Iowa State Budget Targets Released for 2014

A major step in the state budgeting process occurs when the two majority parties (House Republicans and Senate Democrats) release their 2014 budget targets. The targets are the proposed spending amounts in each of the seven budget categories, along with the total amount of state spending.

The state is anticipating about $6.7 billion in revenue for 2014, which is an increase of about 3.4% from last year. Historically, state revenue has grown by about 3.34%.  

The House Republicans proposed a budget of $6.41billion, which is an increase of 3% from last year. Their budget would spend about $187 million more than last year, with much of the increased spending due to Medicaid increases. In total, the state will spend over $1 billion on Medicaid, which is over $100 million more million more than last year.  

The Senate Democrat budget proposal spends $6.9 billion. This is $674 million more than 2013, almost an 11% increase. In addition, this is over $200 million more than the state will bring in.  

It is widely publicized that the state has an $800 million "surplus." This is money that has accumulated over the past two years due to sound budgeting and higher than anticipated tax revenue. It is not a yearly, ongoing surplus, but is more like your household savings account as it is money left over at the end of the year. The Senate Democrat budget spends almost half of the ending balance in one fiscal year!

Through fiscal restraint and sound budgeting principles, the state has climbed to the top of national rankings in terms of financial strength. Now is not the time to throw that fiscal restraint out the window. It was only three years ago that the state was facing over a $1 billion budget shortfall due to the poor budgeting practices of the previous administration and legislature.  

I am surprised and disappointed that the Senate Democrats did not learn from their budgeting mistakes of the past. A budget that spends $200 million more than we bring in and increases spending by almost 11% from last year is unsustainable and irresponsible. Senate Republicans will continue to use the same budgeting principle that all Iowans use: We will not spend more money than we bring in.

The budget targets are just the initial proposals and the budget discussion will continue until the end of session. I am committed to maintaining the sound principles of the past two years to ensure that Iowa remains one of the best managed states in the country!

Please feel free to contact me with any questions or concerns you may have. I look forward to hearing from you!