver incurred debt in the form of selling bonds to help places like Parkersburg and most notably Cedar Rapids with funding. The I-Jobs program helped get those and other effected communities back on their feet. Those bonds are being repaid. I will submit that is what exactly our government should do—take care of its citizens in times of disaster. Ask Cedar Rapids if they objected to that help.