House Advances Cautious and Conservative Budget Plan
The House Majority this week released a conservative budget plan for the upcoming fiscal year (FY21) that funds priorities in a responsible way.
While the COVID pandemic has impacted other state’s finances in a negative way, Iowa is in good shape. Iowa’s budget has a healthy projected surplus, reserve accounts are fully filled, and we are investing in critical programs that move Iowa forward. This is largely due to the strong fiscal discipline that we have employed over the last decade. While some wanted to increase spending to unsustainable levels, we held the line to protect hard-working taxpayers.
Overall, the House budget plan maintains spending at FY20 levels with strategic increases in key priorities like education and health care. Our budget proposal spends less than the state collects in revenue, leaves a large ending balance as a cushion, and does not utilize emergency accounts or federal funding. These smart budget practices will protect Iowa’s critical investments from cuts due to fluctuations in revenue or unforeseen circumstances.
At a time of much uncertainty, we have continued to bring a reasonable approach to budgeting, similar to the way Iowa families and small businesses spend their own hard-earned money.
Following Through on K-12 Education Investment
Earlier this session, the Legislature passed a K-12 education funding package with an increase of nearly $100 million in new money. The total amount dedicated to K-12 is 3.45 billion which is 44 percent of our total budget. When we passed this plan, it was with the intention that we follow through on our commitment. Under the our House leadership, investment in K-12 education has never been cut.
This $100 million package provides significant additional funding for general aid, as well as targeted investment to reduce higher than average transportation costs in rural districts and reduce a long-standing inequity in the school funding formula by an additional $10/per student.
Schools and Iowans should know that when the House Majority makes a commitment, we follow through. Whether it’s a mid-year reduction in revenue or an unforeseen public health pandemic like COVID, we have budgeted in a way to maintain and fulfill our commitments.
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