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Iowa Press #2929
March 15 and 17, 2002

Borg: IOWA'S GOVERNOR AND THE STATE LEGISLATURE DIFFER ON HOW TO MANAGE THE STATE ON MEAGER RESOURCES. WE'LL GET EXECUTIVE BRANCH PERSPECTIVE FROM GOVERNOR TOM VILSACK ON THIS EDITION OF "IOWA PRESS."

ANNOUNCER: FUNDING FOR "IOWA PRESS" WAS PROVIDED BY "FRIENDS" OF IOWA PUBLIC TELEVISION; AND BY THE IOWA BANKERS ASSOCIATION... FOR PERSONAL, BUSINESS, AND COMMERCIAL NEEDS, IOWA BANKS HELP IOWANS REACH THEIR FINANCIAL GOALS; AND BY THE ASSOCIATED GENERAL CONTRACTORS OF IOWA... THE PUBLIC'S PARTNER IN BUILDINGS IOWA'S HIGHWAY, BRIDGE, AND MUNICIPAL UTILITY INFRASTRUCTURE.

STATEWIDE IOWA PUBLIC TELEVISION IS CELEBRATING THE 30TH ANNIVERSARY OF "IOWA PRESS," NOW SERVING THE STATE AS IOWA'S LONGEST RUNNING NEWS INTERVIEW PROGRAM. THIS IS THE FRIDAY, MARCH 15 EDITION OF "IOWA PRESS." WITH THIS WEEK'S EDITION OF "IOWA PRESS," HERE IS DEAN BORG.

Borg: BEFORE ADJOURNING ABOUT A MONTH FROM NOW, IOWA'S 150 SENATORS AND REPRESENTATIVES MUST FORGE A NEW IOWA BUDGET, WHICH BECOMES THE STATE'S SPENDING BLUEPRINT FOR FISCAL 2003 BEGINNING THIS JULY 1. SAGGING TAX REVENUES HAVE FORCED CUTS IN THE CURRENT STATE BUDGET. WHILE SOME ECONOMISTS THINK THEY SEE BEGINNINGS OF ECONOMIC RECOVERY, SHORT-TERM PROJECTIONS THROW AN EVEN BIGGER SHADOW ON THE IOWA ECONOMY AND NEXT YEAR'S BUDGET. WHEN THE LEGISLATURE HAS CRAFTED A BUDGET, IT GOES TO THE DESK OF GOVERNOR TOM VILSACK. NOW, HE HAS OUTLINED HIS RECOMMENDATIONS TO LEGISLATORS, BUT TO PUT IT DIPLOMATICLY, THERE IS A DIFFERENCE OF OPINION BETWEEN THE DEMOCRATIC GOVERNOR AND THE REPUBLICAN CONTROLLED LEGISLATURE. GOVERNOR VILSACK, I SAW YOU SMILE AT THAT. WELCOME BACK TO "IOWA PRESS."

Vilsack: IT'S NICE TO BE HERE, DEAN.

Borg: AND ACROSS THE TABLE: "DES MOINES REGISTER" POLITICAL COLUMNIST DAVID YEPSEN AND "ASSOCIATED PRESS" STATEHOUSE REPORTER MIKE GLOVER.

Glover: GOVERNOR VILSACK, AS DEAN MENTIONED, THERE'S EXACTLY ONE MONTH LEFT IN THIS YEAR'S LEGISLATIVE SESSION. WHAT DO YOU NEED FROM THIS LEGISLATURE BEFORE THEY ADJOURN?

Vilsack: WELL, WE NEED A BUDGET THAT REFLECTS IOWA VALUES, THAT SUPPORTS COMMUNITY, SUPPORTS RESPONSIBILITY AND OPPORTUNITY, THAT ADEQUATELY FUNDS EDUCATION AND THE ABILITY TO MAKE SURE WE HAVE QUALITY SCHOOLS AND PROTECTS OUR CHILDREN AND PROVIDES HEALTH CARE FOR OUR SENIORS. WE ALSO NEED MENTAL HEALTH PARITY AND SUBSTANCE ABUSE PARITY BILL. AND I THINK WE NEED TO MAKE SURE OUR ROADS ARE SAFER WITH THE PASSAGE OF .08.

Glover: DO YOU HAVE ANY INDICATIONS -- .08 IS OUT OF COMMITTEE AS OF THIS WEEK. IT'S LIKELY THAT'S GOING TO END UP ON YOUR DESK THIS YEAR. IT'S LIKELY THAT SOME FORM OF MENTAL HEALTH PARITY BILL IN SOME FORM IS GOING TO LAND ON YOUR DESK. OTHER THAN THAT, DO YOU HAVE SOME INDICATION THAT THEY'RE ACTUALLY GOING TO DO THAT, DO THE SORTS OF THINGS THAT YOU'RE TALKING ABOUT?

Vilsack: WELL, WE HAVE TO HAVE A BUDGET, MIKE. BOTTOM LINE, WE HAVE TO HAVE A BUDGET, AND THAT BUDGET MUST, AT THE END OF THE DAY, REFLECT THE VALUES OF IOWA FAMILIES AND COMMUNITIES. WE'VE PUT TOGETHER A BUDGET THAT ADEQUATELY SUPPORTS, GIVEN THE TOUGH ECONOMIC TIMES THAT WE'RE IN, OUR SCHOOLS. THAT'S OUR NUMBER ONE PRIORITY. EDUCATION IS OUR NUMBER ONE PRIORITY. WE'VE ALSO PUT OUT A BUDGET THAT BASICALLY DRAWS THE LINE ON FURTHER CUTS TO HUMAN SERVICES. THE REALITY IS WE'VE CUT THOSE DEPARTMENTS FAR TOO MUCH, AND WE'RE NOW AT THE POINT WHERE OUR ABILITY TO PROTECT OUR CHILDREN, TO PROVIDE HEALTH CARE FOR OUR SENIORS IS JEOPARDIZED. AND THAT'S SOMETHING THAT I'M, FRANKLY, NOT INTERESTED IN DOING ANY MORE OF. WE'LL BE GLAD TO WORK WITH THE LEGISLATURE TO ENSURE THAT WE HAVE A BIPARTISAN APPROACH TO THIS, BUT THE REALITY IS WE'VE GOT TO PROTECT OUR SCHOOLS AND WE'VE GOT TO PROTECT OUR SERVICES TO OUR SENIORS.

