Letter to the Editor

Budget Time

Wednesday, February 16, 2011

The Iowa House has completed another busy week. The main bill that was debated this week was HF 185 which sets the allowable growth rate for school district funding. The bill passed Tuesday and set the rate at 0 percent for the next two years. Even at 0 percent, this will send $216 million in new funding for state schools next year. I know many of you will question how 0 percent allowable growth can generate new funding dollars. Let me try to explain. Last year's legislature set allowable growth at 2 percent but then proceeded to underfund that commitment by $156 million. In addition they used nearly $48 million in federal stimulus funds and cleaned out the Underground Storage Tank Trust Fund to the tune of $5 million, both of which are not available again this year. Add to those a $7 million increase in funding which is generated by a 0 percent funding formula and you get $216 million.

I know that this can be confusing but the bottom line is that you can set the allowable growth as high as you want but it is a useless figure if you don't fully fund it. We have made a commitment to the Iowa taxpayers to be honest and transparent with our spending and equally as important, we intend to create a budget that is sustainable. We are facing a $700 million difference between revenue and spending this year. When most areas in state government are seeing proposed cuts of up to 6 percent, K-12 education will not see any cuts this year. This bill will now go to the Senate for further consideration.

While we are on the topic of budgeting, House Republicans released our fiscal year 2012 budget targets today. This is the first step in passing the FY 2012 budget and we present this budget complete with a balance sheet so the public will know exactly where the money is being spent. This budget proposal spends $347 million less than the current FY 2011 budget and does not spend more than we take in. We still provide for priority services in the areas of education, health and human services, and public safety. House Republicans are not fully in agreement with the governor's proposal but that does not mean we are advisories. We intend to fully cooperate with the Governor's office to find a compromise that works for Iowans.

It's time to get serious about how we operate down here and let the public know exactly where we are financially. People can spin the discussion anyway they want but the numbers are real and we have to get our house in order. I am completely confident that we can get out of the financial mess we are in but we have to start now and address the problem head on. If you would like more information on our budget proposals feel free to call me anytime.

Before I close I would like to thank all of you that have taken the time to visit the State Capitol. I truly appreciate meeting with you and hearing your concerns and learning more about the various organizations that you represent. It's always good to see a familiar face.

I encourage you to forward this newsletter to your friends and as always, please feel free to contact me with your thoughts or concerns at jeff.smith@legis.state.ia.us or call (712) 320-2679.