"Like other states, Iowa is suffering financially," Grassley said. "This money will help Iowa restore its financial well-being as the economy picks up again. The payment will come with very few restrictions, so Iowa can use this money where it's needed most."
Grassley said the payment to Iowa is part of the $20 billion in temporary fiscal relief to states under the jobs and growth tax relief legislation he authored in the Senate and shepherded through Congress last month. Grassley said Iowa will receive $49.8 million in Fiscal Year 2003 and $49.8 million in Fiscal Year 2004, a total of $99.5 million. Each state's share is based on population.
This population-based money is separate from Iowa's share of temporary Medicaid payments approved through the same legislation, Grassley said. Iowa stands to receive approximately $80 million over two years for Medicaid. The actual amount will depend on how much Iowa spends on Medicaid.
Today, the Treasury secretary sent a letter to states outlining what they have to do to receive their population-based payments. To receive Iowa's $99.5 million in temporary fiscal relief, Iowa officials have to send a letter to the federal Treasury Department certifying that the state's proposed uses of the funds are to (1) provide essential government services, or (2) cover the costs to the state of complying with federal intergovernmental mandates, if the federal government has not provided funds to cover the costs, Grassley said. In addition, the state may only use the funds for types of expenditures permitted under the most recently approved budget for the state.
Grassley said the state may use a single certification for both Fiscal Year 2003 and 2004 funds, or it may provide separate certifications for Fiscal Year 2003 and 2004 funds. Once the Treasury receives a properly executed state certification for Fiscal Year 2003 (whether separately or together with its Fiscal Year 2004 certification), the state's designated account will be credited with the Fiscal Year 2003 payment within two business days. If the state sends the Treasury a single certification for both Fiscal Year 2003 and 2004, the Treasury will process the state's payment for Fiscal Year 2004 on October 1, 2003.