Glover: WHAT'S THE MOOD UP THERE THIS YEAR? LAST YEAR IT WAS KIND OF NASTY, KIND OF PARTISAN, KIND OF SNIPING. WHAT'S THE MOOD THIS YEAR?

Vilsack: WELL, WE'VE HAD VERY GOOD, CANDID MEETINGS WITH LEGISLATIVE LEADERS, AND WE'LL CONTINUE TO HAVE THOSE MEETINGS. I THINK THAT THERE IS SORT OF A HOPE THAT SOMEHOW THINGS ARE GOING TO MAGICALLY TURN AROUND. I'VE BEEN A LITTLE BIT CONCERNED ABOUT THE PACE OF WORKING ON THE BUDGET. IT'S BEEN DIFFICULT FOR THE LEGISLATURE TO FOCUS ON THE ALLOWABLE GROWTH ISSUE, WHICH IT NEEDS TO DO IN ORDER TO GET THIS PROCESS STARTED.

Borg: THAT'S FOR SCHOOLS YOU MEAN?

Vilsack: THAT'S CORRECT. MY HOPE IS THAT STARTING NEXT WEEK WE'LL GET SERIOUS ABOUT THE BUDGET.

Yepsen: GOVERNOR, I ASK YOU THIS QUESTION EVERY TIME YOU'RE ON, BUT EVERY TIME THE BUDGET GETS WORSE. IS THIS TIME FOR A TAX INCREASE IN IOWA?

Vilsack: NO.

Yepsen: WHY NOT?

Vilsack: BECAUSE WE'VE PUT TOGETHER A BUDGET THAT BASICALLY PROTECTS OUR PRIORITIES AND REFLECTS OUR VALUES, PUTS ADDITIONAL RESOURCES TO OUR SCHOOLS, MAKES SURE THAT WE CAN HAVE ADEQUATE CHILD PROTECTION, EXPANDED ACCESS TO HEALTH CARE SERVICES FOR SENIORS, PROTECTS THE ENVIRONMENT, AND KEEPS OUR COMMUNITIES SAFE. WE JUST NEED LEGISLATIVE COOPERATION AND BASICALLY UTILIZING THE RESOURCES THAT ARE AVAILABLE TO THE STATE RIGHT NOW. WE DON'T NEED A TAX INCREASE.

Yepsen: GOVERNOR, ONE OF THE MOST CONTENTIOUS ISSUES IN OUR STATE IS HOG LOTS, AND THAT ISSUE IS IN FRONT OF THE GENERAL ASSEMBLY. WHAT DO YOU WANT TO SEE IN A HOG LOT BILL? LAWMAKERS ARE TRYING TO CRAFT SOMETHING THAT WILL DO SOMETHING ABOUT THE PROBLEM AND YET PROTECT THE INDUSTRY. WHAT DO YOU HAVE TO HAVE IN THAT?

Vilsack: WELL, THERE ARE TWO KEY COMPONENTS, DAVID. FIRST OF ALL, THERE'S GOT TO BE SOME DEGREE OF LOCAL CONTROL, LOCAL DECISION-MAKING IN THE PROCESS. THE FACT IS THAT WE HAVE A SITUATION IN PARTS OF OUR STATE WHERE THERE HAVE BEEN HEAVY CONCENTRATIONS OF THESE FACILITIES, THE PLACEMENT OF THESE FACILITIES POTENTIALLY THAT COULD HARM TOURISM AND CULTURAL AND RECREATIONAL OPPORTUNITIES, WHICH BASICALLY CREATES A CLASH OR A DIFFERENCE OF OPINION WITHIN A COMMUNITY. WE NEED SOMETHING THAT ALLOWS THE COMMUNITY TO VOICE ITS CONCERNS AND TO HAVE INPUT AND CONTROL OVER THE ULTIMATE DECISION-MAKING IF IT'S GOING TO ADVERSELY AFFECT THE COMMUNITY. SECONDLY, WE NEED TO MAKE SURE THAT WHATEVER ADDITIONAL REGULATIONS, RULES THAT WE ESTABLISH, THAT THEY CAN BE ADEQUATELY ENFORCED. THAT MEANS WE'RE GOING TO HAVE TO HAVE ADDITIONAL RESOURCES TO THE DEPARTMENT OF NATURAL RESOURCES TO MAKE SURE THAT IF THERE ARE MANURE MANAGEMENT PLANS THAT HAVE TO BE EXAMINED AND ENFORCED THAT WE HAVE THE PERSONNEL TO DO IT.

Borg: I'M WONDERING, WHERE DO YOU ALSO COME DOWN PHILOSOPHICALLY ON PROTECTING THE INDUSTRY AS PART OF IOWA'S ECONOMY? IT'S BEEN WITHIN THE PAST COUPLE OF YEARS YOU WERE CASTING ABOUT IN IOWA LOOKING FOR A SITE FOR A BEEF PROCESSING PLANT. AND THAT, ALONG WITH YOUR PHILOSOPHY OF VALUE ADDED -- WE HAVE THE BASIC PRODUCTION; WE VALUE ADD AND ADD TO THE IOWA ECONOMY THAT WAY. THE INDUSTRY -- THE LIVESTOCK INDUSTRY, IN PARTICULAR THOSE IN THE SWINE INDUSTRY, SAY THAT IF THERE ARE TOO MANY RESTRICTIONS, IT WILL DRIVE THE INDUSTRY OUT OF IOWA BECAUSE YOU'RE GOING AGAINST THE TREND IN THE INDUSTRY TOWARD BIGGER LIVESTOCK CONFINEMENT FACILITIES. SO HOW CAN YOU BALANCE WHAT YOU WANT ALONG WITH KEEPING THE INDUSTRY IN THE IOWA ECONOMY?

