PDI POLICY PERSPECTIVES | February 19, 2017
Click for PDI Bill Tracker

Legislative Session Update
Monday, February 20, 2017, marks the 43rd Session Day of the 2017 Session of the Iowa General Assembly, the start of week seven. This past week has been the most contentious week in the Capitol in many years, as protestors swarmed the buildin
Over 4600 union members flood the first floor of the Iowa State Capitol protesting Collective Bargaining legislation_ February 13_ 2017
Over 4600 union members flood the first floor of the Iowa State Capitol protesting Collective Bargaining legislation, February 13, 2017
g to watch debate on legislation to alter Iowa's laws governing the collective bargaining rights of non-public-safety public employees, otherwise known as "Chapter 20." The crowds reached a high point of over 4,600 on Monday, as protesters filled the entire first floor of the Capitol and were especially thick outside the old Supreme Court chamber where a public hearing was being held on the bill (HF 291).
 
Consideration of the bill began in both chambers simultaneously on Tuesday afternoon. With Republicans controlling the House, Senate and Governor's Office, the Democrats in the minority were forced to use the only tool the minority party has - the ability to say your peace on an issue by offering amendments and slowing debate as much as possible. On Thursday, the third straight day of debate, the majority party employed a mechanism called "time certain" in order to end debate and force a vote on the legislation. This is mechanism that is very rarely employed in the Iowa House and was used in the Iowa Senate for possibly the first time, at least in anyone's memory.
 
With debate time expired, remaining amendments and then the bill was voted on without further comment. The bill first passed the House, 53-47, with all Democrats and six Republicans voting against the bill (Representatives Baudler, Heaton, Hanusa, McKean, Lundgren and Moore). The bill then passed the Senate, 29-21, with all Democrats and
Union members turn their backs to the Iowa Senate during the final passage of Collective Bargaining legislation_ February 16_ 2017
Union members turn their backs to the Iowa Senate during the final passage of Collective Bargaining legislation, February 16, 2017
independent Senator David Johnson voting against the bill.  The Senate did so while under a "Call of the Senate," a rarely-used procedure Democrats invoked to insure all 50 Senators were locked inside the Senate Chamber for the final hours of debate on the bill. The Governor signed the HF 291 into law on Friday.
 
The intense debate on collective bargaining made it nearly impossible to accomplish any other substantive work this week. While many subcommittees on bills and committee meetings still took place, legislators' attention was largely focused on the task at hand with the collective bargaining debate.   Now with two weeks before the first major legislative deadline - the first funnel - legislators will need to focus on moving priority bills through subcommittee and committee if they want to keep them alive for the year.
 
Collective Bargaining
So, what did this big collective bargaining bill do? I'm sure you saw it all over your local news. Many reports were loaded with one-sided information or misinformation, so it's sometimes difficult to track down a decent summary of the legislation. Basically, the bill contained the following main sections:
 
Disclaimer: This is the simplest way we can explain this complex bill in an attempt to not show a bias for or against it, while still respecting that many people on both sides of the aisle are very raw about the issue. As such, apologizes to anyone who read this bill much differently. The truth is that the effects of HF 291 will take a few years to be fully evident.
 
  • Scope: For non-public safety public employees, the bill would make wages the only subject that would be mandatory in negotiations. Other issues could be added at the consent of both labor and management, but some issues are no longer allowed to be negotiated. (The most contentious of these was health care. Health care is still required to be provided, but the specifics can no longer be negotiated).
  • Arbitration: This is one of the biggest changes made in the entire bill. Under previous law, in cases where a negotiation proceeded to arbitration, the arbiter was limited to choosing one of the last two proposals put forward. Republicans pushing the bill argued that unions were always on the winning side of arbitrations because of this and other provisions. To counter that, they gave the arbiter much more flexibility, and made several other changes to tip this the other way, including cost-of-living caps on how much wages can rise.
  • Recertification: Requires 50% of the employees in the bargaining group to vote to "certify" the group before a new contract negotiation. Previously, unions did not have to have certification votes unless the membership wanted to do so.
  • Withholding: Prohibits the employer from having to withhold union dues. Unions would need to conduct automatic deductions on their own now.
  • State Contract: Disallows a lame-duck Governor in Iowa from approving a labor contract without the newly elected Governor having input.
  • Other: The bill contains a number of other provisions.
With collective bargaining finished, what is next on the horizon?
Legislators are surely starting to have discussions internally about the FY 2018 and 2019 budget, but we do not expect to see the first pieces of that until March. In the weeks ahead, they will focus on finishing up legislation to pull state funds from Planned Parenthood and legislation to standardize the minimum wage across the State (often called "preemption"). We also know they are looking into fireworks legalization, fantasy sport gambling, medical marijuana expansion, voter ID, medical malpractice reform, worker comp and a number of different approaches to addressing water quality.
THANK YOU to all those that attended PDI's Grow Iowa Day at the Capitol on Wednesday, February 8, 2017!! Despite scheduling challenges and some snowfall, many great conversations took place between PDI members and their legislators.

