OUR OPINION: All in all, Iowa’s in solid financial shape
By the Sioux City Journal Editorial Board
Based on a comprehensive review of data on financial health, standard of living and government services, 24/7 Wall St. each year rates the 50 states by how well they’re run.
In its most recent study, Iowa ranked number five. Among its attributes: A strong agriculture economy, rising state GDP, falling unemployment, low debt, a strong credit rating … and a well-managed budget.
In her first budget review, State Auditor Mary Mosiman reinforced the largely strong fiscal state of our state.
In a meeting with the Journal’s editorial board last week, Mosiman framed the state budget for this fiscal year in positive terms, for the most part.
Among the positives: Holding the line on spending increases (the average annual percentage increase in general fund spending between fiscal 2011 and fiscal 2014 was only 2.9 percent, even though the average annual percentage increase in revenue for the same period was 8.8 percent); a dramatic decrease (from $698 million in fiscal 2011 to $36 million in fiscal 2014) in shifting money from one-time revenue sources to the general fund for ongoing expenses; and filling the state’s reserve and emergency funds.
The budget picture isn’t perfect.
One area of concern for Mosiman is increasing reliance on use of money from special funds to pay expenses that properly should be paid with money from the general fund. Due to the lack of transparency involved, she wisely urges state government to wean itself from this practice.
Also, Mosiman prudently cautions the Legislature about the budget impact of education and property tax reform down the road. We supported both areas of reform because we believe such investments are important to the future of our state, but we understand they have a long-term pricetag legislators must bear in mind when crafting future budgets.
Funding of state public employee retirement programs, such as IPERS, is another area of concern for Mosiman.
Finally, the impact of unknown decisions in Washington create uncertainties for all states.
Still, with revenue on the rise, a robust budget surplus at the end of fiscal 2013, and cushion for the proverbial rainy day, Iowa’s in solid shape – better shape than many states, in fact.
In other words, we are on the right track.
Governor Terry Branstad and legislators in both chambers and from both sides of the political aisle share the credit. By continuing to embrace a conservative approach, sound budget principles and long-term vision, Iowa’s leaders chart a course for sustained fiscal strength.