Thank you Madam President. Thank you Mr. Speaker, members of the General Assembly, and our Supreme Court, distinguished guests, and my fellow Iowans.

We are blessed, in troubled times in a troubled world, to live in a special place. A special place of shared values – where we celebrate family and community. Cherish learning and good health, value hard work and self-reliance. And love our land, water and air. To remain that special place, we must nurture hope and opportunity. If we remain content with the Iowa of today we will surely compromise the Iowa of tomorrow.

Given our values, no Iowan should be satisfied if bright Iowans leave, believing they can find no meaningful opportunity here; if Iowans can’t find or afford healthcare services; if Iowans are prevented from enjoying the outdoors because our rivers and streams are polluted. Sadly, all of this is happening in our state today.

We can, we should, and we must do better. Iowans must respond to the challenge by embracing and directing change. I am confident we are up to the challenge; but state government cannot approach this challenge alone.

The primary responsibility for effecting change will always be with the private and nonprofit sectors. State government’s role – to act as a catalyst for change and remove barriers to progress. To fulfill that responsibility we must act now and we must act boldly.

The state budget complicates our task. The work begun two years ago to align revenues with expenditures must continue. The law requires a balanced budget and we will have a balanced budget. While complicated, the task is not impossible.

I want to acknowledge the hard work done by the previous legislature. Tough and often unpopular choices had to be made but those choices create options today that most states do not enjoy. Few states enjoyed surpluses last year or will this year. Fewer still reduced the size of government while increasing the commitment to k-12, expanding access to healthcare for children and seniors, and creating a new venture capital fund. These achievements and many others share more than being accomplished during tough times; they also share, more importantly, having been accomplished in a bipartisan effort.

Today let me identify the four cornerstones to future progress that will preserve our values by nurturing and expanding hope and opportunity: a transformed Iowa economy, continuous improvement to education, expanded access to healthcare and other community services, and renewed commitment to our environment.

The economy of Iowa, grounded in the production of ever-increasing volumes of low priced ag commodities, and the creation of well-intended but low paying manufacturing and service sector jobs, no longer adequately supports our values; nor will it expand hope and opportunity.

For the benefit of ourselves and future generations, we must transform our economy to one rooted in the development and growth of high priced, value added ag-based ingredients to be used to feed, fuel and heal, and in the creation of wealth through high paying jobs held by a highly educated workforce.

This new Iowa economy will preserve and enhance our values, better support Iowans and their families and communities, and allow for continued investment in quality of life.

In the Iowa economy of today, less than thirty percent of employed Iowans have any college experience. Iowans who learn more earn more. Our goal in the Iowa economy of tomorrow – a bio-high tech based economy – should be to double the number of employed Iowans with college experience. Immediate progress towards that goal should be the standard by which our work here is judged.

To reach that ambitious goal requires a new, focused effort on economic development keyed to life sciences, value added agriculture, advanced manufacturing, insurance, and other information solutions. Vision Iowa and its success taught us the power of state resources leveraging more private and other public investment. We must apply that important lesson to economic development.

A companion fund, the Iowa Values Fund, should be created and dedicated to partnering with private investment to begin the transformation of our economy. Administered and managed as a public/private partnership, the fund’s investments should promote regional economic development so no part of Iowa is left behind, and work more closely with the Regents universities, community colleges and independent colleges to double the number of college experienced workers in the workforce. Over the next 5 years $500 million should be committed to this effort. It is that important.

The initial investment from the Iowa Values Fund should be dedicated to making Iowa the life sciences leader in protein development and production. Developing the necessary life sciences infrastructure with an appropriate regulatory structure should be a top economic development priority of the state, allowing us to reach a goal of starting 100 new life sciences companies in Iowa in the next 5 years.

Initial resources from the fund should also spur the development of more renewable fuel and energy of all kinds. The benefits to our economy and our environment from ethanol and biodiesel fuel are well known. Similar benefits will result from an expansion of renewable energy production. Today, Iowa annually produces 200 megawatts of electricity from renewable energy sources – wind, solar, and biomass. By the end of the decade Iowa should annually produce a minimum of 1,000 megawatts committed to the goal of making Iowa a net exporter of energy.

