Reynolds Budget Crisis Dominates Iowa Weekend News
You couldn’t open a paper this weekend in Iowa without seeing critical coverage of the Reynolds Budget Crisis and Governor Reynolds’ dangerous decision to kick the budgetary can down the road, avoiding accountability for her self-inflicted fiscal disaster.
Please see below for a roundup of some recent coverage of the Reynolds Budget Crisis.
“Kim Reynolds’ political foes believe the condition of the state budget makes her vulnerable in 2018.
That much was clear this past week when the many candidates running for governor raised a ruckus over the revelation that the state will have to spend another $13 million from its emergency reserves to balance its budget year that ended June 30.”
“What’s certain is the state had to borrow a grand total of $141 million from reserves to balance its 2017 budget. That’s on the heels of $118 million in midyear budget cuts spawned by slower-than-expected tax revenue growth. And the 2018 budget includes damaging cuts in key areas such as natural resources, human services and education.
…So one budget has been balanced using the state’s credit card. The current budget, which fails to adequately fund key priorities, still could slide into red ink. The fiscal future, burdened by the growing weight of tax gifts and clouded by the murky politics of health care, is uncertain.”
“The problem is the budget is not balanced, not really. If it were balanced, Reynolds wouldn’t have had to borrow money from reserve funds to pay the bills. Plus, lawmakers already had to borrow earlier this year. Not including the new $13 million, legislators had pledged to pay back $131 million they tapped from reserves within the next two years.
…Squeaking through the fiscal year $15 million in the red doesn’t look like sound budgeting.”
“Storm Lake Finance Manager Brian Oakleaf said the city could lose up to $206,000 if the Iowa Legislature ceases payments to local governments that offset commercial property tax cuts the Legislature passed in 2013.
The Des Moines Register reported Tuesday Gov. Kim Reynolds, R-Osceola, wouldn’t commit to maintain “backfill” payments to local governments amid an acute revenue shortage at the state level.”
“That puts the state behind the eight ball from the start and will create significant hurdles for lawmakers who hope to increase funding for short-staffed state agencies, public education and water quality initiatives and pay for tax reform and school choice programs.
“I believe we’re going to have challenges for (the next budget year),” David Roederer, the budget director for Gov. Kim Reynolds, told reporters Wednesday.
…Before writing a single item into the budget, they must repay $111 million to the state’s reserve accounts borrowed to fix the past year’s budget issues.”