A man who served as former Governor Tom Vilsack’s budget director has some experience with across-the-board cuts in state spending. Randy Bauer led the Department of Management in 2001 when Governor Vilsack ordered a 4.3 percent cut in the state budget.
Governor Culver ordered a 10 percent across-the-board last week. In an interview before that announcement, Bauer said while reductions in education, public safety and human needs programs get more of the attention, layoffs in smaller agencies have a big impact. For example, when the Department of Revenue loses staff, Bauer said there are fewer people to keep an eye on businesses and retailers.
“They’ve got enormous responsibility to collect the revenue that’s owed to the state,” Bauer said, “and yet when they’re taking those kinds of budget reductions it’s difficult for them to carry on that mission and then ultimately that can hurt the state even more because you end up in a situation where, because they’re not able to do their job, we collect even less revenue.”
Bauer warns “bad actors” may try to take advantage of the situation. “There’s always a certain amount of gaming of the system that you’re just going to have to take as a fact,” Bauer said. “And you don’t have resources to do as many audits or as many field samplings of sales tax collections and that sort of thing and, as a result, you tend to see an erosion in your overall collections.”
Bauer is now a consultant, specializing in state government operations. He said Iowa isn’t the only state with budget woes. According to Bauer, the news coming from other states is uniformly bad. Bauer’s bio on the “LinkedIn” website shows he’s done consulting work for Georgia, Minnesota, Nebraska, Illinois, New York and Pennsylvania as well as a handful of major U.S. cities, including Washington, D.C. and St. Louis.
(This story was posted on 10/12/09 and updated on 10/28/09 after Mr. Bauer noted the interview on which the story was based occurred before, not after, Culver’s budget-cutting announcement.)