Thank you. Thank you. Thank you. Madam Lieutenant Governor, mr. Speaker, madam speaker let me start over again here. Madam Lieutenant Governor, mr. President , madam speaker, legislative leaders, legislators, judges, elected officials, distinguished guests, family, friends and fellow iowans. Im honored to address a joint session of the General Assembly delivering the condition of the state for the final time as your governor. For 22 years, i have addressed this body as governor and today i want to especially welcome the 22 new legislators who are with us from both sides of the aisle who were elected in november. Your constituents sent you to work hard, to work for them, and to help make iowa a better place. I hope youre filled with the same sense of excitement and eagerness i had when i first served in the legislature in 1973. Lieutenant Governor Reynolds and i look forward to working with each of you and listening to your ideas on how to make our state an even better place for families to live, work and grow. In that spirit, i am today extending an invitation to each legislator to meet with me personally during this legislative session. We also gather again with shared sadness. Returning to do our work without our friend, senator joe sang from davenport. Joe was a devout catholic and a true statesman. We enjoyed his contagious and positive personality in working with him. [ applause ] as i look back at my years of public service, im thankful to those iowans who step forward to serve their fellow citizens. Please join me in applauding those iowans who help make our state and nation safer by serving in the military, Law Enforcement and first responders. [ applause ] since taking office in 2011, weve made the necessary changes to strengthen our economy and improve the quality of life across our state. Weve made tough decisions to give iowans a smaller and smarter government. Weve stayed the course with an unwavering commitment to create jobs, increase family incomes, reduce the size of government and give iowa students a globally competitive education. We provided significant tax relief for iowans the past five years, especially for commercial property taxpayers. And last month, lieutenant Governor Reynolds and leaders of the Economic Development authority and the department of transportation unveiled iowas most comprehensive energy plan. The plan was developed with collaboration from the private sector, the public sector, educators, nonprofits and utilities. Iowa is already a leader in low cost and renewable energy. The comprehensive new energy plan will help build on our past energy successes and reaffirms our commitment to maintaining iowas Energy Leadership for the future. I am proud weve made government smaller and smarter. Our unemployment in the state has dropped from 6. 2 to 3. 8 . The state has helped to track 13. 5 billion in private sector Capital Investments which have translated to jobs across iowa. And more iowans have been employed these past few years than any other period in our states history. Weve also made the tough decisions to ensure government lives within its means, like iowa families must do. Weve accomplished this with a relentless focus on fiscal discipline, demanding budget predictability, fully restoring our iowa reserve accounts and reducing the states debt liability. Together we made progress with our goal of restoring iowa schools to the best in the nation through sieeries of landmark reforms and innovative policies, to improve iowas education standing we need to make sure more is done to help our hardworking teachers make sure they have the tools necessary to succeed given Higher Expectations for all students. So we created the new teacher leadership system that better utilizes the expertise of top teachers to improve education, instruction and foster collaboration. Im proud to say that every Public School in iowa today is participating in the teacher leadership system. To ensure that our children are prepared for the 21st century, we advance the nationally recognized s. T. E. M. Initiative that gives students the confidence and skills for rewarding careers. The s. T. E. M. Initiative is led by Lieutenant Governor kim reynolds and kimmon Industries President and ceo dr. Chris nelson and has seen outstanding growth and success. Sustaining these measures over time is critical to get the right results for our students and our state. The ability of iowans to overcome challenges bolsters my optimism about our states future. When faced with challenges, iowans consistently seek opportunities. Some of the challenges that weve overcome, like the farm crisis of the 1980s, tore at the very fabric of our communities. In 1980s, bloomfield, iowa, a community in davis county southeast iowa struggled like many other communities across the state. An uninsured bank in bloomfield closed in 1983 and caused great loss for area families and businesses. And area farmers were straddled with debt and limited Market Opportunities for their crops. However, through a persistent focus on Economic Diversification and an entrepreneurial spirit to rebuild its community, bloomfield now has new manufacturers that are growing alongside innovative startups. And to continue their effort to stay on the cutting