>> welcome to the cato institute. thank you for coming. thanks to those of you tuning and online. my name is jean healy, senior vice president for policy at cato. i'm going to do the introductions and a little light moderating for today's state policy leadership forum with a special focus on fiscal responsibility, tax policy and educational freedom. we are very pleased to have with us today governor kim reynolds of the great state of viola. she is iowa's 43rd governor, serving since 2017, and the state's first female chief

executive. among governor reynolds' a compliment -- accomplishments, she has delivered the largest tax cuts in history including a reduction of the corporate tax rate. and abolition of iowa's inheritance tax. under governor reynolds' reforms, iowa's tax structure will shift from a nine bracket system with a top rate of almost 9%, down to a single 3.9% flat tax. for those efforts, governor reynolds has earned the highest grade of a on the latest edition of the cato fiscal policy report card on america's governors. governor reynolds has been equally aggressive on the education policy front. last month, she signed into law the students first act under

which education funding follows students and parents who enroll their children in an accredited private school will receive an amount equal to the per-pupil funds allocated by the state to public school districts. roughly $7,500 per that will be deposited into an education savings account to be used for tuition, fees and other qualified educational expenses. >> chris edwards in the center there, holds the fiscal studies at the cato institute and is co-author, with -- of the afro mentioned governor's report card. chris has sometimes been accused of grading on a curve, but he gave a lot of f's this year. it is not like everyone gets the

smiley face sticker. every time a new it issued an of the report card comes out, he spends some time holding the phone away from his years as various governors and chiefs of staff call to scream at him. chris is also the editor of downsizing government, your comprehensive guide to shrinking the beast and hails from the great state of canada. our final panelist is like myself new jersey born and bred. our home state's governor phil murphy got an f. neal is the director of cato's center for educational freedom and author of the fractured schoolhouse. a continuing theme of his work is our one-size-fits-all public schooling system tends to feed culture were conflict.

and that having funding follows students guide -- like in the students first act, can go a long way towards diffusing those sorts of conflicts. i should mention, we will have a conversation on these issues. we will later be taking questions from the in person and online audience. if you are out there in twitter land talking about this event, you should use the #govreportcard. with that, i am going to get out of the way and headed over to chris to kick off today's discussion. >> thanks, gene. [applause] welcome to cato. i am going to provide a minute or so of additional background and then we can get into the discussion. i became aware of the governor's achievements when i did the 2020 report card. she got the second highest

grade, second only to governor sununu of new hampshire. in 2022, she continued on with her tax reforms and got the highest grade. governor reynolds has put together the most impressive set of tax reforms in years. she put in place occupational licensing reforms. she has initiatives this year to reform regulations in iowa, to restructure iowa government, to reduce the number of agencies, as well as school choice reforms which we will be talking about with the governor. on the tax reforms, as jean mentioned, the governor started her drive in 2018 with cuts to the top income tax rate and corporate tax rate. as jean mentioned, the top individual rate will drop from 8.9% down to just a 3.9% flat tax.

on the corporate side, the rate dropped from 12% to 5%. what motivated you or inspired you to do this series of reforms? >> the great thing about republican governors is we are very competitive. chris has challenged me to let me know he is going after that number one spot next year, which means i am going to have to continue to cut taxes for iowans that i have the amazing opportunity to represent. some states cut taxes but did not keep spending in check, and therefore ran into some issues down the line. not only do we want to be competitive, but i also want to make sure we can make investments in priorities that are important to iowans, education, public safety, we put resources into broadband, housing, childcare. overall, we know if we are going to grow our economy and get people to stay in the state, we need to be more competitive.

it has actually been a lot of fun. i want to tell you, i am excited about the results. it is challenging, but i have actually signed three tax cuts since taking office in 2017. i am really proud of the continuing progress we have made. we are not done. my goal is to get to zero individual income tax rate by the end of the second term. we would have this year taken it down more, but i wanted to just watch what was happening with the environment, with inflation and recession. we always do a five-year budget. we do recession-non-recession projected growth that we base our budgets on. i think we would have been ok, but i focused on education reform this year. and then really taking a look at government and how we provide services. i am going to run through the

statistics one more time because i am proud of them. when i took office, our top rate was 8.9% we had nine brackets. we will go down to a flat tax that down. over corporate tax rate was one of the highest in the country. nearly 12%. the goal is 5.5. we took a big drop last year at 8.4 percent, which we were not projected to reach until 2026. we were able to do that in the first year. i am excited about the acceleration we are seeing with that. one of the other things we did, that as i traveled estate, we have an elderly population. there are a lot of young people in the audience, we are working hard to change that. take a look at iowa, you think you will be surprised. we were -- income. i was so tired of losing that valuable asset, which it is. florida, arizona, some of those

