Of all the weeks on the calendar, this may be the week Iowa taxpayers look forward to the least.
On one hand, this week marks the deadline for filing federal tax returns. Many Iowans will likely write bigger checks to both the federal and state government this year.
On the other hand, this is also the week where every school district in the state must certify their budget for the upcoming school year. Normally, this might not seem like a particularly noteworthy annual occurrence to everyday Iowans. But due to the recent actions by Governor Culver and legislative Democrats, property tax increases are on the way.
Last fall, when Governor Culver made his 10 percent across-the-board reduction after three years of unsustainable spending and irresponsible budgeting, hundreds of millions of dollars were slashed from Iowa’s schools. This left a gaping divide between the money schools had to spend and the budget they had been following.
This forced school districts to further trim their expenses, raid their cash reserves (if they had any to begin with) and increase property taxes.
Fast forward a few months and the same problems still persist.
Even though Governor Culver and legislative Democrats spent the second highest amount of money in Iowa history this legislative session, they underfunded the K-12 per-pupil education formula by $162 million dollars.
Though most school districts have made drastic cuts to adjust to the decrease in funding from the state, many school districts have had to dip into their cash reserves and in most cases, substantially increase property taxes. Conservative estimates show that Governor Culver’s property tax increase this year will be in the neighborhood of $182 million dollars when all of the other non-school funding related increases are also added in. It could possibly end up larger.
It’s hard to miss the headlines popping up all over the state this week reminding Iowans of the higher property taxes headed their way. (Special Request: How big was your property tax increase this year? Please e-mail me at Paul.McKinley@legis.state.ia.us)
Iowa already has some of the highest property taxes in the nation. At a time when we should be encouraging entrepreneurs, employers and small businesses to invest and expand in Iowa to help grow our economy and create jobs, this property tax increase will sting badly. The simple truth is that property tax increases badly hurt job growth and business development.
Unfortunately, it was all avoidable.
Every year, our schools receive over four billion dollars. Of that, half a billion dollars comes with a whole series of strings and unfunded mandates attached. In order to assist our schools and shield the taxpayers from the governor’s property tax increases, Senate Republicans offered a bold plan this past session to suspend these mandates and remove these strings to allow greater flexibility and local control.
Normally, these dollars cannot be used for a school’s general fund. However, our common sense plan would allow schools the flexibility to use that money to pay for any expense.
Instead of having to abide by mandates created by lawmakers and bureaucrats in Des Moines, Senate Republicans believed it would be better to give local school boards and administrators the flexibility and local control to spend that money as they see fit.
Regrettably, it was defeated with all Senate Democrats voting to raise property taxes and all Senate Republicans voting to give our schools more local flexibility and more protection for the taxpayer.
Governor Culver and legislative Democrats instead chose to mandate school districts drain their cash reserves. When our school districts replenish their cash reserves in the future, that money will again come directly out of the pockets of Iowa’s property taxpayers.
Is there any wonder why tea parties are popping up all over the state, demanding an end to the policies of the last four years here in Iowa? Iowans know we cannot afford to have the same out-of-control agenda continue to be repeated year after year.
In the coming weeks and months, Senate Republicans will continue to advocate for property tax relief, private sector job creation and responsible and sustainable budgets. We believe that is the recipe for a smarter, healthier and more abundant future for Iowans.