Executive Order 38

.. :') ~~~t :«:.' 1 Sf~lj J!fXl'mtilrr J.ey arlmrnl WHEREAS, WHEREAS, WHEREAS, WHEREAS, WHEREAS, WHEREAS I WHEREAS, IN THE NAME AND BY THE AUTHORITY OFTHE STATE OF IOWA EXECUTIVE ORDER NUMBER 38 the national economy and the Iowa farm and business economies remain unsettled and in a recession with uncertain prospects for immediate improvement; and these factors generated a substantial decline in actual state revenues compared to earlier estimates for f iscal year 1979 - 1980 and a general fund balance of only $23 . 5 million on June 30, 1980- - some $67 million below the June 30, 1979, figure; and latest revenue estimates for fiscal year 1980-1981 anticipate revenues to be $68 million below earlier estimates; and state fiscal experts have concluded chat without revi- sions to the state budget in fiscal year 1980- 1981, the shortfall in revenues will result in a general fund deficit on June 30, 1981, of $5 million to $40 million (Legislative Fiscal Director) and $40 . 9 million (State Comptroller); and Article VII of the Iowa Constitution prohibits state budget deficits (with few exceptions inapplicable here); and Section 8 . 31, the Iowa Code, provides a procedure for uniform and prorated reductions of state appropriations by the Governor to avoid overdrafts and deficits; and without implementing these uniform, prorated reductions in state appropriations, the State will face a deficit in the general fund on June 30, 1981. NOW THEREFORE, I, Robert D. Ray, Governor of the State of Iowa, by t h(; ;:iower and autl':ority ·.·<.•sted in ::•.:? by i::;.e Consti- tution and the laws of I owa, do he r eby make the following findings and orders: Page 2 1. I find that the estimated budget resources during fiscal year 1981 are insufficient in the amount of $63 million to pay all appropriations in full as required by Section 8.30, the Code, to wit: General fund balance, June 30, 1980 Fiscal year 1981 receipts- Fiscal year 1981 appropriations and standing estimated appropriations TOTAL $23.5 million $1,749.3 million $1,835.8 million ($63 million) 2 . I further find that a 3.6 percent reduction in appropriations sub j ect to Section 8.31, the Cod~~ is necessary to prevent an overdraft or deficit in the general fund of the state at the end of this fiscal year. 3. I hereby direct t he implementation of Section 8.31, the Code, requiring the uniform modification of allotment requests filed pursuant to that section for each of the remaining three- quarters of the fiscal year to achieve an annual 3.6 percent fiscal year reduction in each respective appropria- tion unless subsequent projections provide good reason to alter these findings . 4. I further direct the State Comptroller to prepare s·.ich modified allotments for the second quarter of fiscal year 1981, which commences October 1, with the exception of appropriations excluded by Section 8.2(1 ) , t he Code, pertaining to the courts, the leq islature f c onst.ruc4:: '.re trt.:.st ="-=.:-.,3.s c~~h a.3 tax refund allocations, federal highway ma tching 5. funds, and obliyated, e ncumbered or contracted capital items. I ask the Governor's Economic Advisory Council to meet at least 15 days prior to the commencement of each quarterly allotment period for the purpose of evaluating the Iowa economy and its likely effect on budget resources. · ~-=-~ IN TESTIMONY WHEREOF, I have hereunto subscribed my name and caused the Great Seal of the State of Iowa to be affixed. Done at Des Moines this 12th day" of August in the year of our Lord one thousand nine hundred and eighty. /' • _? ·v .. ~ +7=1 ,,7<·· - - g• \ & ·tu:..--rtv' / -.r )'' '~ Governor --,y-- /