Key Takeaways from the 2023 Legislative Session | |
Another Great Legislative Session for Business and Industry | |
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The first session of the 90th General Assembly adjourned sine die at 12:34 pm on Thursday, May 4th. The Iowa Legislature went into just a few days of overtime as the initial adjournment date was April 28. The House, Senate and Governor worked over the last few weeks to come to an agreement on a variety of policy provisions and the overall budget. This session, ABI officially registered a position on 165 bills and tracked more than 200 pieces of legislation internally.
The ABI board of directors established four legislative priorities for 2023:
- workforce
- tort reform
- property tax reduction and reform
- regulatory reform
ABI's public policy team advocated for Iowa businesses throughout the 90th General Assembly's 2023 Session, resulting in favorable outcomes. Their efforts persisted until the session's last day at the Capitol.
Property tax reform was the cornerstone of the Legislature’s work this year, which received strong bipartisan support in both chambers during the final days of session. This will save property taxpayers $100 million once fully implemented and sets the table for more reform in the coming years.
ABI also sidelined a number of mandates and other bills, and notably, removed the guns in employer parking lots provision from the gun omnibus passed by the Iowa House. We’re grateful to ABI members who contacted their legislators in opposition. Your voice made the difference.
For a full analysis and breakdown of the results, please join us this Friday at 8am via Zoom for this members only opportunity! Click the image below to request the link.
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THE SUCCESS OF ABI PRIORITIES IN 2023 | |
WORKFORCE: Supporting the Early Talent Pipeline | |
SF 542: Youth Employment Opportunities Act | |
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Status: Passed the House and Senate, awaiting the Governor’s signature.
About the Bill: The bill allows expanded work hours for minors in the workplace and 16 and 17 year-olds to serve alcohol in restaurants. Iowa Workforce Development will be able to grant waivers for students in approved work-based learning programs to expand knowledge of opportunities in certain industrial environments with the approval of their parents or guardian.
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SF 318: Iowa Registered Apprenticeship Act | |
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Status: Passed the House and Senate, awaiting the Governor’s signature.
About the Bill: The legislation consolidates all apprenticeship government programs and oversight to Iowa Workforce Development (IWD). The state of Iowa will now perform many functions previously done federally by the U.S. Department of Labor. This streamlining should allow for more timely approvals of new apprenticeship programs and oversight closer to the workplace.
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THE IMPACT:
The two bills above, combined with changes made last year will allow for greater work-based learning opportunities and help elevate opportunities for Iowa students with ABI member companies throughout the state.
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TORT REFORM: Supporting an Environment to Retain Iowa's Medical Talent | |
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Status: The bill was signed by the Governor on February 16.
Background: Medical malpractice reform is an issue that the business community has worked on for decades. A number of states contiguous to Iowa have previously tackled this workforce and liability matter and now Iowa is added to the list.
About the Bill: The bill imposes a hard cap on noneconomic damages for medical malpractice, and here's what you need to know:
- The cap is $1 million for doctors and clinics.
- The cap is $2 million for hospitals.
- Both caps increase by 2.1% beginning in 2028 to account for inflation.
- The bill establishes a medical error task force that will issue a report to the General Assembly by January 8, 2024.
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SF 228: Commercial Motor Vehicles | |
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Another significant piece of tort reform approved by the Legislature is related to commercial motor vehicles.
Status: The legislation is awaiting review and signature by Governor Reynolds.
About the Bill: Like HF 161, the bill imposes a hard cap on noneconomic damages for incidents to the specific list of commercial motor vehicles mentioned in the bill. Iowa is now the only state in the nation that has a hard cap for noneconomic damages in this field, and here's what you need to know:
- The hard cap is $5 million per plaintiff.
- An employer cannot be held liable for negligent hiring.
- There is a specific list of commercial vehicles to which the cap applies.
- If a driver commits specific actions laid out in the bill, the cap is null and void.
- A plaintiff is allowed to recover 100% of punitive damages if awarded.
- The cap increases by the inflation rate beginning in 2028.
