Iowans Are Paying For Corporate Tax Giveaways

If you don’t have as much income as you thought, you need to reduce the amount you spend. In a nutshell, that’s the situation Iowa finds itself in as the fiscal year goes on.

Recently, the Iowa General Assembly voted to cut $118 million in spending to account for less-than-expected revenues. The state universities are taking the biggest hit. They must find $18 million to cut from their budgets between now and June 30, the end of the fiscal year. Community colleges have been reduced $3 million.

A $6 million budget reduction cuts the Iowa Cultural Trust. Interest from the trust funds arts projects around the state.

Iowa courts will be shut down one day following $3.3 million in cuts, with 1,400 court employees on furlough.

The Legislature and the governor cut one million dollars from the Department of Public Safety, at the same time the State Patrol has only a half-dozen troopers on duty statewide most nights.

These cuts to higher education will make it more difficult to boost Iowa’s skilled workforce. They will affect Iowa’s most vulnerable populations, including kids with cancer and cuts to public safety will impact our ability to keep Iowans safe.

How did this happen?

We base our budget partly on revenue forecasts from a non-partisan group called the Revenue Estimating Conference. Farm income is down and the revenue forecasts have been lower than expected. The forecasting formula used by the conference dates back many years and it may be worth reexamining.

But my thought is the Legislature hasn’t included corporate tax incentives in the pain. We grant around $400 million in tax breaks to businesses, much of it to out of state corporations. We are giving away money to companies for not moving, or for not reducing employment as much as they originally planned. These corporate tax giveaways should be reviewed and reduced, if we are cutting the arts, natural resources and education.

Over the last several years, corporate tax giveaways have decimated our budget surplus. Unfortunately, it’s Iowans who are being forced to pay for those corporate giveaways.

Iowa is reaching the point of diminishing returns on spending cuts. We are getting to the point where the quality of life in Iowa is in jeopardy. Our budget cutting in favor of corporate giveaways is costing Iowans dearly in terms of public safety, the arts and government services.

by Representative John Forbes
Posted 2/8/17