Governor Chet Culver favors a buck a pack increase in the state tax on cigarettes and he predicts legislators who’ve talked about a cigarette tax hike that’s less than a dollar will be faced with "tough" decisions when it comes to balancing the state budget.
"That’s the great thing about our democratic process is that we don’t always see eye to eye on the issues," Culver says. "But I think as the session moves along here and when it comes time to present budgets and determine how we’re going to pay for our priorities, that’s when tough decisions have to be made." During the past campaign Culver advocated the dollar-a-pack increase in the cigarette tax.
Key legislators from Culver’s own Democratic Party, though, suggest a cigarette tax hike of between 40- and 60 cents-per-pack is more likely. "I’ve made my decision on one of the most important sources of revenue in my budget and I’m anxious to work with the legislature to resolve our differences," Culver says. "This won’t be the only area where we, perhaps, disagree."
Culver estimates his dollar-a-pack cigarette tax hike would generate as much as 150-million more for the state and he would dedicate that money to health care programs. "For example, expanding (government-paid) health care for young people, perhaps including their parents," Culver says. Culver is also calling on legislators to get the bill raising the state minimum wage to his desk this week so he can sign it into law by Friday.
"This will affect 260,000 Iowans literally over night: about 130,000 Iowans that are working at the minimum wage right now (and) another 130,000 who are working…just above the minimum wage — in all likelihood they will see an increase in their hourly wages," Culver says. "This is a great thing for working men and woman across our state." The bill hiking the minimum wage to $6.20 an hour on April 1st is scheduled for debate in the Iowa House tomorrow (Tuesday) and may be debated in the Iowa Senate the next day.
Culver will formally unveil his outline for state spending on Tuesday of next week. Culver will also deliver a "budget address" to legislators. "There’s a surplus to work with and the state is in a pretty good place financially, but I’m also going to be very disciplined and conservative when it comes to the taxpayers’ money and how we allocate it," Culver says. "There won’t be a whole lot of surprises in terms of my budget address.
The budget priorities will be consistent with what I talked about during the campaign." For example, Culver promises to plow more state money into raising teacher pay and he also promises to create a 100-million dollar "Iowa Power Fund" to stimulate the alternative fuels industry. Culver’s budget speech is scheduled for 10 o’clock on Tuesday, January 30.