Iowa Democrats say they've 'gone past the middle' to meet GOP budget demands

Senate Democrats say they have “gone past the middle of the road” to reach a budget agreement with Gov. Terry Branstad and House Republicans – even giving up on their demand that allowable growth for K-12 schools increase 2 percent, according to Sen. Bob Dvorsky, D-Coralville, chairman of the Appropriations Committee.

“We have moved dramatically their direction on the spending side of this equation,” added Senate Majority Leader Mike Gronstal, D-Council Bluffs, referring to Republicans insistence that overall spending be limited to $5.999 billion. Senate Democrats' original budget called for $6.2 billion in spending.

“But we continue to have priorities on things like education … whether that's in preschool or K-12 or at our community colleges or our regents institutions,” Gronstal said. “That's incredibly import for the next gen of workers. So our focus in these budget discussions has been on education and job creation.”

Democrats will also put forth a two-year budget plan that will fund the second year at 85 percent of the “global” or overall budget. It will include a 3 percent bump in allowable growth in the second year, Gronstal said.

Branstad has insisted on a two-year budget, but lawmakers have balked at giving up their appropriation authority. Democrats plan to fully fund school aid, bond payments and property tax credits in the second year. However, many line items would be funded at much lower levels – 50 percent, perhaps – and the budget would be filled in when the Legislature convenes in January 2013.

The Democratic plan calls for spending 97 percent of state revenues or less depending on which revenues are included, Dvorsky said.

Gronstal was “cautiously optimistic” the Legislature will adopt property tax reform that will include House language tying growth in local government property tax expenditures to a Midwest inflation index.

Gronstal declined to speculate what might happen if no budget is in place July 1, the start of the new fiscal year. There are stop-gap measures that could be implemented if necessary if a budget agreement has been struck.

“I'm not talking about the ‘event that it doesn't get done,'” Gronstal said. “The key is to find agreement.”

The Senate is scheduled to be in session today for committee work on several appropriations bills.