House Journal: Page 1712: Monday, April 26, 1999

Dear Mr. Speaker:

Senate File 176, an act relating to the elimination of investment counseling as a 
taxable service under the state sales and use taxes, is hereby disapproved and 
transmitted to you in accordance with Article III, Section 16, of the Constitution of the 
State of Iowa.
While this particular measure has merit and could be approved under other 
circumstances, I must examine all budget decisions as part of the whole of the state's 
fiscal picture.  It would be irresponsible to focus only on the singular aspects of this bill 
and not consider it as a part of the aggregate decisions that will determine our state's 
fiscal health.
I have shared my concerns with the budget framework that has been developed to 
date by the Legislature.  Projecting the Legislature's targets for taxes and spending 
levels into the future, their budget could require as much as a $110 million reduction in 
services or tax increase to meet our legal budget requirements in the fiscal year 
starting July 1, 2000.  Using similar assumptions, the non-partisan Legislative Fiscal 
Bureau has reached similar conclusions.  I will not gamble with our state's fiscal future 
by adhering to this risky and irresponsible budget scheme.
I believe that the Governor and the Legislature are elected to make hard choices.  
This budget must reflect our priorities as a state.  While reducing taxes is a priority, it 
must not come at the expense of our local schools, health care for children, nursing 
home care for senior citizens, or public safety.
Nearly sixty percent of our state budget is dedicated to education, which is and will 
continue to be my highest priority as Governor.  Given the prospect of future budget 
deficits - and then having to choose between cutting $66 million from the budgets for 
education in Fiscal Year 2001 or vetoing this and other tax cut bills - I must choose the 
responsible course.
Until the Legislature can demonstrate a sound approach to fiscal policy, I cannot in 
good conscience approve this bill.  I am hopeful that the Legislature will reverse this 
dangerous tax and spending course.  If they do not, I will continue to act to ensure that 
the state budget is balanced without gimmicks, tricks, or risky assumptions.
For the above reasons, I hereby respectfully disapprove Senate File 176.
	Sincerely,
	Thomas J. Vilsack
	Governor
April 26, 1999
The Honorable Ron Corbett
Speaker of the House
State Capitol Building
L O C A L
Dear Mr. Speaker:

© 1999 Cornell College and League of Women Voters of Iowa

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