Vilsack: WELL, FIRST OF ALL, YOU GIVE FOLKS IN THE COMMUNITY A VOICE. YOU GIVE -- YOU MAKE THEM PART OF THE PROCESS. THE CURRENT SYSTEM TODAY, FRANKLY, THERE IS NO WAY THE DEPARTMENT OF NATURAL RESOURCES CAN DENY A PERMIT IF IT MEETS THE TECHNICAL QUALIFICATIONS OF THE LAW. AND THERE'S NO WAY PEOPLE WITHIN A COMMUNITY CAN RESPOND AND SAY, "NO, THIS IS NOT SOMETHING THAT'S CONSISTENT WITH WHAT WE WANT TO HAVE HAPPEN IN OUR COMMUNITY." THERE IS ABSOLUTELY A NEED FOR A LIVESTOCK INDUSTRY IN THIS STATE, AND THERE IS A WAY IN WHICH IT CAN BE DONE. I'VE SUGGESTED A WAY IN THE PROPOSALS WE'VE MADE FOR THE LAST THREE YEARS. I DON'T THINK IT'S GOING TO CRIPPLE THE INDUSTRY. IN FACT, I THINK IT WILL STRENGTHEN THE INDUSTRY. IT WILL BASICALLY PROVIDE FOR GREATER COMMUNITY SUPPORT FOR THE INDUSTRY. I ALSO THINK OUR UNIVERSITIES HAVE A RESPONSIBILITY, AND THEY'RE STEPPING UP TO THE PLATE IN PROVIDING TECHNOLOGIES, NEW TECHNOLOGIES THAT CAN CONTROL SOME OF THE ODOR PROBLEMS, SOME OF THE MANURE MANAGEMENT ISSUES THAT ARISE FROM THESE LARGE FACILITIES. WE NEED TECHNOLOGY. WE NEED COMMUNITY INVOLVEMENT. I THINK WE CAN GET THERE. I DON'T THINK WE CAN GIVE UP ON THE INDUSTRY. WE ABSOLUTELY HAVE TO HAVE THE INDUSTRY, BUT WE HAVE TO HAVE IT IN AN ENVIRONMENTALLY SAFE AND SECURE WAY.

Glover: WHILE THE LEGISLATURE AND YOURSELF ARE WRESTLING WITH SOME OF THESE WEIGHTIER ISSUES IN THE BACK ROOM, DEALING WITH THOSE IN PRIVATE, SOME OTHER ISSUES ARE FLOATING AROUND THE LEGISLATURE, SOME SORT OF EMOTIONAL TYPE OF SOCIAL ISSUES. ONE OF THEM IS ABORTION. THERE'S A BILL ON ITS WAY TO YOUR DESK TO REQUIRE THAT WOMEN, BEFORE THEY OBTAIN AN ABORTION, BE GIVEN SOME INFORMATION ABOUT ALTERNATIVES TO ABORTION. THE WAITING PERIOD THAT YOU OBJECTED TO LAST YEAR HAS BEEN TAKEN OUT OF IT. WHAT'S YOUR VIEW ABOUT THAT BILL?

Vilsack: YOU KNOW, MIKE, I ABSOLUTELY SUPPORT THE NEED FOR WOMEN TO HAVE AS MUCH ACCURATE, COMPREHENSIVE INFORMATION AS POSSIBLE ABOUT THE ALTERNATIVES TO ABORTION, ABOUT THE CONSEQUENCES OF THE DECISION THAT THEY'RE ABOUT TO MAKE. I HAVE ABSOLUTELY NO CONCERN ABOUT THAT PART OF THE LEGISLATION. THE CONCERN I HAVE ABOUT THE LEGISLATION IS THAT IT CRIMINALIZES THE ACTIONS OF DOCTORS. I THINK WE NEED TO LOOK FOR A BETTER WAY TO PROVIDE COMPREHENSIVE, MEDICALLY ACCURATE INFORMATION TO WOMEN. AND I AM COMMITTED TO DOING THAT, AND WE WILL DO THAT. WE'LL WORK WITH THE LEGISLATURE. AND IF THEY ARE INTENT ON MAKING SURE THAT THE ACTIONS OF DOCTORS ARE CRIMINAL, WE'LL FIGURE OUT ALTERNATIVE WAYS TO PROVIDE THAT ADDITIONAL INFORMATION, BUT WE'RE GOING TO GET THE INFORMATION TO WOMEN FOR SURE.

Glover: BUT YOU CAN'T SIGN THAT BILL?

Vilsack: WELL, I'M DEEPLY CONCERNED. I WANT TO HOLD OUT THE HOPE THAT A COMPROMISE CAN BE REACHED. THE REALITY IS I'VE MET WITH LEGISLATIVE LEADERS ON THIS ISSUE. THEY'VE NOT INDICATED THAT THEY'RE REALLY INTERESTED IN COMPROMISE. SO WE'RE GOING TO CONTINUE TO LOOK FOR WAYS, CREATIVE WAYS TO PROVIDE THAT INFORMATION.

Glover: ANOTHER BILL WORKING ITS WAY TOWARD YOUR DESK WOULD ALLOW SCHOOLS, MAKE IT CLEAR THAT SCHOOLS CAN START THE DAY WITH A MOMENT OF SILENCE FOR STUDENTS TO REFLECT AND APPARENTLY HAVE A FLAG TATTOOED ON THEIR FOREHEAD OR SOMETHING LIKE THAT. WHAT'S YOUR VIEW ABOUT THAT BILL?

