Initial Review of Governor’s Budget FY 2011
The Governor released his budget, as required by law, on Jan. 27.
Does the Governor’s Budget Spend Less than the State Takes in?
No. In addition to general fund appropriations of $5.32 billion, the Governor uses $387 million in one-time money to increase spending:
•$207.5 million from the Cash Reserve Fund
•$37.7 million from the Senior Living Trust Fund for Medicaid
• $48 million in stimulus money for education and general purpose
• $94.2 million in stimulus for Medicaid expenditures
Total spending on general fund items is $5.707 billion
House Republicans have pledged to not support any budget that spends more then we bring in.
Does the Governor’s Budget Raise Taxes?
Yes. The Governor claims to fund 2 percent allowable growth for K-12 education at $333 million. This is $233 million from the general fund and $100 million from the Cash Reserve Fund. LSA estimates that 2 percent will cost $514 million in FY 2011. Therefore, he underfunds the 2 percent by $170 million. Since the spending authority remains, the $170 million can be made up with in property tax increases. The Governor also proposes other property tax increases by funding the property tax credits below last year’s level and funding the State Patrol out of the Road Use Tax Fund. Both will increase property taxes.
How much is the reorganization savings and is it real?
Unclear. The Governor plugs in $341 million in reorganization savings. Some of the things (IT consolidation, reducing the fleet, eliminating phantom employees) were House Republican ideas from last year. Some of the ideas like increasing unclaimed property and federal grants appear to be dubious at best. Also, $50 million of the savings is for shifting the State Patrol into the RUTF and that is unlikely to happen.
Community Empowerment Dissolved in Senate’s Govt. Reorg. Bill
Rumors that Community Empowerment would be dismantled came true this week. Senate File 2088 strikes Community Empowerment from Iowa law.
In its place is “Early Childhood Iowa” board under the Iowa Department of Education. When Community Empowerment was created, the state board was intentionally placed in the Governor’s Department of Management. No one agency or early childhood partner was favored over the other.
Senate File 2088 changes all that and more. The bill makes the Department of Education the lead agency for the “comprehensive early care, education, health and human services system.” The short and long term ramifications of the lead agency status are unknown.
Other particulars include:
•The DE’s new early childhood center provides “coordination for early childhood Iowa activities and funding for the improvement of the individual early care, education, health and human services systems and the comprehensive system”
•Local community empowerment areas will need to be designated as “Early Childhood Iowa areas” approved by the new state board.
•Allows the new local areas to carry forward 20 percent of the grant money received during that fiscal year.
• As of July 1, 2010 the local community empowerment boards are dissolved and ALL of their unexpended funds are returned to the Department of Education. The funds shall be “disseminated” to the new Early Childhood Iowa areas.
Democrats Push Gambling Expansion
A bill suggested by Democrat House Majority Leader Kevin McCarthy would allow Iowa’s 17 state-regulated casinos to add popular card games like poker and blackjack in ballrooms and convention rooms where gambling is currently not allowed. Some of these casinos already have “poker rooms,” but they are too small to hold large poker tournaments. “This is not new gaming; this is existing gaming,” McCarthy said in The Des Moines Register. McCarthy went on to say that this expansion would increase tax revenue for the state. As an anti-gambling legislator this concerns me!
The new poker tournaments suggested by the bill would be held periodically. They would be in casino ballrooms and convention rooms that are separate from where slot machines are. Nobody under the age of 21 would be allowed in the room and there would be no smoking. McCarthy did not say how much Iowa stood to gain from the gambling expansion, but he guessed it would be in the tens of millions.
McCarthy said this is not the only change in gambling that will be considered this session, others include:
Striking the requirement that localities vote every eight years on whether to keep a casino, and allowing casinos to opt out of such referendums for a state fee. Localities would still have the ability to petition for a referendum if they choose.
Lowering the gambling setoff threshold to $3,000. Casinos currently run the names of those winning over $10,000 in a database to check if they owe any debt to the state and withhold the debt amount.
Allowing “advance deposit wagering” which would let gamblers, who are not physically at the casino, wager on races if they have an account.
All of Iowa’s state-regulated casinos are due for referendum votes this November. McCarthy expects this legislation to be debated in late February or the beginning of March.
Question of the week: One of the ways Iowans could reduce the costs of healthcare is to allow Certified Professional Midwives (CPM) to preside during home deliveries. Because of high liabilities, many hospitals no longer deliver babies. House Study Bill 229 would legalize the use of CPMs in Iowa. Do you support greater access to expectant parents by legalizing CPMs to deliver babies?
Please don’t hesitate to contact me. I can be reached at 641-634-2227, or email@example.com.
Rep. De Boef