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Iowa News Analysis: January 15, 2009

posted on January 16, 2009 at 12:17 PM

James Lynch of the Cedar Rapids Gazette, and Jeneane Beck of Iowa Public Radio talk with host Paul Yeager about Iowa legislators response to the troubled state budget, how decisions at the federal level could affect Iowa's budget, and what's left for state legislators to do while they wait for news from the federal government.

Paul Yeager: Earlier this week the Governor gave his Condition of the State Address, he laid out some plans, has yet to deliver a budget but he did talk about some budget plans, Jeneane, there wasn't anything new that he said on Tuesday that hadn't been leaked out earlier.  There wasn't much new vision but that's because there's no new money.  So, what is behind this budget here?

Jeneane Beck: Well, I think the big centerpiece that we all saw was the $700 million, I keep wanting to call it billion like the federal government, the $700 million borrowing package, or bonding if you will.  When you don't have any money it's difficult for a governor to make a big splash in a condition of the state.  There is just something about that speech in which they want to roll something big out and if there's no new money how do you do that?  Well, apparently you borrow it.

Paul Yeager: So, how is that idea going behind the caucus rooms here, James?

James Lynch: Well, I think there is general support from democrats and the leaders say that they will pass some sort of a bonding package, whether it's $700 million remains to be seen.  There is a general opposition in the republican caucus they don't like that idea of bonding, tying up state money for 20 years on these projects but they're in the minority so I'm not sure how much they'll be able to slow that train down.

Paul Yeager: So, where do you put things on a line?  We had Vision Iowa in the 90s into the early 2000s, now we have what could be the new Vision Iowa with some of these.  How are they going to -- are they going to set up a new committee, a new Vision Iowa sponsored by ... name?

James Lynch: We haven't seen those sorts of details.  Vision Iowa was more amenities in a lot of ways, community centers, venues of that sort.  This I think we're going to see more roads, more bridges, more water treatment plants, those sorts of maybe what I call hard infrastructure than those amenities that we saw under Vision Iowa.

Paul Yeager: Are those the type of things that would pass, that republicans would go along with?

Jeneane Beck: Well, I think they're more interested in if they're going to borrow money the auditor said that he's borrowing for the right reason, to pay for long-term infrastructure projects.  The thing they have to be concerned about is what interest rate do they get and is it low enough that they get these bonds paid off before that very infrastructure they're fixing, these water treatment plants, these roads, these buildings start to show disrepair over 20 years, otherwise you're in trouble. 

If you need to fix them again before you've paid off the first round of repairs you're in trouble.  I do think you have to remember the Values Fund was the idea of previous republicans and Governor Tom Vilsack.  This wasn't Chet Culver's baby and I think we don't know yet until his budget comes out at the end of the month whether he will put more money into it or whether he'll say, we did that, it's time for this now.

Paul Yeager: So, is there any reason for the legislature to be in session now until that budget comes forward here?

Jeneane Beck: I'm not sure, I think they could adjourn for a little bit, go home and come back ... I would encourage them to.

James Lynch: Paul, there are a couple of things.  One is that they're waiting for the Governor's budget.  The other thing is they're waiting for REC numbers in the spring, April sometime, and everybody is sort of walking on eggshells.  The last revenue estimating conference report the numbers weren't good and there is a lot of fear that the next report is going to be worse.  So, those two things, the legislators are kind of saying, we have to wait and see.

Jeneane Beck: Well, and there's a third even.  They're also waiting to see what the federal government does.  There's big hope that there's an economic stimulus package from the feds and if there is can we piggyback or what areas should we step back and say, no, they're doing that, we don't have to now. 

Paul Yeager: It's clearly what they're waiting for in Cedar Rapids.  They're waiting on the flood relief in the community where you live, James, and that's something you talk about the sugar falling from the sky.  Are they that confident or that dependent upon federal funds to move forward a little bit?

James Lynch: In Cedar Rapids?

Paul Yeager: Well, anywhere really in the state.

James Lynch: I would say they're that dependent, I'm not sure how confident they are those funds are going to fall from the sky.  Certainly yesterday we heard Emily Hajek from the Rebuild Iowa Office say that they're somewhat hopeful that the new administration will be easier to work with but there's no assurances of what they're going to get and how much they're going to get in what form.  There's also some fear that disaster recovery and economic stimulus are all going to come together and it's going to be one package and not two separate packages.  Iowa will get one bite.

Paul Yeager: Right, and not two like they were hoping or at least more of a bigger bite because they had more of a severe storm.

James Lynch: Exactly.

Paul Yeager: Okay, Jeneane, how do these idle hands then move forward in the next couple of weeks, next couple of months for that matter, on figuring out what parameters they're going to set on this budget or at least try to pass things to the Governor?

Jeneane Beck: They start looking at other legislation that doesn't cost them money, it might cost other people money and one of the things they have started working on is adding substance abuse treatment to the mental health bill requiring most businesses to provide that coverage if they do provide health insurance, things like local control of large animal confinement feeding operations, we're going to see that come up in debate in committee, drunken boating, lowering the legal blood alcohol limit for that, a range of things to pass the time until the budget is put together.

James Lynch: Some of the annual chestnuts, the banning handheld phones while you're driving, those sorts of things.  We'll see those sorts of things for the next month or so while they're waiting for budget numbers to come in and then they'll probably be quietly forgotten.

Paul Yeager: Or as David Yepsen said, the debate on what's the official state tenderloin.  Alright, that's James Lynch of the Cedar Rapids Gazette and Jeneane Beck of Iowa Public Radio.  Thank you both from your statehouse positions coming out to visit us here on The Journal. 

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