Governor Branstad presents 2 year budget

State of Iowa Seal

Governor Branstad delivered his first speech to the State Legislature in nearly 14 yesterday. Branstad presented to the Iowa Legislature his budget proposal for the next two years. Branstad started off by announcing that 89 programs in Iowa would not be receiving the funding that they had in the past. Branstad said that these organziations had been funded by “one time money” in the amount of $900 million. “Now, you wouldn’t run your family budget that way.  If you did so, you would soon be visiting the bankruptcy court. And we should never run the people of Iowa’s budget that way, either.  And with this budget, it will come to an end, now.” said Branstad

Branstad further announced that $770 million that was being funded by one time service revenue back into the general fund. He also announced that nearly $160 million in property relief tax to Iowan’s would be used to fund school committments. “It fully funds the state’s share of our school funding commitments – erasing the need for local school districts to make up the difference in property taxes.” said Branstad.

Governor Branstad also announced a series of tax cuts to help create jobs in Iowa. Branstad said that the small business income tax cut rate will be cut to a flat 6% and that commercial property tax rates will be lowered by 40% over the next years. He also announced that new investment will be taxed at 60% of its value and that existing commercial property will be rolled back by 8% over 5 years.

Branstad also announced how he will fund the state after these tax cuts. “My plan includes funding for these tax cuts through the use of new revenue coming to the state due to economic growth, the additional revenue generated by the extension of the Bush tax cuts, and by a restoration of the gaming tax to the level at which it was originally agreed to years ago.” said Governor Branstad.

The Governor also spoke on the size of government and what needs to be done to lower the size of the state government. “Services must be shared so Iowans’ needs are met.  Costs must be reduced – we can no longer afford to pay 46% more for public services; the collective bargaining law must be changed to recognize the rights of the taxpayers.  And we, the leaders of our governments, must do a better job of managing our scarce resources.” Branstad said.

Branstad also announced the formation of an education summit to be held later this year. He said the purpose of this summit will be to determine what needs to be done with our state schools and how to improve them. Branstad said that educational leaders from all across the nation will be invited to this summit. ” I will convene an education summit this summer—bringing together the nation’s most dynamic educational reform leaders. These national leaders will work with our new education policy team and strive to reach a consensus on what changes are needed to give our children the nation’s highest quality schools.”

The Governor closed his budget message with these words “We stand at the crossroads of that history.  Which path will we take? I know that this institution is fueled by compromise; but we cannot compromise on the future of Iowa.”

“Our state will be driven by the right policy choices and I will fight with all my political might to make sure that we make the right choices.We are the fortunate few who have been chosen by the people to do what is right.  Let us be motivated by the better angels of our nature for the good of all Iowans.Together, we will accomplish great things.”