HOUSE TO HOUSE

By Polly Granzow

State Representative

 More on the Governor’s Budget Proposal 

I have mentioned some of the Governor’s revenue recommendations including raising the bottle deposit, changing taxation on companies to combined reporting, and collecting unclaimed gift certificates.  This article includes three more recommendations.  The first is to reallocate gambling revenue.  Currently, the first $60 million of gambling tax revenue is deposited into the General Fund, and has been for many years.  The next $20 million is dedicated to paying the debt on the Vision Iowa and School Infrastructure Bonds.  Any remaining revenues are deposited into the Rebuild Iowa Infrastructure Fund (RIIF).  The Governor is recommending depositing an additional $90 million per year of gaming revenue to the General Fund, for a total of $150 million.

 The second item to mention is the Governor’s recommendation to eliminate two funds:  the Endowment for Iowa’s Health Account and the Healthy Iowan Tobacco Trust Funds.  He would transfer $36.3 million of revenue to the General Fund.  In addition, the Governor is recommending that programs previously funded from these two funds be funded from the General Fund transferring approximately $75 million in appropriations.

 The third recommendation is to sell the taxable bond proceeds from the tobacco settlement agreement, with the bonds to be repaid from the 22% of the tobacco payments that were not previously securitized.  The State receives payments from tobacco companies as the result of settlement agreements.  The Governor estimates the bond issuance will generate $67 million to deposit into the General Fund.

 Whenever money is shifted from designated funds to the General Fund, it gives an excuse to spend it for other purposes.  I do not believe money should be taken from RIIF and health programs (used from the Health Account and Tobacco Funds) to balance a budget with a $350 million shortage.   How will they be funded?

 There are more recommendations in the Governor’s budget I will share with you in the future.

 

Tax Stimulus

 

On January 29, the U.S. House approved a $150 billion economic stimulus package by a vote of 385-35, H.R.5140.  Many Iowans will receive income tax rebates along with other incentives.  I am pleased to be a co-sponsor of a bill that will exempt the rebates from Iowa income tax.  When you receive your check, you can be assured you will not have to pay Iowa income taxes on it.     

Visitors this week were students from Ellsworth and Marshalltown Community Colleges.

 

As always, you can contact me at polly.granzow@legis.state.ia.us or at 641-858-5210 on weekends.