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THE IMPACT:
For the first time in decades, tort reform was established as an ABI priority and the legislative results were significant.
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PROPERTY TAXES: Voters' Voices Heard in 2023 | |
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Status: The bill was signed by Governor Reynolds earlier today, May 4.
Background: As candidates campaigned across Iowa last fall, voters were expressing their concerns with rising property taxes that affect both rural and urban parts of the state. Historic assessment increases this spring catalyzed the need for the Legislature to act, which is what they have done.
About the Bill: This historic piece of legislation sets the stage for additional reforms to property taxes in the future and provides $100 million in relief, and here's what you need to know:
- Consolidates 15 city levies into a general fund levy
- Creates a ratcheting down mechanism whereby if cities and counties see certain levels of growth, the windfall must be applied to reducing taxes. This will help slow the budget growth of local governments
- Iowans 65 and older will be eligible for a $6,500 property tax exemption.
- Veterans are eligible for a $4,000 property tax exemption.
- New transparency measures aim to clarify property tax information for taxpayers, including proposed budget impacts and potential actions to be taken.
- Bonding elections are moved to the general election timeframe.
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THE IMPACT:
This historic piece of legislation sets the stage for additional reforms to property taxes in the future and provides $100 million in relief.
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HF 352: Pass-Through Entity Tax Changes | |
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Status: The legislation is awaiting review and signature by Governor Reynolds.
About the Bill: ABI supported legislation affecting pass-through entities that has passed in more than 20 states. The legislation is a result of the 2017 federal income tax reduction legislation that capped the amount of state and local taxes that could be deducted on federal returns at $10,000. The Internal Revenue Service allows for pass-through entities to move some expensing to the entity level, resulting in a reduced tax obligation at the federal level for individuals.
| SF 549: Insurance Premium Tax Cut | |
Status: The legislation is awaiting review and signature by Governor Reynolds.
About the Bill: The legislation reduces the insurance premium tax from 1.0% to 0.9% over four years. It ends up being an $18 million tax cut once fully implemented and helps continue to ensure that Iowa remains the top state in the nation for the insurance industry.
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REGULATORY REFORM: ABI Continues Success at Legislative Level | |
SF 514: Government Reorganization | |
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Status: Supported by ABI, the bill passed the Legislature and was signed by the Governor early in session.
Background: State government has not been studied and reorganized since 1986 and was overdue.
About the Bill: This reduces 37 cabinet level departments to 16. Similar functions that have developed in multiple departments will be centralized. For example, all professional licensing will now have one agency of oversight and issuance. Here's some other key details:
- The practice of budgeting for unfilled positions or “ghost employees” will end.
- State government property ownership and leases will be reviewed and reduced.
- Coordinated computing and database systems will be pursued.
All of the above concepts are continual improvements in the private sector, but required legislative action and coordinated effort to bring it to state government. As part of the review, the Governor has also issued a moratorium on new rules.
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HF 461: Boiler Inspection Regulatory Reform | |
Large industrial boiler owners continuously monitor their boilers for safety but best practices have allowed for longer periods of operation before maintenance shutdowns. The legislation allows the boiler owners to ask the Iowa Labor Commissioner for permission to match longer maintenance intervals with required internal inspections. | |
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THE IMPACT:
Like Workforce, Regulatory Reform is an ongoing priority for the Association, as established by hundreds of members each year. ABI members strive to comply with a wide scope of regulations at the local, state and federal levels. These regulations can often overlap, be outdated or are overly burdensome; therefore ABI seeks solutions to addressing the challenges at the legislative and administrative levels.
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ABI STOPS BAD-FOR-BUSINESS BILLS | |
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Each year, lawmakers introduce legislation that would have a negative effect on Iowa’s business climate. ABI was able to defeat numerous anti-jobs bills during the first session of the 90th General Assembly. ABI would like to thank all members who engaged their legislators on these key issues.
Your continued education and outreach to your legislator(s) is essential in helping to stop bad for business bills. You can read more about some of the job-crushers ABI stopped below.
