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The Paulsen Perspective: Living Within Our Means

SpeakerKP

“Cavalier reliance on using surplus money simply because it’s there is unwise fiscal practice and could create bigger budget problems for the state down the road.”

That statement is from an editorial from the Sioux City Journal posted this week. You can read the entire article here.

The editorial does a good job of highlighting what House Republicans have been saying all along — it is important to Iowans that we do not spend more than we have and live within our means.

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The Paulsen Perspective: Meet Aaron

SpeakerKP

Every year when legislators descend upon the Capitol and go to work on behalf of Iowans, they are joined by some of Iowa’s brightest and most talented high school students. These students spend the session (or half session) as Legislative pages – serving in the House, Senate and Legislative Services Agency. As the Speaker of the House, I have an office page that assists me and my staff, his primary responsibility being running soundboard in the chamber. I’ve asked him to share his perspective on being a page. Meet our page, Aaron.

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The Paulsen Perspective: House Republican Budget Targets

SpeakerKP

This week, the House Republicans released our budget targets – our plan for fiscal year 2016 spending. As I’ve mentioned before, in March the Revenue Estimating Conference (REC) met and determined the state has $7.175 billion available in on-going revenue. This is the number the House Republicans started our budget process with.

Our proposal spends 99.9 percent of that on-going revenue number, which is $7.168 billion. This represents a 2.5 percent (or $173.8) million increase over last year’s budget.

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The Paulsen Perspective: Tax Freedom

SpeakerKP

This week the day the majority of Iowans (and Americans) dread the most came and went– tax day – April 15th.

Iowa’s “Tax Freedom Day” also happened this week – April 13th. This represents how many days Iowans will work just to pay their taxes.

Iowa has a:
8.98% individual income tax (top rate)
12% corporate income tax (top rate)
6% sales tax

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The Paulsen Perspective: Proceeding with Caution

SpeakerKP

Last week the Federal Department of Labor’s Bureau of Labor Statistics released their latest jobs report for the month of March. The report was not very optimistic of the national economy as only 126,000 jobs were added last month. Additionally, the national unemployment rate held firm at 5.5%.

The meager 126,000 added jobs is an abrupt slowdown in hiring compared to the last several months of strong job growth. The number of added jobs comes in much lower than 250,000 added jobs that economists had projected. Prior to March, the US had seen 200,000+ added jobs each month for the last year. The 126,000 added jobs are the lowest total since December of 2013.

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The Paulsen Perspective: What We Can Afford

SpeakerKP

Another week has come and gone and still students, schools, parents, teachers and administrators are left in limbo as the Senate continues to put off sending school funding to the governor.

At a conference committee this week, a proposal was offered which would have doubled the House Republicans’ proposal. As I’ve been saying since the beginning of session, even with the 1.25% increase in funding that House Republicans have proposed, the state budget is going to be extremely tight and significant cuts are going to have to be made in other areas of the budget.

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The Paulsen Perspective: Simple Math

SpeakerKP

The Revenue Estimating Conference met on March 19 for its required meeting during the legislative session. All three members of the REC said there had been little change in the economic factors since their last meeting in December. Economic growth in the US and Iowa remains solid, if at a modest pace. Iowa’s collections from income tax withholding remain strong. The average work week is now at 42 hours and wage growth is beginning to pick up in-state, even though is has yet to reach the level seen before the 2008 recession.

There is concern over Iowa’s ag economy. The state saw a loss of manufacturing and ag machinery jobs in the last few months and the Rural Main Street Index fell below neutral levels. The strong dollar is having an impact on export markets, which are a key part of Iowa’s ag economy. Average corn prices are still 43 percent below their 2013 highs with significant supplies still in the bins.

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The Paulsen Perspective: Excited and Disappointed

SpeakerKP

This week was both exciting and disappointing.

I remain disappointed that the legislature still has not settled K-12 education funding.   We have continued to reach out to our counterparts in the Senate, trying to get Supplemental State Aid down to the governor’s desk.  As a reminder, this was the first bill off the floor of the House and commits over half of all the new revenue coming into the state to K-12 education before any other budget commitment has been made.  Overall, the state spends nearly 42% of its budget on K-12 education – and with this new funding, state education spending will have increased $570 million over the past five years.

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The Paulsen Perspective: The Time for Action is Now

SpeakerKP

Another week has gone by and still we have seen no action from the Senate Democrats on approving school funding and sending it to the governor’s desk. Nor have we received details on what budget items they intend to cut to fund their plan.

The Revenue Estimating Conference (REC) meets multiple times a year to determine how much revenue is coming into the state. This in turn outlines the parameters for state spending. In December, when the REC met they noted that revenues were not coming in at the rates they once anticipated. That said, there would be about $200 million more in revenue available for the legislature to spend. As the House has begun moving their K-12 education funding bill, we are outlining an increase of $100 million for Iowa’s schools. That’s HALF of all the new revenue coming into the state before any other budget commitment has been made. Overall, the state spends nearly 42% of its budget on K-12 education – and with our new education spending by the state will have increased $570 million over the past five years. Anyone who says the Iowa taxpayers are not making a serious commitment to education in this state is being disingenuous.

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The Paulsen Perspective: Funnel Week

SpeakerKP

This week was the first legislative funnel – a self-imposed deadline in the Legislature that helps move the process along.  Bills that passed out of a House committee by the end of this week remain alive for consideration for the rest of the year.

As the House completes its work on the first funnel deadline, bills that survived are those that will focus on increasing opportunities for Iowa employers as well as protecting Iowa families and taxpayers. Here are a few examples:

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Dansette