|
Governor
Responds to $40 Million Deappropriations Bill
In
a press release response to HF 399,
Governor Vilsack admits that there will, in fact, be a
revenue shortage in FY 2001.
This comes after weeks of denying that there could be such
a budget problem this year.
To
add insult to injury, the Governor’s press release merely
criticized the cuts contained in HF 399, instead of suggesting
alternative reductions to the budget.
Many would say that this reaction shows that the Governor
is not serious about solving the budget crisis.
Further, it appears that his proposed ‘solution’ for
this issue is to simply shift money and raid the rainy day funds.
This type of behavior would justify the reasons the Wall
Street Journal recently used in labeling Vilsack as one of the
three most “fiscally reckless” governors in the United States.
The
Governor claims that the proposed budget cuts offered in HF 399
will cost the state federal funds, revenues to the general fund
and unemployment compensation funds due to potential state
employee layoffs.
However,
we disagree.
First,
the departments are claiming that they will be forced to layoff
employees. However,
there are a few other options available for these state
departments. Layoffs
can be prevented by simply decreasing the purchase of office
supplies, and equipment. Another
solution is to use the practice of furloughs instead of layoffs.
A furlough is basically a day off without pay.
According to the Legislative Fiscal Bureau, furloughs have
been used in the past, and if all state employees (those paid by
the general fund) were furloughed for one day, the state would
save $4 million. Such
a savings would relieve a majority of the Departments’ financial
problems.
Second,
in most cases, the loss of federal funding is being used as a
threat for layoffs. There
are numerous options where state funding could be cut without
affecting the aspect of a department’s federal funding.
Instead, some departments are showing their budget cuts as
severely damaging-due mostly to their unequal disbursement
of funding to their department.
Of course, when funding is cut only from one area of a
budget, the loss will seem much greater in effect.
Yet
in other cases, the Governor has made outright false claims in
regards to the budget. As
an example, he has made mention that the under the proposed budget
reductions the Department of
|
of
Human Services will be forced to layoff 334 of the department’s
346 central staff employees. He
has also claimed that such a layoff would endanger $1 billion worth
of federal funding. In both situations, the Governor has spoken
falsely. Under no
circumstances would proposed budget reductions require such a
layoff—from any department. In
addition, should a layoff of that size ever become an issue, not a
single form of federal funding to the state would be endangered.
As
history has revealed, it is not a surprise that the bureaucrats
would throw red flags up at the mention of a budget reduction.
Jeff
Boeyink, Vice-President of Iowan’s for Tax Relief, put it best at
Monday’s public hearing at the Statehouse:
“Leaders
don’t hide behind closed doors hoping problems go away.
Leaders don’t live in denial . . . No, leaders take action,
even when action comes with significant political risk.
To fail to act [on the budget], to fail to lead, will only
exacerbate this problem in coming years.”
The
Governor on Tax Cuts:
This
past Saturday, Governor Vilsack delivered his weekly Democratic
radio address. In his
remarks, he stated “Democrats believe in fairness—your taxes
should be cut. After
all, you built the surplus and you should reap the benefits of that
effort.”
If
Governor Vilsack believes that tax
cuts are beneficial to Iowans at a federal level, why is he
so opposed to reductions at the state level?
Also,
it appears that the Governor has developed a favorite comment on the
cuts that Republicans have championed through the legislature since
1995.
We
have cut 47 different taxes totaling over $900 million, and
eliminating sixteen percent of the state’s budget.
The
implication of the above statement is that tax cuts are hurting the
state and Iowans.
If that is the case, the Governor has every legal right to
submit a bill to the State Legislature reinstating all the taxes
that were cut since 1995.
House Republican leadership will be happy to bring the bill
up for debate.
Ways
& Means Update
Bills
assigned in the Ways & Means Committee this week:
No
committee actions this week.
|
Week
in Review Archives