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HF 654: Guns in Employer Parking Lots | |
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There was a lot of momentum behind this gun omnibus legislation that contains a provision that would have allowed employees to bring guns onto their private employer’s parking lot.
Thanks to the proactive efforts of ABI members who voiced their concerns to legislators, the provision in question was successfully removed from the bill before its passage in the House.
The Senate ultimately decided to not run this bill off the Senate floor. The conversation on HF 654 will begin in the Senate Judiciary Committee in 2024.
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This bill would have mandated all employers regardless of size use the federal electronic verify system for their employees.
The legislation would impose draconian penalties for violations and make it unnecessarily burdensome for small businesses to comply. Any member of the public could file a complaint with Iowa Workforce Development alleging the business hired someone illegally.
The Senate Judiciary Committee passed the bill, but it did not advance out of the full Senate.
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ABI would not normally be involved in the reform of the food stamp program (SNAP) in Iowa, but the House version of the bill not only revamped eligibility verification, but went further by limiting the foods that could be purchased with the benefits.
These provisions were concerning for the value-added agriculture, food production and beverage industry members of ABI.
Ultimately the Senate version, which had no such provisions, prevailed.
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A bill that‘s been around for a number of legislative sessions would require employers to provide the same benefits and policies that they give to biological parents of newborn children to parents of adoptive parents.
ABI was successful in narrowing the scope of the bill so it only applies to children 0-6 years of age and disability leave is not issued to an employee unless they have a qualifying disability under the employer’s policies.
The bill passed the House and made it through a Senate committee, but it was not brought to the floor.
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ABI follows the appropriations process, watching for policy or appropriations that affect businesses and the agencies with which they interact. ABI weighed in two budget bills this session, which contained important policy. Below are the appropriations bills and the issues that ABI followed. | |
SF 558: Ag/DNR Budget, Section 19 | |
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Background: Many ABI members have manufacturing facilities in various parts of the state. In every case they are subject to air permitting requirements under the federal Clean Air Act. Both ABI and the state of Iowa endeavor to have an anti-stringency policy that ensures that environmental regulations in Iowa are no more stringent than federal requirements. Two counties, by contract with the DNR, carry out the responsibilities under the Clean Air act. Until the passage of Section 19 of the Ag/DNR budget, those counties could exceed the state requirements for compliance.
About the Bill: Now compliance with the standards of the federal Clean Air Act should be uniform statewide. ABI is preparing a letter to ensure the Governor’s signature on the legislation.
Contact JD Davis with questions.
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Background: This budget funds the College Student Aid Commission, the State Board of Regents, the Department of Education and other entities.
About the Bill: A key component of this bill is the $23 million appropriated for the Last Dollar Scholarship Program. The initiative, a feature of Future Ready Iowa, provides funding to students to help them achieve their degrees or certificates in high demand fields. Results are proving strong from the program, and ABI was very supportive of its inclusion in the final bill.
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Now that session is over, Gov. Reynolds has 30 days to veto or approve bills received in the last three days of session. She can veto a whole policy or budget bill, or item-veto specific appropriations or policy language in an appropriations bill.
During this time, the governor and her staff will carefully review the language to ensure it fits within the state's budget targets and her policy goals. Groups who want items signed or vetoed typically use the 30-day time to send letters of support or opposition to the governor. If she vetoes or item-vetoes an appropriations bill, she provides an explanation about the reason for the veto.
Bills have enactment dates of July 1, unless otherwise specified.
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In a Town Near You: Attend In-Person Regional Policy Meetings | |
With the Legislature having adjourned, in-person regional meetings will take place between now and mid-June. The dates for the meetings are on our website. You can find out more about the meetings by going to the ABI events calendar. | |
Save the Date: Summer Public Policy Committee Meetings | |
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Help form ABI's 2024 policies by participating in a policy committee meeting this August. Each committee will review current policies, suggest new policies, and provide recommendations to the Legislative Committee.
ABI's Public Policy Committees:
- Tax
- Economic Growth
- Workplace and Product Safety
- Environment
- Employment and Workforce
Learn more about this process here.
To sign up for an ABI public policy committee, contact Levi Lefebure.
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