Recap of Week 7

With funnel week this week, all the committees have been busy getting their necessary bills through and ready for debate on the floor. If a bill doesn’t make it through committee this week, it can no longer be considered this session.

On Tuesday I had the chance to greet members of Manchester’s Good to Great program. They are advocating a river project to make white water rapids in the Maquoketa River, which runs through Manchester.                    

The Jones County Farm Bureau also visited the Capitol on Tuesday. I took time to hear their thoughts and concerns about the gas tax and tax reform.

The Cost of Doing Nothing

The General Assembly and Governor Branstad have to make a business decision regarding investing $5 million (a small portion of the estimated total $18 million reconstruction and restoration costs) in rebuilding the dam at Lake Delhi.

One of the key considerations for the Iowa House is the impact on the Maquoketa Valley School District’s education system, and how much additional money the state would have to spend through the school aid formula to replace lost property values. The Lake Delhi Community accounts for 20% of all of Delaware County and a substantial portion of the School District property tax base.

Let me explain how the destruction of the dam has and will affect the state’s general fund.

Currently, the State of Iowa provides about half of the cost of educating our young people through the School Aid Formula. This formula has three parts: a basic property tax levy of $5.40, State Aid that brings each school district up to a statewide average of 87.5% of the average per pupil cost statewide and a second property tax levy that generates the final 12.5% of funding. Iowa spends an equal amount on each child as the courts have ruled (currently about $6,000 per pupil).

Maquoketa Valley generates more property tax money because the Lake Delhi Community makes it a “property rich” district in terms of assessed valuation. Without the dam, property values of the Lake Community have dropped nearly 40% and are expected to continue to decline.  This will mean the state has to put more money into the school district. It also means Maquoketa Valley property tax payers will have to pay more property taxes to make up for the lost Lake Community value.

This is projected to cost the State of Iowa approximately $300,000 to $500,000 for every year going forward; or the state can make a one-time $5 million investment to restore the dam and maintain the property tax base for the school district. From a budget perspective, it makes more sense for a one-time investment, rather than paying more money going forward forever.  This is truly a pay me now or pay me more, later issue.  I hope you can support the appropriation.

House Approves Senate Changes the Prison Supplemental Bill

On Tuesday, the House approved Senate File 2071, the FY 12 supplemental appropriations bill.   

When the Senate initially approved the bill, $8.5 million was appropriated to the Department of Corrections.  The bill also created a third round of funding available from the Mental Health Risk Pool ($5.0 million).  The Senate approved the bill on February 1 on a 26-23 party-line vote. 

The House approved the bill for the first time on February 15 on a 96-0 vote.  The House reduced the supplemental to the Governor’s recommendation of $6.5 million and off-set the appropriation by reducing the appropriation for Medicaid by $6.5 million.  The House also changed the risk pool language to only allow for the first two tiers of counties to be eligible for the additional mental health funding.

On Monday, February 20, the Senate approved the bill for a second time.  The House agreed to add $1 million for prisons and CBCs, which went to the following institutions as follows:

• Rockwell City Prison — $86,998          Clarinda Prison — $187,387
• Mitchellville Prison — $216,965           Fort Dodge Prison — $196,961
• CBC District 2 — $130,853                  CBC District 4 — $25,498
• CBC District 5 — $155,338                      

In addition, the Senate appropriated $7.2 million from the Economic Emergency Fund (EEF) to restore the standing appropriation to the Property Tax Relief fund for mental health services.  This is needed to prevent a $7.2 million property tax increase due to approving a two-year budget last session.

Finally, the Senate amendment removes the provision that county MHMRDD committees are not required to submit a three-year strategic plan by April 1, 2012 to DHS, since the Legislature is in the process of overhauling state mental health services.

The House approved the Senate amendment on a voice vote and approved SF 2071 on a 95-0 vote.

If you have any questions, comments or concerns about these topics or any others please feel free to contact me by e-mail at lee.hein@legis.state.ia.us or by phone at (515) 281-7330.

Sincerely,

Lee Hein

Recap of Week 6

We had the honor of hosting Chinese Vice President Xi Jinping Wednesday night at the Capitol. I had the pleasure to visit with Wang Lei, Vice Chairman of Beijing Kings Nower Seed S&T Co., LTD. in China. Overall, the night was a great experience and very enjoyable.

On Wednesday we had an incredible presentation in Agriculture Committee from Trent Loos. Mr. Loos is a Midwest farmer that hosts a radio program and writes a blog pertaining to rural America and Agriculture. He touched on several different topics including the importance of nitrates in the human body and the importance of agriculture and technology education. He emphasized how new technology in agriculture has provided for higher yielding crops and more food availability. If interested in learning more about Mr. Loos, you can visit his website at www.loostales.com.

This Saturday, the 18^th, there will be a forum at the Maquoketa Valley REC in Anamosa at 9:00 as well as at City Hall in Monticello at 11:00. As always, the forums are open to the public and I encourage anyone to come and share any thoughts or concerns you may have.

Next Saturday, the 25^th, I will be meeting with the Dubuque and Delaware County Farm Bureau at Country Junction in Dyersville at 10:00 am.

