Governor Culver faced the media for the first time since the non-partisan Legislative Services Agency released its year-end numbers. The LSA numbers are sobering. They show that the FY 2009 budget was out of balance to the tune of $161 million. Culver, who insists everything is fine, has decided to wait until the FY 09 books officially close in September before making any changes to the current state budget. Governor Culver also used his press conference to attack Republicans. Culver said, “In a very partisan way, the Republicans running for governor are misleading people.”
While Republicans have been critical of the governor, they have only echoed what the LSA report clearly states. Culver seemed most aggravated by State Representative Chris Rants. Rants called for a special session after learning of the $161 million budget deficit so that the legislature can make needed changes to the FY 2010 budget that would allow school boards and other government entities can plan accordingly. In a phone conversation with the Iowa Republican last night, Rep. Rants stated that since 1992 (the year Rants was elected to the State House), the House, Senate, and Governor’s office have always agreed to abide by the numbers provided by LSA.
“I am worried that we are backsliding to those days in the late 80’s when the governor and legislature fudged the numbers to look good for an election. They didn’t abide by generally acceptable accounting principles. That led to bigger problems and late payments to local school districts. The difference between then and now is that, in the information age, you can’t hide the facts. Every Iowan can go on-line and track state revenue on a daily basis. We can hold Culver accountable in a way that wasn’t possible back then. Still, any attempt to ignore the LSA number is very serious and very worrisome,” Rants told the Iowa Republican.
He added, “But closing the books on FY09 is the smaller of the two problems. The loss of revenue means that the FY10, which starts this week, starts in the red. School districts and community colleges have to respond to what the state does, so it’s important that we act to balance the budget sooner rather than later. Again, it’s obvious to everyone involved.”
Republicans are correct when they state that Culver is in denial regarding the state’s financial woes. In fact, if you were looking to use a real-world, everyday scenario, Governor Culver is acting like a guy who gets his credit card statement in the mail but refuses to open it. Opening the statement would mean that he has deal with the fact that he is living a lifestyle that he cannot afford.
It is important for Iowans to understand the financial problems facing our state. One way to do that is to translate the huge numbers involved in state government to something that’s easy for everyone to understand. Governor Culver likes to mention that the state has $400 million in reserve funds, but that shouldn’t comfort anybody since that figure means that only 6.5% of the state’s annual budget is in savings.
Iowa’s current budget situation is not any different from what some people are currently facing at home. To illustrate this, let’s pretend “Chet’s” family earns $40,000 a year. During these tough economic times, Chet has maxed out the family credit cards, asked and received money from his Uncle Barry, and taken out a huge loan to build an outdoor kitchen, to install a pool, and to buy a new car. The only money “Chet” has left is $2600 that is in his checking account. Making matters worse, “Chet” also has a $10,000 balloon payment to make on his mortgage next year.
If you were “Chet,” could you sleep at night? Would you feel comfortable that the only money you have for unexpected expenses is the $2600 in the checking account? This is exactly the situation that the State of Iowa is in, and our governor is ignoring the problem. I wonder if “Chet” would tell his financial advisor to stop scaring his family by telling them that, if they don’t make some lifestyle changes, they could lose everything they own.
Iowa Republicans are not out there trying to scare people; they are confronting the reality of our fiscal crisis and asking the Governor Culver to act. The governor seems adamant in his desire to wait three months so the FY 2009 books can close before dealing with the problem. Doing so creates uncertainty for Iowa’s schools and employees, which is not fair to them.
Waiting to make changes to the current fiscal year 2010 budget means that more furloughs and across-the-board cuts are likely. While putting these things off may help the governor’s re-election campaign, it means that state employees can’t prepare for unexpected layoffs and furlough days. It also means that superintendents and school boards could be forced to make mid-year cuts.
Iowans are hard-working, honest people. They expect our elected officials to tell it to them straight. Unfortunately, Governor Culver has opted to deceive Iowans by rejecting the financial numbers from the LSA, which are the numbers that represent reality and that he and everybody else are supposed to follow.
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