Culver’s budget debated at Eggs & Issues

By SCOTT MANTHE
The Oskaloosa Herald

March 26, 2007 06:18 pm

— OSKALOOSA — Saturday’s Eggs & Issues forum at Smokey Row cafe in Oskaloosa showed that Republicans Richard Arnold and Paul McKinley and Democrats Tom Rielly and Eric Palmer had very different opinions regarding Gov. Chet Culver’s budget.
In addition to the state budget, the panel discussed election day voting, the car title loan bill, the so-called bully bill, biofuels, and the Time 21 road funding proposal.
State Rep. Richard Arnold, R-Russell, was the first to speak at the forum. He began by saying that there were no controversial bills that came out of the three committees he sits on — transportation, local government, and natural resources — during this session. He brought up the Time 21 Fund proposal, put forth by the Iowa Department of Transportation, which suggests ways to overcome a projected shortfall in road funding.
Arnold said the Transportation Committee was studying the proposal and was looking at the various recommendations it contains.
Arnold then commented on Culver’s budget. He said that he believed the budget would result in a deficit. According to Arnold, spending is more than 10 percent higher, while revenues have only increased about 6 percent.
“The budget this year is coming in at 10.8 percent higher than it was last year, and the revenues are coming in about 6 percent over what they were last year. So, there’s a 4 percent deficit there that I don’t know how the majority party’s going to make up the difference,” said Arnold.
He said he wasn’t sure the new cigarette tax would close the gap.
“We did pass the cigarette tax out of the House and the governor signed it … I was told then yesterday (or) the day before, that in the southern two tiers of counties, that sales of cigarettes are down 60 percent … I don’t think these people have probably quit smoking, they’re probably going across the state line and buying their cigarettes and I can’t say as I blame them … I don’t think the revenue is going to come in like they think it will from the cigarette tax increase,” continued Arnold.
Arnold also talked about the same-day voting bill, with which he said he had some problems. “You can register the same day that you can vote and I don’t think that’s right … That leaves it open to a lot of fraud. It was presented to us that it was just like the Minnesota bill and it isn’t the Minnesota law at all. We tried to get an amendment on there that would allow for provisional voting, where the vote would have been held until it could be proven where these people were from. The way the bill is right now, once you vote, your vote’s counted, even though you aren’t who you say you are or where you’re from — the vote will still count,” said Arnold.
State Rep. Palmer, D-Oskaloosa, was next up, and he disagreed with Arnold’s assessment of the state’s budget. “I can give you a few points on the budget, which I think are important. The budget, which is for July 1, 2007, through June 30 of 2008, it will be a balanced budget. The state’s ‘rainy day funds’ will be at the highest levels ever. The cash reserve fund will be at its maximum of $442 million, the economic emergency fund at $136 million will be close to its maximum level. Medicaid will be funded, as will salaries. The senior living trust fund, which has been raided in recent years, will be at $140 million, nearly half of what we want in there. Budget wise, I think we’re doing some good things and I think we’re on the right course,” said Palmer.
Palmer addressed Arnold’s concerns about same-day voting. “We did pass Election Day voting and we looked at Minnesota as a guide and Minnesota’s had Election Day voting for about 30 years, I understand. There are about six states that do, and they’ve found that in those six states, they have about a 10 percent higher voter turnout. And I think that one of the things in our democracy you want to encourage is voter turnout. We want people to get out and vote and this is one way to do it … We talked to some of the people in Minnesota about the fraud issue and they said it’s almost non-existent.” explained Palmer.
Palmer singled out a couple of other bills he thought were important during the session — a bill to allow health insurance purchasing pools and an emergency communication bill that deals with the issue of interoperability between departments, which is the ability for different public service agencies to communicate with each other. The bill “establishes a board to develop standards so that we can help the various emergency providers communicate with one another,” said Palmer.
State Sen. McKinley, R-Chariton, was the next panelist to speak, and he agreed with Arnold about the potential for a state deficit, saying spending was up 10.8 percent, while revenues were up only 6.2 percent.
“We are seeing revenue increases of about 6.2 percent, that’s a good thing. Unfortunately, we’ve increased spending 10.8 percent. Now, that’s not a good thing. That means we’ve either got to raise taxes, or the economy will have to pick up steam, and I don’t think anybody expects our economy to grow at a rate of over 11 percent. And what I fear is, we’re creating more government, and government programs than our economy can support,” said McKinley.
McKinley said he was worried about the Election Day voter registration bill.
“Same day voter registration was passed in the house. Many of us have issues with that — we think that there are potential problems. Is the next thing just drive-up voter registration or Internet voter registration?” asked McKinley.
He addressed the car title loan bill, which capped loans at 21 percent, saying that it would put that industry out of business, resulting in people with poor credit histories not being able to get credit. He also said that while the title lenders were having interest rate limits imposed, that savings and loans and banks were being allowed to make payday loans at interest rates of more than 500 percent, if the fees that these lenders charge are taken into account.
