The Republican state auditor says Governor Culver, who’s a Democrat, has not cut the state budget deeply enough. The governor ordered a 1.5% across-the-board budget cut last week, but State Auditor Dave Vaudt warns the governor and legislature may have to pare much more in the months ahead.
"If I’d been in…their shoes first off I would have never passed a budget at the spending that they passed. You should have allowed for some conservatism and plus we knew everybody was heading into a recession…and (experts) were projecting the 35 – 40 states were, so it shouldn’t have been a surprise," Vaudt says. "…Had we been conservative, we wouldn’t have had to cut back."
The State of Iowa has about 620-million dollars in cash reserves, but Vaudt says one a portion of that money may be used to plug budget holes or to help in flood recovery.
"If you take a look at the ‘rainy day’ funds in total, there’s a 10 percent reserve set aside: 7.5 percent goes to cash reserves and 2.5 percent goes to economic emergencies — so about a quarter of that’s available for economic emergencies like the flood and so forth. The other piece we need to have there in order to cash flow and make school aid payments and stuff on time because of the timing of tax receipts and so forth," Vaudt says. "…The problem is (the cash reserve) can’t solve all of our problems and it’s going to be difficult."
The auditor suggests now is the time to make changes that have proven too political difficult in the past. If Iowans want to pay lower taxes, Vaudt says they have to expect fewer government services — and although Vaudt’s not endorsing specific ideas like reducing the number of counties in Iowa or merging more schools, Vaudt says government consolidation may be the best answer in some instances.
"I think definitely whenever you go through tough times, it makes everybody step back and look at doing things differently," Vaudt says, "so the good part of going through tough times is it sometimes makes you address significant difficult decisions and make changes that you otherwise wouldn’t have thought about doing." Vaudt may feel a bit like "chicken little" as he’s been warning about tough budget times for years.
"I think people have listened, but they haven’t been willing to make the difficult decisions that go along with that. That’s either cutting back on your spending or increasing your taxes and fees and the reason they always (give) is ‘Well, we have to worry about the services’ or ‘We have to worry about the kids.’ We could all do that with our personal finances — say, ‘I did it, but I did it for the kids’ but where you reach the point where all your credit cards are maxed out, was that good for the kids? No it wasn’t," Vaudt says. "…The key (for statehouse politicians) is take fiscal responsibility and incorporate it just like any family…decide what are true priorities, what do we really have available to spend and how do I stay within that spending limit."
Vaudt made his comments during and after taping of the "Iowa Press" program that airs Friday night on Iowa Public Television at 7:30.