Vilsack: WELL, WE CAN ALREADY DO THAT. I DON'T HAVE ANY REAL CONCERNS ONE WAY OR THE OTHER. THE REALITY IS THAT CAN ALREADY TAKE PLACE IN SCHOOLS ALL ACROSS THE STATE. I THINK WE HAVE TO BE VERY CAREFUL WE DON'T CROSS THAT LINE WHERE WE'RE IMPOSING A PARTICULAR THOUGHT PROCESS ON YOUNGSTERS OR A PARTICULAR RELIGIOUS VIEW ON YOUNGSTERS. BUT RIGHT NOW A MOMENT OF SILENCE CAN TAKE PLACE IN CLASSROOMS ALL ACROSS THE STATE. TO THE EXTENT THAT THIS IS GOING TO MAKE PEOPLE FEEL BETTER ABOUT IT, WE'LL TRY TO WORK WITH FOLKS. BUT CANDIDLY, MIKE, THESE ISSUES ARE NOT THE FUNDAMENTAL ISSUES THAT WE OUGHT TO BE TALKING ABOUT ON THIS SHOW OR IN THIS LEGISLATURE. WE OUGHT TO BE TALKING ABOUT HOW WE CAN SUPPORT SCHOOLS, HOW WE CAN EXPAND ACCESS TO HEALTH CARE FOR CHILDREN AND SENIORS, HOW WE CAN PROTECT THE ENVIRONMENT, AND HOW WE CAN KEEP OUR STREETS AND COMMUNITIES SAFE. THOSE ARE THE FUNDAMENTAL ISSUES, AND THOSE ARE REFLECTED IN THE BUDGET DISCUSSIONS WHICH HAVE NOT YET TAKEN PLACE AND WHICH NEED TO TAKE PLACE. YOU OPENED THIS SHOW WITH THE IDEA THAT THE SESSION HAD A MONTH TO GO. I'M NOT AS CONFIDENT AS THE REST OF IOWA IS THAT THIS SESSION CAN BE CONCLUDED IN ONE MONTH, UNLESS WE GET SERIOUS ABOUT THIS BUDGET AND UNLESS THERE IS A RECOGNITION THAT WE'RE NOT GOING TO BE ABLE TO CUT HUMAN SERVICES, THAT WE'RE NOT GOING TO BE ABLE TO REDUCE FUNDING IN EDUCATION. LET ME TELL YOU, I'M REALLY CONCERNED ABOUT THE DISCUSSIONS THAT ARE TAKING PLACE RIGHT NOW ABOUT THE SUPPORT FOR THE K-12 SYSTEM. I'VE SEEN OPTIONS THAT ARE BEING CONSIDERED, OPTIONS OF NO ALLOWABLE GROWTH, NEGATIVE ALLOWABLE GROWTH. THAT IS NOT ACCEPTABLE. WE HAVE GOT TO HAVE SUPPORT FOR OUR SCHOOLS. WE'VE GOT TO MAINTAIN THE PROGRESS THAT WE HAVE SEEN RECENTLY IN EDUCATIONAL QUALITY IN OUR SCHOOLS. AND HERE'S WHY... IT'S NOT JUST ABOUT EDUCATION. IT'S BEEN ECONOMIC DEVELOPMENT. I TALKED TO THE CHAIR OF CISCO SYSTEMS YESTERDAY. HE WAS IN MY OFFICE. HE SAID, "GOVERNOR," HE SAID, "YOU KNOW, IT'S NOT THE BUSINESS TAX STRUCTURE OF A STATE THAT WE LOOK TO." HE SAID, "THAT'S IMPORTANT BUT IT'S NOT THE KEY THING. THE KEY THING IS DO YOU HAVE AN EDUCATION SYSTEM THAT PRODUCES PRODUCTIVE, WELL-MEANING, INNOVATIVE, CREATIVE YOUNG PEOPLE. IS THAT WHAT YOU'RE CREATING? ARE YOU GIVING US THE OPTION?" THAT'S WHAT WE OUGHT TO BE TALKING ABOUT, MIKE. THAT'S WHAT WE OUGHT TO BE SPENDING OUR TIME ON.

Yepsen: WELL, GOVERNOR, WHAT'S THE ISSUE HERE? I MEAN THE REPUBLICANS SAY THEY'RE ALL FOR EDUCATION, BUT THEY HAVE A QUESTION WHETHER YOU CAN AFFORD SOME OF THE SPENDING --

Vilsack: YOU CAN'T AFFORD NOT TO, DAVID! YOU CAN'T AFFORD NOT TO!

Yepsen: WELL, THE STATE IS BROKE. I MEAN --

Vilsack: THERE ARE RESOURCES. NO, I WILL NOT ACCEPT THAT PREMISE! THE STATE IS NOT BROKE! YOU CAN'T SAY A STATE IS BROKE WHEN YOU'RE LOOKING AT A SURPLUS THAT IS ABOVE THE NATIONAL AVERAGE, WHEN YOU HAVE RESOURCES AND OTHER FUNDS THAT CAN BE USED. IT IS ABOUT PRIORITIES. IT IS ABOUT VALUES. WE'RE NOT BROKE. IT IS A QUESTION OF REALLY WHAT IS YOUR PRIORITY. THERE ARE ADEQUATE RESOURCES TO FUND THE BUDGET THAT WE'VE PUT BEFORE THE LEGISLATURE. WE'VE IDENTIFIED THOSE RESOURCES. NOW, THERE MAY BE DISAGREEMENTS ABOUT WHETHER THEY WANT TO USE THOSE RESOURCES FOR THOSE PURPOSES, BUT DON'T TELL ME WE DON'T HAVE ENOUGH MONEY. WE DO.

Yepsen: SO IN ALL OF EDUCATION, GOVERNOR, YOU CAN FIND NO EFFICIENCIES THERE? THERE'S NO SAVINGS TO BE MADE IN THE WAY WE DELIVER K-12 SERVICES IN IOWA?

