Governor Tom Vilsack wants to increase the state tax on cigarettes by 80 cents per pack, starting April 1st. That proposal is among hundreds included in Vilsack’s five-billion dollar state spending plan. Vilsack says Iowa’s 36-cents-per-pack cigarette tax ranks 42nd lowest in the country, and raising the tax will not only raise money but save lives as more people decide to quit rather than pay the tax. Vilsack warns legislators that if the tobacco tax isn’t increased, they may have to cut some state health care services like hospice care or prescription drug coverage for the poor elderly. “Without a tobacco tax increase, the legislature is faced with some very difficult choices,” Vilsack says. “They can choose to pit grandchildren against grandparents.” Vilsack proposes a total of 137, million dollars more for K-through-12 public schools, including nearly 47-and-a-half million dollars to boost teacher pay. Vilsack says the state hasn’t made that high of a spending comittment to K-through-12 schools in over a decade. “I think it’s really important for people to understand the importance of investing in children and in education because if we make children and we help them with the tools for success, they can essentially help us fix whatever problems society faces,” Vilsack says. Vilsack also calls for a four percent increase in state spending for the 15 area community colleges and a 40 million dollar increase in state spending at the state-supported universities in Ames, Cedar Falls and Iowa City. Finally, on economic development, Vilsack proposes an 800-million, five-year committment to an Iowa Values Fund to dole out large state grants to new and expanding businesses. Vilsack says it isn’t enough to make a one-year committment, because the state needs to enter multi-year pacts with companies. Vilsack says the new taxes that state will collect from new gambling operations could be used to finance it, but he’s willing to look at other options. As you may recall, an Iowa Supreme Court ruling this summer put the Iowa Values Fund out of business. Vilsack briefed legislative leaders earlier this afternoon (Monday) on this budget plans, then released his spending ideas to statehouse reporters. At four o’clock he convenes a meeting in Waukee to lay out his plan to the public.
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