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The Finish Line
At 3:38pm, on Friday, June 5, 2015, the Iowa House completed all its intended action for the year by adjourning "sine die." Sine Die means "without date" and is always the last action taken by both the House and Senate every year. Passage of the sine die resolution indicates the Legislature will not reconvene again until it is ordered to by the Iowa Constitution which calls the Assembly to convene on the Second Monday of January. The Governor can call the Legislature back for a Special Session, but that is a rare occurrence in Iowa.
Once one chamber passes the Sine Die resolution, the other chamber has three days to follow suit, or else they are no longer adjourned for the year. This year, the Senate followed suit about ten minutes later and the 2015 Session of the 86th General Assembly was officially over at 3:48pm on the 145th day of the 110-day session.
With the exception of a temporary diversion to focus on an infrastructure improvement bill that included a gas tax increase, the entire 2015 session was consumed with K-12 education funding. It was both one of the first votes taken in each chamber this year and one of the last, finally passing in "agreed-to" form on the final day of the session. The final budget increased K-12 funding by 1.25 percent, the original amount passed by the Iowa House, but also includes a one-time $55.7 million expenditure for schools that increases the new money for K-12 schools to about 2.62 percent. That one-time expenditure was included in a separate one-time funding bill (HF 666) that also included $43 million for Medicaid as well as a number of other programs.
The education funding debate, while extremely heated all session, was fought with the best of intentions from both sides. First off, the two parties had fundamental differences with how they calculated the revenues that were available to spend and whether spending targets should include the previous year's spending or revenues. Democrats in the Legislature argued repeatedly that education should be the first and top priority of the Legislature, and that the money is there to provide better resources to teachers and schools. Republicans argued that the economic indicators they were seeing in the agricultural economy, as well as unforeseen issues like avian flu, demand that the Legislature be more conservative with its funding this year. Unfortunately, since the budget only addressed the school year that begins July 1, 2015 and ends June 30, 2016, this debate will begin anew in seven months.
While education funding soaked up all the headlines, the Legislature did actually work on dozens of other issues, some successfully and some not. Broadband and school start date were resolved. However, bullying legislation, fireworks, texting while driving and a host of other issues were thrown overboard and will become live rounds again next year. Expect next year's session, in an election year, to be fast-moving and loaded with political maneuvering. Now is a GREAT time to reach already to your House and Senate members, invite them for coffee, ask them about the session, and then start planting the seeds for next year with them.
Economic Development Legislation
The TIF bill (HF 628)
we emailed you about in early April ultimately DID NOT get considered by the full Iowa House of Representatives this session. The day before final adjournment, they re-referred HF 628 back to the House Ways & Means Committee, so this effort will start anew in 2016. When you are talking to your legislators in the months ahead, be sure to explain to them that
PDI is registered as opposed to the bill because we believe it should be amended to allow a lot more flexibility.
Economic Development Budget (SF 499)
The IEDA Budget faced some serious challenges this session. In the final version of the bill though, neither the IEDA's Administration budget nor the High Quality Jobs Program saw a cut. It is worth noting though that since the Legislature has not passed a "salary bill" in many years now (to cover cost-of-living increases for state employees), a status quo budget for any state department really means a reduction since the department has to fund salary increases through their budget. Here are some highlights of the bill:
- Level funding for IEDA Administration budget
- Level funding for the High Quality Jobs Program at $16.9M
- $3M - Regents Economic Development - level funded, 35% each goes to Iowa and ISU, and 30% goes to UNI
- $712K - World Food Prize - Cut of $88K, but $100K in RIIF funds means an overall $12K increase
- Elimination of $1M for STEM internships
- Zero funds for Home Base Iowa marketing ($500,000 requested by the Governor)
- $200K for Councils of Government (COGs)
- The bill also requires the Iowa Economic Development Authority (IEDA) to establish a Nuisance Property Remediation Fund and contains related information.
Renewable Chemical Production Tax Credit
In the final weeks of the session, we sent you two alerts about the Renewable Chemical Production (RCP) Tax Credit proposal. THANK YOU to everyone who responded by weighing in with your legislators! Ultimately, while the House did pass the RCP language twice, we were unable convince the Senate to support the new program.
The IEDA and the many supporters of the bill intend to pursue the legislative authorization for the program again next year. To refresh yourself about the proposal, you can view the bill HERE and the issue brief HERE. Be advised that the final version of the Standing Appropriations bill (SF 510) DID contain the Angel Investor language that you'll find summarized on end of page 2 and page 3 of the issue brief.
The Legislature did take action in the closing moments of the session on broadband legislation that provides property tax abatement for companies investing in infrastructure to be able to deploy broadband services in the underserved/rural areas. The legislation was not as aggressive as what the Governor had proposed, but looks to be a step in the right direction.
