Iowa House passes about $11 million in midyear cuts to UI, ISU

The+Iowa+House+Chamber+is+seen+during+Hawkeye+Caucus+at+the+State+Capitol+in+Des+Moines+on+Tuesday%2C+April+4%2C+2017.+%28Ben+Allan+Smith%2FThe+Daily+Iowan%29

The Daily Iowan; Photos by Lily

The Iowa House Chamber is seen during Hawkeye Caucus at the State Capitol in Des Moines on Tuesday, April 4, 2017. (Ben Allan Smith/The Daily Iowan)

[Update: The Senate passed the deappropriations bill on March 21, sending the legislation onto Governor Reynolds. Read more about the debate on the Senate floor here.]

Legislation to take back funding from Iowa’s public universities as the end of the fiscal year approaches passed Tuesday in the Iowa House, making it the second year in a row the state Legislature has had to make midyear cuts to balance the state budget.

More than a month after the Iowa Senate passed Senate File 2117 on Feb. 8, the House voted 59-41 to make about $11 million in midyear cuts to the fiscal 2018 budgets of two of the three universities governed by the state Board of Regents — the University of Iowa and Iowa State University — while leaving the University of Northern Iowa’s budget intact.

The version of the bill that ultimately passed in the House puts the amount to be cut above its earlier proposal of $8.1 million in reductions to the UI and ISU budgets, but below the $14.6 million the Senate passed in February.

Total cuts to state programs and services as stipulated in the House-approved bill amount to $35.5 million, which is below the Senate’s initially proposed reductions of $59 million.

The Senate could vote on the House’s amended version of the legislation as early as Wednesday.

This appropriations-reduction plan hinges on the assumption that the state will see a $33.3 million increase in revenue as the result of the December 2017 passage of the federal Tax Cuts and Jobs Act, as projected by the state’s Revenue Estimating Conference.

RELATED: Senate, House propose tax reform

Gov. Kim Reynolds unveiled her own tax-reform package Feb. 13 as promised in her Condition of the State address in January. Her plan includes cutting state income taxes by $1.7 billion between fiscal years 2019 and 2023.

“My plan combines meaningful tax relief while protecting our budget priorities,” Reynolds said in a statement. “We’ve prioritized tax relief for middle-class taxpayers, small-business owners, teachers, and working families across the state. We’re long past due for real tax reform that simplifies and updates our system while allowing Iowans to keep more of their hard-earned money in their communities.”

After Reynolds released her plan, Senate Republicans passed their tax plan, Senate File 2383, on Feb. 28. to cut taxes by approximately $1.2 billion annually. The Legislative Services Agency issued a revised fiscal note Tuesday showing the plan would slash Iowa’s general-fund revenues by more than $1 billion annually.

“Republicans have a spending problem, and they have a priority problem,” Rep. Bruce Hunter, D-Des Moines, said Tuesday on the House floor.

Once approved by the full Legislature, midyear funding reductions will leave the universities with just a few months to figure out where to make budget cuts; fiscal 2018 runs from July 1, 2017 to June 30, 2018.

RELATED: Iowa regent universities to make a second attempt to establish predictable tuition increases

Uncertainty regarding the state funding situation has forced the regents to hold off on discussing tuition rates for the 2018-19 academic year. That discussion will now occur at the regents’ April meeting, but Regent President Mike Richards has indicated the regents are considering tuition rate increases of less than 4 percent.

UI President Bruce Harreld told The Daily Iowan March 7 that planning year by year rather than thinking long-term about tuition and state appropriations has been bad for students and their families as well as the university.

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