Allowable Growth Passes in Senate at 2%

On Tuesday, February 24, the Iowa Senate passed SF 218, most commonly referred to as allowable growth, with 32 Democrats in favor of the bill and 18 Republicans opposed. The bill sets the allowable growth rate for the 2011-2012 school year at 2 percent.

During a budget year when all areas of government are being asked to cut spending, this bill will essentially allow Iowa’s K-12 public school districts to increase their budgets by 2 percent for fiscal year 2011. Under 2 percent “allowable growth,” per-pupil funding will increase by $115 to $5883.

School funding is based on a combination of state aid and property taxes. Two percent allowable growth will provide almost $3.7 billion in total funding for schools. Of that amount, roughly $2.4 billion will come from the state, and $1.3 billion will come from local property taxes. As families are being forced to re-examine their personal budgets and tighten their belts, this bill will increase property taxes by nearly $60 million compared to the amount established for the 2010-2011 school year. While there is never a good time to increase taxes, it is abundantly clear that now is an especially bad time.

Additionally, it is still unclear how the state will pay for a 4 percent increase in funding for schools next year, let alone another increase two years from now. The Governor has even recommended that funding be cut from next year’s K-12 budget, thereby placing the burden of his party’s excessive spending habits on local school districts and taxpayers to fill the inevitable gap. It is irresponsible to allocate additional dollars for fiscal year 2011 when we have not yet fixed the current fiscal year nor begun serious work on next year’s budget shortfall.

It was excessive spending on the part of the majority party that got our state into this financial crisis in the first place. Rather than possibly forcing schools to decide between making deep cuts to their budgets or raising taxes, the responsible approach would be to require schools to maintain a status quo budget for now, as it is always easier to appropriate additional dollars in the future if it is economically viable to do so.

Had the governor and legislative Democrats not spent nearly a billion dollars during the last two years and driven up hundreds of millions of dollars in self-inflicted deficits, it would be more feasible to permit additional allowable growth. Had the governor and legislative Democrats done a better job controlling spending and keeping government within its means, there would be more money available for top priorities like education.