Governor Chet Culver says the state will be able to "manage" its way through budget woes. State tax receipts dropped dramatically in May and some officials conclude there’s a more than $100 million hole in the state budget plan.
The state budgeting year ends in just a few weeks, on June 30th, but Governor Culver says there’s no need to call legislators back in special session to fix the problem.
"We don’t believe that that will be necessary," Culver says.
The governor has the authority to withdraw up to $50 million from the state’s cash reserve to put the budget back in the black. In addition, the budget plan calls for spending all but $45 million. Adding that $45 million "ending balance" with the money Culver can withdraw from the state’s cash reserve indicates Culver can fix a "hole" in the budget of about $95 million.
"We will be able to balance in ’09 as we have always believed despite the additional down, I should say lowering of estimates," the governor says.
Culver rejects charges from Republicans who say Culver and his fellow Democrats spent too much and have jeopardized the state’s fiscal footing.
"Despite the rhetoric and misinformation you’re hearing on the Republican side of the aisle, we actually cut $135 million from our state appropriation. We had a reduction of two percent, over two percent of the budget," Culver says. "We actually are spending less state money in fiscal year ’10 than we spent in fiscal year ’08 and that meant we had to cut pretty severely in certain areas."
Culver argues Iowa is "better positioned" to weather this financial storm than most states.
"We have a cash reserve. We have a triple A bond rating," Culver says. "…So we’re going to manage our way through this challenging economic environment."
Culver is in the midst of out-of-state travel that took him to Washington, D.C. and Canada for a series of meetings. During a telephone conference call with Iowa reporters over the noon-hour today, Culver twice misstated a key budget number — the money left over as an "ending balance" in the state budget. Culver said it was "north" of a hundred million. It’s actually a little less than half that much. Culver spokesman Troy Price says the governor merely misspoke…..