If you weren't able to attend, please take a moment to weigh in with your legislators. Just introduce yourself, tell them you are a member of PDI, and offer to give them feedback on any economic development legislation that comes up this session.  Be a resource for them! 

Not sure who you legislators are?  Just go HERE and type in your home address.
Other Issues

Preemption
Another contentious issue that will be debated in the near future is the issue commonly referred to as "preemption," that is the State cracking down on local governments' ability to have control over issues such as minimum wage.  The bill in question right now is House File 295 (Click HERE).

In our conversations with PDI members about this issue in the Fall, it became pretty clear that members support a mechanism that prevents the creation of 300+ different minimum wage zones in Iowa.  As such, PDI is supporting this legislation.  However, we have been very clear with legislators that members differ widely on whether the state minimum wage itself should change or stay the same.  We also recognize that some areas of the State, under this legislation, will need to lower their minimum wage, and this is not ideal. 

Either way, we expect this issue to become heated in the weeks ahead as opponents of the legislation accuse supporters of wanting to keep low wages.  To whatever extent you can stay positive and let legislators know that consistency across the State helps attract and grow businesses, that would be helpful.  Legislators MAY decide to attach a minimum wage increase to the bill, but it looks doubtful at the moment.

IEDA Workforce Housing Expansion Bill
PDI is supporting legislation that IEDA Director Durham announced at the PDI Fall Conference to add a rural component to the Workforce Housing Tax Credit program.  The Workforce House Tax Credit Expansion Bill (HSB 65 & SSB 1035) has a one pager available HERE

Subcommittees were held on both bills, at which PDI lobbyists made legislators aware of our support.  We also asked the legislators to consider moving the Workforce House Tax Credit program (and ideally the Brownfields program) out from under the tax credit cap that exists for IEDA programs. So far, legislators have not been willing to make this addition.  However, that is not too surprising given the current climate toward tax credits.  

TIF Chronicle
Still no TIF bills. Any bill making changes to TIF though would be exempt from the funnel deadlines due to the fact that it would be a Ways & Means Committee bill.  Keep your fingers crossed! 

Tax Credit Discussion
We expect to hear news in the next few weeks about the Legislature addressing tax credits.  We have no idea if this will be a study or what may be proposed.  The Legislature already has a mechanism in place where all tax credits are reviewed every five years (on a rotating schedule).  We anticipate any action will probably look well beyond just the Research Activities Tax Credit and IEDA job creation programs.


Bills Being Tracked for PDI
This is a list of the bills being tracked for PDI and their status at the time of publication.  The online bill list is updated constantly, so if you wish to see the updated bill list, just go to http://www.ialobby.com/billtracker/bills.cfm?ClientID=5&NoHeader=0

Bill# Title Status
HF1
Executive Branch Program/Project Review
Summary | Details
House State Government Committee

Establishes an ongoing system of review and ongoing repeal dates for Executive Branch programs and projects.
HF100
Environmental Protection Agency Regulations
Summary | Details
House Natural Resources Committee

Nullifies the regulations of the US Environmental Protection Agency in Iowa.
HF158
Iowa Common Interest Ownership Act
Summary | Details
House Judiciary Committee

Creates the Iowa Common Interest Ownership Act.
HF212
Licensing Sanctions
Summary | Details
House State Government Committee

Prohibits College Student Aid Commission from initiating action to deny, revoke, or suspend any license authorized by the state to any person who has defaulted on an obligation owed to or collected by the commission.
HF288
Water Service Taxation
Summary | Details
House Ways & Means Committee

