The 2002 Iowa Legislative Session began Monday, January 14, in the midst of serious budget constraints. Both income- and sales-tax revenues are lower than expected, flatlining growth for the state and jeopardizing such line items as education, Medicaid, and affordable health care, to name a few.
According to Republican Senator Maggie Tinsman, "We are going to have to get out of the box if we are going to solve these monumental problems. Iowa's economy is slowing down. The state budget reflects a projected 4-1/2% growth in revenues that has not occurred. We only gained 1-1/2% in 2001, and this year revenues so far are totally flat; therefore we must go back and get creative in addressing these shortfalls. We've adjusted our projected growth in revenues to 2-1/2% for this year, which translates to about $50 million. I am not confident we will even realize this much. The dilemma is that we plugged $465 million into the budget for education, Medicaid, and so forth?a $415 million difference! That is why it is so important to restructure government. We have to think outside the box and do things differently. We cannot do things the same way that we have been."
Senator Tinsman listed her goals for the 2002 Legislative Session in clear terms. "Education is number one. For Iowa to lead the nation once again in student performance, we need to attract and keep well-trained teachers. The schools are asking for annual funding of 4% growth. There are legislators who want to curtail this because of the lack of money. It is critical that we maintain the emphasis on K-12 as a priority in education, as well as the new Empowerment program for children zero to five that assures they are ready for learning. We must also restore funding to the community colleges. Iowa students pay a higher tuition than the national average and this must be reduced. We have a myriad of tax credits and exemptions that need to be looked at to determine their merits in today's economic conditions. We must establish a $100 million venture capital fund?in the form of tax credits, not actual dollars?to encourage investment in start-up companies. We must also implement a small business tax break to soften the burden of small chapter S businesses. We have done a good job with the Hawkeye program, which insures children, but we must be more aggressive with affordable family health care for Iowans. Another component of childcare is day care registration with the state. This is just common sense. We must also dedicate ourselves to revamping Medicaid by allowing for assisted living as part of the eligible expenditures. We have an overabundance of nursing-home beds that we pay for whether they are full or not. We should transfer some of this funding to programs that help families care for the elderly in their homes, which is a far more likely scenario over the long term."
The legislature called a special session last June in order to cut spending by almost $175 million to bring the budget back in line with the actual revenues. During a press conference in Davenport last Friday, Democrat House Leader Richard Myers stated, "Last year's session was the most partisan I have ever been involved in. But in the special session called this past June, Democrats and Republicans proved that we can work together."
Democrat Senate Leader Tom Fiegen also expressed optimism about the two parties presenting a unified front. "I agree with the Republicans that we must restore funding to community colleges. We made a mistake cutting that funding. Job training is critical for a skilled workforce in Iowa. We need to modernize the economy by reevaluating antiquated tax laws and policy, incentive programs and so forth to see if they still have merit. We currently have 280 tax credits on the books that need reexamination. Meanwhile, we want to implement a venture capital program at the $100 million level to encourage investment and economic development in Iowa by closing the gap between those with good ideas and the marketplace where funding sources exist. We must also preserve the gains we have made in education. Governor Vilsack has presented a good plan for reorganizing government, cutting a lot of middle management."
Representative Myers emphasizes "sticking to the basics. First we need to guarantee access and availability to prescription drugs for the elderly, and to health care for Iowa's children. We need to raise teachers' and nurses' pay. Teachers' pay is 37th in the nation; nurses are dead last at an average of $33,100. There is a huge gap in wages between companies' top-paid upper management and the workers. We need to increase the minimum wage in Iowa. Most importantly, people want unity in the legislature."
Overall, the goals appear remarkably similar. The devil is in the details relative to how each party intends to achieve them. In his "Condition of the State" speech (Tuesday, January 15), Governor Vilsack stated possibly utilizing the surplus or "rainy day" funds to overcome some of the shortfalls in the budget. Senator Tinsman emphatically disagrees with this remedy. "By law, we must maintain a 10% balance in the cash reserves fund, and we are already lower at approximately 8%. This is not the answer. We must become more efficient and look for ways to operate within our current means without depleting the reserves." While the Governor didn't mention Medicaid, he did support education, economic development, and mental health parity.
Other issues to be addressed in the 2002 Iowa legislative session are hog lots or factory farms' pollution of Iowa's aquifer, contract home sales, and "private right of action" for Iowans, which allows individual citizens to sue businesses for unfair and deceptive practices. Currently, Iowa is the only state in the nation without this legal right of remedy.
