Iowa Treasurer: State Should Borrow To Ensure Bills Are Paid

DES MOINES, Iowa (AP) — Iowa’s treasurer is warning that the state should borrow money to ensure it can pay its bills on time amid a potential budget shortfall, but Gov. Kim Reynolds’ staff says the move is politically driven.

Treasurer Michael Fitzgerald announced Thursday that he had asked the Republican governor to authorize using loan notes that are paid back quickly and don’t increase the state’s liabilities.

Fitzgerald, a Democrat, says borrowing would be a “sensible way” to manage “uncertainties.”

Brenna Smith, Reynolds’ press secretary, says Fitzgerald is engaging in “headline-grabbing scare tactics” and it’s “unwise” to suggest the state can’t pay its bills. Fitzgerald says his warning is not political.

Reynolds may need to call a special legislative session to address the state’s roughly $7.2 billion budget. A nonpartisan state agency has estimated Iowa faces a revenue shortfall of about $100 million, but the figure could fluctuate.

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