Breaking Trust with the Trust

Iowa voters were disappointed with Governor Kim Reynolds’ proposal to support the state’s trust fund for outdoor recreation and water quality. In order to assure increased money for outdoor recreation and water quality, Iowa voters adopted a constitutional amendment that established the trust fund. This amendment became section 461.31.2(c) of the Iowa Code. The next rise in the state sales tax was required by law to be taken as the first three-eighths of a cent. Furthermore, it said that this would be brand-new money. The Governor, however, believes that the three-eighths of a cent only applies to the sales tax element, hence she has recommended boosting both the sales and use tax rates by one penny. She also does not include the new digital goods and services sales taxes. The result is $31 million less going into the Natural Resources and Outdoor Recreation Trust Fund (known as IWILL).

The Governor’s proposal also re-cuts the financial allotment for the trust fund. The governor argues that since people’s perceptions of the problems we face now and future have changed from those of 10 years ago, it is necessary to change the formula.

About half of the cash given under the Governor’s proposal is just transfers from current programs, despite the legislation expressly stating that the revenue flowing into the fund should be fresh and extra funding. For instance, the Governor transfers $12 million from the REAP program’s current budget to the IWILL program and then adds $5.1 million in new funds from the sales tax hike. The REAP program already has an annual budget. As a result, REAP will get $17 million as part of IWILL, although the majority of that sum was previously planned for.

Last but not least, the Governor is only consenting to implement the voters’ approval of a tax rise if she can also reduce other taxes. She is recommending massive and unjustified income tax cuts that would shift taxes from Iowans with lower incomes to those with higher incomes. This plan will drain the public coffers in order to enrich the wealthy while making the rest of the population pay for an ineffective effort to clean up Iowa’s waterways and make it a nicer place to live.

In conclusion, Iowa voters did not support the Governor’s plan to finance the state’s trust fund for outdoor recreation and water quality. The plan re-slices the pie of the trust fund’s funding formula, replaces the old pie with a new pie, and shifts taxes from the wealthy to lower-income Iowans, violating the law’s stipulations on how the revenue would be allocated. Instead of the $200 million or more that people should anticipate, the Governor’s proposal only adds $82 million to the budget for the objectives that voters desired to be extended by establishing the trust fund.

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