edge, Community Leaders are instituting aggressive strategies to become iowas first Energy Independent community by the year 2030. I visited bloomfield last year. And was impressed with their main street revitalization, a new Hardware Store and m3 fabrication manufacturing plant. And woodbine, iowa, is another example of a community that took its future into its own hands. The community showed how an integrative approach to Community Revitalization that focuses on Historical Preservation and Community Sustainability can redefine a struggling small rural community. Woodbien also had a bank close in the 1980s but the community turned its challenge into future growth and diversification. Lieutenant Governor Reynolds and i visited woodbine and were impressed with the success of their main street program. And waterloo, iowa, after experiencing economic challenges throughout the previous three decades embraced the challenge of reshaping its Industrial Heritage to succeed in modern times. Ce cedar valley tech works has made waterloo a nationally recognized leader for manufacturing innovation. And john deere continues to be a leading manufacturer and innovator in waterloo. In the balcony today are leaders from bloomfield, woodbine and waterloo, please join me in congratulating them on their accomplishments and supporting their future success. Where are they . Okay. [ applause ] iowas industries are increasingly high tech, including advanced manufacturing. In total, iowa has over 6,100 manufacturers that contribute over 31 billion to iowas economy and employ over 200,000 iowans. Over next year, the iowa Economic Development authority will work with iowa manufacturers to advance a year of manufacturing to help grow this important part of iowas economy. We should also be proud that iowa remains an agriculture powerhouse that feeds and fuels the world. Thanks to the hard work and innovation of iowas farmers and agriculture producers. We just set an alltime record for ethanol production. We set a new record for biodiesel production by adding an additional 55 million gallons and we lead the nation in the percentage of electricity generated by wind. We now generate over 35 of our electricity from wind. We expect that number to exceed 40 by the year 2020. We love wind. Over the last 30 years, weve significantly added to our agriculture commodities. Weve diversified the iowa economy by expanding exports and supporting growth in biofuels, wind energy, data centers, fertilizer plants, biorenewable chemicals, advanced manufacturing, insurance and financial services. These Newer Industries employ hundreds of thousands of iowans in rewarding careers. And while im pleased with this progress and optimistic about our future, i believe theres more work to be done. We must seize the opportunity that is before us. This new General Assembly brings new dynamics, new expectations and new opportunities to deliver positive results for iowans. Our state is in an admirable position. Many states are strapped with crushing debt, poor Credit Ratings and a bleak economic outlook. But iowa is a shining example of what hard work and smart, tough choices can do for a growing business and nurturing families. While the december revenue estimate is lower than previous projections, the estimate still shows a modest increase in state revenues. Although we faced a headwind out of washington, d. C. , that is stifling our agriculture economy, we still have positive revenue growth. But we must proceed with caution and not repeat the mistakes of the past. With that prudence in mind, i present my proposed adjustments to the current fiscal year budget to you today. These adjustments are required by law. My proposal does not include across the board cuts. Does not reduce funding for k through 12 education, does not reduce property tax credits and does not include furloughs for state employees. The budget reductions im recommending for this fiscal year are difficult. But they maintain our funding, mutual they do maintain funding for mutual priorities. Im committed to working with legislative leaders and with all of you to implement these adjustments. For the coming biennium, im presenting a complete twoyear budget that is balanced each year and meets our fiveyear projections for a sustainable future. This budget is based on the principles laid out by the iowa taxpayers association. It prioritizes education, health care, Economic Development and Public Safety. And it redirects Family Planning money to organizations that focus on providing health care for women and eliminates taxpayer funding for organizations that perform abortions. On my first trip to china in 1984, i learned that the chinese word for danger and opportunity is one and the same. Today, america and iowa exist in a challenging world. We must seize the opportunity to make it a better place. In 2010, lieutenant Governor Reynolds and i promised to reduce the size and scope of government. Im proud to report that we do have a smaller, smarter government. With a steady focus on improving services for our citizens in a more timely and efficient manner. Yet while the size of government is smaller, the benefits for Public Employees at the state and local level have increased. Unfortunately, the cost of these