Exempts from the state sales tax the sales price from the sale or furnishing by a water utility of a water service in the state to consumers or users. 
HF291
Collective Bargaining
Summary | Details
Signed

Makes changes to several employment matters involving public employees, including collective bargaining, educator employment matters, personnel records and settlement agreements, and city civil service requirements.
HF295
Minimum Wage
Summary | Details
House Floor

Prohibits a county or city from providing for any terms or conditions of employment that exceed or conflict with the requirements of federal or state law relating to a minimum or living wage rate, any form of employment leave, hiring practices, employment benefits, scheduling practices, or other terms or conditions of employment.
HF316
Regional Water Authority
Summary | Details
House Agriculture Committee

Creates a regional water authority and regional water authority board to assume the transfer of powers, duties, assets, and liabilities of a water utility.
HF328
Soil and Water Conservation Practice
Summary | Details
House Agriculture Committee

Exempts certain soil and water conservation practices from being considered as the practice of engineering.
HF335
Public Recreational Use Area Tax Credit
Summary | Details
House Ways & Means Committee

Provides a tax credit and other benefits for private land owners who make land and water areas available for public recreational purposes.   
HF76
Local Option Sales Tax Rate
Summary | Details
House Natural Resources Committee

Allows an increase in the maximum local option sales tax rate to fund local natural resources and outdoor recreation projects.
HF82
State Agency Fees
Summary | Details
House State Government Committee

Prohibits state agencies from establishing, imposing, or collecting fees for licenses and applications unless authorized by state or federal law.
HF90
Raceway Facility Sales and Use Tax Rebate
Summary | Details
House Ways & Means Committee

Modifies the sales and use tax rebate to the owner or operator of a raceway facility.
HJR4
Right to Hunt, Fish, Trap, Harvest Wildlife Constitutional Amendment
Summary | Details
House Natural Resources Committee

Proposes a state constitutional amendment establishing the right to hunt, fish, trap, and harvest wildlife.
HJR7
County Reorganization
Summary | Details
House Local Government Committee

Proposes an amendment to the Iowa Constitution for the reorganization of counties beginning in January 2021.
HSB108
Alcoholic Beverage Control
Summary | Details
House State Government Committee

Makes several changes concerning alcoholic beverage control and matters administered by the Alcoholic Beverages Division of the Department of Commerce.
HSB36
EDA Programs and Projects
Summary | Details
House Economic Growth Committee

Makes changes to programs and projects administered by the Economic Development Authority.
HSB43
Local Option Sales Tax
Summary | Details
House Ways & Means Committee

Makes changes to the process for approving and imposing a the local option sales and services tax.
HSB60
City and County Zoning
Summary | Details
House Local Government Committee

Allows a city or county to allow, regulate, and restrict the transfer of development rights.
 
HSB65
Workforce Housing Tax Incentives Program
Summary | Details
House Economic Growth Committee

Increases the maximum dollar amount that may be allocated to the Workforce Housing Tax Incentives Program.
HSB85
Endow Iowa Tax Credits
Summary | Details
House Ways & Means Committee

Increases the amount of Endow Iowa tax credits that may be authorized by the economic development authority.
HSB9
Primary Road Fund
Summary | Details
House Transportation Committee

Allows the state transportation commission to periodically allocate funds from the Primary Road Fund (PRF) to the secondary and municipal road systems in exchange for retaining all or a portion of federal aid road funds that would otherwise be allocated to counties and cities.
HSB90
Professional Licensure Fees and Regulations
Summary | Details
House Local Government Committee

Makes changes to professional licensure fees and regulations.
HSB91
County and City Bonding
Summary | Details
House Local Government Committee

Makes changes relating to the designation of certain county and city activities  for bonding purposes.
SF1
Jobs Impact Statements
Summary | Details
Senate Floor

Requires that every proposed rule under a notice of intended action or publication without notice contain a jobs impact statement outlining the purpose and statutory authority of the rule and analyzes and sets out in detail the impact of the proposed rule on state agencies, local governments, the public, and the regulated entities, including regulated businesses and self-employed individuals affected by the rule.
SF103
Inheritance Tax Repeal
Summary | Details
Senate Ways & Means Committee

Repeals the state inheritance tax and the state qualified use inheritance tax effective July 1, 2017.
SF104
High Quality Jobs Criteria
Summary | Details
Senate Ways & Means Committee

