Auditor Vaudt Reviews FY 2010 Budget

The Auditor released his review of the FY 2010 budget yesterday. Here is a summary of the talking points:

  • While certain agencies and programs had their general fund spending cut, overall spending went up. $5.9 billion in FY 08, $6.1 billion in FY 09 and $6.3 billion in FY 10. (FY 09 and FY 10 include federal stimulus funds used for general fund purposes.) The Democrats are saying they cut the budget, but this just isn’t true.
  • The FY 07 budget (the last budget approved by House Republicans) spent $1.01 for every $1.00 of ongoing revenue. The FY 2010 budget spent $1.14 for every $1.00 of ongoing revenue. That is simply not sustainable and leaves a gigantic spending gap in FY 2011.
  • The Auditor believes the spending gap between revenue and expenditures in FY 2011 is $1.062 billion. If the remaining federal stimulus dollars are used to help fill the gap, it would mean the state would need 15 percent revenue growth in FY 2011 to make up the difference between revenue and spending.
  • revenues-vs-expenditures

  • According to the Auditor, $248 million was shifted out of the Rebuild Iowa Infrastructure Fund (RIIF) for general fund purposes. If these funds were allowed to remain in the RIIF, the entire I-Jobs program could have been funded on a pay-as-you-go basis in less than 6 years.
  • Borrowing $1.664 billion to receive $765 million in net bond proceeds means that for every $1 of construction in the next 2 years, it will cost the taxpayers $2.18 over the next 25 years.

For a copy of the news release and PowerPoint presentation, click here (PDF). Also, we linked to it yesterday, but here it is again. The Auditor has put up a video on Youtube discussing the state’s budget situation.