-- states, we have a couple of months january through december, where it is relatively chilly. i said to ron and doug, when douglas the other -- when douglas governor of arizona, i don't care if they come down for a couple of cold months, but i am not going to lose any residence to your state. starting this year, we no longer tax retirement income. i got a call from my father who could tell me how much more that means in his paycheck on a monthly basis and he was pretty excited. we need to be competitive. if i want business to be in this state, those are things we need to do. to be honest, that is what my colleagues were doing. i am competitive by nature. you might get that sense by the time we are done. >> interesting you mentioned, reducing the individual income tax all the way down to 0%, abolishing it, which had first

seems radical. but as you know, there are nine u.s. states that do not have individual income taxpayer they are in different parts of the country. red states, blue states. washington, tennessee, nevada, new hampshire, florida. the states that have no income tax are prospering and generally high economic growth rate. it is not as radical. >> it is not. we did a group in town this week with republican governors across the country. this team of republican governors have additional tax cuts on their agenda this year. that number is going to continue to grow. if we are going to continue to be competitive, we have to be aggressive. that means growing revenue, looking at other issues that will help bring business and industry to iowa. but keeping spending in check is key. the budget i proposed to the legislature this year only

spends 82% of what my projected revenue is. those are the things you have to do. >> i was looking at a map the other day. iowa has got six neighbors. on one side, south dakota, a no income tax state, very competitive. you look at the data, they've got strong migration. on the other site, illinois. probably the worst fiscally run state in the nation. the difference between iowa and illinois in terms of basic fiscal matrix is amazing. iowa has got a aaa bond ratings, low debt, low pension. illinois has a very low credit rating. high unfunded pension. what accounts for that difference? is it just a different fiscal culture growing up over time? >> it is a different philosophy. we are a right to work state. a lot of differences i was

meeting with a potential investor in the state of value with this week. we are hoping to land him. illinois my competition. walking through all the differences, the last thing is said as i am fairly certain we will be able to honor the incentive package we put together and i am not sure illinois can even honor the pension program for the state employees currently working in that state. they might be able to offer the moon. whether they can deliver is something to consider. it is kind of who we are as a state. it is a philosophical difference appeared i think iowans know better what to do with their money than government. we continue to see growth in government. they believe they have the answers and we do not. when you let iowans decide what they are going to do with their money, we see communities flourish. we see the state flourish. it works.

>> you touched on the state budget. you scored very well on the governor's report card partially because you kept spending in check. it is kind of amazing, the first five years in office, she held the state budget to 2% annual growth. the average was 6%. we are in the middle of fiscal 23 now. i think the iowa budget is growing 1%. the average is 6%. where is your secret? how are you able to do that? >> that is the problem. we do work closely with our legislature. both chambers are controlled by republicans. we meet every year. it is communicating. working together. setting expectations. we know collectively we want to reduce taxes. the only way to do that is keep spending in check pair not only have i been able to cut taxes, we have made historic investments in key priorities for iowans.

we have increased funding and k-12 education by over $1 billion. we continue to increase in priorities but we have still been able to continue to look for ways to reduce the budget as well. we have been able to do both. last year was under 1%. in the fiscal year we are in right now, growth this year, revenue is increased but i think we are still thinking 3%. but the largest percentage of that increase is because of school choice. we actually were able to fund putting the esa in place. so, that is probably contributing to a little bit of a larger increase in funding this year. >> we should jump over to school choice? >> you have already -- the fiscal stuff. but that is not really the interesting part. you mentioned that you are very