McKinley also talked about a bill that would rewrite the Iowa Civil Rights code, which would add sexual orientation and gender identity to a list of characteristics that cannot be discriminated against. He said he believes the bill will cause problems for many employers and actually hurt those the bill is designed to protect.
“It’s billed as a fairness issue, but in reality, what it does it continues a string of bills that really put a hardship on small business — and all business for that matter — but primarily small business. And here’s how it does it: It gives the employer tremendous liability if they ever fire anybody, because there can be a cause of action … It removes Iowa’s at-will employment, and that is the bedrock of the employer/employee relationship in Iowa,” said McKinley.
State Sen. Tom Rielly, D-Oskaloosa, was up next and said of the bills the Legislature has passed, “I think we’re doing a pretty good job.”
He talked about the governor’s “Iowa Power Fund” concept and how important it could be in developing Iowa’s role in a new “bioeconomy.” Rielly used the example of a research project that was lost to University of California Berkeley, instead of going to Iowa State University.
“We lost out an almost a half a billion dollar project with BP (British Petroleum) and it went to Berkley, Calif. How can we miss out on something like that? We are the corn state. If anybody should be in the business of research and development, it should be at Iowa State University. We’re missing out, we’re missing out on opportunities, we have to wake up and get in this game and I think this power fund, this concept, is a step in the right direction,” said Rielly.
Rielly also said the senate had passed a statewide cable franchise, which will restrict cities from negotiating their own cable franchise fees, leaving the fees up to the state now. Rielly claimed this would increase competition.
“We did that mostly to promote competition and I think we here, in at least Oskaloosa, have benefited from the competition that can come in as it relates to cablevision. When I was mayor, we had Mediacom, or whatever cable channel, for 25 years. There was very little infrastructure, they didn’t upgrade anything, cause there was no competition. There wasn’t competition until MCG came in. Once MGC came in, whoa! Now all of a sudden we’re going to do all these great things and rates are going to start coming down. So competition is good,” said Rielly.
Rielly said that he supported giving cities the power to restrict smoking in public places and a grandparents’ rights bill, which will give grandparents the right to see their grandchildren.
After the speakers’ session was over, Oskaloosa Area Chamber and Development Group Director Jon Sullivan invited the audience to ask questions.
The first question came from William Penn University trustee Ken Van Gilst.
Van Gilst wanted to know why opportunity grants exclude private universities in the state.
Palmer answered saying that he will try and make sure that private colleges and universities are not excluded from the program.
“Ken, I hear what you’re saying, All Iowa Opportunity grants, they’re excluding private colleges, and believe me, I’m not going to vote for a bill unless it includes the private schools. I’ve heard from the presidents of Grinnell and Penn college and they’ve both encouraged me to fight for the private colleges, and I intend to on that issue,” said Palmer.
The other panelists said they agreed with Palmer on this issue.
Wapello County Supervisor Mike Peterson asked about the “Time 21” proposal, which attempts to increase funding for roads in the state. Peterson said that he was concerned that the funding formula change — from 47.5 percent for the state, 32.5 percent to the counties and 20 percent to the cities to 60 percent to the state and 20 percent to the counties and cities — included for the new funding in the bill will hurt counties, which he said have the least ability to raise road funds. He told the panel that he’d like to see that formula changed.
Rielly said that from the cities’ perspective, the increased funding is needed as well and that he was working to “get his arms around doing this.”
Audience member Joe Warrick commented that it’s often beneficiaries of state spending that come to forums like the one at Smokey Row and that this might give the impression that there is more support for these programs than there really is. He said that the panel should keep in mind those people who pay the taxes and not just the groups that want the state funds.
McKinley answered, “There’s a common theme that we’re hearing and it’s beginning to evolve: If you give government enough money, there’s no limit to the good things we can do for you. Now, how many people here think you’re not paying enough for your gas? And I know we need good roads, but I think that was a very salient comment … I think that we need to do good things, but keep in mind that our budget grew from $1.8 billion in the 1980s to almost 6 billion dollars. We have no more population, we’re the slowest growing state in the union, so where is all that money going? It’s going to grow government and we have a hungry machine that needs a lot of money to keep going,” said McKinley.
Saturday’s forum was the next to last one for this legislative session. According to Jon Sullivan, there were 65 attendees at the forum Saturday. The next “Eggs and Issues” forum will be Saturday, April 14, at 8:30 a.m. at Smokey Row in Oskaloosa.
Herald Staff Writer Scott Manthe can be reached by e-mail at manthes@oskyherald.com

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