Vilsack: THAT QUESTION PRESUPPOSES THAT WE HAVEN'T ALREADY HAD REDUCTIONS. WE'VE ALREADY SEEN REDUCTIONS IN THE K-12 SYSTEM. WE'VE ALREADY SEEN CUTS TO THE COMMUNITY COLLEGE SYSTEM. WE'VE ALREADY SEEN EFFICIENCIES IN CUTS AND REDUCTIONS IN THE REGENTS UNIVERSITY SYSTEM. WE'VE ALREADY SEEN A REDUCTION IN THE COMMITMENT TO TUITION GRANT. LET ME UNDERSCORE SOMETHING HERE. THIS IS NOT JUST ABOUT EDUCATION. IT IS ALSO ABOUT ECONOMIC DEVELOPMENT. IT IS ABOUT A STATEMENT OF WHERE OUR FUTURE IS. I AM OPTIMISTIC ABOUT WHERE THE FUTURE OF THE STATE IS BECAUSE I THINK WE'VE PUT IN PLACE SOME VERY KEY COMPONENTS TO A PROSPERITY AGENDA. WE HAVE PUT IN PLACE AN EDUCATION IMPROVEMENT PROCESS. WE'VE PUT IN PLACE ADEQUATE POWER. WE'VE GOT VISION IOWA EXPANDING CULTURAL AND RECREATIONAL PROGRAMS, AND WE ALSO HAVE A VENTURE CAPITAL PROGRAM. THESE ARE VERY IMPORTANT COMPONENTS. IF WE TAKE A STEP BACK ON THE EDUCATION PIECE OF THIS, WE WILL NOT ONLY COMPROMISE THE FUTURE OF OUR CHILDREN, WE WILL COMPROMISE THE FUTURE OF THIS STATE. AND WE'RE NOT GOING TO LET THAT HAPPEN!

Glover: ONE ISSUE THAT'S WORKING ITS WAY AGAIN TOWARDS YOUR DESK IS THE ISSUE OF THE LOCAL OPTION SALES TAX, WHICH HAS BEEN IMPLEMENTED IN A NUMBER OF URBAN COUNTIES IN THE STATE. SOME RURAL FORCES WOULD LIKE TO SEE THE LOCAL OPTION SALES TAX FOR SCHOOLS TAKEN STATEWIDE. IF THAT BILL LANDS ON YOUR DESK, WHAT ARE YOU GOING TO DO WITH IT?

Vilsack: MIKE, I DON'T BELIEVE IT'S GOING TO HAPPEN. THE REASON IT'S NOT GOING TO HAPPEN IS BECAUSE I DON'T THINK THE DEBATE ON THAT ISSUE CAN BE CONTROLLED TO JUST SCHOOLS. I ALREADY KNOW OF PEOPLE THAT ARE SUGGESTING THAT MAYBE A PORTION OF IT SHOULD BE USED FOR HUMAN SERVICES, A PORTION OF IT SHOULD BE USED FOR THE ENVIRONMENT. I DON'T SEE ANY SUPPORT AMONG LEGISLATIVE LEADERS FOR A TAX INCREASE DEBATE. I JUST DON'T THINK THAT'S GOING TO HAPPEN.

Yepsen: GOVERNOR, YOU MENTIONED THE MENTAL HEALTH PARITY BILL AS ONE OF THE PRIORITIES YOU'D LIKE TO SEE IN THE LEGISLATURE. SENATOR PRESIDENT MARY KRAMER HAS COME UP WITH WHAT SHE SAYS IS A COMPROMISE, THAT INSTEAD OF REQUIRING INSURANCE COMPANIES TO PROVIDE -- AND BUSINESSES TO PROVIDE MENTAL HEALTH COVERAGE, SHE'S GOING TO CREATE A TAX INCENTIVE TO HELP THEM PAY FOR IT. WHAT DO YOU THINK OF THAT APPROACH?

Vilsack: ONE OUT OF FOUR IOWA FAMILIES IS IMPACTED BY MENTAL ILLNESS. AND THE REALITY IS THAT UNLESS WE DEAL WITH THIS ISSUE, WE ARE LEAVING A LOT OF PEOPLE OUTSIDE THE HEALTH CARE SYSTEM THAT NEED HELP. AND THE FACT IS, THE STATE ENDS UP PAYING FOR IT ONE WAY OR THE OTHER IN CORRECTIONS OR ADDITIONAL HEALTH CARE EXPENSE. SENATOR KRAMER, I APPRECIATE THE WORK THAT SHE IS DOING IN TRYING TO KEEP THIS ISSUE BEFORE THE LEGISLATURE. SHE HAS DONE A YEOMAN'S WORK ON KEEPING IT IN FRONT OF AND MOVING THE PROCESS FORWARD. CANDIDLY, I DON'T THINK HER PROPOSAL GOES AS FAR AS WE NEED TO GO. SENATOR LUNDBY HAD A PROPOSAL VOTED OUT OF HER COMMITTEE THAT WE WOULD SUPPORT. IT RECOGNIZES THE NEED FOR REAL PARITY. IT ALSO RECOGNIZES THE FACT THAT WE NEED TO TAKE A POSITIVE STEP FORWARD ON SUBSTANCE ABUSE. I DON'T NECESSARILY THINK WE NEED A TAX CREDIT FOR BUSINESSES. MUSCO LIGHTING CAME UP TO THE LEGISLATURE OVER THE COURSE OF THIS WEEK, AND THEY BASICALLY SAID, "LOOK, WE'RE A SMALL COMPANY. WE HAVE A SMALL NUMBER OF EMPLOYEES. WE PROVIDE MENTAL HEALTH COVERAGE. IT HAS NOT INCREASED OUR PREMIUMS AT ALL." WE HAVE, IN OUR PROPOSAL, A PROCESS THAT WOULD GUARD AGAINST UNREASONABLY HIGH PREMIUM INCREASES. SO I DON'T THINK THIS IS NECESSARILY AN ISSUE WHERE WE HAVE TO LOOK FOR ADDITIONAL TAX BREAKS FOR BUSINESS. I THINK WE JUST NEED THE WILL TO DO WHAT ONE OUT OF FOUR IOWA FAMILIES NEEDS.

Yepsen: THE INSURANCE INDUSTRY IS UP AT THE LEGISLATURE AND WITH YOU TRYING TO ASK FOR A TAX BREAK ON THEIR INSURANCE PREMIUM TAX. ARE THESE TWO ISSUES TIED TOGETHER THAT YOU'LL SIGN A TAX BREAK FOR INSURANCE COMPANIES IF THE LEGISLATURE APPROVES A MENTAL HEALTH PARITY BILL?