competitive. i have one question, by some counts iowa is the third state with universal school choice. i do not count west virginia because we are not there. >> we do not either. [laughter] >> i don't want to seem anti-mountaineer. >> i know. >> just based on data. i am curious how did you let arizona beat you the universal school choice? or interesting, you have been working on it for a few years. what do you think puts you over the top this year? >> i want to give a huge shout out to both arizona and west virginia. it is to lead and take a stance and -- has been working on this for a long time. the governors are competitive. it took you eight years, we are doing it in three. you are about to see this happen

across the country. it is not just iowa. you're going to see additional governors set the bar. that is where they will be looking to go to implement it has quickly as they can. covid was a pivotal point not only for parents, but her governors. i think the data we see right now really demonstrates that it was the wrong thing to do to keep kids out of the classroom. in the amount of loss is staggering. some of those kids will never get that back. we were one of the first states to get our kids back in the classroom. i am proud of that. we did it responsibly. we could see that is where they needed to be. and how important it was. we have been able to minimize our -- to talk to parents and students and have schools actually sue me to keep the kids out of the classroom. it was one of our largest school districts. it had a tremendous impact on kids dropping out of school. i think it was 90% or so were on

free or reduced lunch and dropped out. lots of minorities were impacted. it had a fine point with me because the parents that were in that school that suit to stay closed, that had the financial resources, were able to put their child someplace else. so they were not impacted by not being in the classroom, not having a safe environment to learn, not having a hot meal, which a lot of the kids didn't. i fundamentally disagree that that option for parents to decide what is the best environment for their child to learn and be the best that they can be can only be afforded to families that have the financial means to do that. every parent, regardless of income or zip code should have that option. to put their child, whether it is a safer school because they are being bullied, maybe it is

gang-related, whatever that reason may be, it shouldn't be only available to individuals that have the resources to do it. we have been working on it for three years. and to be honest, i think covid gave parents a front row seat to some of the things that was happening in the classroom. they really didn't like what they saw. honestly, they just want to quality education for their kids. they wanted to continue to be the parents at home and help prepare the kids for a successful future. we had more and more parents reach out and ask for the opportunity to make that choice. >> a very common objection to school choice, and we have heard it, there is no accountability. the money will be wasted. what is your answer?

is there accountability? >> there is. it is only to accredited private schools. they go through similar accreditation process that our public schools two. if you go to our department of education website, you will see a comprehensive list of the accreditation requirements that they are held to. we could add some language in the bill too to ask for additional requirements. but to be respective, also of the private school system. i wanted to know what some of the outcomes were. we are investing in esa and giving parents choice and we are funding students, but i want to know some of those metrics. we could aggregate the data, but i want to know what they are doing and how they are doing it. we've got a small set of additional metrics we have added to that. it is just not true, they are held to many of the same standards public schools are.

it is a very extensive list. >> and of course there is accountability by having to attract parents to your school, which is almost never mentioned when people say there is no accountability. >> they say really if they don't like my school -- they are paying to come here. if they do not like what they are doing, they are going to leave. the accountabilities with the parents. thank you for helping me remember that. >> i only have three talking points. [laughter] i am curious also because iowa is relatively rural. a very common objective -- objection is that it does not help rural families. does it? >> i went to a public school system. we educated our daughters in public school. a rural public school. my daughter is a public school teacher in a rural public school. you can imagine, bless her heart. she said this might be one of

those times where it might not be fun to have your mom be their governor. but i truly believe with all of my heart it elevates education overall. she is a great teacher and i am proud of her. i had rural lawmakers of my own party that were -- i could not get them on board. i offered to go to their district to do town halls or whatever and talk to the superintendents and just walk through some of the reality of what it meant and tried to answer some of the misconceptions that were out there. i sat down with a lot of superintendents and principals and said, i am not here to convince you. that i believe it is the right thing to do. but tell me, what are we doing that impacts your ability to provide your students and be competitive? what i heard over and over is that there are just too many restrictions.

