Iowa Condition of the State Address 2005

DES MOINES, Iowa, Jan. 11 - Following is the full text of Iowa Gov. Tom Vilsack's (D) 2005 Condition of the State address. Click here to access the governor's Web page and access video and audio links of the address.

Thank you Mr. President. Thank you Mr. Speaker. Thank you members of the General Assembly for your kind invitation to speak to you about the condition of our great state. Before I do let me also acknowledge the Chief Justice and members of our Supreme Court, Court of Appeals and our statewide elected officials our Attorney General, our Treasurer, our Secretary of Agriculture, our Secretary of State, and our Auditor. I need to extend a special acknowledgment to Sally J. Pederson for her outstanding work as our lieutenant governor, and to my first lady and our First Lady, Christie Vilsack, for all of her volunteer efforts on behalf of libraries, literacy and education. I want to thank each of you for the work you do to make our lives in Iowa better.

Each year I address the General Assembly to report on the condition of our state. I am happy to report that our state is improving. More Iowans are working now than last year, and after several years of decline, state revenues are now growing. We will unveil a new budget system this month focused on results and priorities. While difficult choices still face us, progress is being achieved.

Six years ago when I first spoke to the General Assembly, we worried about declining reading and math scores. Since that time, we have committed resources to reduce class sizes, and reverse the eight-year decline in test scores.1 Today, our children have achieved four straight years of improved test scores- scores ranked among the nation's best.2

Six years ago we agonized about access to affordable health care for our most vulnerable citizens children, veterans, and seniors. We extended health security to thousands of Iowans by expanding our Hawk-I Health Insurance Program, by extending additional benefits to our veterans and their families, and by creating the senior living trust to give older Iowans more options for their long-term care. Today, 15,000 more children get medical care when they need it, 3 38,000 more veterans receive health care benefits they earned, 4 and 28,700 more seniors are able to stay in their own homes. 5

Six years ago we wondered whether we would have the people, the power or the resources to transform the Iowa economy. By embracing Vision Iowa, reforming our regulatory structure, and funding the first two years of the Iowa Values Fund, we have changed Iowa's economic landscape. One hundred and seventy (170) community projects have received Vision Iowa and CAT, or community attraction and tourism grants. 6 Cultural and recreational attractions grew, and the number of college-educated workers in our workforce increased by 50,000 in just the last three (3) years. 7 2

The six new utility facilities currently under construction or recently completed represent the first new power plants constructed in Iowa in two decades. 8 When added to the efforts to expand reliance on renewable energy, Iowa will be energy independent!

The Iowa Values Fund has lead to the creation or retention of over 14,000 high-paying jobs primarily in the life science, advanced manufacturing, and insurance and financial services sectors. 9 These jobs positioned Iowa's national reputation as a leader in biotechnology and insurance, and allow Iowa to lead the nation in income growth. All of this and more was accomplished during the most difficult fiscal challenge in 50 years. 10

We continue to meet the challenge. Recognized nationally as one of the best-managed states in the country, we embraced change and adopted reform. Tough decisions made by our legislature, and the sacrifice and hard work of state workers have allowed us to get the job done while reducing the cost of state government. Iowa's price of state government is the lowest it's been in over 30 years. 11 The Iowa tax burden has dropped from 16th to 27th. 12 Iowa's national rankings underscore our improvements. according to the Gold Guide and other national surveys, our state ranks among the top ten for safety, 13 quality health care, 14 best places to be a child, 15 e-commerce, 16 shortest commute time, 17 private land conversation, 18 and overall quality of life. 19 We should all take pride in being the number one state among all states in social health. 20 During the last two years, Fordham University ranked states from best to worst in caring for and about people. Iowa ranked number one in the nation both years. 21

While the condition of our state improves, we have much work to do to transform Iowa. My friends, we've reached a fork in the road. The path we choose will be historic. Where do we go from here? Do move cautiously and incrementally or accept the challenge of our time by tackling the big issues of our day?

Some, who look at this general assembly with a virtual even party split, predict not much will be accomplished. They do not share my faith in leaders and members of this General Assembly. I know you care deeply about this state, and you believe it can and should be the best place to live, work and raise a family. I share your passion and your belief. In that spirit, I propose we seize this historic opportunity and work as one no republican agenda, no democrat agenda, only one shared agenda an Iowa agenda. Let us tackle the big issues with bold ideas that transform Iowa to accomplish our shared mission to grow Iowa, and realize our shared vision of Iowa as the best place to live, work, and raise a family.

