DES MOINES — Iowa Gov. Terry Branstad’s proposed fiscal 2015 budget plan would create a $144 million “spending gap” in the state’s general fund if adopted as is by the split-control Legislature, State Auditor Mary Mosiman said today.

Mosiman, a first-term Republican, told reporters her “apples-to-apples” comparison of the numbers indicates state budget-makers will have $7.239 billion in available ongoing revenue, and the governor has proposed a budget with “true total appropriations” of $7.383 billion for fiscal 2015, which means Branstad has offered a plan that seeks to spend $144 million more than the state is projected to take in.

The auditor said lawmakers would have to dip into the state’s projected $746 million “surplus carry forward” to balance the fiscal 2015 ledger sheet.

“The proposed budget does not include significant spending on new programs, so nearly all of the spending increase in the proposal is focused on honoring commitments made to existing programs,” Mosiman told reporters. She said “multi-year accelerating” commitments made last session to commercial property tax relief and education reform will exceed $150 million in fiscal 2015 and increase in future years.

She said it will take long-term planning and fiscal discipline to maintain budget sustainability as lawmakers decide how best to fund multi-year commitments they put on the books during the prior session.

Mosiman said the general fund's ongoing costs continue to be shifted to other funds, although she noted that the governor and Legislature reduced reliance on onetime monies to $36 million in the current budget year, and that figure would be further reduced to $29 million under the governor’s spending proposal.

She also made a point that lawmakers and the governor continue to engage in “significant transparency-related shifts” that move general fund revenue — such as gaming receipts and tobacco tax collections — and expenses to other funds, which “distort” comparisons. She said those shifts that impact transparency would decline from $405 million in this fiscal year’s adopted budget to $339 million in the governor’s fiscal 2015 proposal.

Also of concern to the state auditor is the fact that Branstad’s fiscal 2015 spending plan would potentially underfund Medicaid by $19 million and that, for the sixth straight year, state agencies would be asked to absorb salary and benefit costs because no increases were separately funded in the plan the governor presented to lawmakers last month.

The budget plan Branstad submitted to lawmakers Jan. 14 proposed general fund appropriations of slightly more than $7 billion, but Mosiman said the spending level is closer to $7.383 billion when revenue shifts, onetime funding and underfunded costs are taken into account. According to her analysis, the “true total expenditures” for the current fiscal year that ends June 30 are an estimated $7.012 billion.

The budget proposal Branstad submitted to lawmakers proposed general fund appropriations of slightly more than $7 billion, but Mosiman said the spending level is closer to $7.383 billion when revenue shifts, onetime funding and underfunded costs are taken into account.

Sen. Bob Dvorsky, D-Coralville, the chairman of the Senate Appropriations Committee, said negotiators for the GOP-controlled House, the Democrat-led Senate and the governor’s office are working through the process of establishing a spending target for fiscal 2015.

“We’re looking at the governor’s proposal as well as some other ideas, maybe a smaller budget,” said Dvorsky. One approach would be to set overall fiscal 2015 at the governor’s proposed level, he said, but added, “There are others that are less.”

Branstad spokesman Jimmy Centers said the governor’s fiscal 2015 budget plan seeks to spend about 91 percent of the available revenue capacity,  8 percent below the state’s spending limit.

“Gov. Branstad has restored predictability and stability in budgeting by implementing a biennial budget with a five-year budget projection that is in balance,” Centers said in a prepared statement. “Additionally, careful budgeting allowed the state to be able to give Iowans the largest tax cut in the state’s history and significant investment in education.”

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