everything was a -- like everything in government. i want to talk about my realignment before we -- we add and we never take away. it is -- chapter 12. teachers know about chapter 12. principals know about chapter 12. i read the entire chapter and it was a nightmare. it was outdated. it was restrictive. so, i said well, look at that. and we will change a lot of those shallots to may and give you flexibility. the average teacher salary was 59,000 dollars pair that is probably more reflective of our larger school districts, not so much rural. they just did not feel like they could be competitive. we tried to look at existing funding and some of our categorical spirit -- categorical. we freed up some restrictions on that to allow them to only put

the teacher salaries. not administration, but only into bringing on new teachers or increasing that amazing individual that come in the classroom every day is working with our kids, to be able to pay them what they are worth. we have occupational sharing. we extended that where small school districts could share. -- principal or whatever. there's about 20 different categories. we extended that. i think it was at least an offer to them to show them that i hear you. you are right and we are going to give you flexibility and opportunity to be more competitive with your teachers. that really helped bring some of my lawmakers on board. >> utah, not long after you passed your bill, passed a similar bill delivering more funding for teachers.

it is important to understand, people often frame school tours -- school choice as anti-teacher. school choice in no way is inherently anti-teacher anyway, but putting it together to help teachers is a smart way to go. i think they governor teed up a question for you. >> i wanted to say real quick, having heard that discussion and working with the superintendent, i have met with several. they said things like, i realize if i am not at the table i am on the table. we were focused on not letting you get esa through. but now we like what you have started to do. can we come back and continue to work on it? we will. we worked on apprenticeship programs and we are excited by what we have done. where the first state in the country to do a teacher's registered apprenticeship program that will bring 1000

into the pipeline. 500 pair educators and 500 teachers. it is helping to diversify our teaching population and it is awesome. we want to be able to align some credit with the registered apprenticeship programs. i had another superintendent say , i do not like what you did. i didn't agree with the law, but it is the law. i am going to make my public school the best destination of choice. and that is the kind of culture that we want to drive. it is already happening. it is going to be fun to see. thanks. >> governor reynolds has seat up two -- teed up two reform of government strategies here. one is on the regulatory front. she has called for an overhaul of iowa state regulations. she has also called for restructuring of government to reduce the number of agencies

and bureaucracies to sell excess estate land the government does not need. >> truly that is one of the ways we are going to continue to keep costs down so we can continue to keep growth at a minimum. we have spent the last six months doing a deep dive into the executive branch. we brought in a consultant to help. i have an amazing rockstar team. we have been able to get a lot done over the last several years because of them. you can't just incur around the edges. we got a consultant. we worked with all of the agencies. we hadn't done it for 40 years. after what we have uncovered, i can't even imagine what is happening at the federal level. we are a small state. we come to find out i have -- i

actually knew this, but 37 executive branch agencies that were part of my cabinet, 37. it was out of line with other states that were similar in size and population. arkansas, mississippi, oklahoma all had the same size population and had about 15 agencies. that were under the executive branch. the real kicker for me, you talk about illinois, as we did the review, we found out that we were appropriating $2000 per capita more than illinois. four times our population. that is not good. we are going from 37 state agencies down to 16. i am excited. his -- it is about $240 million in savings.

that is conservative, to be honest. as we continue to realign the services we are providing iowans. we did end up taking it through the legislature. we will have full transparency. iowans can weigh in. we did have a proof of concept. our department of public health and we actually combined them. two really large agencies. no way lost their job. none of these services were downgraded. it is incredible that hhs, the department we put together, these are individuals struggling to get through a day and had to go through seven or eight different doors to get an answer. how inefficient is that? there is a cost of that. and then there is no synergy. collaboration was duplicate of. and then another example we have been able to share his with the

department of inspections and appeals and workforce development. their administrative judges. workforce was behind about 5400 cases. we were able to merge the two and provide efficiencies and they eliminated that backlog in three months. i have some good examples to share with the legislature. the agencies we brought together have together sat down with the committees and with iowans to talk about why they agree with what we are doing in the direction we are moving the state. i won't have to go off-site to have a cabinet meeting. i can actually have a cabinet meeting in my office. and we can really talk about strategizing, better initiatives and better service to save money. >> it sound like you're are taking a data-driven approach.

