Friday, March 7th marks Session Day 54 for the 2014 Legislative Session. At the moment, all signs point to the Legislature being pretty far ahead of their 100-day schedule. Some are even talking about a late-March adjournment, but that would assume the wheels don't fall off the wagon at least once. And they always fall off at least once. A safe bet would be that the Legislature, without any major hiccups, should be able to finish the session slightly before Easter.
One big development that occurred this week on the budget front was the release of joint targets. To the average Iowan, this statement has little meaning. But to the legislators and lobbyists and about 10 other Iowans, this is very exciting news! Targets are the first major step in the budget process when the majority party in a chamber designates how much total money they will spend in the upcoming fiscal year, and they divide that number among the seven appropriations subcommittees.
Typically, the overall spending numbers in each chamber are usually several million dollars apart, and each subcommittee in each chamber has a vastly different amount of revenue to allocate. Each subcommittee in each chamber assembles their appropriations bill, and the two chambers begin a process of negotiating between each chamber's version. First, one chamber passes their version. The other chamber usually replaces most of that bill with their own version. Then, after a long negotiation process, the final changes are made to each bill, and each chamber passes the final version.
The significance of joint targets to the budget process is that the House and Senate, for the first time in this author's memory, have agreed across chambers on both the overall spending number and the seven allocations. In theory, this means the appropriation bills that come out will be the same size in both the House and Senate, leaving only the individual line items inside over which to negotiate. While this could still be contentious, it's less likely to be nearly as time-consuming as when each chamber is starting from a different set of numbers.
Now that you know what the targets represent, here is what they show this year.The House and Senate have agreed to spend a total of $6.972 billion in the fiscal year 2015 (which begins July 1, 2014).That amount would represent a 7.4 percent increase (or $480 million) compared to the FY 2014 funding level of $6.492 billion.That $480 million is mostly used in four places - a 4% increase in allowable growth for education ($170 million), education reforms passed last year ($54 million), property tax reform "backfill" to reimburse local governments for revenue losses ($120 million), and to pick up a larger share of the state's Medicaid obligation that is not covered by the federal government ($86 million).