Let us start with education. Our children deserve and need a world-class education that prepares them for the challenge of global competition. While Iowa enjoys good schools today, our children need the best if they hope to succeed with that competition and in life. From this day forward good must no longer be considered good enough.

Some argue: simply invest more in the current system. Clearly, we must invest more in general school aid and in our effort to make teacher salaries more competitive. Iowa will not or cannot be competitive if we continue to rank 37th in teacher salaries. 22 The budget we submit will fully fund allowable growth and will more than double our commitment to the teacher quality student achievement initiative. But, that is not good enough.

Thirty-eight dedicated Iowans from all walks of life met for over a year to consider how we can offer our children a world-class learning experience. The recommendations of that group, the Iowa Learns Council, form the basis of a transformed educational opportunity for all children.

We must begin with our youngest children. Brain research proves that 85% of brain growth occurs within the first six years of life. 23 To fulfill our collective responsibility to our children, Iowa needs a more comprehensive commitment to our youngest learners that integrates early care, health and education. Every child in Iowa deserves to be healthy and to have a real chance at success.

As part of that effort, we must invest more to help parents succeed as their child's first and best teacher. Several years ago the legislature had the foresight to promote an integrated and planned approach to early childhood by creating and funding community empowerment areas. We need to increase our investment. in doing so, we expand home visitation and parent education and we will increase the knowledge and tools available to enable parents to create more stimulating learning environments at home.

Most of the parents of these youngest children work and these parents must rely on childcare during part of the day. They struggle to find and pay for quality childcare. We should help these parents and help them we will when we establish a quality rating system defining quality childcare. If parents know what quality is and where they can find it in their communities, they will make the right decision for their child. Data shows professional development and training produces quality teaching. We will offer more learning opportunities for childcare providers. Working with the newly formed Iowa community college early childhood education alliance, we will invest more in the professional development and training of childcare workers. Access to quality preschool is essential to a comprehensive commitment to our early learners. Children who attend quality preschool are ready for kindergarten. Iowans cannot be satisfied when less than 20% of our young children have access to accredited preschool. 24 Working with public schools, head start, for profit providers, and faith-based efforts we must commit now to increase annually the number of children having access to quality preschool until all of our children have quality preschool experiences.

Our children have waited long enough for us. Every day learning opportunities are lost and once lost, can never be recovered. Consistent with the recommendation of the Iowa Learns Council; I propose that we make an immediate investment of $39.1 million in the future of our youngest children. With improved revenues this year, an immediate investment will not compromise our plan to restore our reserve accounts, nor will it compound our difficult choices for next year's budget.

Some may question the return on this investment. The federal reserve bank of Minneapolis concluded in 2003 that there are "high public and private returns." 25 A 40-year study from Ypsilanti, Michigan documented the positive impacts of a quality early childhood and preschool experience: higher education and income levels, and lower crime and divorce rates among adults who had quality preschool experiences. For every $15,000 invested, society reaped a return of over $250,000 a 15 to 1 return on investment! 26

Our children deserve this commitment and our values command it. Iowans would not be surprised to know that our state graduates a greater percentage of its high school students than all but four states in our country. however, I suspect Iowans would be surprised to know that for every 100 students starting 9th grade this year only 83 graduate from high school within four years. Of that number, only 54 go on to higher education within a year of graduation. Of that number, only 37 are in school in the second year, and of that number only 28 -- 28 of the original 100 will graduate with an associates degree within three years or a bachelor's degree within six years of graduation. 27 When the department of labor reports that 49 out of the top 50 paying jobs will require post high school education, Iowans should expect and must demand better. 28 High school in Iowa needs to be transformed. The Iowa Learns Council recommends a more rigorous and relevant high school experience. They call for a stronger curriculum, a tougher graduation standard, and a tighter relationship between high schools and higher education with more opportunities for college credit before graduation.

In most high schools in our state, a student can graduate with only two years of math and two years of science. 29 For our children to be competitive in a global economy they will have to be more academically challenged. Parents, school board members and school administrator's concerned about student achievement and local control will do well to heed this call.