Vilsack: WELL, I REALLY UNDERSTAND THE LIFE AND HEALTH PIECE OF THE INSURANCE INDUSTRY IN OUR STATE SEEKING SOME DEGREE OF EQUITY. AND WE'RE WORKING WITH THAT INDUSTRY TO SEE IF THERE'S A WAY IN WHICH THE SAVINGS THAT THEY WILL GENERATE FROM A PREMIUM TAX REDUCTION FROM OTHER STATES CAN BE FUNNELED BACK INTO THE STATE OF IOWA. I SUGGESTED AND THOUGHT IT WOULD BE A GOOD IDEA FOR THEM TO COMMIT THAT TO VENTURE CAPITAL. IT WOULD BE ANOTHER ADDITIONAL SHOT IN THE ARM. THERE IS NO TYING OF THE TWO ISSUES. I AM PLEASED WITH THE FACT THAT THE FEDERATED GROUP OF INSURANCE COMPANIES HAVE COME OUT IN SUPPORT OF PARITY AND RECOGNIZING THAT, FOR THE FIRST TIME, THEY'RE WILLING TO GO ON RECORD PUBLICLY AS SUPPORTING PARITY. I THINK THAT WAS HELPFUL IN KEEPING THE ISSUE BEFORE THE LEGISLATURE. WE HAVE A LOT MORE WORK TO DO ON THIS, BUT WE'RE MAKING SOME PROGRESS.

Glover: GOVERNOR, I'D LIKE YOU TO STEP BACK FOR A SECOND FROM YOUR ROLE AS GOVERNOR OF THIS STATE AND THINK ABOUT YOUR ROLE AS TOM VILSACK, FATHER OF A COUPLE OF KIDS. YOU'VE GOT A COUPLE OF KIDS THAT ARE MOVING THROUGH THE EDUCATIONAL PROCESS, TRANSITIONING INTO THE WORK PROCESS. DO YOU EXPECT THEM TO LIVE AND WORK IN IOWA?

Vilsack: WELL, I KNOW MY SON JESS IS GOING TO BE HERE. HE JUST GOT A JOB WORKING FOR A FEDERAL JUDGE IN IOWA. AND HE'S EXCITED ABOUT THAT AND HE'S COMMITTED TO THE STATE OF IOWA. DOUG IS A JUNIOR IN COLLEGE, AND WE'VE GOT TO DO A LOT OF AGGRESSIVE WORK TO ENSURE THAT PEOPLE LIKE MY SON ARE INTERESTED IN LIVING IN THE STATE, AND I THINK WE HAVE. LET ME EXPLAIN WHAT WE'VE DONE, MIKE. WE ARE CHANGING THE PHILOSOPHY AND FOCUS OF ECONOMIC DEVELOPMENT IN THIS STATE FROM A FOCUS THAT WAS BASED ON GROWTH AND JOB DEVELOPMENT, WHICH WASN'T NECESSARILY DESIGNED TO INCREASE THE STANDARD OF LIVING OF IOWANS, TO ONE THAT IS FOCUSED ON PRODUCTIVITY, INNOVATION, AND EFFICIENCIES. WE'VE PUT IN PLACE, AS I SAID BEFORE, THE FOUR CORNERSTONES OF THIS PLAN: A MUCH BETTER SUPPORTED AND QUALITY EDUCATION SYSTEM FROM THE BEGINNING OF A CHILD'S EDUCATION ALL THE WAY THROUGH; ADEQUATE SUPPLY OF POWER FOR NEW-TECH AND HIGH-TECH COMPANIES; EXPANSION OF CULTURAL AND RECREATIONAL OPPORTUNITIES THAT WILL BE ATTRACTIVE TO YOUNG PEOPLE THROUGH VISION IOWA... NOW 45 COMMUNITIES SEEING ACTIVITY ON THAT FRONT; AND THIS YEAR A VENTURE CAPITAL PROPOSAL THAT WILL PROVIDE THE RESOURCES, THE FINANCIAL CAPITAL TO ENCOURAGE FOLKS TO COME TO IOWA. WE HAVE A TAX CREDIT PROPOSAL -- HIGHER EDUCATION TAX CREDIT PROPOSAL THAT WILL ALLOW US TO RESPOND TO THE HUMAN CAPITAL SIDE OF THIS. THIS IS SOMETHING WE WANT TO WORK WITH THE LEGISLATURE ON. AND WE ALSO HAVE SOMETHING THAT WILL TIE ALL OF THIS TOGETHER: A NEW ECONOMY COUNCIL THAT WILL BRING PEOPLE FROM BUSINESS, FROM THE UNIVERSITIES AND COLLEGES AND COMMUNITY COLLEGES, AND THE GOVERNMENT SECTOR TOGETHER AT THE SAME TABLE AT THE SAME TIME TALKING ABOUT THE SAME AGENDA... HOW DO WE MAKE IOWA BUSINESSES AND IOWA WORKERS MORE PRODUCTIVE? HOW DO WE MAKE THEM MORE INNOVATIVE?

Glover: HAVE YOU TALKED TO YOUR SONS ABOUT THIS?

Vilsack: I HAVE. I HAVE AND THAT'S ONE OF THE REASONS WHY JESS CHOSE TO COME BACK TO THE STATE AND WENT TO THE UNIVERSITY OF IOWA LAW SCHOOL AND WHY HE CHOSE TO STAY IN THE STATE LOOKING FOR JOB OPPORTUNITIES.

Yepsen: ONE OF THE ISSUES THAT THE BUSINESS COMMUNITY SAYS IT NEEDS IN ORDER TO CREATE SOME OF THE JOB OPPORTUNITIES YOU'RE TALKING ABOUT IS THE CAPITAL GAINS TAX BREAK TO ENCOURAGE NEW BUSINESSES TO START UP TO ENCOURAGE NEW ECONOMY BUSINESSES TO START IN THIS STATE. DO YOU -- WHAT'S YOUR CURRENT THINKING ABOUT GIVING A CAPITAL GAINS TAX BREAK?

