Iowa lawmakers face tough budget grind as time is running out

DES MOINES - Partisan leaders in the House and Senate said Thursday they are making progress on issues holding up adjournment, but they remain far apart on fiscal 2016 budget differences that could slow the process for shutting down in May.

'We're moving forward. We're making progress. Bills are coming out of committee,” said House Speaker Kraig Paulsen, R-Hiawatha.

Paulsen and Senate Majority Leader Mike Gronstal, D-Council Bluffs, said it was a positive development that Republicans and Democrats have come out with fiscal 2016 spending targets that will form the basis for future negotiations, although compromise continues to elude them.

'We are moving forward with a budget that we think reflects Iowa's priorities,” Gronstal told reporters Thursday. 'It's a tough budget but a fair budget, and it invests in those things that we think we ought to be investing in, and we also think it's a budget that the governor will sign.”

Paulsen said Republicans remain adamant the state not spend more than the $7.175 billion in revenue projected to be available next fiscal year, which limits how much new money can be appropriated. State budget experts project current-year spending at $6.994 billion, but that number may need a $68 million adjustment to cover Medicaid costs.

Legislative Democrats and Gov. Terry Branstad have proposed $7.341 billion in spending to cover program increases and past commitments made for property tax relief, education reform and expanded health care. However, Democrats want to hike state aid to K-12 schools by 2.625 percent while Branstad and legislative Republicans favor a 1.25 percent boost for fiscal 2016.

The only thing that everybody could agree on Thursday was that lawmakers will not adjourn by May 1 - the session's 110th day when their daily expense money ends.

'I don't expect to be done by May 1,” Paulsen said.

'We'll be here as long as we need to be here until the work is done,” he added.

Both House and Senate leaders plan floor debates over the next two weeks with the expectations that disagreements will get referred to conference committees for resolution.

Discussions turned testy at times Thursday as majority Democrats in the Senate and majority Republicans in the House began moving budget bills that are about $166 million apart.

Sen. Julian Garrett, R-Indianola, drew a sharp Democratic objection when he made references in a Senate Appropriations Committee meeting to a shortfall in the current budget year that caused the state's surplus to shrink by about $350 million. Sen. Tom Courtney, D- Burlington, noted that a justice systems bill he managed was roughly the same as what Branstad proposed but drew five GOP no votes.

'I never dreamed people in this building would say, no, the governor is spending frivolously and we're going to cut him,” Courtney told members of the Senate Appropriations Committee.

It was unclear whether there would be full contingents of 100 House members and 50 senators on a daily basis at the Statehouse as priority bills begin to work through the process, but Paulsen said lawmakers will exchange budgets and work through negotiations.

'Everybody who needs to be here will be here,” Paulsen said.