As a parent, I understand the value of sound budgeting practices. In our household, we don’t spend more than we take in because we choose not to bury our family in a pile of preventable debt. This also is a teachable moment for our children. They learn the valuable concept that just because you have a credit card, it doesn’t mean you should spend frivolously. As we all know, when that credit card bill comes due, it has a significant impact on the family budget.
I received a phone call Wednesday from a Lucas County constituent urging me to do everything possible to hold state spending in check. He stressed he makes financial sacrifices in his household, and as elected officials we should exercise the same fiscal restraint. I couldn’t agree more.
In fact, I am pleased with the strides Legislative Republicans have made in recent years to help Iowans keep more of their hard-earned money to best use in their household budgets. When Republicans regained control of the Iowa House and the Governor’s Office in 2011, Iowans were burdened with one of the largest spending gaps in state history.
It was projected in fiscal year 2012 spending outpaced projected revenues by more than $1 billion. Remember, that credit card bill eventually comes due, and as taxpayers it is completely unacceptable to expect you to cover the tab for reckless state spending.
With the looming spending gap, Governor Branstad and Legislative Republicans implemented responsible budgeting principles and exercised sound fiscal discipline. Those efforts have resulted in a healthy projected ending balance for this current fiscal year of more than $800 million. I have received numerous emails and several calls from constituents regarding this budget surplus, and let me say I understand that the money is not ours – it’s yours. This is hard-working Iowans’ money collected through over-taxation. This money must be returned to the people.
I support bills filed by Senate and House Republicans that would remove the cap on the Taxpayer Trust Fund and return these funds to the taxpayers who have made these overpayments.
Established in 2011 to prevent overspending, the Taxpayer Trust Fund captures and sets aside over-collection of taxpayer dollars. The amount of money transferred each year into the Trust Fund is determined by subtracting the adjusted revenue estimate for that year from the actual revenues received. The difference, up to $60 million, gets transferred into the Trust Fund for the following fiscal year.
The balance in the Trust Fund after two fiscal years is projected to be $120 million. If the proposed legislation to remove the cap passes, and transfers the ending balance into the fund, the projected balance in the Fund will grow to almost $800 million for FY 2014 instead of just $120 million. That is a significant amount of money Iowans can utilize in their family budgets.
Family budgets have been tight and with such a large ending balance in the state bank, we can provide this tax credit and should not delay! Now is the time to ease the tax burden on Iowans and help stimulate the state economy. I am committed to helping Iowans to keep more of their hard-earned money, and this is a good first step.
In contrast, Senate Democrats introduced legislation this week that would rob the Taxpayers Trust Fund in support of greater state spending. This fund should be protected and used for the sole purpose of returning taxpayer dollars back to the taxpayer.
State Senator Amy Sinclair (R-Allerton) represents Iowa Senate District 14.
Tags: Amy Sinclair, Senate Republicans, state budget, state spending, taxpayer trust fund, Terry Branstad