benefits have grown dramatically. Because of our antiquated collective bargaining system that has led to over 500 health care plans, many of which are inefficient and way too costly for Public Employees and iowa taxpayers. Under our present system, a few Adverse Health outcomes can destroy the budget of a city, county or school district. By replacing this system with one comprehensive statewide contract, we can spread the risk and dramatically reduce the costs using a uniform Health Care Benefit system similar to the Ipers Program for retirement, we can provide Quality Health care at a significantly lower cost and give local governments more flexibility to provide better wages and meet other needs. The statewide Health Care Contract also needs to reward the employees who take ownership of their own health by conducting Health Risk Assessments and taking actions to improve their own health. We have made a commitment to examine each and every dollar of revenue and expenditure in order to maximize efficiency and respect our hard working taxpayers. We are committed to a smaller and smarter government that seeks innovative ways to provide services. Rather than blind adherence to the way things have always been done. Im asking this General Assembly to take a comprehensive review of all of iowas state boards and commissions to address unnecessary barriers that prevent competition and raise costs. I encourage you to ask the tough questions that challenge the status quo. In iowa, 90 of our General Fund Budget is spent on three items. K through 12 education, medicaid and employee wages and benefits. The state is significantly increased funding for education since 2011. Amounting to over 654 million additional. Education and job training are the foundation for our future economic growth. Growing our states Talent Pipeline needs to be a top priority, even with modest revenue growth. My recommendations include an increase of 78. 8 million for k through 12 education for fiscal year 2018 and an additional 63. 5 million for fiscal year 2019, which equates to roughly 2 growth each year. So this year, lets show iowans we can make these decisions early and meet the legal requirements of supplementing state aid for fiscal years 2018 and 19 in the first 30 days. The second big driver in the states budget is health and Human Services spending. Together, weve transformed our Mental Health system to a communitybased model. Weve obtained a federal waiver for our iowa health and wellness plan which has reduced charity care for iowa hospitals. And like 39 other states, weve modernized our medicaid program. As a result, weve created a new system where more iowans have access to Mental Health services closer to home than ever before. More iowans have Health Insurance than ever before and more than 80 new Value Added Services are now being offered under our modernized medicaid program. Weve also replaced the medicaid system with a coordinated team of Health Care Professionals to ensure that patients see the right provider at the right time. As a result of these reforms and innovation, we have improved the focus on Health Outcomes and saved taxpayers 110 million. Our increase in Education Funding last year was made possible because of our modernized medicaid efforts. Without these vital reforms, the budget choices before us today would be twice as hard. In order to grow iowa, we must also look at policies and reforms that will continue growing family incomes. One way to do that is to close the skills gap, which in many ways is the biggest challenge facing us in the next decade. Thats why lieutenant Governor Reynolds and i set the future ready iowa goal that 70 of iowas work force should have education and Training Beyond High School by the year 2025. Today less than half the work force has that. Accomplishing this ambitious goal will create unpre presprec opportunities for iowans. Thats why we established the future ready iowa alliance, which is cochaired by lieutenant Governor Reynolds and dan houston from principal. They will be making recommendations by october 31st, 2017, to assure that more iowans have the careers they deserve and employers can hire the skilled workers they need to grow and innovate. Even with a tight budget, we should continue to prioritize initiatives that will grow iowas Talent Pipeline. Like the s. T. E. M. Initiative, registered apprenticeships and workbased learning for iowa students. Please help me recognize students who are here today from Jackson Elementary School in des moines, mondra rant and wakee high school which has one of the premier workbased learning programs in the state. Students, thank you. The students in the gallery represent children from across iowa who are counting on all of us to modernize the schools for the 21st century. Thats why lieutenant Governor Reynolds and i launched the comprehensive Computer Science initiative. Were encouraging every high school to offer at least one high quality Computer Science course, every middle school to provide exploratory Computer Science and every Elementary School to provide an introduction to Computer Science. All students need to learn how computers operate because its fundamental to their life and work. Computer science will provide students a chance to