Republicans and democrat Governor Tom Vilsack have offered differing plans to try to, among other things, resurrect the state’s new economic development program, but neither side is backing down yet. Republicans asked Vilsack to accept about half of the income tax cuts they originally sought in return for having the legislature put the Iowa Values Fund back in business. Vilsack offered to accept a different, one-time tax cut for businesses. House Speaker Christopher Rants, a republican from Sioux City, spoke with reporters after meeting privately with Vilsack yesterday afternoon. Rants characterized the republican proposal as a “middle ground” as he says the governor has talked repeatedly about governing in the middle. Rants says republicans have “heard the governor loud and clear that he doesn’t support tax cuts,” but Rants says republican still believe tax cuts are crucial to stimulating the economy. Senate Republican Leader Stewart Iverson of Dows says the G-O-P will insist on tax cuts. Iverson says Presidents Kennedy, Reagan and George W. Bush enacted tax cuts, and each time the nation’s economy grew. Senate President Jeff Lamberti, a republican from Ankeny, says one of the major flaws in Vilsack’s proposal is that it would only validate the Values Fund grants that have already been. Lamberti calls that “taking a step back.” The Governor, however, says his proposal focuses on the immediate problems created by last month’s Iowa Supreme Court ruling which nullified wide-ranging legislation that created the Values Fund. Vilsack says he prefers a “targeted and focused” special legislative session to fix the short-term problems, rather than “monkey business or funny business” that adds a lot of other issues into the mix. Vilsack says the two sides will continue to negotiate. Vilsack says republicans offered everything they wanted in exchange for no guarantee that the Values Fund would operate permanently, and he won’t accept that. Vilsack says 150-million dollars worth of income tax cuts would be too big a hit to the state treasury. Vilsack says policymakers have been struggling to find enough money for priority areas like schools, so he wonders aloud why it would be a good idea to reduce state resources even more in the future. Vilsack, though, isn’t willing to say the two sides are at the end of the road when it comes to finding a compromise. Vilsack says “the journey continues.”
