Words From Windschitl

Early Retirement Proposal

As the Legislature continues to discuss how to close the nearly $1 billion budget gap for the coming year, numerous proposals have come forward.  One of these proposals is an early retirement program for executive branch employees, which could also cover justice system employees and the regent university institutions if those departments choose to implement it.

The intent of this proposal is to cut back on top-heavy departments, reduce unnecessary state positions, reduce the size of government, and save taxpayer dollars. While the proposal is not perfect, it does move Iowa in the right direction to balance the budget and streamline government.

To safeguard against abuse of this program, provisions were adopted to limit the ability of an agency to refill vacated positions and also exclude a participant of the program from being able to retire and then be rehired as a consultant or independent contractor; which has happened in the past under different early retirement programs.

An agency participating in this program will not be able to fill vacated positions without the Department of Management’s approval.  An agency will also be restricted from offering part-time, full-time, or temporary employment to people who retire under this program.  Past employees can, however, have membership on a boards or commissions.

The proposal will generate an estimated savings of $26.4 million for the coming fiscal year and save an estimated $189.4 million over the next five years.

If this bill is signed into law and you are a qualifying employee who would like to participate in the program, and would like further information, please feel free to contact me.

Government Reorganization

Another controversial savings proposal that has been making its way through the Legislative process is a plan to reorganize government and the services it provides. The proposed bill, as it stands, is over 200-pages and affects numerous aspects of government. 

In Governor Culver’s budget request last week he uses roughly $341 million in efficiency savings and revenue shifts to balance his proposed budget.  The reorganization bill was supposed to make up for the majority of these savings and shifts; however, it currently saves only $70 million. This means the Legislature is tasked with implementing an additional $241 million in savings in order to make the budget balance as the Governor has proposed it.

House Republicans have taken this task to heart and have to date come up with an additional $290 million in budget saving amendments which were offered in the State Government Committee meeting where the bill is currently assigned. Last year House Republicans offered over $300 million in savings, with only a few of the ideas being accepted by Governor Culver.  If the majority of the amendments this year are adopted before the bill is signed into law then we would be able to balance the sate budget and reduce the burden on taxpayers across Iowa while improving government efficiency.

Below are a few of the larger budget saving amendments offered in committee and unfortunately rejected:

• Eliminate the Governor’s pet project called the Power Fund and eliminate the Office of Energy Independence. Savings: $25 million
• End all state benefits to adult illegal immigrants. Savings: an estimated $92.3 million
• Move all voluntary preschool responsibilities to Empowerment. Savings: $45 million
• Combine all administrative functions at the Regents universities. Savings: $62 million
• Sell or lease the Iowa Communications Network (ICN). Savings: an estimated $15 million
• Sell and completely privatize the State vehicle fleet. Savings: $18 million

Some of these ideas would take a good deal of work to implement, but it is these types of measures we must look at in order to bring our spending in line with the taxpayer dollars which fill the state coffers.

There is still a great deal of work to be done on the government reorganization proposal and we will remain vigilant in trying to work in a bi-partisan fashion in order to best serve Iowans and reduce the state budget.

General Fund Revenue Close to the Revenue Estimating Conference Estimate

On Monday, February 1, Fiscal Services Division released its monthly revenue memo reviewing actual general fund revenue through the first seven months of the current fiscal year 2010.

Through January 31, general fund revenue was down 7.5 percent, or $257 million, compared to the first seven months of last fiscal year 2009.  The Revenue Estimating Conference (REC) estimates that revenue for FY2010 is going to be roughly $490 million less than FY2009, so to date, actual revenue is just above the estimate, which is a good sign for us as we may be on our way to an economic recovery.

The overall picture for Iowa’s economy is still a bit uncertain at this time, which is why we must remain on task in finding ways to draw business to Iowa to create new jobs and bring our unemployment levels down to a reasonable level, while creating a friendly tax environment which will encourage people to stay in Iowa and raise their families here.

Share Your Thoughts

If you or a friend would like to receive this newsletter by e-mail I would be more than happy to add you to my newsletter list.  Please contact me with any questions or concerns, the district number is 712-642-4334 or e-mail me at matt.windschitl@legis.state.ia.us.

Matt Windschitl

Iowa State Representative

House District 56