According to Republican Senator Maggie Tinsman, "We are going to have to get out of the box if we are going to solve these monumental problems. Iowa's economy is slowing down. The state budget reflects a projected 4-1/2% growth in revenues that has not occurred. We only gained 1-1/2% in 2001, and this year revenues so far are totally flat; therefore we must go back and get creative in addressing these shortfalls. We've adjusted our projected growth in revenues to 2-1/2% for this year, which translates to about $50 million. I am not confident we will even realize this much. The dilemma is that we plugged $465 million into the budget for education, Medicaid, and so forth?a $415 million difference! That is why it is so important to restructure government. We have to think outside the box and do things differently. We cannot do things the same way that we have been."
Senator Tinsman listed her goals for the 2002 Legislative Session in clear terms. "Education is number one. For Iowa to lead the nation once again in student performance, we need to attract and keep well-trained teachers. The schools are asking for annual funding of 4% growth. There are legislators who want to curtail this because of the lack of money. It is critical that we maintain the emphasis on K-12 as a priority in education, as well as the new Empowerment program for children zero to five that assures they are ready for learning. We must also restore funding to the community colleges. Iowa students pay a higher tuition than the national average and this must be reduced. We have a myriad of tax credits and exemptions that need to be looked at to determine their merits in today's economic conditions. We must establish a $100 million venture capital fund?in the form of tax credits, not actual dollars?to encourage investment in start-up companies. We must also implement a small business tax break to soften the burden of small chapter S businesses. We have done a good job with the Hawkeye program, which insures children, but we must be more aggressive with affordable family health care for Iowans. Another component of childcare is day care registration with the state. This is just common sense. We must also dedicate ourselves to revamping Medicaid by allowing for assisted living as part of the eligible expenditures. We have an overabundance of nursing-home beds that we pay for whether they are full or not. We should transfer some of this funding to programs that help families care for the elderly in their homes, which is a far more likely scenario over the long term."
The legislature called a special session last June in order to cut spending by almost $175 million to bring the budget back in line with the actual revenues. During a press conference in Davenport last Friday, Democrat House Leader Richard Myers stated, "Last year's session was the most partisan I have ever been involved in. But in the special session called this past June, Democrats and Republicans proved that we can work together."
Democrat Senate Leader Tom Fiegen also expressed optimism about the two parties presenting a unified front. "I agree with the Republicans that we must restore funding to community colleges. We made a mistake cutting that funding. Job training is critical for a skilled workforce in Iowa. We need to modernize the economy by reevaluating antiquated tax laws and policy, incentive programs and so forth to see if they still have merit. We currently have 280 tax credits on the books that need reexamination. Meanwhile, we want to implement a venture capital program at the $100 million level to encourage investment and economic development in Iowa by closing the gap between those with good ideas and the marketplace where funding sources exist. We must also preserve the gains we have made in education. Governor Vilsack has presented a good plan for reorganizing government, cutting a lot of middle management."
Representative Myers emphasizes "sticking to the basics. First we need to guarantee access and availability to prescription drugs for the elderly, and to health care for Iowa's children. We need to raise teachers' and nurses' pay. Teachers' pay is 37th in the nation; nurses are dead last at an average of $33,100. There is a huge gap in wages between companies' top-paid upper management and the workers. We need to increase the minimum wage in Iowa. Most importantly, people want unity in the legislature."
Overall, the goals appear remarkably similar. The devil is in the details relative to how each party intends to achieve them. In his "Condition of the State" speech (Tuesday, January 15), Governor Vilsack stated possibly utilizing the surplus or "rainy day" funds to overcome some of the shortfalls in the budget. Senator Tinsman emphatically disagrees with this remedy. "By law, we must maintain a 10% balance in the cash reserves fund, and we are already lower at approximately 8%. This is not the answer. We must become more efficient and look for ways to operate within our current means without depleting the reserves." While the Governor didn't mention Medicaid, he did support education, economic development, and mental health parity.
Other issues to be addressed in the 2002 Iowa legislative session are hog lots or factory farms' pollution of Iowa's aquifer, contract home sales, and "private right of action" for Iowans, which allows individual citizens to sue businesses for unfair and deceptive practices. Currently, Iowa is the only state in the nation without this legal right of remedy.
