DES MOINES - The Iowa Power Fund and other efforts to promote renewable energy in the state should be largely protected from budget cuts despite a projected shortfall that could top $600 million next year, top Democratic lawmakers said
But a Republican legislative leader said the fund should face the same scrutiny as other areas of the budget when the Legislature convenes Jan. 12.
Slumping tax revenue already has forced Gov. Chet Culver to order a 1.5 percent across-the-board cut in state spending for the fiscal year that ends June 30. In addition, the governor has ordered $180 million in cuts for the current year.
Democrats who lead the Legislature said they face big challenges as they deal with the economic crisis, but efforts to encourage and develop renewable sources of energy in Iowa are too important to cut deeply.
The Legislature approved the four-year, $100 million Power Fund in 2007 as the centerpiece of Culver's energy plan. It was designed to encourage research and development of renewable energy, and so far, about $30 million has been given to Iowa companies and schools for energy-related projects.
"We won't be looking to cut in those areas," said Senate Majority Leader Michael Gronstal, D-Council Bluffs. "Anybody who believes that gasoline is going to stay under $2 a gallon is deluding themselves. Our opportunities lie in that area and it will help us reduce our dependence on foreign oil."
Gronstal said Iowa has a central role in the nation's alternative energy efforts and that spending on such programs now could bring a huge payoff. Still, he wouldn't promise that no cuts will be made.
"The size of the (budget) problem is very significant and we have a daunting task ahead of us, but it would be penny-wise and pound foolish to cut from a fund that will lead to our long term future in this state. But we won't promise every nickel will be preserved," Gronstal said.
House Speaker Pat Murphy, D-Dubuque, said renewable energy will be a high priority for lawmakers.
"We'll continue to keep a focus in those areas," Murphy said. "It's one of our highest priorities because of the success we've had."
He cited Iowa's expanding wind energy industry and the ethanol industry, which he conceded has cooled in recent months because of fluctuating commodity prices and oil and fuel prices.
"But it needs to continue to be a focus for this country," he said.