Branstad says lawmakers likely to OK school plan

DES MOINES – Gov. Terry Branstad on Monday advised school superintendents finalizing their budgets for next school year to plan on his funding approach of no allowable growth increase in base state aid and a means-tested preschool system despite the current uncertainty in legislative process.

Branstad did not rule out that some school districts could face layoffs under a scenario where the state “backfills” $212 million in past state underfunding but provides no increase in per-pupil state aid for the next two fiscal years. But he promised that school officials will have “stability and predictability” that they can rely on as opposed to the “false kind of budgeting” of recent years where state promised funding increases went unfulfilled and was even slashed by 10 percent in mid-year in October 2009.

“The state will meet its obligations, which it didn't do the last two years,” he told reporters at his weekly news conference.

“What we have offered is something that offers stability and predictability so that they know what the budget will be,” the governor added. “And it is an austere budget and I would remind you that revenue is still below where it was two years ago. It's a little higher than it was last year, but we inherited a financial mess that we're committed to straightening out.”

Branstad said he is hopeful the split control Legislature -- where Republicans control the House and Democrats guide the Senate – will be able to come together soon on a two-year state budget that includes a fiscal 2012 spending plan that would follow the recommendations he offered in January.

House Republicans are on board with Branstad's call for zero allowable growth in state aid the next two fiscal years and have indicated that they view the governor's plan to end an “entitlement” preschool approach in favor of a scholarship program based on of families' ability to pay for their 4-year-old children's instruction as middle ground in resolving that issue. Legislative Democrats want to keep the voluntary, state-provided universal preschool offering as is and they favor a 2 percent increase in allowable growth funding to K-12 schools for fiscal 2012.

The governor said Monday he remains willing to work with lawmakers to reach an agreement. “My interest is to work with them and not to make any threats, but instead to say how best we can do things and I believe that we've created a proposal that makes sense,” he said.

Last week Mary Gannon of the Iowa Association of School Boards warned that zero growth in per-pupil funding and preschool changes could result in “layoffs of epic proportions” if they come to fruition. The state's largest teachers' union is estimating 1,500 layoffs at zero growth – a figure that does not include administrators or support staff.

Also Monday, Branstad signaled that he is likely to sign legislation that would allow convenience stores and gas stations in Iowa to sell hard liquor in their main aisles like they can beer and wine already.

Currently, those retail establishments cannot sell liquor in the same area where customers purchase gas and other goods, but they are allowed to offer liquor products if they have a separate entrance in a partitioned are with a separate cash register – something that nearly five dozen businesses currently do. House File 617, which has been sent to the governor, would remove the separate-room requirement.

“I haven't seen any compelling reason not to sign it,” Branstad told reporters Monday.