NW Iowa lawmakers weekly reports
With just one week left until the first legislative deadline, when a number of bills must be passed out of committee, week seven of the 2011 Iowa General Assembly was primarily filled with committee meetings and sub-committee meetings in the Iowa House. Information on all the bills, amendments, and floor action can be found on the Iowa General Assembly website: www.legis.iowa.gov.
What is Really Happening to Iowa's Collective Bargaining Law?
The issue of collective bargaining is a hot topic around the nation. Wisconsin, Indiana, Ohio, and most recently Iowa, have been focal points for a debate about each state's own process for collective bargaining. In Wisconsin, Democrat Senators fled the state in order to prevent a vote that would require public employees to pay for a portion of their health insurance and pension plans. Their bill would also eliminate collective bargaining rights except in relation to wages.
Most Iowans are familiar with the issue that is being debated in Indiana. Indiana is attempting to pass Right-to-Work legislation, which prevents any worker from being forced to join or pay dues to a union in order to get or keep a job. The Indiana House Democrats' have also reportedly fled from their state to avoid a vote on this issue. Their current arrangement also known as "Fair Share" forces non-union workers to pay union dues regardless of their membership in the union. While Iowa remains a Right to Work state, several unsuccessfully attempts were made in 2007 to repeal these Iowa law provisions.
Iowa had its own protests this week as several changes to Iowa's collective bargaining law were proposed in HSB 117. On February 23rd, protests from union members and a counter-protest from Tea Party members occurred at the Capitol. A number of individuals spoke for and against the bill. Work continues on this bill in the Labor Committee. Changes being considered include:
(1)Allowing a public employee to opt out of representation by the union.
(2)Allowing the state to control what portion state employees pay for insurance (currently, 84% of state employees pay no premiums for health insurance).
(3)Allowing arbitrator's to make a decision between two opposing sides during the arbitration process.
(4)Forcing the arbitrator to compare public and private wages and benefits when possible (currently, the arbitrator does not have to compare to private wages or benefits).
(5)Forbidding the arbitrator from considering past bargaining agreements when negotiating new contracts.
"Re-Open Iowa for Business" Rules & Regulations Tour
On Friday, February 25th, the House and Senate Republicans will hold a "Re-Open Iowa for Business" forum in Sioux City beginning at 10:30 a.m. This event is part of a 10 city stop that is open to the public and media. It will be held in the Lincoln Center UPS Auditorium on the campus of Morningside College, 1501 Morningside Avenue, Sioux City.
For the past several years, employers - both small and large, entrepreneurs, farmers, city administrators, and others have increasingly become subjected to overly burdensome rules and regulations that have been adopted by government agencies. The objective is to collect specific input from Iowans across the state about the burdensome rules and regulatory climate that is hurting job creation and keeping employers from locating or expanding in Iowa.
Iowans sent a strong message this last November asking their elected officials to listen and get serious about job creation. The House Republicans have been working to get government out of the way so employers can start expanding and hiring again.
Governor Branstad Releases His New Preschool Plan
This year, much emphasis has been placed on whether changes should be made to the current public preschool program. Governor Branstad released his preschool plan this week. Currently, preschool is offered at no cost, even to those who could readily afford preschool. The Governor and House Republicans have argued that the current statewide voluntary preschool program costs too much and is unsustainable in the current budget climate.
The current program has cost the state taxpayers $156 million in just 4 years and that number will keep increasing until it reaches an annual cost of over $100 million. It is estimated to cost the state $70 million in the next school year. Governor Branstad's new plan contrasts sharply with the current plan as it proposes to spend $43 million in state money for the next school year for preschool tuition scholarships and requires parents to kick in an additional $7.5 million.
Under the proposed Iowa Preschool Program, all families would contribute something to their child's preschool. However, that amount would change based on the family income level. The program would provide scholarships of $3,000 per eligible four-year old which follows the child to an eligible preschool provider of the parent's choice. The program requires 10 hours of instructional time per week for 34 weeks in the year. A certified teacher will no longer be required, meaning private preschools will not need a certified teacher in order to qualify for funds. To assure teacher quality, a newly created early childhood certificate will be required.
House Works to Couple With Federal Tax Code
SF 209, which couples Iowa tax law to the Federal tax code for changes made between January 1, 2008 and January 1, 2011, passed the Ways and Means Committee with a bi-partisan vote of 17-7. The Legislature chose not to couple with the federal tax code the past few years which has been a source of frustration not only for taxpayers but also for tax preparers. The Federal changes include the repeal of the limitation of itemized deductions, expands the child and dependent care credit, maintains the student loan interest deduction, increases the limits on Section 179 expensing for business, and allowing teachers to take a deduction for classroom supplies.