A Couple Bills to Watch Next Year
The advocates for Iowa's Water and Land Legacy (IWILL) were able to get a bill (HSB 256) to fund the Natural Resources and Outdoor Recreation Trust Fund through a 3/8 cent sales tax increase introduced in the House on the last day of session. Representative Sands, Chairman of the House Ways & Means Committee, wrote the bill, which also includes some changes to the Trust Fund's funding formula as well as the establishment of an Iowa Alternative Minimum Tax.
With an IWILL bill now introduced in both chambers, expect to hear a lot of talk from IWILL advocates this summer and fall in preparation for the upcoming 2016 legislative session.
Iowa Next Falls Short
Senator Bill Dotzler tried until the final moments of the legislative session to push through a modified version of the Governor's Iowa Next proposal. In the end, there were too many questions among both Senate Republicans and Democrats that needed answering before they could move such a big proposal. Expect to see much more activity on this next session, starting with discussions that are sure to begin in the months ahead.
Remember that ALL funding is generally subject to Line Item Veto by the Governor. If you have some things on the list of particular importance to you, you should consider weighing in with the Governor's office (at https://governor.iowa.gov/contact).
Infrastructure Budget (HF 650)
- $9.6M - Water Quality Initiatives - Increase of $5.2M over last year
- $9.6M - Lake projects to improve watersheds - level - funded
- $1.75M - Low-head dam mitigation - cut by $250,000
- $5M - State park infrastructure - level
- $3.4M - Trail appropriation - cut roughly in half (current year - $6 million)
- $1M - Great Places initiative - level
- $5M - Community Attraction and Tourism - level
- $2M - Railroad Revolving Loan Fund - Cut in half
Ag/DNR Budget (SF 494)
- $1M - Conservation Resource Enhancement Program - level-funded
- $950K - Watershed Protection - level
- $6.75M - Soil & Water Conservation - level
- $600K - Loess Hills Development and Conservation Fund - level
- $6.135M State Park Maintenance - level
- $2.995M - Water Quality Monitoring
- $16M - Resource Enhancement and Protection (REAP) - level-funded
Bills Being Tracked by PDI
Posted below are the bills that appear in the PDI bill tracker right now. Click the links to read more information about them.
Prohibits government entities from charging a fee for access to project contract documents when such documents are provided electronically.
Makes changes to rural improvement zones.
Appropriates federal block grants and other federal funds.
|HF645 ||Sent to Governor|
Makes changes to laws regarding renewable energy tax credits.
|HF650 ||Sent to Governor|
Appropriates $119.1 million in gaming dollars from the Rebuild Iowa Infrastructure Fund (RIIF) for various infrastructure projects in FY16. Appropriates $5.8 million in FY17.
|HF658 ||Sent to Governor|
Appropriates $992.2 million for education programs in fiscal year 2016 ($6.1 million increase over current year spending). Also spends another $40.3 million from the Skilled Worker & Job Creation Fund (same as current spending levels). Funds the second of this two-year budget at 50% (legislators will come back next year and adjust to full year spending).
|HF666 ||Sent to Governor|
Appropriates funds from the state's ending fund balance, so these funds are considered "one-time appropriations."
|HSB256 ||House Ways & Means Committee |
This bill would implement the 3/8 cent sales tax increase for the Natural Resources and Outdoor Recreation Trust Fund. The bill also contains significant changes to the Trust Fund's voter-approved funding formula and creates an Iowa Alternative Minimum Tax (AMT).
Increases the gas tax by 10 cents to pay for critical road and bridge construction projects.
Allows the Office of the Ombudsman d to get copies of the minutes and audio recordings of closed session governmental body meetings without a court order, if the purpose is to resolve complaints alleging violations of Iowa's open meetings law.
|SF499 ||Sent to Governor|
Appropriates $42.3 million for economic development, cultural affairs, and workforce programs and agencies for FY16, a decrease of $331,000 over current year funding. Also appropriates a total of $27.9 million from other funds for FY16 (no change from current funding levels). Appropriates 50% of that amount for FY17 (legislators will come back next year to adjust).
|SF510 ||Sent to Governor|
This is the annual "standings" budget, which makes appropriations for all code-required appropriations and, as the typical last bill of the year, becomes the catch-all for legislation and appropriations that didn't find their way into law through the normal legislative process.
|SF513 ||Sent to Governor|
Allows government to continue to operate while the Governor makes decisions on budget bills (Governor has 30 days after session ends to sign bills, but that puts the state into the next fiscal year without a budget, as the state fiscal year ends June 30, 2015).
Since session has ended, this will be the last legislative update of 2015. However, be on the lookout for legislative alerts as the Governor over the next 30 days makes his decisions about the bills he has been sent.