Corporate tax subsidy reform is long overdue

Let's accomplish the long-overdue reform of corporate tax subsides. Iowa has a $500 million shortfall in state revenues, a shortfall due almost entirely to the national recession caused by Wall Street.

This unprecedented drop in income led Gov. Chet Culver to impose a 10 percent across the board cut in all general fund spending. Almost $600 million was cut from education, health care, public safety and clean air and water programs. Meanwhile, on the tax spending side of the state budget, no cuts have been proposed for the $400 million we give to corporations each year through tax subsides.

This state spending, which includes corporate tax credits, has increased by 350 percent over the past five years. It is the fastest growing part of state spending. And it receives virtually no regular oversight. There are no performance measures or regular reports to the Legislature or governor on whether these programs are working.

Why aren't we insisting that corporate tax credits and similar corporate spending receive more scrutiny and also take its fair share of across-the-board cuts?

Put a spending cap on all corporate tax subsides. Put a sunset all the tax credits subsides and regularly evaluate every dollar spent in this area for results.

Difficult times force everyone to establish priorities. I support effective economic development programs, but it is time that they become far more transparent and accountable for creating good paying jobs.

Joe Bolkcom

Chairman,

Senate Ways and Means Committee