As we work on various issues, I would love to hear from you. On February 26th, I will be participating in a forum in Sioux City at the Siouxland Center for Active Generations located at 313 Cook Street, Sioux City beginning at 10:00a.m. KSCJ radio talk show host Dr. Sam Clovis will be the moderator for the forum. I hope to see you there.
State Senator Randy Feenstra, Hull:
Governor Branstad’s Job Plan
The state needs a well thought out plan to create new jobs and a stronger economy in Iowa. Below is a picture that shows how far Iowa has slipped economically over the years:
• 106,500 Iowans are currently unemployed (6.3%)
• Iowa’s population growth in the last decade was the 10th slowest in the nation
• Of those states bordering Iowa, only Illinois had a slower population growth rate
• Iowa’s State Business Tax Climate is rated as the 45th worst in the United States
• Iowa is ranked 40th by the Small Business Survival Index as one of the least friendly policy environments for entrepreneurship
• Iowa is ranked 2nd highest in the nation for urban commercial property taxes and 2nd highest in the nation for rural commercial property taxes
• At 12%, Iowa’s top corporate income tax rate is the highest in the nation
(This information was noted in a handout given by the Governor)
New legislation has been offered by Governor Branstad to change the current structure of the Iowa Department of Economic Development. The new plan creates a partnership between the private business sector and government. Below are some of the new ideas in this plan:
• Replace the current incentive programs with a more focused set of incentives
• Use the best practices of the public and private sector that are results-oriented
• New commercial property would be taxed at 60%
• Current commercial property taxes would be rolled back 8% a year for five years
• Local governments would see a temporary revenue reduction due to this legislation, so the state will replace half of the estimated lost revenue
• Corporate income tax rate of 12% will go to a flat 6% for all Iowa corporations
By adopting the measures listed above, the state will help thousands of Iowa businesses, both large and small. They will have reduced income taxes and reduced property taxes; allowing them the opportunity to reinvest those savings to expand their operations and hire more Iowans. This will make Iowa one of the best places in the Midwest to locate or expand a business.
I applaud Governor Branstad’s aggressive agenda to reduce taxes on business which will create new jobs and lead to a vibrant economy for Iowa.
By Senator Bill Anderson, Pierson:
This week Governor Branstad rolled out his “Jobs Plan” for putting Iowans back to work. A major part of his plan is the restructuring of the Iowa Department of Economic Development. The Iowa Partnership for Economic Progress, under the leadership of Debi Durham, will eliminate the alphabet soup of incentive programs, develop a customer service attitude, use best practices of public and private sector, and create a 501c3 non-profit organization to house the Iowa Innovation Council. One of the most common complaints I have heard from economic development professionals is that the incentive system is too complicated. The Governor’s plan will correct that and expand opportunities for growth, retention and recruitment of business. Other major proposals are the lowering of both commercial property taxes and corporate income taxes. Both came up repeatedly on the campaign trail. The challenge is how to pay for the reductions. I will keep you up to speed as the proposal unfolds.
I held my second subcommittee meeting regarding SSB 1098, a bill establishing the reportable damage to a new car. The original bill would have set 5% of the dealer’s cost as the threshold. However, the Attorney General’s office raised concerns and drafted an amendment with tiered disclosure requirements. The subcommittee requested that all interested parties sit down and reach a compromise. Ultimately an agreement was reached with 4% as the new standard for reportable damage. The bill will move to the full committee next week, and then the senate floor.
The Ways and Means Committee was introduced to Courtney Kay-Decker, the Governor’s nominee for the Director of the Department of Revenue. Her nomination was approved and added to the individual calendar for confirmation. A bill relating to the Endow Iowa tax credit passed through the committee. It will increase the amount of tax credits that are available under the Endow Iowa Program. The amount available for the program will increase from $2.7 million to $3.5 million.
In Labor and Business we met with the Governor’s Workforce Development nominee, Teresa Wahlert. Director Wahlert shared her background and took questions. She is an impressive nominee who brings energy and new ideas to the position. She will play an important role in accomplishing Governor Branstad’s job creation goals.