it seems like the advantage of federalism is that the 50 states not only compete with each other, they learn from each other. it seems like there are two ways to learn from other states if you look at the data and out other straights structure their government. also you have relationships with doug ducey who are leading a lot of reforms. it seems there are two ways you can learn about best practices from other states. >> absolutely. when we looked at reform, we look at what doug had done in arizona. you look at your existing state and what you are dealing with, look at what the other states are, look at the metrics and the data. and then you put your own plan together. we have 99 counties in iowa. we have too much government. if we want to continue to cut taxes, we need to look at that overall. i didn't feel like a challenge 99 counties and local governments to get their act together if i didn't take a look

get -- get my own house together. i am hoping i can be a real example to some of our local governments and our 99 counties. >> let me ask one more workforce government question and maybe jump back to neil. we talked briefly before we came on about collective bargaining reform. which i hadn't learned about until yesterday when i was reading. in 20 17, before the governor came into office, this stated profound reform of labor union regulations for government employees. that seems like a good model for other states. >> it is a great model. we have seen our agencies and our employees, they are the face of state government. the environment is better and they are able to advance based on merit. various agencies across the state have had such great outcomes because of that.

it is not often you get an opportunity to take on a state monopoly and overhaul collective bargaining reform and bring in school choice as well. we have taken on two state monopolies and we will see. we will be able to show that those were the right decisions. we have been able to show that with collective bargaining reform. after two sorts of labor reforms. there is a right to work, which is -- fundraising for private-sector unions, then there is collective bargaining within the government which state legislators have power over. >> and what they can negotiate. we have limited to what they can negotiate. we capped that at 3%. they can agree to bring in other negotiable items, but both parties have to agree. law enforcement was the only exception.

we did not include them in the collective bargaining reform. contrary to what the naysayers said, state government still exists and we are still able to continue to provide tremendous services to iowans. we have been able to do it in an effective manner. >> this whole discussion makes me very happy about federalism. [laughter] you can learn from other states when they do something wrong. they do something right, you can look at what others have done. you mentioned occupational licensing and that led me to a question that is sort of tied in with that. cato has a new series of papers about new american workers. one thing we talk about his college degree requirements to get specialty jobs in government. but also licensure that would be required for maybe not good reasons. maybe not actually seeing that degree means you can do something. >> we did address that.

we had to look inside and see what our requirements were. a college degree was a big part of that. we have done so much in the last couple of years and we've got another proposal we are working on. we put a moratorium on new rules and regulations and we are having each agency review every rule they have in their department and if it meets the new standard, it can be renewed. otherwise it is not going to be renewed. we are going through that process as well. that was preventing so many people from getting into the workforce. we were encouraging the private sector to do that. and then oh my gosh, we are putting those same restrictions in place and we need to not do that. does that answer your question? >> maryland removed a bunch of college requirements.

pennsylvania's new governor, it seems that is picking up speed. >> we have. thank gosh for the chief of staff. i knew he said it was folded into that original round of workforce issues we have been dealing with. but we do a lot with workplace learning. i have been involved in stem education since i have been lieutenant governor. it works. especially for keeping our young people in rural iowa because it connects them with the opportunities. they find out what they have a passion for. the -- sometimes it does not require a four year degree. sometimes it does. a lot of times they want to continue to advance in their career with no debt. making a living and then if they want to advance, ok. so, it is smart.

not for all, but it is an option as it should be. >> i do not know. unless you are -- ok. this gets a little philosophical. one of my favorite questions. what, i'm sort of interested in educational freedom as a way to diffuse cultural and social conflict. obviously this has been very big across the country. we keep something called the public school battle map. there are several school districts in iowa, just as everywhere, that have had conflicts about books in the library. was the son of the thinking behind the school choice push to enable people to choose what they think is the right values for their kids in parts where they don't have to fight with their neighbors? >> we said no to critical race theory. we are doing a parental rights

bill. parents are the decision-makers for their children. i thick it is sad we have to codify that. the fact of the matter is we have to. we have had school districts, school boards that have said a seventh grader can decide if he shares information with his parents about pronouns or changes in names. just completely taking the parent out of the child's education. you can pass various legislative bills to address some of that but ultimately, sometimes they find a way around it or it is hard to completely stop that. but by giving parents, all parents, the choice to decide what environment they want their child to receive their education , that is going to be the most effective. i don't mean this in a negative way -- sort of -- they

understand money. people funding for schools. if you start to have the one school where the parents kin -- they have had but between -- 200 and 300 of already made the decision. parents have made the decision to leave the school district and go to another. we had open enrollment before we passed the students first act. so, we sort of had it for quite some time. it just allows the funding to go with it. i think ultimately that will be the most impactful. to drive different decisions and maybe get people back to, or get schools back to what parents expect and that is quality education in core subjects and leave the rest to the home. >> i want to turn to audience questions.

