StateCapitol


State Capitol Report 
Issue 1 |
April 15, 2018   
Legislative Session Update

Headed for Overtime
The last two weeks have been filled with floor debate and lots of behind-the-scenes negotiating about taxes, budget and any remaining policy issues. While we are still technically at an impasse on taxes, there has been a lot of activity between the Chambers, which is a good sign.
 
Legislative per diems officially run out after the 100th day of the session on Tuesday, April 17th. At that point, legislators will largely lose their clerks for the rest of the session, so there will be added incentive to wrap up for the year.
 
On top of that, some legislators are affected by the June 5 Primary Election, so the longer the session continues, the fewer days they have to campaign. Additionally, gubernatorial candi dates are prohibited from taking PAC checks until 30 days after the legislative session (when the Governor's veto period ends), so if session goes until Sunday, May 6, the Democratic candidates for Governor will be shut out of those large checks before their June 5 primary.  That impacts Senator Nate Boulton and Cathy Glasson the most, as they have been endorsed by most of the groups that own those PACs.  Governor Reynolds is also unable to accept those checks, but she does not have a primary opponent, so it's not an issue on the Republican side. 
 
Publication Note - This is most likely the last regularly scheduled update that will be published until the Legislature adjourns for the year. Keep an eye out for timely alerts requesting you to take action.
 
What do we need to do to close down the session?
The one thing legislators and the Governor HAVE to do is enact a Fiscal Year (FY) 2019 budget for the State. This will require the following:
1.)  Determining an overall number that can be spent (in the neighborhood of $7.5 billion),
2.)  Dividing those funds up (targets) between the seven appropriations subcommittees for allocation into the ten Appropriations bills, and
3.)  Passing all ten in identical form to the Governor which she then signs into law.

There are a number of smaller steps along the way, but that is the general outline.
 
Since the 100 day scheduled session is almost up, why have we not begun this Appropriation process? Because in addition to the budget, the Governor, House and Senate ALL agree that they need to enact tax cuts. Why? As Speaker Linda Upmeyer explained in her latest newsletter, the recently enacted federal tax cuts will reduce taxes on Iowans by an estimated $1.8 billion per year. However, because Iowa is one of three states that have federal deductibility, a decrease in federal taxes means that state taxes on Iowans will rise by $107 million in 2018 (and $153 million in 2019) if the Legislature makes no changes in tax policy.
 
The tax plans
The Governor has a tax plan she released in February. Her plan is summarized HERE and was introduced in the Legislature as HSB 671 and SSB 3195. The House has recently released their plan, summarized HERE and in legislation as HF 2489. HF 2489 could be passed by the House this week. The Senate has introduced two plans, the first of which (SF 2383) was by far the largest of all the tax cut proposals and was passed by the Senate over to the House on February 28. The most recent Senate plan was announced on Thursday; the language is not yet available but a one pager is available HERE.
 
All of the tax reform plans have cuts to personal income taxes and an expansion of the sales tax to cover online purchases. The biggest differences are the size of the tax cuts, whether to include corporate cuts, whether to include getting rid of federal deductibility and whether to include a tax increase on credit unions. With the House backing down completely on getting rid of deductibility while the Senate has doubled down on it, we may be waiting around for a while for resolution of the tax reform issue.
 
FY 2019 Budget Status
The House and Senate were reportedly waiting on moving any budget bills until the tax reform issue was resolved. However, in the wake of the two chambers moving vastly different tax bills, the House has gone ahead and scheduled four appropriations subcommittee meetings for Monday. They look to bring the following four spending bills out of subcommittee - Transportation, Economic Development, Justice, and Agriculture and Natural Resources. This will constitute the "House version" of those bills, and should not be assumed to be "signed off on" by the Governor and Senate.
 
Given all that, when will we finish for the year?
We all wish we had the answer to that question. Everyone is making guesses, ranging from Cinco de Mayo to mid June. One thing to keep in mind - Once they reach agreement on taxes and budget, it will still take a solid week to draft the bills, draft amendments, make edits, discuss everything in caucus, debate the bills, and close down. While rank-and-file members wait for all that to happen, we often see them taking up other issues and trying to tinker with new policy ideas, which then adds even more time to closing down the session. So buckle in, we'll be here a while.
What Should You Be Doing?  

As was the case in the last update, your continued advocacy from now through the end of the legislative session will be crucial.  Look at how well it worked with DRAM Shop Reform, which has now been signed into law! 

In the days ahead, we should learn more about funding levels for Tourism, REAP, trails, and other programs of interest to you. 

We also need legislators to hear from you about issues we still need addressed - the biggest of which is the passage of HF 2131 by the House.  This bill would extend from 31 to 90 the number of days a renter would pay hotel/motel taxes during a stay.  

Finally, while none of the tax bills currently contain a sales tax increase that would fund the Natural Resources and Outdoor Recreation Trust Fund, several legislators continue to talk about the issue and are looking for a way to include it in the final tax reform package. 

For all of these reasons, please keep weighing in with your legislators!! We still have plenty of work to do, so don't let up!!  
    