I wanted to take a moment to let all of you know how much I appreciate your attendance at my recent town hall meetings. Two weeks ago in Pierson, I had over 30 people attend our meeting; one of the largest crowds yet. I would encourage you to take time to meet with your legislators, and I hope all of you are able to attend a forum at some point. There are a number of town halls left, including those scheduled for March which are listed at the end of this newsletter. I look forward to seeing you.
This week was a great week for visitors. I had realtors from Sioux City and Cherokee, and students from Marcus, Meriden, Cleghorn and Cherokee community schools. It is always a pleasure to see my good friend Joan Ballantyne from Cherokee.
March Town Halls
Saturday, March 5th
· Sergeant Bluff Town Hall, 9AM to 10AM, Community Center, 903 Topaz
· Sioux City Town, Hall, 10:30AM to 11:30AM, Morningside Public Library, 4005 Morningside
Saturday, March 12th
· Larrabee Town Hall, 9:30AM to 10:30AM, Fire station, 106 N. Main
· Cherokee Town Hall, 11:00AM to 12:00PM, Western Iowa Tech, 200 Victory Dr.
· Quimby Town Hall, 12:30PM to 1:30PM, City Council Chambers, 101 E. 2nd
Representative Dan Huseman, Aurelia:
The first week of March is Funnel Week, so there will be very little floor debate. Budget sub-committees will not meet in order to free up more time for standing committees to complete their work. Quite a few bills will advance, but most will die. The funnel helps winnow down the workload for the legislature, and basically establish priorities. Lawmakers are sometimes like school children who wait until the last minute to finish homework or studying, and wind up cramming in order to get everything finished on time. A funnel is a self-imposed disciplinary measure designed to keep lawmakers focused and on track. It is a good system that has worked well over the years.
Earlier in the session, the House passed HF 45 and sent it to the Senate. The bill made about $500 million worth of budget cuts over the next three years. The Senate took up the bill this week and basically gutted it. They sent it back to the House with only $10 million worth of reduction over three years. I believe Senate Democrats thought we would fight it and the bill would die, but we accepted their version and sent the bill to the Governor for his signature. Even though the savings are paltry, we decided to take what we could get for now, knowing that many of the priorities stripped out by the Senate are still alive in other budget bills.
The Governor's office has filed a bill which would serve as the structural reorganization of the Department of Economic Development. This is the second attempt at creating a public-private collaboration to take care of the state's economic development. The whole idea behind the legislation is to have everyone working together to attract new business and expand existing businesses here in Iowa. This is a new concept and there is going to have to be a lot of fine tuning to this bill before it is perfected. I am willing to give the private-public concept a chance. Instead of bureaucrats picking winners and losers, business leaders will be available to provide valuable information to new prospects and existing companies.
Governor Branstad announced his three Supreme Court picks this week. The Governor was forced to fill the three vacancies on the court because, as you may recall, three justices were not retained in the last election. It is unusual for a Governor to make multiple appointments, but this was an unusual situation. The Supreme Court will now be full at seven members, even though there is a movement to have the current four impeached. I do not believe that will happen, as it seems that most Iowans are satisfied with our current system of choosing and removing judges, if necessary.
The state of Illinois has a massive budget deficit, and they have just recently raised income taxes. The Governor there has also proposed a series of cuts to various health and human service providers, such as nursing homes. He is talking a 6% cut. This is in contrast with a proposal by Governor Branstad to provide a 5% increase to Iowa nursing homes. Something troubling about Illinois Governor Quinn's proposed cuts is that he really whacks substance abuse treatment. What this means is that Illinois residents will now be coming into Iowa for treatment because our residency requirements are quite loose. If this happens, Iowa's Medicaid system and taxpayers will be asked to pick up the tab. There is a bill being considered here in the Iowa House designed to address this issue. It will simply require Medicaid applicants to prove Iowa residency. Pretty simple, and I wonder why this hasn't been addressed before.
Representative Dwayne Alons, Hull:
The issue of collective bargaining is a hot topic around the nation. Wisconsin, Indiana, Ohio, and most recently Iowa, have been focal points for a debate about each state’s process for collective bargaining.
In Wisconsin, Democrat Senators fled the state in order to prevent a vote that forces public employees to pay for a portion of their health insurance and pension plans, and the bill also eliminates collective bargaining rights, except for wages. Republicans in Wisconsin control the Senate, the House, as well as the Governor’s office. Gov. Walker has vowed a vote on the bill and is not about to compromise.
