A three-member panel of experts says the state’s economy is holding steady and the group has stuck with its previous estimate of state tax collections for the current fiscal year. Legislative Services Agency director Holly Lyons today said while the economy is “lackluster”, the state is experiencing “slow growth.”
“It’s like when you’re walking against a stiff Iowa wind in the springtime,” Lyons said. “The wind may blow you back and it may be a little off course, but you still move forward and reach your destination.”
Lyons and the other two members of the Revenue Estimating Conference project state tax revenues will grow 4.4 percent in the next state fiscal year which begins July 1. David Roederer, the governor’s budget director, expressed concern about farm commodity prices.
“When you have the price of corn down 57 percent from our high in 2012, it’s going to have an impact,” Roederer said.
But Lyons said the financial service industry is now one-fifth of the Iowa economy and that is helping Iowa “ride the negative impacts” of the slumping ag economy.
“The Iowa economy is growing, just at a slower pace,” Lyons said. “There is no immediate indication of a significant downturn or a looming recession.”
David Underwood, a retired business executive from Mason City, is the other member of the Revenue Estimating Conference. He provided a similar assessment of Iowa’s economy.
“In Iowa we’re very lucky in that we’re not on the list of those states that are in recession or teetering on the brink,” Underwood said.
The predictions on state tax collections Underwood and the other two experts made this morning mean legislators won’t have to pare down the current state budget, plus legislators now can finalize their budget writing for the following year.