To find out who your legislators are, click HERE 
To find a list of the Representatives, click HERE   
To Register Your Opinion with the Governor's Office, click HERE  

Bills Being Tracked for TFI

This is a list of the bills being tracked for TFI.  The online bill list is updated constantly, just go to http://www.ialobby.com/billtracker/tfi/ 

Bill# Title Status
HF2038 
Nonreversion/Reallocation of State Funds
Summary | Details 
House Appropriations Committee 
 
Allows state agencies to keep up to 10% of the funds appropriated that are unencumbered or unobligated at the close of the fiscal year (funds won't revert).
HF2046 
Sales Tax Collection
Summary | Details 
House Ways & Means Committee 
 
Amends definition of "retailer maintaining a place of business in this state" for the collection of sales tax from out-of-state retailers.
HF2131 
Hotel/Motel Tax Exemption
Summary | Details 
House Unfinished Business Calendar
 
Extends the length of a room rental to qualify for the state and local hotel/motel taxes from 31 consecutive days to 90 or more consecutive days.
HF2343 
State Agency Restrictions
Summary | Details 
Signed
 
Prohibits a state agency from implementing or enforcing any standard, requirement, or threshold unless explicitly required or permitted by a state statute or a federal statute or regulation.
HF2374 
Tax Credit Repeal
Summary | Details 
House Ways & Means Committee 
 
Repeals certain state income tax credits, and provides for the future repeal of tax credits.
HF2407 
Pesticide Application in Lakes
Summary | Details 
Signed
 
Prohibits pesticide application in lakes under certain circumstances.
HF2417 
Fair Concessions Payment
Summary | Details 
Signed
 
Allows a participant in an amusement concession at a fair to pay by credit card.
HF2440 
Water Quality Programs
Summary | Details 
Senate Unfinished Business Calendar
 
Makes changes to existing water quality programs.
HF2448 
Sports Betting
Summary | Details 
House Ways & Means Committee 
 
Authorizes gambling licensees to conduct sports betting.
HF575 
Bottle Bill Repeal and Replace
Summary | Details 
House Ways & Means Committee 
 
Repeals the beverage containers control law and replaces it with new recycling, litter control, and community enhancement programs.
HF597 
The WISE Solution for Water Quality
Summary | Details 
House Ways & Means Committee 
 
A permanent $180-200 million/year that flows into the Natural Resources and Outdoor Recreation Trust Fund, at least 60% of which would have to be used for specific water quality.
HF631 
Hunting, Fishing, Fur Harvesting Fees
Summary | Details 
Senate Floor
 
Increases certain fees and reallocates certain revenues related to hunting, fishing, and fur harvesting. Successor to HF574.
HSB678 
Property Tax Backfill
Summary | Details 
House Appropriations Committee 
 
Phases out the roughly $150 million property tax backfill, starting in FY 2019 (which starts July 1, 2018).  Cuts one-third ($50 million) from the backfill in Year One and then $25 million every year thereafter.
SF2069 
Forest Reservation Property Tax Exemption
Summary | Details 
Senate Ways & Means Committee 
 
Lowers the property tax exemption for forest reservations.
SF2074 
Raceway Facility Construction Sales Tax Rebate
Summary | Details 
Senate Ways & Means Committee 
 
Makes changes to sales tax rebates for construction at certain raceway facilities.
SF2080 
State General Fund Expenditure Limitation
Summary | Details 
Senate Appropriations Committee 
 
Revises calculations for the general fund expenditure limitation, increases reserve fund balances, creates a safety net fund, creates an Iowa personal income tax rate reduction fund, and provides for related state personal income tax rate reductions.
SF2081 
Commercial and Industrial Property Tax Replacement Claims
Summary | Details 
Senate Appropriations Committee 
 
Eliminates the appropriation for commercial and industrial property tax replacement claims.
SF2117 
FY18 Deappropriation
Summary | Details 
Signed
 
Cuts the current fiscal year (FY18) budget by $50.1 million, about $20 million more than the Governors' recommendation.  Cuts regional tourism marketing, skilled worker and job creation fund, hawk-i, autism support program fund, Regents universities, community colleges, vocational rehabilitation, autism support program, human services,
 
SF2161 
Agriculture and Natural Resources Programs
Summary | Details 
Senate Ways & Means Committee 
 
Amends several agriculture and natural resources programs.
SF2169 
DRAM Shop Revision
Summary | Details 
Signed
 
Limits the liability of an alcoholic beverage licensee or permittee for certain alcohol-related injuries.
SF2310 
Alcoholic Beverage Control
Summary | Details 
Signed
 
Makes changes related to alcoholic beverage control and matters under the purview of the alcoholic beverages division of the department of commerce.
SF2333 
Amusement Concessions
Summary | Details 
Signed
 
Increases the maximum allowable retail value for any prize awarded for an amusement concession.
SF2383 
Senate Tax Reform Package
Summary | Details 
House Ways & Means Committee 
 
The Senate's tax reform package.
SF2389 
State Park Fees
Summary | Details 
Sent to Governor
 
Allows DNR to establish fees for camping and rental facilities at state parks and recreation areas.
SF2390 
Hotel Sanitation/Food Establishment Regulations
Summary | Details 
Senate Floor
 
Changes requirements for the hotel sanitation and food inspection.
SF2397 
Lake Manawa Park User Fee
Summary | Details 
Senate Ways & Means Committee 
 
Establishes a pilot program to collect fees from nonresidents at Lake Manawa state park.
SF2401 
Vessel Registration and Title
Summary | Details 
House Ways & Means Committee 
 
Modifies provisions relating to the registration and titling of vessels.
SF512 
Water Quality/Wastewater Treatment
Summary | Details 
Signed
 
Modifies existing wastewater treatment program, establishes new water quality programs, and creates a water service excise tax and sales tax exemption.
SSB3195 
Tax Reform
Summary | Details 
Senate Ways & Means Committee 
 
Makes changes to income taxes, the sales and use taxes and local option sales tax, the hotel and motel excise tax, the automobile rental excise tax, the Iowa educational savings plan trust, and the Iowa ABLE savings plan trust.
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