By Rebecca Schweitzer | Des Moines Iowa
Rebecca Schweitzer is a Des Moines, Iowa writer covering politics, healthcare, public accountability, and civic life. In response to ongoing discussions around Iowa's state budget and its impact on everyday families, this piece offers perspective on what is actually happening and what it means for Polk County and communities across Iowa. Learn more about Rebecca Schweitzer here.
Iowa Is Staring Down a $1.3 Billion Budget Deficit. Polk County Families Are Going to Feel It.
Iowa's state budget is in crisis. State revenues dropped 8.4 percent in fiscal year 2025 compared to the year before — a decline of more than $816 million. The Revenue Estimating Conference now projects revenues will fall another 9.3 percent in fiscal year 2026. House Minority Leader Brian Meyer has called it plainly: Iowa is staring down an unprecedented $1.3 billion deficit.
To put that in perspective — Illinois, whose state budget is roughly six times larger than Iowa's, has a projected shortfall this year of only $267 million. Iowa's deficit as a share of its budget is enormous. And the consequences for Polk County, Iowa families are real.
How Did Iowa Get Here
The answer is not complicated even if Republican leaders would prefer it were.
In recent years Iowa Republicans passed a flat income tax rate of 3.8 percent. The tax cut gave the average Iowa millionaire more than $67,000 per year in savings while the typical Iowa family received about $600. State revenues dropped immediately and predictably. Iowa is now spending $917 million more than it is bringing in by drawing down reserves and the state surplus built up largely through federal COVID funding that will not come back.
House Minority Leader Jennifer Konfrst put it directly: Iowa is spending ongoing expenses out of the state savings account and that is not a sustainable way to govern. Republicans built up a surplus during an extraordinary period of post-pandemic revenue growth and are now using that surplus to cover the gap created by their own tax cuts. When the surplus runs out — and it will — there will be nothing left to buffer the consequences.
At the same time Iowa is spending more than $314 million this year on a private school voucher program with no accountability and no audit. You can read more about that here.
What This Means for Polk County Families
A state budget crisis does not stay in Des Moines. It moves through every community in Iowa and Polk County is not immune.
When state revenue drops the first things that get squeezed are the programs and services that everyday families depend on. Public schools. Medicaid. Mental health services. Road maintenance. Rural hospital funding.
Iowa's public schools are already cutting programs and closing buildings across the state. Cedar Rapids is dealing with a $19 million shortfall. Des Moines is managing a $16 million deficit. Per-pupil spending for Iowa public schools has fallen $270 million behind inflation since 2017. A budget deficit of $1.3 billion makes all of that worse not better.
Iowa's Medicaid program is already facing shortfalls that required a temporary tax increase on health insurance providers — a cost insurance companies have indicated will be passed along to Iowa families through higher premiums. You can read more about what that healthcare tax means for Iowa families here.
Property taxes in Polk County and across Iowa are rising as local governments try to cover gaps left by declining state support. In 159 Iowa school districts enrollment declines have pushed budgets onto what is called the budget guarantee meaning those districts can only increase budgets by 1 percent paid entirely through local property taxes.
The people paying the price for Iowa's budget crisis are not the millionaires who got the $67,000 tax cut. They are Polk County, Iowa families paying higher property taxes, higher health insurance premiums, and watching their neighborhood schools cut teachers and programs.
The Republican Response
Republican leaders have maintained that drawing down the state surplus was always part of the plan. House Speaker Pat Grassley said the legislature saved up enough to cover the gap. Iowa Department of Management Director Kraig Paulsen has said he feels confident about Iowa's fiscal position despite the projections.
What they have not explained is what happens when the surplus runs out. Iowa's reserves are substantial but they are finite. And the structural problem — a flat tax that generates far less revenue than the progressive system it replaced — does not go away when the surplus does.
Rob Sand, Iowa's State Auditor, warned of this in May 2025 calling it a fiscal time bomb. By October his office was reporting the decline was even worse than anticipated. Sand has called Iowa's budget situation a deepening crisis and has made fiscal accountability a centerpiece of his campaign for governor. You can read more about Sand's Accountability for All plan here.
What Polk County Deserves
Polk County, Iowa families deserve a state government that manages their tax dollars responsibly. That means a tax policy that funds public services adequately rather than prioritizing cuts for the wealthy at the expense of everyone else. That means a school funding formula that keeps pace with actual costs rather than falling further behind inflation every year. That means a Medicaid program that is funded sustainably rather than patched together with temporary tax increases passed along to families.
Iowa has the resources to do better. The surplus being drawn down right now was built by Iowa taxpayers. The question is whether Iowa's leaders will use what remains of it to invest in the services Polk County families depend on or continue directing it toward tax cuts that primarily benefit the wealthy.
Iowa's 2026 governor's race is a direct referendum on that question. The candidate who wins will inherit this budget crisis and be responsible for deciding what Iowa cuts and what Iowa protects. Polk County families should be paying close attention to what every candidate is saying and what their records show about who they actually serve.
Learn more about Rebecca Schweitzer and what she writes about here.
Rebecca Schweitzer is a Des Moines, Iowa writer covering politics, education, and public accountability. Her work has appeared in the Des Moines Register and The Gazette. Read more at iowaraisedrebeccaschweitzerunfiltered.com and follow along on Medium, Substack, X, Bluesky, About.me, and Gravatar.