Today almost 40% of our high schools have fewer than 200 students. That percentage will grow over the next decade. 30 With fewer experienced teachers, higher workloads, and fewer course offerings combined with declining enrollments and limited resources these districts may find it impossible to tighten standards or expand learning opportunities. They simply may not have the resources to hire more science or math teachers, or partner with a community college to offer credit. These districts need our help, but they must also help themselves. Sharing superintendents and other administrative staff, whole grade sharing, or consolidating high schools or districts will free up resources to increase instruction. These efforts need our encouragement. In accord with the recommendations of the Iowa Learns Council, our budget will target resources, through additional supplemental weightings, to encourage these steps at the local level.

Transformation starts with education but does not end there. If Iowa is to grow and be the best place to live, work and raise a family, expanded economic opportunity through economic growth remains key.

We have begun to transform Iowa's economy by focusing our efforts on three industry clusters unique to Iowa's strengths: life sciences, advanced manufacturing, and information solutions with an emphasis on insurance and other financial services.

As part of that transformation, we helped companies seeking to add value to our crops by converting them to valuable ingredients. We tripled the number of ethanol facilities and doubled our capacity. 31 We supported the development of bio-diesel. We invested in research and development at our state universities in a variety of bio-based opportunities enhancing Iowa's reputation as a national leader in biotechnology. We invested in advanced manufacturing jobs -- jobs that require higher skills and command higher pay.

We welcomed small, high-tech firms to Iowa while also announcing the largest single economic development project in our history with the expansion of Wells Fargo. 32 We have supported thousands of good paying jobs while the number of companies expressing an interest in locating or expanding in Iowa grew from 51 in January 2003, to over 400 today. 33

All of this occurred because we worked together to establish and promote the Iowa Values Fund. We know the Iowa Values Fund works. Now, we must ensure that it works for years to come transcending this administration and this legislature. With interest rates low, the state's good credit rating, and increased gaming revenues the time will never be better to make a substantial investment in a brighter and better future. We should complement and build on the progress already made by the Iowa Values Fund, and Vision Iowa, with an $800 million investment over the next five years. the dividend from this investment would be 50,000 good paying jobs that support families and communities, expansion of cultural and recreational opportunities, well-maintained critical infrastructure, and cleaner water. 34

Now is the time for us to take Iowa to a higher level. The time for action is now! Transforming Iowa's economy includes transforming Iowa government. We need to support opportunities for bold thought at the local level. Iowa needs great places to live, work and raise a family. Building on the success of Vision Iowa and the Iowa Values Fund, we will create more great places while stimulating more locally. Our administration is eager to do just that. The directors of economic development, cultural affairs, the Iowa finance authority, and others will package together resources under their control into competitive grants awarded to the most creative and innovative communities aspiring to be "great places." the time for action is now!

Last month I outlined an income tax proposal to make Iowa more competitive. Today, I want to support legislative efforts to reform our property tax system. We all know that our property tax system treats business and commercial interests unfairly. We all know that our property tax system supports more government than we need to provide important services. We all know that property taxes are too high.

Nothing I said should surprise anyone here. The book I hold in my hand, published in 1933 by the Brookings Institute entitled "Survey of Administration in Iowa" came to many of the same conclusions. 35 Why haven't things changed? The reason is simple, no one has come up with a better system. I believe working as one, we can. The time for action is now! We must improve services, reduce property taxes, and preserve representative government at the local level.

I propose a two step process. First, in the short term, fix the current inequities in the property tax system by adjusting the rollback and limiting property tax increases in a fair and workable manner. Second, establish a process where Iowa government would be reconfigured fewer units with more autonomy dedicated to better service at less cost. If there is the will - the way will be found.

Government must ensure the safety and security of its citizens. This solemn duty involves multiple functions of state government including homeland security. Let me take this moment to acknowledge we still have husbands and wives and sons and daughters in harm's way. Some have paid the ultimate price. We are proud of the men and women in uniform making us safe and secure. We thank them for their service and pray for their safe return.