Alters the high quality jobs criteria to no longer allow projects that only have capital investment, but no new job creation. 
SF110
Water Quality and Soil Conservation Assessment
Summary | Details
Senate Agriculture Committee

Requires commodity organizations to establish a separate state assessment for water quality and soil conservation, if approved by a majority of its members at a referendum.
SF130
Appropriations for FY2016-17
Summary | Details
Signed

Makes appropriations reductions and reallocations for FY2016-17.
SF14
Sales Tax Increase
Summary | Details
Senate Ways & Means Committee

Increases state sales tax rate from 6 percent to 6.375 percent and provides for the transfer of sales tax revenues to the natural resources and outdoor recreation trust fund.
SF148
Federal Low-Income Housing Credits
Summary | Details
Senate Commerce Committee

Prohibits the Iowa finance authority from allowing a developer fee to exceed an amount equal to 10% of the total project costs for federal low-income housing credits.
SF149
Administrative Rules and Rulemaking
Summary | Details
Senate State Government Committee

Makes provisions for the review of administrative rules and the rule making process.
SF16
Wind Energy Conversion Property Tax Division and Allocation
Summary | Details
Senate Ways & Means Committee

Requires property taxes collected from wind energy conversion property located in an urban renewal area be allocated to and, when collected, paid into the funds for the respective taxing districts in the same manner as all other property taxes.
SF167
State Sales and Use Tax
Summary | Details
Senate Ways & Means Committee

Increases the state sales and use tax to 6.375%, and provides for the transfer of sales tax revenues to the natural resources and outdoor recreation trust fund. Amends the transfer of use tax revenues to the SAVE fund to 15.6863%.
SF17
Property Taxes from Wind Energy Conversion
Summary | Details
Senate Ways & Means Committee

Requires property taxes collected from wind energy conversion property located in an urban renewal area be allocated to and, when collected, paid into the funds for the respective taxing districts in the same manner as all other property taxes.
SF176
IEDA Technical Corrections
Summary | Details
Senate Floor

Makes technical corrections to IEDA programs and projects.
SF179
IRS-Bonus Depreciation Provisions
Summary | Details
Senate Ways & Means Committee

Temporarily updates the Code references to the Internal Revenue Code and decouples from certain federal bonus depreciation provisions.
SF180
EDA Powers and Programs
Summary | Details
Senate Floor

Addresses Economic Development Authority powers and programs.
SF228
Certified Suppliers of Anchor Manufacturers
Summary | Details
Senate Ways & Means Committee

Creates an economic development program allowing certified suppliers of anchor manufacturers to make an adjustment to net income for state individual and corporate income tax purposes.
SF38
Individual Income & State Sales and Use Taxes
Summary | Details
Senate Ways & Means Committee

Repeals the individual income tax and increases the state sales and use tax rates.
SF82
Inheritance Tax
Summary | Details
Senate Ways & Means Committee

Reduces the state inheritance tax rate over a nine-year period with the tax repealed effective July 1, 2027.
SJR1
State Spending Limit/Constitutional Amendment
Summary | Details
Senate Appropriations Committee

Proposes an amendment to the Iowa Constitution that limits state spending to 99% of revenue estimates, or 104% of the revenue estimates for the current fiscal year (whichever is greater).
SJR4
Right to Hunt, Fish, Trap, Harvest Wildlife Constitutional Amendment
Summary | Details
Senate Natural Resources & Environment Committee

Proposes a state constitutional amendment establishing the right to hunt, fish, trap, and harvest wildlife.
SSB1034
Water Quality/Wastewater Treatment
Summary | Details
Senate Natural Resources & Environment Committee

Modifies existing wastewater treatment program, establishes new water quality programs, and creates a water service excise tax and sales tax exemption.
SSB1035
Workforce Housing Tax Incentives Program
Summary | Details
Senate Ways & Means Committee

Increases the maximum dollar amount that may be allocated to the Workforce Housing Tax Incentives Program.
SSB1097
Alcoholic Beverage Control
Summary | Details
Senate Commerce Committee

Makes several changes concerning alcoholic beverage control and matters administered by the Alcoholic Beverages Division of the Department of Commerce.
Your Legislative Team
The Advocacy Cooperative | Campbell/Patterson Consulting LLP, PO Box 1403, Des Moines, IA 50131
Sent by craig@ialobby.com in collaboration with
Constant Contact