both in person and online. the online audience can submit questions directly on the event webpage. facebook, youtube, twitter. please speak clearly and directly into the mic -- into the microphone so everyone can hear you. announce your name and affiliation if you think that is important. please do keep the focus on what we have been talking about today. fiscal, education, regulatory policy in the states. not chinese spy balloon's or hunter biden's laptop. or other things you are interested in that we are not talking about today. please do make sure you get quickly in your question to something that ends with a question mark and no

soliloquies, please. with that, do we have any questions? razor hand and chris will bring the microphone to you. >> perfect. we will start with a question online. alun asks, keeping average spending down while expanding administered -- must require cutting programs and spending you talked a little bit about this. what you looked at in your state administration. what have you been able to cut? what lessons you have further states? >> we didn't cut. that is the point i was trying to make. we made historic investments in k-12 education. we add new money to education every year. i have invested in public safety p have invested in broadband. over $100 million. if we want to be successful nc prosperity in every corner of our state, we need to be able to connect.

. they are not going to live there if they cannot connect. be more efficient and effective in the way you deliver your services. it means growing revenue by letting iowans and businesses be successful and grow. we have 35,000 new to startups, small business startups. we set another record in iowa. even through difficult times we continue to see growth in iowa. that is encouraging. it is not either/or. i believe you can do both. we have a record of doing both. you just have to be targeted and how you allocate the funds. and then hopefully continue to see growth in your state. i believe you see growth by reducing taxes. that is part of the scenario. in 2021, we had 11% growth. in 2022, 11% growth.

we are looking at a -1.9. we are actually running at 5% right now through january. we are ahead of projections. >> the key thing for a lot of states has just been the -- it takes all analysts by surprise that starting in the summer of 2020, revenues initially dropped. but then they boomed across many states. which took a lot of people by surprise. a lot of states spend extra money and gave one time tax breaks. but then the sensible states took the surpluses and did essentially long-term investment which was making the tax structure more competitive to draw businesses and households to the state to benefit the state in the long term.

>> i name is josh. we do studies on regulatory growth. i am excited about the regulatory moratorium. with that moratorium, i guess it is a two part question. one, are you interested in some kind of target for reduction in regulation? do you have a specific number in mind? two, are there any specific regulations that are high on the target list that you really want to reduce? >> we have already -- thank you for the question. we brought in a company to help monitor that so that i can actually have data. they have been able to account for all of the regulations we have on the books right now. we are talking a level that does not make sense. we have so many regulations that should not be on the books. they are outdated, or barriers to economic growth in the state a bio up. we will be able to benchmark

this has we are just starting the process. i think it was important to bring in a consultant to help us do that. we are doing four agencies at a time. i think we are spreading it out so we can be focused. . we don't want to be a barrier, we have to make sure we are providing safety but we also want to make sure we are partnering with business and industry and growth in the state a bio up. i am looking forward to it. i think we have laid out a strategic and well-thought-out plan. i just got a quick update i think that lee's -- that is running it. i will be interested to see. were not very should be.

you just tend to add and you never knew the hard work. there is a process if there are some new regulations that absolutely need to be put in place. we've got a process for them to be able to do that but we have tried to keep that as well. >> my name is -- freeman. i write about women in politics. iowa has been the home of some great women. what are you doing to enhance women's opportunities at this time? >> thank you for that. first of all, being the first female to lead the state of bio as governor, a do not think i really even fully understand the

impact, but i can't tell you how many little girls recognize me and just want their picture taken or just want to come up and say hi. i am trying to lead by example and it is not because they are a woman, it is because they deserved it. all most my entire leadership team are woman. at again, because they earned it. not because i was -- that also sends a message. we get out of the car and i've got four really strong women surrounding me. i have had people stop and comment on the fact that they just don't see that often. that is encouraging. the other thing i do is, in my office -- the big black chair, i thought, i am going red. i am going to do something different. anyway, when i have young girls in the office, i always try to

