Time to Take Care of the Budget
Last Friday we received stark news from the REC that should cause the focus of the session to shift from meaningless bills of renaming departments and giving up our electoral votes, to helping keep Iowa a business friendly state and balancing our budget.
The Revenue Estimating Conference (REC) met today to estimate state revenues for the current fiscal year (FY2009) and next year (FY2010). The state’s fiscal year runs from July 1st through June 30th.
The REC is a three person committee of experts who estimate state tax revenues. The Governor and Legislature are bound by law to use the REC’s estimate to build the budget. The REC is comprised of the Governor’s designee, the Director of the non-partisan Legislative Fiscal Bureau, and a third person agreed upon by the other two members. It meets three times a year, once each in the fall, winter, and spring.
By law, if the REC lowers its revenue estimate at the spring meeting (which is what happened today), the governor has 14 days to re-submit his budget to ensure it complies with the 99 percent expenditure limitation law.
In December, the REC estimate for fiscal year 2009 was determined to be $5.991 billion. Today it lowered that number by $130 million. This means state revenue for this year is 2.6% less than FY2008.
For FY2010, the estimate was reduced by an additional $270 million from the December estimate; this includes the $130 million reduction for FY2009. This means revenue for FY2010 is expected to be 2.8% less in FY2010 than in FY2009.
The current budget continues to be out of balance. The expected ending balance was going to be $30 million so we must cut at least $100 million from the current year’s spending. The legislature must deal with this ASAP.
We have got to fix this problem without raising taxes and punishing the people of Iowa. They should not pay the price for the Governments mismanagement. During a year that has been filled with uncertainties it is time that a message comes out of the Statehouse that is clear and speaks loudly, that we are here to help solve the problems at hand without creating new ones.
It is time we stop the assault on small business and employers that could help put the 80,000 unemployed Iowans back to work.
It is time to make it clear that we cannot borrow our way out of this problem by bonding and leaving our children to carry the load.
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