Friday, March 6, 2009

Guest Column by Senate Republican Whip Steve Kettering (Lake View)

Confessions of a Shopaholic is a play that normally you would find on stage or screen at a downtown Des Moines venue. This week the troupe opened at the Capitol. The legislative version is - How much of your money do we need to spend? Initial calculations total at least $10.6 billion. The main players include a federal stimulus package of $2.1 billion, disaster relief of $1.5 billion, the Governor’s bonding proposal of $700 million, and state tax revenues of $6.1 billion. However, on stage first is a $175 million remake of a 2009 bond offering that attracted no buyers.

Our story begins there. You may recall that the 2008 Legislative Session ended with spending up nearly one billion dollars over a two year period. While the shopping was nearly complete, some items remained. The problem was lack of cash for the budget, so a tobacco bond was proposed. The state could simply borrow the money; spend now and pay later. But, no bond buyers showed up with cash for the state in exchange for those tobacco bonds.

Now a budget crisis looms. The state has more shopping to do, but where to find the money? Swinging on stage from high above stage left is the State Treasurer recommending an annual appropriation bond instead of a tobacco revenue bond. “You don’t even have to have a source of repayment,” he shouts. Spend now and future legislatures can simply appropriate every year for 20 years - enough to pay back what is spent this year. It is a simple and easy procedure. Pain free! Not to worry, the anticipated bond rating should be no more than one notch below the usual usurer rating. There may not even be a debt service reserve fund required. Spend away. This appropriation bond can be paid from any future source of revenue. Just let the next 20 legislatures worry about the repayment. A great idea. For 2009 we can cruise easy and trouble free; with that the Treasurer exits – stage left.

This annual appropriation bond moved out of the Senate Appropriations Committee this week. It will be debated on the floor in the near future. On the floor this week was also the 2009 appropriation adjustment bill. This formally deals with the changes the Governor has articulated in the past several months. Thus ends Act I.

An important budget date in the near future is March 20th. That is the scheduled date of the next Revenue Estimating Committee meeting. The projections announced at the conclusion of that meeting will have far reaching implications. They could render the Governor’s budget proposal and the recently announced Democrat targets meaningless.

Thursday, March 5, 2009

Power Plant Goes Down Before it's Even Built

Today it was announced that Alliant Energy will not move forward with their plans to build a $1.8 billion coal plant in Marshalltown. The Iowa Utilities Board set too much red tape around the facility being built.

Iowa currently receives 76% of it’s power from coal plants and because of that, rates in the state are some of the lowest in the nation. Those in support of the Marshalltown power plant have argued that another coal-fired plant is needed in order to bring more accessible power to the state. A larger power base will be more attractive to businesses as they explore moving to Iowa. And at a time when everyone seems to be talking about bringing jobs to the state, the IUB and with no help from the Governor, this plant plan has died.

We all know that Microsoft has put their plans on coming to Iowa on hold. Businesses like Microsoft really need lots of power to run. What's next? This is a huge blow to the state. And for everyone who is concerned about greenhouse gas emissions, look up the facts about coal. It is cleaner than ever. Emissions would be at a minimum.

It's really too bad that Iowa won't see the 1000 jobs that go with that plant and hopefully rates won't go up for customers.

You can read more details here:

Wednesday, March 4, 2009

SRC Unveils Job Creation Initiative

Today, Senate Republicans announced a three-point plan to give Iowa's economy a shot in the arm.

The Grow Iowa Not Government plan wouldn't cost a thing, wouldn't create more beauracracy and at the least would create jobs and get people talking about enhancing the state. It's a no-nonsense plan. Here are the details:

Tuesday, March 3, 2009

Still Waiting

The budget is one of the most contentious pieces of legislation that must be passed every year. It is the very last bill that has to be agreed upon for the Legislature to gavel out for the year and conclude session. As the majority party, the Democrats set the tone and budget numbers that are debated. Recently they released their first round of numbers for what they’d like the budget to look like. So far, their numbers still look like a hot mess and they only have themselves to thank for it.

We still don’t have the entire picture and most likely won’t for a while. The Revenue Estimating Conference meets on March 20 so target numbers will have to be re-estimated based on what comes out of that meeting.

For now, let’s attempt to break down the info that we do have and that is: over the last two years the Democrats have grown the General Fund by nearly $1 billion. That money has gone to programs and to fund things like the restoration of a pipe organ in Clermont. Growing government breeds dependency so in lean years funding these programs becomes pretty tough. When across-the-board cuts are made it doesn’t really look so deep – but the propped-up programs need to follow through on their promised dollars. (Say hello to higher taxes, Iowa, and good bye to Federal Deductibility) Just think where the state would be if spending had never been raised. We probably wouldn’t even need cuts.

Where’s the fiscal leadership? Waiting……..Waiting………..Waiting…………………

Monday, March 2, 2009

Bills Debated Today

The Senate calendar is starting to get a little full and if the Democrats truly want to be outta here by April 2 the Legislature better get moving. So far, though, nothing too controversial has come up for debate. Since we are now eight weeks into the 2009 Legislative Session we’re predicting some late nights in the very near future. Here’s a run-down of bills the Senate will debate today:
SF 237

SF 207

SF 203

SF 199

SF 176

They all passed.