have them sit in the chair behind my desk and really let them know that they can be anything they want to be. and if that is a mom, a teacher, or president or governor, they can do that. hopefully i am leading by example and i have surrounded itself is very strong, articulate, capable, compassionate women and it has been fun to see the reaction we get from women. not only in iowa, but across the country. it is important. >> coming from our online audience, how will iowa protect the parents in private schools that participate and use esa funds from regulation by the state that effectively turn them back into single management public schools? >> good question. the bill, we have some autonomy language. arizona did this. we were able to look at florida and arizona and see that

language that they use in their school choice bill. it has been tested through the courts, that is always good. you want to put together a bill that is in the best place it can be. it could be caught up in litigation for years to come. so, we do have language in there they were fine with pair that was also a concern for a lot of our legislators. we worked very closely with our private schools to make sure they were comfortable with that. i think we really did a good job striking a balance with the language we included. >> you have to make sure the statute won't be challenged in court, are you talking about federal regulations, state regulations? >> federal. -- i guess i have a spreadsheet of lawsuits. it is a litigious society we live in. it is a way to slow things down. especially if you do not agree with the bill.

we really work hard to make sure that we have legislation in the best possible position to be successful and we've got a great team that does that. and you have other states that have put together legislation and it has gone through the process. that is awful helpful because there is case law there. >> it is rare to see a school choice bill passed and not get challenged quickly in court. in part because unions are very powerful in most places and are quick to say we are going to strike it down. once families actually get to use it, it is harder to take away because they want that kind of power. >> that is the other thing too. another impact of this bill will be the fear mongering and information that is not true. there is no data to support it, but yet we will be another state that will be able to dispel a lot of the myths and fear mongering you hear surrounding educational choice.

[indiscernible] [inaudible] >> i am a cyclone girl, but i love the hawks too. >> [inaudible] [indiscernible]

>> there we go. [laughter] >> i have got a question about administrative bloat. in the universities. it is the main complaint that is happening all over the united states, that the number of administrators gets larger and larger. i was intrigued by your point, in the case of k-12 subsidies, you specify that it can go to administration. do you have any plans to do the same thing with the three big

state-funded universities? >> yes. it is ridiculous. i have one school district with 12,000 employees. have his administration, half. they have a purpose. but, that is ridiculous. we were really excited when we were able to find a mechanism where we can find ongoing funds, funds within the base that rolls every year, whatever the increase is for education funding. it continues to grow because it is a part of that. for teacher leadership, there were three different ones fairway allowed them to take the unused portion and roll it into

teacher salaries. we specifically set in the bill it can only be used for teacher salaries, not for administrative positions. that might be a model we can use other places. >> one final question from online peer >> the governor gets the pleasure of working with a republican legislature both in the house in the senate, but it took you several years to get universal choice adopted. can you walk us through the difficulties he ran into in the republican caucus? educating your fellow republicans on the values of school choice. >> i started out in failing schools. i couldn't get it through the house. i came back, and republicans control both chambers. the second year, we expanded it a little bit. we tied it to income so it was 300% of federal property.

and some additional, other language that is similar in this bill. half the senate again, only to be held up in the house by two or three votes. one of the individuals not helping was the chair of the end of it -- share the education committee. i couldn't get them to take it to the floor for a vote because you make different decisions when you actually have to push yes or no. but if you are never forced to make that decision, you can say a lot of -- you can take a lot of different positions. i served in the state senate, and i can be hard on them because i was one of those legislators at one point. i had to make a difficult decision and it is not one i took lightly. i was either going to stand by and continue to be an enabler and not get legislation passed, or i was going to weigh in on some primaries. i would go out to legislators that were running, especially in

areas where there was a primary and the chair of the education committee wasn't in one of those areas. i asked his opponent if she was in favor of school choice. it was one of her number one priorities. i weighed in on nine primary races. we flipped eight of them. it was successful at i got the numbers we needed. the ninth one was really -- he just couldn't answer it. i couldn't lend by endorsement. endorsements only go so far. the issue won overwhelmingly. that is what i kept telling them this is what parents want to pair this is what parents want. i hear it as i travel across the state. the individual that we did not win, he met me the next day. she said, i am all team reynolds. we are ready to go. again, not a decision i made lightly.

but it was the right thing to do and we were able to -- it went to a vote. and we were able to be successful in getting across the finish line this year. >> thank you governor. and all of you for a great conversation. please join us outside in the foyer for lunch. >> thanks, governor. [applause]