Bonding and Budgets

From Republican Leader Kraig Paulsen:
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Last week two significant issues became somewhat clearer. First, the Governor’s bonding proposal was partially revealed. Second, the final budget numbers are starting to take shape. Although there are still significant pieces we have yet to see, it appears the Democrat Leaders want to complete our work this week and adjourn for the year – but at this point I think that will be very difficult.

Bonding

Last week, we were able to see the beginnings of the legislation which will send our state into debt, borrowing between $700 million and $750 million.

It is my understanding that the Bonding Plan includes three separate bills. At this point, we have only seen one complete bonding bill. This is frustrating because as you may recall this was a proposal the Governor proposed 14 weeks ago in his State of the Union address.

Senate File 376 is Part 1 and currently has $175 million in bonding in it. This bill will cost taxpayers $141 million in interest over 20 years. The $175 million is to correct a flaw in the borrowing proposal the Democrats passed last year.

Senate File 474 is Part 2 and has $100 million in bonding in it and will cost the taxpayers $80 million in interest. This is exclusively focused on rebuilding parts of the University of Iowa campus damaged from the floods last summer. These bonds will be backed by tuition.

The last bill is SF 477. We have not seen this legislation but is my understanding that it will total an additional $125 million in borrowing. $100 million of this is for vertical infrastructure that will be determined next year and $25 million for broadband (aka the ICN network).

Over the last two years, Democrats in the Legislature have used well over $200 million in infrastructure dollars for non-infrastructure spending. If the infrastructure fund was used for what it was intended instead of spending it on various non-infrastructure priorities, this borrowing discussion wouldn’t be happening. That means we could be using a pay-as-we-go approach instead of borrowing.

Regardless, plunging our state into debt and borrowing just because we can is not being responsible with taxpayers’ dollars. The Legislature should not saddle our children and grandchildren with debt when we are perfectly capable of paying for the projects on a pay-as-you-go basis.

Budgets

We all know we are facing uncertain economic times. At home, Iowans are cutting back on big expenses, trying to find savings in their own family budgets and living within their means. In Des Moines, things are quite the opposite. Despite hearing about the tough budget cuts the governor has been making, this year the Legislature will pass the LARGEST amount of general fund spending in the history of Iowa … $6.3 billion.

Just to show you how much it has grown, in Fiscal Year 2008 the general fund budget was $5.9 billion. In FY 2009, $6.2 billion and in FY 2010 the budget will top $6.338 billion, an amount of money that has never been spent in our state’s 162 years of existence. I find this remarkable for several reasons, not the least of which is all we have heard from the Governor and the Legislative Democrats is about all the “cuts”.

Now is not the time to be breaking the bank with historic spending levels. Now is the time to conserve. To cut waste. To reinvent government as a more streamlined and efficient entity. When it’s all said and done, House Republicans will have offered up more than $350 million worth of savings. To view some of our savings suggestions, visit the House Republicans’ website at www.iowahouserepublicans.com

Record-setting budgets and a debt plan. These are the solutions that Legislative Democrats have come up with to help our state in this unstable time. Instead of helping the 80,000 Iowans who are out of work find jobs, the plan is to increase government spending.

If taking more taxpayer dollars and having the government spend it were the answer to our struggling economy, then why after increasing spending by a billion dollars over the past two years is our economy still struggling? If government spending was the answer to a strong economy then why are things so tough?

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