The 2017 Legislative Session is Underway
Who's In Charge??
January is the month when the results of the November Election come into full effect as newly elected officials take control of the federal government and the 50 state governments. In Washington DC, Republican Donald J. Trump was sworn in as the 45th President of the United States on Friday, January 20th, and was joined in power by a Republican-controlled Senate and a Republican-controlled House of Representatives. This is the first time all three have been unified under one party's control since the Democrats took control in January 2009 (2009-2010), and the first time Republicans have had unified control since 2001-2002.
At the State level, the November election also saw Republicans swept into power. The Iowa Senate, previously held by the Democrats 26-24 for a number of years, flipped to the Republicans by a wide 29-20 margin (+1 independent). In the House, Republicans were able to add two more to their margin and now control the chamber by 59-41. Republican Governor Terry Branstad is in the middle of his term, so he was not the 2016 ballot.
Change at Terrace Hill Coming
Speaking of Governor Branstad, while his name was not on the 2016 ballot, the election will still have a profound effect on him, far beyond delivering the Iowa Legislature to his party's control. Trump has announced that he will be appointing Branstad as the U.S. Ambassador to China, not surprising given that Branstad has a long-standing friendship with the leader of China that dates back to his first go-around as Governor of Iowa in the 1980s. The timing of Branstad's departure, which will establish Lt. Governor Kim Reynolds as Iowa's first female Governor, is an issue you will hear speculation about throughout the Legislative Session. And with that...
The Legislature Convenes
Monday, January 9, marked the first day of the First Session of the 87th Iowa General Assembly, a scheduled 110-day session. The 110th day of session, when per diems to legislators expire, is April 28th, 2017. Typically, the Legislature goes beyond the last day, but this year's new power alignment may change that. This Legislature consists of 23 new members and one still to come on January 31st in House District 89 in Davenport.
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Much to their chagrin, the first major order of business for the new 2017 Legislature will be to introduce and enact a "deappropriations" bill to cut somewhere near $120 million from the current fiscal year (2017) which ends on June 30th. They need to do this because revenue projections made in the December show that revenues into the State will fall far below earlier expectations, thanks in large part to trouble in the agricultural sector of the economy caused by lower commodity prices.
The Governor did make recommendations for the cuts in his Condition of the State address, but he needs the Legislature to take action on legislation. The Governor's recommended cuts included about $30 million in fund transfers, $25 million for Regents, and a number of other cuts, including a reduction of roughly 4.25% in the administrative budget for most agencies in state government. Most of those 4.25% reductions would be continued into the next two full fiscal years (FY 2018 and FY 2019).
Since the Governor's speech on Tuesday, January 10th, the House and Senate have been working behind the scenes on their own deappropriation bill. By the time you read this, the bill may have just come out, but it is expected by the middle of the next week, at the latest.
Some other issues the Legislature will take up soon:
As soon the deappropriation bill is finished, expect to see legislators push school funding legislation to the front burner. They have had to wait while they see how much the deappropriation bills leaves on the table, but they want to pass it quickly. The Governor has recommended two percent allowable growth, but the House and Senate may recommend less than that.
The House, Senate and Governor plan to end the roughly $300,000 in state funding that goes toward Planned Parenthood. Since these funds leverage about $3 million in federal matching funds, they need to find funds elsewhere to cover this gap.
Governor Branstad and the House and Senate will push to change Iowa's collective bargaining laws to give the State more ability to control costs, particularly with health care. During his Condition of the State speech, the Governor cited numbers from the Legislative Services Agency that showed between 2005 and 2015 that health insurance costs for state employees soared from $143.2 million to $235.7 million, an increase of $92.5 million, or 64.6 percent. This promises to be a contentious debate at the Statehouse.
As the session plays out, there are a number of other issues that will enter discussion, including tax reform, water quality, Medicaid oversight and many others.