Barriers to a new Iowa economy must be removed. Regulatory approval for new business and expansion needs to be timely for progress delayed is progress denied. A complex income tax system with loopholes places Iowa in a non-competitive position. Simplifying the system and closing loopholes will remove a barrier to progress. No Iowan should have to use a form larger than a postcard to report state income and pay state taxes.
At the same time, the property tax system pays for services not related to property ownership; extends credits, exemptions and abatements in a haphazard fashion; encourages inefficiencies in government; and discriminates between and among classes of property owners. The time has come. Sunset the system that doesn’t work and replace it with one that does. Remove the barrier.

As our investments result in a new economy, our values demand that we not forget those struggling in the old economy. There are over 100,000 Iowans working at or near a minimum wage. Many support families. Most qualify for public assistance. All work hard. Let us honor their work, and all work, by raising the minimum wage.

Each generation of Iowans carries a special responsibility to support the education of all of our children. The members of the last legislature understood that in supporting change and investment in Iowa’s schools even in the face of tough economic times. Their commitment to lower class sizes, reading initiatives, and improved teacher quality reaped positive results in improved test scores and better professional development.

We cannot and should not abandon those efforts – but more is needed to keep faith with our values and maximize hope and opportunity for our children.

A transformed Iowa economy requires continuous improvement in education.

If we are to double the number of college experienced workers in the workforce, more of our children will have to attend college. To achieve success in school, children must be ready to learn before they get to school. Bold goals precede and encourage bold action. We must challenge ourselves to create an Iowa where virtually all (over 90%) of our children have access to quality preschool and where virtually all, at least 90%, of our children complete their formal education with at least 2 years college experience.

Achievement gaps and dropouts carry a heavy price for failure. Just a generation ago the thought of all day kindergarten for all Iowa children seemed an impossible dream. Today, over 90% of our children have access to all day kindergarten. Our 90/90 goal embodies our values. The goal can be reached. The goal must be reached. The goal will be reached.

The creation of the Iowa Learns Council, with representatives from all levels of education and statewide leaders will develop strategies and policy recommendations for accomplishing the 90/90 goal.

The 90/90 goal needs resources. As investments from the Iowa Values fund are made and expand opportunities, a portion of new revenues generated from these investments should be dedicated to achieving the 90/90 goal. In the meantime, college tuitions continue to go up and some students may be discouraged from attending. That is why this legislature should restore funding to the important work-study program to empower students to earn their way through college.

Barriers to reaching the ninety/ninety goal must also be removed. A disparity exists in educational opportunity.

Very small school districts with high schools of less than 200 students find it increasingly difficult to provide the range of opportunities needed for success. This barrier can be removed through collaboration or consolidation. The creation of a Virtual Academy allowing access to online courses, and Regional Academies enabling schools to combine course opportunities will help reduce the disparity. For those districts where consolidation provides the only answer, financial incentives should be created to encourage consolidation.

Some believe that a financial disparity in education exists. For more than a generation, based on a study of school finances, Iowans operated under the belief that the school funding formulae promoted equity. Much has changed since that study – and the times call for a new study of school finances. If inequities exist, they must be addressed. Our values require it. Hope and opportunity depend upon it.

Iowans have a right to expect quality healthcare. We’ve worked hard to extend that right to our children. Today, we protect almost ninety-five percent of our children by providing access to healthcare through Medicaid; Hawk-I, our children’s health insurance program; or other private insurance. We take pride in knowing almost ninety percent of adults have health insurance as well.

However, access to quality healthcare, even in Iowa, remains threatened. An unfair Medicare reimbursement system, the ever-increasing costs of prescription drugs, and the exploding costs of Medicaid all will test our commitment to the value of good healthcare.

We will fight whenever, wherever, and for as long as it takes for a fair Medicare reimbursement. We will negotiate whenever, wherever, and for as long as it takes until Iowa seniors have fair drug prices.

