Conservative Budgeting is the Best Path Forward

The Revenue Estimating Conference (REC), which is tasked with the difficult job of projecting state revenues, held their December meeting and is estimating Iowa will collect $8.2 billion in revenue for Fiscal Year (FY) 2022. The REC also increased the current FY 2021 estimate to $7.9 billion, which is a $65 million increase from their previous projection. The REC will […]

Creating Opportunity in 2021

On January 11, 2021, the Iowa legislature is scheduled to reconvene. Besides crafting a budget, the legislature will also be confronted with the challenge of creating policies to help stimulate the economic recovery from COVID-19. Governor Kim Reynolds and the Republicans in the legislature have been following a policy of fiscal conservatism by keeping spending low and reducing tax rates. […]

The Importance of Iowa’s Tax Climate

Tax rates matter. They determine how much income an individual or business must pay to the government. For every dollar taken away by taxes, it is one less dollar an individual, family, or business has to save, spend, or invest. Tax rates also play a big role in how competitive a state economy is in relation to other states. Higher […]

Cut Red Tape to Grow Iowa’s Economy

By James Broughel   Like most of the country, Iowa is facing two problems. First, the coronavirus is threatening the lives of its residents. Second, the response to the virus, in terms of lockdowns and social distancing, has been a threat to the state’s economy. The balancing act is figuring out how to keep the virus in check without destroying […]

Iowa Governor Makes the Grade

The Cato Institute released their 2020 Fiscal Policy Report Card on American Governors, which “grades governors on their fiscal policies from a limited‐​government perspective.” The report utilized “statistical data to grade the governors on their tax and spending records — governors who have restrained taxes and spending receive higher grades, while those who have substantially increased taxes and spending receive […]

Conservative Budgeting Pays Off

Governor Kim Reynolds announced, Iowa will “end Fiscal Year 2020 with a balance of $305.5 million in its General Fund.” Governor Reynolds and the Republican legislature have been following prudent budget policies. This has been especially difficult considering the COVID-19 pandemic and uncertainty in the agricultural markets.   “Fiscal responsibility has put the state of Iowa in a strong position […]

The Economic Impact of COVID-19 on the Iowa Economy

Foreword   This summer COVID-19 continues to be an albatross on the economy. Although Iowa’s economy is open, social distancing policies remain. Iowa’s unemployment rate fell from 10 percent in May to 8 percent in June. Even with Iowa’s unemployment rate falling, fear of the virus is preventing people from resuming regular consumer activities. In addition, many small businesses are […]

2020 Candidate Education Guide

Recently TEF Iowa polled Iowans to get their view on some key public policy issues. In this guide you will find not only how Iowans think about these issues, but also public policy solutions that align with the interest of Iowans. TEF Iowa has developed this guide as a resource to provide legislative candidates additional information on some of the […]

Iowa’s Unemployment Rate Drops

Iowa’s unemployment rate dropped from 8 percent in June to 6.6 percent in July. A year ago the unemployment rate was just 2.7 percent . The national unemployment rate for July stands at 10.2 percent. Iowa has the 7th lowest unemployment rate in the nation, and regionally only Nebraska (4.8 percent) and South Dakota (6.3 percent) have lower rates. Iowa’s […]

Taxpayer Protection Starts with Limiting Spending

Governor Kim Reynolds and the legislature have been working to control spending in Iowa. Prior to the COVID-19 emergency, Iowa was in a strong economic position with healthy and stable revenue growth. This included $800 million in reserves and a $400 million surplus. By March, all of this changed as the pandemic triggered an economic downturn and revenue uncertainty. In […]

Tax Rates Are the Key to Economic Competitiveness

The American Legislative Exchange Council (ALEC) released the 13th edition of Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index. Rich States, Poor States, measures the competitiveness of each state in terms of economic outlook and performance. In the latest rankings, Iowa has moved from 29th to 25th in terms of economic performance, but in terms of economic outlook, Iowa […]

Iowa Economy: Not Out of the Woods Yet

  This summer COVID-19 continues to be an albatross on the economy. Although Iowa’s economy is open, social distancing policies remain. Iowa’s unemployment rate fell from 10 percent in May to 8 percent in June. Even with Iowa’s unemployment rate falling, fear of the virus is preventing people from resuming regular activities. In addition, many small businesses are fighting to […]