Vilsack: WELL, THE REALITY IS WE'VE GOT TO HAVE ADEQUATE RESOURCES TO SUPPORT THESE FOUNDATIONS THAT WE'VE PUT IN PLACE. WE'VE GOT TO HAVE THE RESOURCES TO SUPPORT EDUCATION. WE'VE GOT TO HAVE THE RESOURCES TO SUPPORT EXPANSION OF CULTURAL AND RECREATIONAL OPPORTUNITIES. IF YOU TALK TO BUSINESS LEADERS ACROSS THE COUNTRY, THEY WILL TELL YOU IT'S QUALITY OF LIFE, IT'S THE QUALITY OF THE EDUCATION SYSTEM. IT ISN'T NECESSARILY ONLY ABOUT YOUR TAX STRUCTURE. WE HAVE PUT IN PLACE $100-MILLION PROPOSAL FOR VENTURE CAPITAL. THAT IS A SIGNIFICANT FIRST START IN THIS PROCESS. I THINK WE NEED TO GET THAT UNDERWAY. AND WE ALSO HAVE THE FIFTH LOWEST COST OF DOING BUSINESS IN THE STATE OF IOWA TODAY. THAT'S SOMETHING WE CAN MARKET, BUT OBVIOUSLY THAT'S NOT ENOUGH. WE'VE GOT TO BE ABLE TO SAY WE CAN GIVE YOU WELL-EDUCATED WORKERS, WE CAN GIVE YOU ADEQUATE SUPPLY OF POWER, WE CAN HAVE EXPANDED CULTURAL AND RECREATIONAL OPPORTUNITIES FOR YOUR EMPLOYEES, AND IF YOU START A NEW BUSINESS AND HAVE A NEW IDEA, WE HAVE VENTURE CAPITAL AVAILABLE TO START THAT BUSINESS.

Yepsen: ISN'T THAT VENTURE CAPITAL PIECE, WHICH CAME REAL EARLY IN THE SESSION AND WE ALL FORGET ABOUT NOW, AS WE LOOK BACK, ISN'T THAT GOING TO BE THE MOST IMPORTANT THING THAT YOU AND THIS LEGISLATURE GET DONE?

Vilsack: WELL, I THINK IF WE GET PARITY AND WE GET .08 AND WE GET A BUDGET THAT REFLECTS OUR VALUES, ALL OF THOSE THINGS ARE IMPORTANT. BUT THAT IS A CRITICAL COMPONENT PIECE WITH THE OTHER PIECES THAT WE'VE PUT IN PLACE OVER THE LAST COUPLE OF YEARS, DAVID. NO QUESTION ABOUT IT.

Glover: THIS PAST WEEK YOU FILED YOUR NOMINATION PAPERS. YOU'RE OFFICIALLY A CANDIDATE FOR A SECOND TERM IN OFFICE. WHAT'S THE CASE THAT TOM VILSACK TAKES TO VOTERS FOR A SECOND GUBERNATORIAL TERM?

Vilsack: WELL, CANDIDLY, MIKE, WHAT I'M FOCUSED ON RIGHT NOW IS DOING THE JOB WHICH I WAS ELECTED TO DO, WHICH IS TO MAKE SURE THAT THE BUDGET WE PASSED FOR THIS LEGISLATURE IS REFLECTIVE OF THE VALUES OF IOWANS. I WILL TELL YOU THAT WE HAVE PUT IN PLACE AND WE HAVE SIGNIFICANTLY IMPROVED OUR EDUCATION SYSTEM WITH TEST SCORES GOING UP. WE'VE EXPANDED ACCESS TO HEALTH CARE FOR 30,000 CHILDREN. WE HAVE A SENIOR LIVING TRUST FOR 12,000 SENIORS THAT ARE NOW GETTING CARE THAT THEY WEREN'T GETTING BEFORE. WE ARE WORKING WITH PHARMACEUTICAL COMPANIES TO TRY TO BRING THEM TO THE TABLES FOR OUR PRESCRIPTION DRUG PROGRAM. WE HAVE MADE SIGNIFICANT INROADS IN THE ENVIRONMENT WITH OUR WATER MONITORING PROGRAM AND EXPANDED CLEAN WATER INITIATIVE THAT HAS GOTTEN THE NATION'S ATTENTION IN TERMS OF THE FARM BILL DEBATE. WE HAVE A VENTURE CAPITAL PROPOSAL THAT'S GOING TO EXPAND NEW ENTREPRENEURIAL OPPORTUNITIES IN THIS STATE. WE HAVE INCREASED THE WAGES OF JOBS CREATED THROUGH STATE ASSISTANCE FROM $12 TO $13 AN HOUR TO $18 AN HOUR. WE HAVE THE HIGHEST RATE OF EMPLOYMENT IN THE STATE'S HISTORY. THIS IS A STRONG, POSITIVE RECORD TO BUILD ON, BUT WE'VE GOT TO DO MORE. NO QUESTION ABOUT IT. WE HAVE TO CONTINUE TO IMPROVE OUR EDUCATION SYSTEM. WE HAVE TO CONTINUE TO LOOK FOR WAYS TO LINK OUR K-12 AND OUR COMMUNITY COLLEGES TOGETHER AND DO A K-14 SYSTEM. WE HAVE TO CONTINUE TO EXPAND CULTURAL AND RECREATIONAL OPPORTUNITIES. WE HAVE TO LOOK FOR WAYS TO MAKE SURE THAT IOWANS ARE ADEQUATELY INSURED -- INSURANCE COVERAGE AND HEALTH CARE COVERAGE, AND WE HAVE TO CONTINUE TO LOOK FOR WAYS TO FOSTER THIS CULTURE OF INNOVATION. IOWA STATE UNIVERSITY IS THE TWELFTH LEADING DEVELOPER OF PATENTS IN THIS COUNTRY. THE TWELFTH LEADING -- THAT MEANS THERE ARE ONLY 11 OTHER PLACES IN THE COUNTRY THAT ARE COMING UP WITH MORE NEW IDEAS. THIS IS HAPPENING ALL OVER THE STATE. WE NEED TO TAKE THESE NEW IDEAS, WE NEED TO MAKE THEM INTO PRODUCTS AND SERVICES, AND WE NEED TO PROMOTE AN AGENDA THAT FOCUSES ON INNOVATION AND EFFICIENCY. WE CAN DO THAT AND WE'VE PUT IT INTO PLACE, THE OPPORTUNITIES TO DO THAT.