join one of the Fastest Growing and best paying fields. No student should miss out on this opportunity because of where they live. This is another step to better align education and training with essential work force needs. We all care deeply about the safety of our families, our friends and our neighbors. However, troubling trends have begun to emerge that threatens iowas safety on our roads. Traffic deaths were 315 in 2015. But jumped to 402 in 2016. That is unacceptable. Earlier this year, i called on the department of Public Safety and the Governors Traffic Safety Bureau to lead a working group to study this disturbing trend. The group with the support of key stakeholders, including Law Enforcement, made recommendations that are worth your consideration. Im asking you to take a hard look at these recommendations and evaluate which can be put into law to make our roads safer. Unfortunately, too many innocent bicyclists, motorcyclists, pedestrians and passengers have lost their lives on our roads. Last year, i received a handwritten note from christine and darrel harkin, parents of grace harkin, who lived near riceville. They wrote, our daughter, gracies life was so sadly ended on july 29th, 2015 by someone who was driving and texting. Grace was biking safely and lawfully during a morning bike ride when a driver who was texting struck and killed her. They went on to write, grace would have forgiven the driver and moved forward. Thats what weve chosen to do. But we miss her so. Grace harkins life was tragically ended way too early. Modern technology should comp with new responsibilities. I ask all iowans to join the iowa Law Enforcement in the community, first responders, the league of cities, all of our major cell phone carriers, the Insurance Industry and the medical community in demanding real change in the laws for distracted and impaired drivers. Last year, i called on t legislature to send me a Water Quality improvement bill. I was pleased with the bipartisan progress made on this front here in the house of representatives with 2541 last session. This bill was approved by the agriculture, ways and means and appropriations committees and passed with 65 votes. This bill provided longterm, dedicated growing source of revenue to help implement projects to improve habitat and Water Quality directed by the iowa nutrient reduction strategy. The bill provided funding for Community Conservation practices and improvements for wastewater and Drinking Water facilities. By leading on this issue together, we have the opportunity to modernize iowas agricultural infrastructure, create jobs in rural iowa and promote collaboration between urban and rural communities. I believe our discussions should begin with the house passed bill from last session. I hope we can Work Together to perfect and improve the legislation that will provide a longterm dedicated growing source of revenue for Water Quality improvements. I have been so blessed to serve as your governor, serving the state i love for 22 years. Im confident iowa will continue to move forward because iowans care deeply about their neighbors, their communities and creating an even better future. Im extremely thankful for perhaps the most patient person in the state, my wife, chris. As she has served as first lady with grace, shes welcomed iowans and visitors from around the world to terrace hill and shes volunteered to help in many ways, including reading to students from Jackson Elementary School. She, chris and my entire family, thank you for your sacrifice during my time of service, public service. Thank you very much. [ applause ] chris told me she felt bad about missing out on reading to the first graders from jackson elementary this morning, but honey, i appreciate you being here. Im also thankful for the friendships weve made in all 99 counties, friendships that we will always cherish. And im grateful for the prayers from iowans that have encouraged me along the way. Theres no better job in the world than being governor of the state that you love. But sometimes were called to serve in ways that we never imagined. As i approach the u. S. Senate confirmation process, my priority continues to be serving the people of iowa with the same energy and passion that i have brought to this office each and every day. Thank you. God bless you and all the people of iowa. [ applause ] the u. S. Senate today confirmed business woman betsy devos as education secretary. The vote was 5150. Vice president mike pence was in the Senate Chamber and cast the final vote to break the tie. Senate also voted to advance the nomination of senator Jeff Sessions to be the next u. S. Attorney general. If all debate time is used, a final confirmation vote could happen at about 6 50 p. M. Eastern tomorrow evening. After that, the chamber will then move on to consider congressman tom price to head health and Human Services department and Steve Mnuchin as treasurer secretary. Live coverage of the u. S. Senate is on cspan 2. Coming up next from boise, idaho, governor butch otter with his annual message to state lawmakers. You can watch more state of the state speeches at cspan. Org by typing your state in the search bar. Honored guests, friends, my family and, of course, our first lady, miss lori