Iowa Governor signs executive order to cut spending - KWWL - Eastern Iowa Breaking News, Weather, Closings

Iowa Governor signs executive order to cut spending

DES MOINES, Iowa (KWWL)-- Iowa Governor Chet Culver announced Monday he signed an executive order to reduce the state's spending.

Four days after announcing that he would implement further state budget savings, Governor Chet Culver signed his 10th Executive Order to institute a 1.5% across-the-board reduction in state expenditures starting January 1st. This is estimated to save the State $91.4 million.

"In the midst of this national economic recession, I am committed to meeting my constitutional responsibility to balance the state budget," said Governor Culver.  "My 10th Executive Order will ensure that our state's budget remains balanced during this fiscal year.  This is a step I wish we did not have to take, but it is something we must do to meet the fiscal challenges before us."

Earlier this month, the Revenue Estimating Conference (REC) determined that state government would see additional declines in revenue during the current fiscal year.  After meetings with state budget officials and members of his Council of Economic Advisors, the Governor determined the end of the economic downturn has not yet reached Iowa, that the REC could make further reductions to revenue estimates, and that an across-the-board reduction was necessary. 

In addition, Governor Culver plans to work with legislative leaders to transfer $10 million to the General Fund from accounts and funds in state government that have balances that exceed the amount needed for the current fiscal year.  In recent weeks, Governor Culver has announced a total of nearly $180 million in budget savings for the people of Iowa.

Attached and below is a copy of the Executive Order signed today by Governor Culver:



WHEREAS, irresponsible actions by Wall Street financial interests, combined with the impact of misguided economic and fiscal policies of the federal government in the past eight years, have resulted in creating the worst economic recession since the Great Depression, one that is hitting Main Streets and factories and farms and families in Iowa and across the nation and the world; and

WHEREAS, at least 43 other states across the country have experienced significant reductions in their revenues and are using their state reserve funds to combat the adverse effects of this economic downturn; and

WHEREAS, the State of Iowa, in 2008, experienced a series of unprecedented natural disasters, wreaking havoc on Iowa homeowners, businesses and governmental jurisdictions and requiring unanticipated emergency draws from the state's General Fund for Fiscal Year 2009 to assist in the payment of damages; and

WHEREAS, the State of Iowa, using sound fiscal and management practices, has created reserve funds, and has positioned itself to avoid some of the worst budgetary impacts of the combined forces of the recession and natural disasters upon the State Treasury; and

WHEREAS, on December 12, 2008, the State's Revenue Estimating Conference (REC) reduced its projection of state revenues for Fiscal Year 2009 by $99.5 million; and

WHEREAS, the Department of Management has informed me that budget allotments to state departments and agencies must be modified in order to avoid an overdraft or deficit in the State's General Fund for Fiscal Year 2009; and

WHEREAS, conservative fiscal management during this period of uncertainty necessitates the creation of an economic buffer in budget allotments in the event that the actual revenue collected by the State at the end of Fiscal Year 2009 is even lower than now-anticipated; and

WHEREAS, I have already announced on December 9, 2008, $77 million in expenditure adjustments, including a proposed de-appropriation of $37 million, fund transfers of $12 million, and a reduction of expenditures of $28 million; and

WHEREAS, a 1.5 percent reduction in appropriations, pursuant to Iowa Code 8.31, would reduce state expenditures by an additional $91.4 million and help the State avoid an overdraft or deficit in the Fiscal Year 2009 General Fund; and

NOW, THEREFORE, I, Chester J. Culver, Governor of the State of Iowa, by the power vested in me by the Constitution and laws of the State of Iowa, do hereby order and direct a uniform modification of allotment requests, pursuant to Iowa Code §8.31, to achieve an annual 1.5 percent budget reduction for fiscal year 2009.  The Department of Management shall take all necessary steps under Iowa law to effectuate the annual 1.5 percent budget reduction for fiscal year 2009, directed to all state departments and establishments, as provided in Iowa Code §8.2(5).  Actions taken by the Department of Management and all state departments and establishments described above, to implement this order, shall commence on December 22, 2008.

IN TESTIMONY WHEREOF, I have hereunto subscribed my name and caused the Great Seal of Iowa to be affixed.  Done at Des Moines this 22nd day of December, in the year of our Lord two thousand eight.

_/s/ Chester J. Culver_______________



Online Producer:  JJ Murray

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