Yepsen: GOVERNOR, WE'VE GOT JUST ABOUT A MINUTE LEFT. THE REPUBLICAN CANDIDATES FOR GOVERNOR ARE SAYING, "VILSACK BLEW IT, THE BUDGET IS A MESS, IT'S HIS FAULT, WE NEED A CHANGE." WHAT DO YOU SAY TO THE REPUBLICAN -- ALL THREE OF THE REPUBLICAN CANDIDATES WHO ARE RUNNING WHO ARE CRITICAL OF YOUR STEWARDSHIP OF THE STATE FINANCES?

Vilsack: WELL, I'LL GIVE THEM A COPY OF "THE WALL STREET JOURNAL" EDITORIAL THIS WEEK THAT RECOGNIZED THAT WE'RE DOING IT THE RIGHT WAY. I'LL GIVE THEM A COPY OF "GOVERNING MAGAZINE'S" RATING OF OUR STEWARDSHIP. I'LL GIVE THEM A COPY OF "MOODY'S" AND "STANDARD AND POOR'S" RATING OF OUR FISCAL STEWARDSHIP. THE REALITY IS WE HAVE NOT RAISED TAXES. WE HAVE CUT TAXES IN A TOUGH ECONOMIC TIME. WE HAVE MOVED AN AGENDA OF PROGRESS FORWARD IN TOUGH ECONOMIC TIMES. WE HAVE ALSO MAINTAINED A RESERVE WELL ABOVE THE NATIONAL AVERAGE. WE ARE IN MUCH BETTER SHAPE THAN STATES AROUND US. WE HAVE SEEN SIGNIFICANT IMPROVEMENTS IN THESE AREAS. I'VE TALKED ABOUT EXPANDED ACCESS TO HEALTH CARE, BETTER EDUCATION SYSTEM, BETTER QUALITY JOBS. I'M WILLING TO TAKE THAT ISSUE ON.

Yepsen: WE'VE GOT ABOUT THIRTY SECONDS --

Vilsack: LET ME JUST -- ONE OTHER THING. I'M WILLING TO CONTRAST THAT TO THE WAY DIFFICULT TIMES HAVE BEEN DEALT WITH IN THE PAST WHERE WE'VE SEEN TAX INCREASES AND DEFICITS THAT HAVE BEEN HIDDEN FROM PEOPLE. I'M WILLING TO TALK ABOUT THAT AS WELL.

Yepsen: OKAY, WE'VE GOT ABOUT FIFTEEN SECONDS LEFT, GOVERNOR. WHO IS DOING THE BEST JOB AMONG THE DEMOCRATIC PRESIDENTIAL CANDIDATES IN '04 IN THIS STATE?

Vilsack: DAVID, I'VE BEEN SO FOCUSED ON THE BUDGET, I COULDN'T -- I CAN'T ANSWER THAT QUESTION.

Yepsen: WE CAN'T GET YOU TO TALK A LITTLE POLITICS?

Vilsack: YOU WOULD BE IN A BETTER POSITION TO ANSWER THAT QUESTION THAN I WOULD.

Borg: WE'LL HAVE YOU BACK WHEN YOU HAVE TIME TO THINK ABOUT THAT. THANK YOU, GOVERNOR. ON OUR NEXT EDITION OF "IOWA PRESS," THE FOCUS REMAINS ON THE 2002 LEGISLATIVE SESSION. JOINING US WILL BE THE SPEAKER OF THE IOWA HOUSE OF REPRESENTATIVES, BRENT SIEGRIST OF COUNCIL BLUFFS, AND HOUSE DEMOCRATIC MINORITY LEADER RICHARD MYERS OF IOWA CITY. THAT WILL BE AN INTERESTING DISCUSSION WITH THE LEADERS OF BOTH POLITICAL PARTIES IN THE IOWA HOUSE OF REPRESENTATIVES, NEXT WEEKEND, FRIDAY AT 6:30, SUNDAY AT NOON. AND WE'RE NOW IN OUR FINAL WEEKEND OF THE "FRIENDS" FESTIVAL HERE AT IOWA PUBLIC TELEVISION. THESE FINAL HOURS, WE INVITE YOU TO BECOME A MEMBER OF "FRIENDS" OF IOWA PUBLIC TELEVISION. IT'S AN INVITATION TO BECOME A PARTNER IN WHAT WE BELIEVE IS TELEVISION WORTH WATCHING. A "FRIENDS" MEMBERSHIP IS AN INVESTMENT IN QUALITY, LOCALLY PRODUCED PROGRAMS... PROGRAMS LIKE "IOWA PRESS," WHICH, INCIDENTALLY, NOW IS IN ITS 30TH ANNIVERSARY YEAR HERE ON STATEWIDE IOWA PUBLIC TELEVISION. YOUR SUPPORT HAS BEEN ESSENTIAL IN OUR PAST AND IS ABSOLUTELY CRUCIAL TO OUR FUTURE. SO ON BEHALF OF OUR ENTIRE "IOWA PRESS" TEAM, THANK YOU. I'M DEAN BORG. THANKS FOR JOINING US TODAY.

ANNOUNCER: FUNDING FOR "IOWA PRESS" WAS PROVIDED BY "FRIENDS" OF IOWA PUBLIC TELEVISION; AND BY THE IOWA BANKERS ASSOCIATION... FOR PERSONAL, BUSINESS, AND COMMERCIAL NEEDS, IOWA BANKS HELP IOWANS REACH THEIR FINANCIAL GOALS; AND BY THE ASSOCIATED GENERAL CONTRACTORS OF IOWA... THE PUBLIC'S PARTNER IN BUILDING IOWA'S HIGHWAY, BRIDGE, AND MUNICIPAL UTILITY INFRASTRUCTURE.