Iowa governor signs efficiency plan cutting $128M

AP News
Posted: Dec 16, 2009 4:09 PM

Iowa Gov. Chet Culver signed an executive order Wednesday expected to save the state nearly $128 million through government efficiency efforts and called for lawmakers to approve early retirement incentives for state workers in order to save millions more.

Culver also said it's likely the Legislature will close one of the state's four mental health institutions in another cost-cutting move.

"I hope and expect that we will have the political will to move forward on a majority of these recommendations," Culver told editors and reporters at an annual Associated Press legislative seminar. "The alternative is not good. We're making tough cuts that will result in pain."

Legislative leaders, who also spoke at the seminar, predicted that they would enact the bulk of the budget cuts Culver will seek in the session that begins Jan. 11.

"Everything in state government will be cut," said Senate Majority Leader Michael Gronstal, D-Council Bluffs. "I think you'll see us look favorably on the recommendations the governor makes that require legislative action. I think you'll see real changes in the way state government operates."

The governor signed the executive order at the end of the meeting, moving ahead on 40 efficiencies included in a consultant's report made public last week. The moves ranged from consolidating computer systems and purchasing networks to reducing the state's vehicle fleet.

Although Culver said he had implemented most of the suggested reforms, some minor changes were made to the consultant's recommendation, such as protecting the Iowa State Patrol from the vehicle consolidation effort.

In all, the cuts ordered by Culver are expected to trim $128 million from state spending in the next fiscal year, and the changes he's seeking from the Legislature would save another $207.1 million.

With the state facing a budget shortfall of $400 million to $900 million in the fiscal year beginning July 1 _ depending on which projections are used _ most expect bipartisan agreement on spending cuts. Culver and Democratic legislative leaders have ruled out increasing taxes to ease the shortfall.

"I think there's going to be a fair amount of bipartisan consensus on a number of these big-ticket items that require legislative approval," said Culver.

Among the major changes Culver said he'll seek from the Legislature are:

_Closing one of Iowa's four public mental health institutions. The director of the state Department of Human Services has recommended closing the institute in Mount Pleasant.

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_Implementing an early retirement incentive program for state employees that could save $30 million to $50 million.

_Augmenting the Iowa State Patrol budget with the Road Use Tax Fund, supported by gasoline taxes and used to pay for highway construction and maintenance.

"A lot of them are really tough," Culver said of the items he wants lawmakers to consider.

The road fund issue is certain to rile powerful highway interests, who see a $50 million diversion of money that would otherwise be spent on road work.

Culver said the state is already spending $1.7 billion a year on roads.

"The question is, how are we going to fund public safety," said Culver. "That is an idea that we have done before and I think you can make a pretty compelling argument about why that makes sense."

Culver said he also wants legislators to considering putting some state workers on a four-day, 10-hour work week. That schedule wouldn't work for all agencies, but could make sense for some and needs more study, he said.