COVID-19 and Economic Growth

The coronavirus (COVID-19) is having an impact on economic growth in Iowa. The Bureau of Economic Analysis (BEA) released Gross Domestic Product (GDP) by state from the fourth quarter of 2019 to the first quarter of 2020, which demonstrates some of the economic impact of COVID-19. During this time Iowa’s economy declined by -3.5 percent. Other than Nebraska and South […]

Spending Restraint: A Conservative Budget

Crafting a state budget is never an easy process and this year was especially difficult with drafting a budget amid the COVID-19 pandemic. Prior to the COVID-19 emergency, Iowa was in a strong economic position with healthy and stable revenue growth. By March, all of this changed as the pandemic triggered an economic downturn and revenue uncertainty. In May, the […]

Uncle Sam’s “Free” Handouts

Iowa, just as with other states, has become dependent on the federal government for support. Iowa’s $7.6 billion state budget is dependent on the equivalent in federal aid to help fund numerous programs. Through these funds, the federal government can impose both funded and unfunded mandates on the states.  This growing dependency on Uncle Sam is dangerous not only because […]

COVID’s Economic Uncertainty

Iowa’s economy has begun the process of reopening with continued limitations due to social distancing. Nevertheless, economic uncertainties remain. How will businesses cope with operating at limited capacity? Will Iowa consumers feel safe to fully reintegrating into the economy or will a fear of a “second wave” keep people away? How will lost economic activity impact state and local tax […]

Tough Budget Decisions Ahead

Iowa’s economy is reopening, but the economic impact of COVID-19 (coronavirus) is still uncertain. Iowa’s April unemployment rate was 10.2 percent because of business closures resulting from social distancing policies used to mitigate the virus. The economic impact of COVID-19 is still a fluid situation. One of the uncertainties is the impact of the virus on state and local revenues. […]

COVID-19 ECONOMIC IMPACT MAY UPDATE

Executive Summary   As of May 20, 2020, the CDC calculates that COVID-19 has generated 99,498 U.S. deaths and 449 Iowa casualties. Per 1,000,000 in population, this represents 303 deaths for the nation, and a much lower 149 for Iowa. Due to COVID-19, the U.S. economy contracted by 4.8% in Q1, 2020, and Iowa’s economy experienced:     Highest level […]

Small Business Recovery after COVID-19

The COVID-19 pandemic is precipitating an unprecedented economic downturn, and small businesses are likely to bear the brunt of it. Mandatory shutdowns and social distancing are forcing many small businesses to shut their doors, leaving millions of people out of work and driving down sales. Even when governments begin lifting social distancing restrictions, the residual effects of unemployment and disrupted […]

Iowa Revenue Source

Do you know that the income taxes you pay to the state of Iowa makes up the majority of the General Fund budget? Iowa’s General Fund is supported not just by income taxes, but also sales and a variety of other taxes, fees, and revenue sources. In addition, the budget is supported by taxes paid to the federal government. In […]

Methods to Economic Recovery

Iowa’s economy is in a recession marked by high unemployment, not seen since the Great Depression of the 1930s. Iowa’s economic crisis is a result of the coronavirus (COVID-19), which has  forced an economic shutdown of the state. Low commodity prices are also having a detrimental impact on the farming industry in our state.  Ernie Goss, PhD,  who serves as […]

Uncle Sam to the Rescue?

David Kennedy, prominent historian and Stanford University professor, in an interview with Governing discussed the COVID-19 (coronavirus) emergency in relation to the Great Depression. In that interview he stated, “[President] Calvin Coolidge said that if the federal government went out of business, the average person wouldn’t notice for six months, except for the post office. Now, the federal government is twice the size of the states all put together.”     […]

IOWA HEADED FOR ECONOMIC WINTER?

The United States is confronted by an unprecedented crisis with the coronavirus (COVID-19) pandemic. From an economic standpoint, the COVID-19 crisis is being compared to the Great Depression with the growing army of unemployed Americans and the possible historic loss in state and local tax revenues. In March, Iowa along with other states, closed the economy except for essential businesses […]