Governor Culver spins deception with new revenue numbers

Net receipts show $23 million decline from July 2008 and continued
trouble for the state budget

Des Moines, IA – Governor Chet Culver today touted state revenue numbers for July 2009 as “early signs of improvement in the economy.” His comments came on the heels of a new report on state revenue that shows gross receipts to state government in July 2009 grew by $4.7 million over the previous year. What the Governor failed to mention, however, was that net receipts to state government actually fell by $23 million for the same period.

Matt Strawn, Chairman of the Republican Party of Iowa, said, “Anyone who has spent two minutes in the private sector knows that gross revenues only tell half the story of a business's financial health. The state budget is no different. To suggest otherwise is not playing it straight with Iowa taxpayers.


“Either the Governor doesn't understand his own budget or is deliberately misleading Iowans. Quite frankly, either is a problem,” said Strawn.

The report released by the Legislative Services Agency showed personal income tax collections are down 6.1% over last July and corporate income tax revenues dropped by a whopping 42.1%. The report also shows a $40 million increase in sales tax collections to the state, but this is simply the result of the final implementation of the state takeover of the penny sales tax for school infrastructure. That is wholly pass-through revenue and nearly every dollar is immediately refunded to the school infrastructure account and NOT net new dollars to the state government or available for state expenditures.

Strawn concluded, “In just the first month of the new fiscal year the state budget is already way out of balance. The Governor’s unwillingness to come clean with Iowa taxpayers about the true fiscal health of our state is yet more evidence that a change is needed at Terrace Hill.”

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