House Republican Notes on Auditor’s Budget Review

Today the Auditor released his review of the FY 2012 budget.
(The press release and charts are attached— 8-29-2011PressBriefing.)

Here are the House GOP talking points on the Auditor’s review:

  • The Auditor praised the Legislature and Governor for “making huge progress in the area of fiscal sustainability” and “while the budget process took a significant amount of time, the result is clearly a win for the taxpayers of Iowa”
  • The Auditor said the budget reduces reliance on one-time money from $638 million to $53 million, a reduction of 92 percent compared to FY 2011
  • The Auditor considers expenditure of funds from the Economic Emergency Fund for Performance of Duty to be one-time money, we consider it as a recurring expenditure for one-time flood rebuilding costs
  • The budget approved by the Legislature and signed by the Governor spends 97 cents for every $1 of ongoing revenue
  • The Auditor believes the budget spent $1.04 for every $1 of ongoing revenue but that takes into account alternative accounting scenarios that differ from current Iowa law – the Auditor admitted that under current law the budget spends less than the state takes in
  • The Auditor claims that the FY 2012 budget is larger than the FY 2011 but he does not take into account the expenditure shift to property taxes due to underfunding K-12 education and another $200 million in one-time revenues – when these shifts are taken into account the FY 2012 budget spends almost $250 million less than FY 2011
  • The Auditor claims that we went backwards in budget transparency because he believes that all spending should be in the general fund – we believe that it is actually more transparent to put the cigarette tax revenue into the Health Care Trust Fund instead of artificially inflating the expenditure limitation by first sending it to the general fund – in addition, depositing the cigarette tax into the HCTF ensures that it is not scooped for something other than its original purpose of funding health care initiatives
  • The Auditor was critical of only funding FY 2013 at 50 percent for most line items – we actually approved a 100 percent budget for FY 2013 but the Senate would not agree to it
  • The Auditor issued a warning about the potential for a loss of federal funds as Congress attempts to balance the U.S. budget – this is a concern of House Republicans also and something to keep an eye on
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Dansette