In his report (which can be found here http://auditor.iowa.gov/press/Briefing_04-16-2010.pdf) the auditor has five major concerns with the budget.
1—The government reorganization plan, as passed, failed to save enough taxpayer money.
2—The budget relies too heavily on one-time money and creates a huge spending gap for FY 2012.
3—The “rainy day funds” have been depleted which will limit Iowa’s ability to deal with fiscal challenges.
4—This budget creates serious challenges for the future.
5—This budget did nothing except kick the can down the road and create a $1 billion problem for next year.
Vaudt is correct in his analysis of the state government reorganization bill. While this bill was being touted as major reform and consolidation, House Republicans noted back in February that this legislation did not go far enough in saving taxpayers’ dollars. In fact, we rolled out several additional proposals that would have increased the general fund savings by $290 million per year. Instead we passed a bill that saved the general fund at best $108 million. Every idea we suggested (view full list herehttp://www.iowahouserepublicans.com/republicans-offer-deeper-savings) was shot down immediately.
The auditor also points out that the budget relies heavily on one-time money, over $700 million which was handed down from the federal government in the form of bailouts, which will not be available next year. According to the auditor, this creates a spending gap for 2012 when those dollars are no longer available. Crafting a budget that spends more money than it takes in is not how we budget as families and it is not what we expect from our state government.
The “rainy day fund” has been used in the past for economic emergencies or major crises. As Vaudt points out, the fund has been raided and spent on things that are not true fiscal crises and now the fund is down nearly $400 million from the beginning of Fiscal Year 2009. A mere $200 million will be left in the fund at the end of Fiscal Year 2011 which will limit the state’s ability to deal with any financial challenges that may be yet to come.
Two major challenges that the auditor made point to the future increase in property taxes and staffing issues. As we’ve been pointing out, the unfunded state school aid total is $162 million which means that the Legislature pushed off their responsibility on to the school districts, forcing local boards to raise property taxes. http://www.sigourneynewsreview.com/default.asp?sourceid=&smenu=1&twindow=Default&mad=No&sdetail=5562&wpage=&skeyword=&sidate=&ccat=&ccatm=&restate=&restatus=&reoption=&retype=&repmin=&repmax=&rebed=&rebath=&subname=&pform=&sc=2581&hn=sigourneynewsreview&he
The other challenge the auditor noted deals with $50 million in collective bargaining costs which are unaccounted for in the budget. He believes this will ensure additional unpaid leave days or layoffs for state workers.
Finally, the auditor agrees with House Republicans’ assessment that because of the out of control spending, the Legislature faces a $1 billion budget gap when it convenes next January. State revenues would have to grow over 13 percent to cover the amount of spending passed by this Legislature.
Because this isn’t going to happen, House Republicans will once again be ready with serious government reorganization and budget savings ideas.
Auditor Vaudt has always been the taxpayer watchdog, even being critical of past Republican budgets if they were not in order. Once again it’s obvious that the Legislature spent too much, saved too little and raised property taxes on Iowans.
