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With two weeks until the second funnel, week 10 was dominated by extended floor debates on big-ticket Republican priorities.
- Rental Vouchers (SF252) prohibits local ordinances that require landlords to accept federal vouchers. Republicans believe the bill is necessary to protect landlords who do not wish to deal with extra paperwork and requirements involved with federal housing vouchers. Democrats believe these ordinances are an important tool in making sure people have access to affordable housing. The House amended the Senate version of the bill and messaged it back to the Senate; the Senate concurred, and the bill has been messaged to the Governor. Many believe this bill is afoul to the Governor’s previous proposal on Affordable Housing (HF582/SF295) which deals with the current shortage of affordable homes and are interested to see how the Governor will reconcile the two issues.
- On Tuesday, March 16, the House passed Racism Training (HF802) 59-38. The bill establishes rules related to training on racism and sexism in schools and colleges, including prohibiting teaching that Iowa is fundamentally racist or sexist. Specifically, the bill prohibits teaching divisive concepts and race or sex scapegoating. A floor amendment opened this beyond schools and colleges and makes the bill applicable to state and local governments as well. The floor manager of the bill said that teaching that the United States and Iowa are inherently racist is simplistic and ignores the efforts of many Americans and Iowans to fight racism and make the country better. Republicans believe the bill allows for balanced diversity and racial sensitivity training and prevents any training that scapegoats the people of a particular race as inherently racist. Democrats expressed concern that the bill will chill education on important issues in diversity training in a planned way.
- The Senate passed Banning Social Media Censorship (SF580) on a 30-17 party line vote on Wednesday, March 17. The lead sponsor of the bill has been persistent in his efforts to fight what he believes is the monopoly power of large social media and internet companies. Republicans believe these companies have the power to affect elections and suppress political views, that the big tech companies have more powers than the monopolies of the 19th century, and the federal government should review the necessity to break these monopolies. Democrats have expressed concern over how the bill will impact economic growth in the state and that even the introduction of this bill hurts Iowa’s efforts to attract new businesses. The bill prohibits companies from intentionally interfering with the right of Iowans to interact on various internet platforms, prohibits companies found to be in violation from receiving economic incentives, and requires that the AG take court action to enforce the bill.
- Also on Wednesday, the House passed Weapons Omnibus (HF756) on a 60-37 vote (with one Democrat voting with the majority). Republicans have continually touted the necessity for “permitless carry,” that Iowans should not need to get permission from the state to exercise their constitutional freedoms. The floor manager of the bill believes that the increased penalties in HF756 for unauthorized gun sales will lead to more background checks, though the bill strikes the existing state background check provisions. A lengthy floor debate led to extensive discussion about background checks and permits. Democrats expressed concern that this bill will repeal background checks on all gun sales (specifically private gun sales that are made outside of a federally licensed dealer) and that permits protect law enforcement officers and are a necessary public safety tool for officers to determine if a person with a gun is allowed to possess one.
- There was one significant bill that passed with surprising bipartisan support: Inheritance Tax/Tax Triggers (SF576). It is a bill that will remove the “tax triggers” that were put into place when the 2018 tax package was negotiated and signed into law. Those “tax triggers” were guardrails established to ensure that Iowa’s revenues hit a certain number before tax cuts become effective in 2023. In addition to striking the triggers, the bill also phases out Iowa’s Inheritance Tax over four years. The bill passed unanimously (46-0) in the Senate on Wednesday afternoon. The Governor had previously proposed removing the tax triggers and making a number of other tax changes in HSB174 Income Tax Changes (the bill has not moved in the House, but is funnel-proof as it is a Ways and Means bill) calling the triggers unnecessary and stating that their removal will allow the state to be more economically competitive if the changes are made (see more about the tax triggers in the REC section below).
Revenue Estimating Conference
The Revenue Estimating Conference (REC) met Friday, March 19, and released the budget estimates for FY 2021 and FY 2022. The REC increased the estimate for FY 2021 (from the December estimate) by about $109 million, from $7.969 billion to $8.078 billion (about a 1.9% increase). They also significantly increased the FY 2022 estimate (from the December estimate) by about $120 million, from $8.265 billion to $8,385 billion (about a 3.8% increase).
Governor Reynolds issued a statement on the REC projection and the tax triggers that the legislature is considering removing in SF574:
Today’s forecast shows that Iowa’s economy is strong, and we can make it even stronger by ensuring that our historic 2018 tax cuts are fully implemented, giving Iowans certainty that they’ll see more in their paychecks. We can easily do that by removing the unnecessary triggers, which are no longer needed and only stand in the way of our future growth…I was pleased that the Senate voted unanimously to remove these triggers and look forward to signing the final bill making these significant tax cuts a reality for Iowans.
Last Wednesday, Governor Reynolds signed Executive Order 8 launching a new Child Care Task Force to develop a comprehensive strategy to address the childcare shortage and barrier to work in Iowa. The governor also announced awardees of two childcare grant programs totaling $13,053,372 and contributing to the creation of more than 4,000 new childcare slots across Iowa.
House Republicans have made improving access to childcare a priority and have already passed eight childcare bills, messaging them to the Senate.
- Child Tax Credits (HF230)
- Childcare Numbers (HF260)
- Childcare Reimbursement Rates (HF292)
- Childcare Matching Grants (HF301)
- Childcare Phase Out (HF302)
- Business Childcare (HF370)
- On-Site Childcare (HF606)
- Workforce Childcare Credits (HF712)
These bills are currently moving through the Senate with HF230 out of committee (funnel-proof).
Concerns over the US Census Bureau and the delay in the release of census data continue. At least two states, Ohio and Alabama, have engaged in lawsuits. Iowa faces similar deadline problems, with constitutional requirements for finalizing redistricting mid-September prior to the anticipated release date of census data at the end of September.