It appears officials will soon make a significant withdrawal from the Iowa’s “rainy day” account to cover the latest state budget dilemma.
That’s Holly Lyons, director of Iowa’s Legislative Services Agency. She serves on a small panel of financial experts who met and reduced their estimate of state tax collections by 131-million dollars for the current budgeting year. After a previous round of budget cuts in February and with just three months left in the state’s spending plan, Iowa Department of Management director Dave Roederer says using the state’s cash reserve is the only real option left.
Roederer, who is the governor’s top budget advisor, says the situation is NOT dire, as the state is still projected to collect about four percent MORE in taxes this year compared to last.
More than a third of ALL the revenue collected by the state comes from the state sales tax. Sales tax collections are running not quite even with a year ago.
In addition, the Revenue Estimating Conference has reduced its prediction of tax collections during the next state budgeting year by $191.8 million. The governor and legislators will have to adjust the tentative spending plans they’ve developed. The next state budgeting year starts July 1.
