Iowa’s Revenue Forecast Drops Again
DES MOINES, Iowa — Iowa legislators and the Governor’s Office will have to do even more belt-tightening when the next legislative session begins in January.
Today the Iowa Revenue Estimating Conference released its final outlook on the state budget for calendar year 2016 and the news was once again bad. The REC adjusted its forecast down another $96 million dollars. By law the governor must base his budget for the next year on the numbers from the December revenue estimate.
Legislators on the House Appropriations Committee, where much the state’s spending bills originate, had differing takes on where blame lies for the poor numbers. Republican lawmaker Pat Grassley of New Hartford says Iowa is feeling the impact of a downturn in the international agriculture sector. “A sluggish agricultural economy, driven by low commodity prices, continues to have a ripple effect in other industries throughout the state,” Grassley says, “this challenge will require us to closely examine the effectiveness of every program to find areas of efficiency and duplication.”
However Democrats argue the blame for lack of funding belongs to Governor Branstad and his administration for tax breaks given to corporations. “The Branstad/Reynolds Administration and House Republicans have put the state budget $135 million in the red and stalled the state’s economy,” says Democrat Chris Hall of Sioux City, “It’s clear their unsustainable tax giveaways to out-of-state corporations have not produced good jobs, skilled workers, rising incomes for hard-working Iowans, or a stronger economy like they promised. ”
The news wasn’t all bad from the REC today. The three-member panel expects a slight increase in tax revenue in the coming year.