A coalition of groups representing a broad cross-section of Iowans Thursday called on Gov. Terry Branstad and legislators to adopt a balanced approach to state budgeting that would use surplus dollars to restore funding to some vital areas, rather than focusing primarily on tax cuts.
“We feel that talk about more cuts is misguided,” said Adam Mason, state policy organizing director for Iowa Citizens for Community Improvement and a member of the Coalition for a Better Iowa. “We can afford to start reinvesting in public services that have suffered over the last four or five years.”
Coalition members representing children, seniors, faith, human service providers, research, advocates, labor and environmental organizations said they want Iowa’s elected leaders to invest in all Iowans, not just in tax breaks for big corporations.
Sue Dinsdale, who is executive director of Iowa Citizens Action Network, an organizer for Main Street Alliance and small business owner, said business owners realize a balanced approach is required to provide the educated workforce, cultural amenities, infrastructure, health care, and public safety that enable economic well-being needed for communities to thrive with customers who can afford to buy their products and services.
“When businesses thrive, it’s because of the overall strength of the state,” she said. “Cutting revenue is not the answer. Strengthening communities is the key and this is accomplished by maintaining adequate programs such as education, health care and public safety.”
Tim Albrecht, spokesman for Gov. Terry Branstad, said the governor has worked for two years to restore stability and predictability to a state government financial house that was beset with a $900 million structural deficit when he took office in January 2011. He added the governor is committed to maintaining fiscal responsibility while addressing high commercial property and corporate income tax rates that are impediments to Iowa’s future economic growth.
Albrecht said the state’s current surplus position exists “because taxpayers send a check to government month after month. We believe the prosperity should be shared with them. We need to look at that surplus and insure that we don’t spend every single dollar and get ourselves into the same predicament we were in three years ago this month when (former Gov. Chet) Culver was forced to enact a 10 percent across-the-board cut.”
State government ended fiscal 2012 last June an estimated record of $595.5 million in the cash reserve and economic emergency accounts. Another $60 million was deposited in a newly created taxpayers trust account and projections called for an ending balance topping $320 million.
Mason said significant cuts were made after the recession hit that “weakened overall investments in people” such as reductions to K-12 schools, community colleges and state universities that resulted in job losses and higher tuition costs. He said 40,000 children in Iowa still are not covered by health insurance, and many jobs were eliminated in public safety and essential services that need to be restored now that the state’s economic position has improved.
“We must now make strategic reinvestments in the very systems that make Iowa a great place to live and an attractive place for business to grow,” he told a Statehouse news conference. “We can’t squander the surplus that we have on new tax breaks or subsidies to lure business. We need a sound and fair tax structure, one that provides a level playing field. We cannot race to the bottom in our efforts to lure businesses looking for quick tax breaks rather than a productive workforce and good public services.”
Mason called for a review of all state tax breaks and subsidies so incentives that are identified as ineffective can be eliminated, and the funding redirected for other purposes.