Iowans are not unfamiliar with the issue that is being debated in Indiana where a scene similar to Wisconsin flared up as Democrat House members have reportedly fled the state. Indiana Republicans are attempting to pass Right-to-Work legislation, which prevents any worker from being forced to join or pay dues to a union to get or keep a job. The current arrangement, also known as “Fair Share,” forces non-union workers to pay union dues regardless of their membership in the union. Iowa is currently a Right-to-Work state, and Iowa Democrats attempted to change that in 2007 by repealing those provisions in Iowa law. Their attempts ultimately failed in the House after the bill had originally passed the Senate.
Iowa had its own run in with labor issues this week. Wednesday saw a protest from union members, and a counter-protest from TEA Party members. Also under discussion in a Labor sub-committee that afternoon was HSB 117, which is a bill sponsored by House Republicans that affects the collective bargaining law in Iowa.
The subcommittee heard from a variety of individuals who spoke for and against the bill. The major changes in the bill include: the ability of a public employee to opt out of representation by the union, allowing the state to control the portion state employees pay for insurance (currently, 84% of state employees pay no premiums for health insurance), allowing an arbitrator to make a decision between two opposing sides during the arbitration process (currently, the arbitrator must only choose either side A’s offer or side B’s offer), forcing the arbitrator to compare public and private wages and benefits when possible (currently, the arbitrator does not have to compare to private wages or benefits), and forbidding the arbitrator from considering past bargaining agreements when negotiating new contracts.
The bill will continue to be worked on by Republicans, who have invited their Democrat counterparts to provide input into making the bill better and then send it to the Labor Committee.
Some Relief for Speeding Tickets in Transition Zones
House File 239 passed the House Transportation Committee on Tuesday with unanimous support.
Currently when the Department of Transportation considers a license suspension or revocation, they are required to disregard the first two speeding tickets a driver receives within any 12 month period when the violations were for less than 10mph over the speed limit and in a 34—56mph speed limit zone. The bill raises that ceiling to 61 miles per hour.
The reason behind the change is an attempt to accommodate those “transition” zones on where the speed limit might go from 70mph to 60mph and then to 55mph. House File 239 does offer some protection for drivers who might be caught in those quick transition zones.
In addition, the bill also directs that the official record provided to insurers must include a designation as to which speeding violations were for 10mph or less over the speed limit in speed zones with a speed limit between 35mph and 60mph (previously the ceiling was 55mph). The bill also states that car insurance companies must disregard the first two speeding tickets in a 12 month period that are for no more than 10mph in a speed zone between 35mph and 60mph for purposes of insuring or cancelling a policy. House File 239 now moves to the floor as committee bill.
House Adds to Senate Supplemental Bill
Senate File 209 which couples Iowa tax law to the Federal tax code for changes made between January 1, 2008 and January 1, 2011 passed with a bi-partisan vote of 17-7. The Legislature has chosen not to couple the past few years which has been a source of frustration not only for taxpayers, but also for tax preparers.
The Federal changes include the repeal of the limitation of itemized deductions, expands the child and dependent care credit, maintains the student loan interest deduction and increases limits on Section 179 expensing for business. In addition, teachers can take a deduction for classroom supplies.
The original Senate File only allowed individuals and corporations to couple with the federal tax code beginning January 1, 2011. The House Ways and Means Committee amended the bill to allow individuals and corporations to couple with tax years beginning on January 1, 2010 and for businesses to take enhanced bonus depreciation in 2010.
Enhancing bonus depreciation encourages firms to accelerate otherwise planned investment spending forward – thus giving the economy a much needed boost. Businesses will get deductions for machinery, equipment, software and other items to grow their business. This will help spur job growth all over the state, at all income levels. With over 100,000 Iowans still out of work, this bill delivers a $311 million stimulus to our economy over the next three years.
The original Senate File included an increase to the Earned Income Tax Credit (EITC) from 7% to 10% increasing the total impact of the EITC from $30 million to $44 million. House Republicans voted to keep the EITC at the current level of 7% as any increase in the EITC needs to be discussed in conjunction with the 20% income tax already approved by the House. The 20% across the board income tax cut impacts all Iowans not just those earning under $45,000 as the EITC. The 20% income tax cut provides working Iowans 2.5 times the tax relief and impacts 257,000 more Iowans than the Senate Democrats’ expansion of the EITC.
February 25, Inwood, Market Place Grille, 12:00 noon
February 26, Rock Rapids Forster Community Bldg., 8:00 am, “Eggs and Issues”
March 11, Boyden Public Library, 10:30 a.m.
March 11, George Pizza Ranch, 12:00 noon
(Content of newsletters is unedited)