Iowa lawmakers passed a $9.425 billion budget to fund the state for the next fiscal year that starts on July 1. The budget uses $2 billion in reserve funds to fund the budget as state revenues are expected to decline due to previous years income tax cuts. 

The $9.425 billion budget is a $478.1 million — or 5.34 percent — increase over the current fiscal year’s budget of $8.947 billion.

The budget comes after weeks of negotiations, a public spat between the governor and the House, and a week of legislative overtime as lawmakers debated priorities for the new budget and worked to finish policy work. 

Lawmakers were scheduled to adjourn on May 2 and had a jam packed week while legislative leaders worked to find a compromise on the state budget. After two weeks of legislative overtime lawmakers gaveled out at 6:31 a.m. early Thursday morning. 

Iowa Senate lawmakers had come to an agreement with the governor on April 28 and Iowa House lawmakers released their own budget targets that were $36 million more than the Senate’s target spending numbers. 

This difference was largely over $14 million in spending for paraeducator pay and $25 million, $9 million more than the Senate’s version, for nursing home rebasing or updating a facility’s Medicaid reimbursement rates. 

The budget was also delayed by a group of Senate lawmakers that told Senate leadership they would vote against any budget unless they bring eminent domain legislation to the floor. This group of 12 Republicans, if joined by all Democrats who typically vote against Republicans budget plans, would kill any budget bill brought to the floor. 

Senate lawmakers passed eminent domain legislation on Monday and worked the rest of the week to pass the state’s budget. 

“To keep taxes low and ensure Iowans keep more of what they earn, we passed a responsible, balanced budget that puts taxpayers first and keeps Iowa on a strong, fiscally sustainable path,” Reynolds said in a statement Thursday morning. “Some have claimed Iowa is facing a deficit. Let’s be clear: this isn’t a deficit—it’s the result of the state collecting more from taxpayers than it needed. Now we’re giving it back. That’s what the Taxpayer Relief Fund is for.”

Lawmakers approve no general education increase for regent universities 

Iowa lawmakers passed a $1.033 billion education budget that included no increases to general education aid for Iowa’s regent universities and $1 million for a new Center for Intellectual Freedom at the University of Iowa. 

The Senate version of the bill kept general education funding stagnant and did not fund special increases that regent universities asked except for the cancer research funding the governor proposed and the center for civic education at University of Northern Iowa.

This includes $10 million for the UI in funding for a rural health care program that the UI has asked lawmakers for two years in a row, and Iowa State University request to fund a rural manufacturing program for $4 million, and a request from UNI to expand their connections with Iowa’s Community Colleges that allow associate degree holders to obtain their bachelor’s online from UNI. 

The bill also includes a $7.5 million increase for Iowa’s community colleges and a 2 percent increase in Iowa Tuition Grant dollars. 

A House version of the spending bill cut regent universities budgets by the amount that they were spending on diversity, equity, and inclusion programs since those were banned in last year’s budget bill. The House bill also included tens of millions in special purpose funds for regent universities. 

However, the House bill did not gain traction and Senate lawmakers’ proposal was passed by both chambers. 

Democrats argued that the newly instituted tuition increase cap and a flat budget for regent funding could put the regent universities in financial jeopardy and argued that it would only further increase the cost of college. 

Iowa lawmakers ban using Medicaid funding to pay for gender affirming treatments 

Iowa lawmakers approved a $2.47 billion budget for the Iowa Department of Health and Human Services and state Department of Veteran Affairs this year, a $254 million increase from the current fiscal year. 

 The budget bill also included a provision that banned the use of state Medicaid funds to pay for gender affirming healthcare. The bill specifically names gender affirming care given to transgender people including surgery and hormone replacement. 

The bill also includes an increase of $257.7 million in Medicaid spending, within that includes a $20 million increase in nursing home funds, a $3 million increase in community based home services for disabled Iowans, a $2.1 million increase in dental Medicaid rates, and an increase in maternal health services rates. 

The bill also increases foster care and adoption subsidy rates by 5 percent and Qualified Residential Treatment plan and shelter rates by $4.8 million. The bill also increases personal needs allowance for nursing home patients on medicaid to $55 per month. 

Iowa lawmakers increase judicial pay 2.5 percent, indigent pay increase 

Iowa lawmakers funded a 2.5 percent increase for state judges in the budget after Iowa Supreme Court Chief Justice Susan Christensen called for an increase in her Condition of the Judiciary in January.

The increase is part of a  $924 million budget for the state’s judicial and justice system. However, the increase does not bring judicial pay in line with Christensen’s request of 75 percent of federal judges salaries. 

The budget also funds an increase of $1.07 million for the defense of those who cannot afford a lawyer in rural areas where the State Public Defender’s office does not have the capacity to defend clients. The increase equates to a $2 increase in the hourly rate paid to contract attorneys.