We will look whenever, wherever, and for as long as it takes for strategies to control Medicaid costs without limiting access to quality healthcare. I want to thank Senator Kramer, in particular, for her efforts already exercised in these areas and pledge to work with her and the General Assembly to maintain quality healthcare.

To remain true to our values and to extend hope and opportunity to all, we must protect those vulnerable Iowans who cannot protect themselves. Thousands suffering from mental illness do not have access to the treatment they need. The fact is that one out of every four Iowa families have family members touched by mental illness. Barriers exist to the care they need.

Let us stop the needless suffering. Iowa should lead the nation with the highest percentage of residents with mental health and substance abuse coverage. Let us make the enactment of mental health parity a landmark for which this legislature will be remembered and celebrated for years to come.

But people with mental illness, mental retardation, or other disabilities need more than access to quality medical care; they need access to basic community resources that most of us take for granted – like housing, transportation and job opportunities – so they, too, can participate in the American dream.

This goal has been a personal passion for Lt. Governor Pederson. That is why I have asked her to lead the effort to transform our system of services to respond more effectively to the needs of those with disabilities.

Changes in the system will be directed by a commission of stakeholders created through bipartisan legislation last year. The Lt. Governor will continue to work with the commission and Republican and Democratic legislators to create a system that supports self-determination, self-sufficiency and independence.

It is our goal over the next four years to substantially increase accessible residential housing and workplace opportunities through public/private partnerships and leveraging funds in new and innovative ways. We will make the largest investment in housing for people with disabilities in Iowa history.

And we will seek legislation to give the Department of Inspections & Appeals the authority to regulate adult day care facilities for dependent adults and seniors, so that families can feel secure about the quality of care their family member receives.

In a land where stewardship is a value and virtue, knowing that we have over 150 rivers and streams, a number likely to grow, impaired by pollution should be a call to action for all of us. A new Iowa economy should support resources necessary to clean up our rivers and streams. By 2010 there should be no impaired waters list in Iowa. By 2010 Iowans should be free to swim, fish, or use this great natural resource as God intended.

To those who doubt such a goal is obtainable, stand aside. Iowans working together to achieve a common goal will succeed, but to succeed there must be consensus. One hundred years ago Theodore Roosevelt brought interested parties together in a summit dedicated to conservation. The time is right for a statewide summit on water quality to eliminate the impaired waters list. Today I ask the Department of Natural Resources, the Iowa Farm Bureau, the Association of Business and Industry, and the Iowa Environmental Council each to designate a representative to work with me and representatives of the General Assembly, cities, and counties to plan and hold such a summit to develop a conservation plan for restoring our waters.

Earlier I mentioned the role of the nonprofit sector to effect change. The vital role of nonprofit organizations in Iowa’s future must be clearly understood and actively supported. Nonprofit organizations are often small and may need technical assistance and training. All of us need to help them to help us. I asked Willard “Sandy” Boyd, President Emeritus of the University of Iowa, founder of the Iowa Nonprofit Resource Center, and a great Iowan, to chair a task force to be appointed for this purpose.

My time with you is limited, so I cannot share thoughts about other important aspects of Iowa life, from public safety to support for arts and culture. All is important in our effort to help build a better Iowa.

All will be needed in this effort.

Great values, great needs, great goals mandate from all of us, inside and outside state government, great action. Many may question if it all can be done.

Theodore Roosevelt said it so well so long ago. “It is not the critic who counts; not the person who points out how strong men and women stumbled or where the doer of deeds could have done them better. The credit belongs to the person who is actually in the arena, whose face is marred by dust, sweat, and blood; who strives valiantly; who errs and comes short again and again; who knows the great enthusiasms, the great devotions, and spends a life in a worthy cause, who at the best knows in the end the triumph of high achievement and who at the worst, if he or she fails, at least he fails while daring greatly, so that their place shall never be with those cold and timid souls who knew neither victory nor defeat.”

Let that be said of this generation of Iowans who risked embracing change, fought to preserve our values, and nurtured hope and opportunity for all.

God bless you. God bless our great State of Iowa, and the United States of America.