Iowa Senate Democrats seek same spending level as Branstad, but priorities differ

DES MOINES - Majority Senate Democrats on Tuesday issued a fiscal 2016 budget outline that calls for spending the same $7.341 billion proposed by Republican Gov. Terry Branstad but parts ways on his priorities by seeking a higher investment for K-12 schools for the coming school year.

'It's time to break the budget gridlock,” said Sen. Bob Dvorsky, D-Coralville, chairman of the Senate Appropriations Committee. 'Our balanced budget is sustainable and spends less than the state takes in.”

The Senate Democratic plan calls for a 2.625 percent increase in state support for Iowa's local schools, a tuition freeze for instate students at Iowa's regent universities for a third straight year, fully funding property tax credits, and meeting 2013 commitments to property-tax relief and education reform. The plan includes an early-retirement incentive plan for eligible state employees that Democrats project will save the state $16.1 million in the next fiscal year.

Senate Majority Leader Mike Gronstal, D-Council Bluffs, said Democrats have been working with majority House Republicans to resolve budget differences but decided to move ahead with spending targets Tuesday, while Branstad and GOP legislators work to forge their consensus approach. House Republicans were at a $7.175 billion level for fiscal 2016, leaving about a $166 million difference with the spending level set by the governor and now Senate Democrats.

'We think it's time to start moving our budgets,” Gronstal said in an interview. He said Senate Democrats adopted the same use of $129 million from the state's surplus ending balance to fund the overall 5 percent growth in general fund spending.

'We figure that's an appropriate place to be,” Gronstal said of the decision to adopt the governor's overall spending level. 'We don't do everything in the budget the same way that the governor does it, but that's fiscally responsible. We know that we'll have challenges in the next fiscal year.”

Soderberg said GOP lawmakers plan to stick with the budgeting principles not to spend more money than the state collects in yearly revenue and not to use one-time money to fund ongoing programs or expenses. He likened to do otherwise to a family using a savings account to pay for a home mortgage.

'We've stood firm on our prinicles for five years. I do not anticipate that that would change because I think Iowans expect that,” he added. 'Anytime you spend more than what you have, that obviously creates a problem.”

Gronstal noted that Iowa law allows the Legislature to spend up to 99 percent of available revenues, which the nonpartisan Legislative Services Agency has pegged at nearly $7.423 billion.

Iowa law allows the Legislature to spend up to 99 percent of available revenues, which the nonpartisan Legislative Services Agency has pegged at nearly $7.423 billion.

Branstad and House Republicans have agreed to boost state supplemental aid to K-12 schools by $55 million, or 1.25 percent, in fiscal 2016 and 2.45 percent in fiscal 2017 along with providing money needed to fund early childhood and teacher leadership/education reform initiatives.

Gronstal said his caucus' fiscal 2016 spending targets provide money to cover an expected $200 million increase in Medicaid costs and could provide money to keep mental health institutes in Mount Pleasant and Clarinda operating past June 30 but those decisions will be taken up by the appropriate subcommittees.

'We've not said here's your budget,” Gronstal said. 'We've said here is your target, put it together.”