Our duty to secure the safety of our citizens includes winning the war on drugs. I support the efforts to crack down on the sale of the precursors vital to the manufacturing of Meth and I ask you to support them as well. We must drive the makers of this poison that robs our children of their childhood and future out of our state, out of our country, and out of business. The time for action is now!

We will not be doing our duty if we do not provide adequately for the health care security of our citizens by ensuring access to affordable high quality health care. For the last five years the lieutenant governor and I have called upon the General Assembly to extend health care security to the thousands of Iowans suffering with mental illness and substance abuse. It is a matter of access. It is a matter of equity. It is a matter of fairness. We will never transform our health care system until it includes mental health and substance abuse parity. Let's get the job done this year. The time for action is now!

Each year smoking costs all of us in increased medical expenses and lost productivity. According to the campaign for tobacco free kids, last year alone the state spent over $235 million dollars in medical expenses for smoking-related illnesses, while collecting only $88 million dollars in cigarette and tobacco taxes. 36 This inequity must be corrected. Fairness dictates that these revenues be raised now to better cover expenses associated with smoking.

Raising the cigarette and tobacco tax will save lives and allow us to better provide for the health care security of all Iowans. Additional revenues should be dedicated to adequately funding Medicaid to avoid cuts in vital services to vulnerable Iowans, to create a consumer choice support and education program so that older Iowans get the services they need in a way that is cost effective and respects their personal choices, to capitalize a "critical care fund" that would enable doctors to stay in high risk specialties by lowering malpractice costs, to encourage electronic records to implement chronic care management and minimize costly medical errors, and to promote small group insurance reform with lower costs for small businesses. The time for action is now!

Do we believe in an Iowa where every new job transforms the state's economy? Do we believe in an Iowa served by an innovative, responsive, and efficient government? Do we believe in an Iowa with health care security for all? Do we believe in the power to transform? The time for action is now!

Let it be said of us that we held those beliefs and, guided by our values, acted on them to meet the historic challenge of our time. Let it be said of us that in doing so Iowa grew and became the best place in this great nation to live, work and raise a family.

May God bless our work and may God bless the good people of Iowa and of this nation.

1 Iowa Department of Education; 2005 Condition of Education Rreport, figure 36

2 Iowa Department of Education; 2005 Condition of Education report, figure 37

3 Iowa Department of Human Services

4 Veterans Administration; Veterans Integrated Service Network

5 Iowa Department of Elder Affairs

6 Iowa Department of Economic Development

7 Iowa Workforce Development; Labor Market and Economy Research Bureau

8 Iowa Utilities Board

9 Iowa Department of Economic Development

10 The Fiscal Survey of the States, April 2004, NGA/NASBO

11 Iowa Department of Management

12 Tax Foundation

13 America's Best Cities & States, The annual Gold Guide to leading rankings, National Policy Research Council- NPRC Press, Washington, DC, 2004.

14 Center for Medicaid and Medicare Services

15 America's Best Cities & States, the annual Gold Guide to leading rankings, National Policy Research Council- NPRC Press, Washington, DC, 2004.

16 America's Best Cities & States, the annual Gold Guide to leading rankings, National Policy Research Council- NPRC Press, Washington, DC, 2004.

17 U.S. Census Bureau

18 Iowa Department of Natural Resources

19 America's Best Cities & States, the annual Gold Guide to leading rankings, National Policy Research Council- NPRC Press, Washington, DC, 2004. 20 2003 Fordham University Institute for Innovation in Social Policy, The Social Health of States

21 2002 & 2003 Fordham University Institute for Innovation in Social Policy, The Social Health of States

22 2005 Condition of Education Report, table 36

23 Rand Corporation

24 Iowa Department of Education

25 Rolnick and Grunewald, 2003, MN Federal Reserve Bank

26 "Life Way After Head Start", New York Times Magazine, November 21, 2004.

27 National Center for Public Policy and Higher Education, 2002

28 Occupational Outlook Handbook, UDSOL, 2004

29 Iowa Department of Education; 2005 Condition of Education Table 73-74

30 Iowa Department of Education; Beds survey

31 Iowa Corn Growers Association

32 Iowa Department of Economic Development

33 Iowa Department of Economic Development

34 Iowa Department of Economic Development

35 "Survey of Administration in Iowa," the Brookings Institute, 1933.

36 Campaign for Tobacco-Free Kids
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