Rick Morain is the former publisher and owner of the Jefferson Herald, for which he writes a regular column. This essay first appeared on Substack.
The state of Iowa has a budget problem, and it could surface with teeth in a few years. Thoughtful action now could postpone it, buying enough time to eventually defang it.
The long and short of the situation (emphasis on “short”) is that the state’s revenues remain below its expenditures. The Iowa legislature’s practice now is to fill that gap with money from the state’s reserve funds, particularly the Taxpayer Relief Fund, which by a few years ago had grown to several billion dollars.
This past fiscal year, which ended in July, state revenues totaled about $8.1 billion, and general fund spending reached around $9.4 billion. The state’s reserve funds subsidized the budget with about $1.4 billion. The Taxpayer Relief Fund ended July 31, 2026, with about $3.1 billion left.
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