House Republicans Pass Historic Property Tax Reform and Relief

Tuesday House File 2274, the only property tax proposal that delivers significant tax relief and genuine reform to all classes of Iowa’s property tax payers, passed the Iowa House.  

Iowa currently has the 2^nd highest commercial property taxes and the 16^th highest residential property taxes in the country.  Additionally, over the last ten years, school property tax collections have increased 60 percent, counties have increased 64 percent, and cities have gone up 74 percent.  Over the same time period, Iowans’ personal income only grew by 46 percent.  

If nothing is done, the hardworking taxpayers of Iowa are staring down the barrel of a $2.5 billion property tax increase over the next 10 years, with the majority of that falling to homeowners. 

Now is the time for real, genuine property tax relief and reform for ALL Iowans.  This bill will put money back in the pockets of Iowa families and job creators.

Property tax reform also affects Iowa’s economy and is an impediment to putting people back to work.  The Republican plan further provides an emphasis on smaller, Main Street, entrepreneur-type employers.  It creates predictability and stability for all employers.

Highlights of the Republican plan include:

ALL Iowans receive tax relief and there is no shifting of burdens to any one class of property

Job creators receive a $602 million property tax cut

Homeowners receive a $417 million property tax cut

Republicans’ proposal offers a total of $1.2 billion in relief for Iowa property taxpayers

The plan proposed by Democrats results in a $2.5 billion property tax increase, with $1.69 billion of that falling on the backs of homeowners.

According to public polling, Iowans favor broad based property tax relief proposal, similar to the Republican plan, by a 2 to 1 margin over a targeted tax credit plan, similar to the Democrat plan.

This will be the fourth property tax reform proposal the House has sent to the Senate for their consideration.

Trees for Kids Grant Application for Spring 2012 Now Online

Trees for Kids and Trees for Teens are tree education and planting programs targeted to Iowa’s elementary and secondary school students. The goal of these programs is to educate students about the value of trees and to encourage tree planting projects at schools and other public areas around the state.

The competitive grants awards range from $1,000 and $5,000 for qualified tree planting projects on publicly owned property.  All trees for the spring grant must be planted by May 31, 2012.

These trees can help cities, counties and schools to increase their urban canopy and increase the urban forest diversity in order to prepare for Emerald Ash Borer and Gypsy Moth.

For more information, visit: www.iowadnr.gov/Education/ForTeachers/EducationTrainingPrograms/Trees for KidsTeens.aspx

Utilities Board Set Hearings for Public Input on Electricity Rates

For the first time in years, MidAmerican Energy Company is seeking a rate increase for electricity rates.  The company is expected to file for a rate increase of 3-4 percent in the next few weeks.  This would be the first electric rate increase for MidAmerican customers in 16 years.  In preparation for this request, the Iowa Utilities Board has set up 6 meetings around the state to take input from MidAmerican customers.  The dates and locations are:

February 23, 2012 – DES MOINES – Utilities Board Building, Hearing Room, 1375 E. Court Avenue
February 28, 2012 – DAVENPORT – Modern Woodmen Park, Suites 10 & 11, 209 S. Gaines Street
March 1, 2012 – WATERLOO – Petersen Town Hall, Waterloo Center for the Arts, 225 Commercial Street
March 6, 2012 – SIOUX CITY – Briar Cliff University, 3303 Rebecca Street, Stark Student Center, Clare Room
March 8, 2012 – IOWA CITY – Johnson County Fairgrounds, 4261 Oak Crest Hill Road SE, Montgomery Hall
March 13, 2012 – COUNCIL BLUFFS – Council Bluffs Public Library, Rooms A & B, 400 Willow Avenue

Mental Health Redesign Bills Start Moving in the Iowa House

After months of public discussion and interim committee meetings, the House Human Resources Committee has begun work on three pieces of the legislation that will redesign Iowa’s mental health and disability services system.

House Study Bill 623 is the product of the DHS/Judicial Branch work group that has been in existence for several years.  In 2011, the group was tasked with addressing a number of issues related to the interaction of law enforcement, the Judicial Branch, and the mental health system.  The group put together a series of recommendations ranging from on-going mental health and disability services training for law enforcement officers, the ability of residential care facilities to determine whether or not to accept people referred to them by the court, and clearing up conflicts within the Code on which mental health professionals may be involved in the commitment process. 

The change that may have the most immediate impact within the bill is a change to all pre-assessment screening for all individuals considered for commitment.  The screening is usually done at a local health care facility, like a hospital or mental health center.  Under current law, this screening is only allowed when the clerk of court office is closed.  This means a person going through the commitment process during work hours may have to go to one of the four mental health institutes before anyone assesses their current condition and service needs.  Allowing the pre-commitment screening at any time will help reduce the number of long trips that sheriff departments must take to the MHI’s or psychiatric units.

House Study Bill 624 is significant in length, but simply does one thing.  The bill strikes references in the Code to “mental retardation” and replaces that term with “intellectual disability”.  There has been a national push by a variety of disability advocate groups to make this term change.

The final bill, which is expected to be released on Wednesday afternoon or Thursday morning, will be the main redesign bill.  It will track many of the recommendations proposed by the Department of Human Services.  These include:

• Transforming the management structure for mental health services from a county-based system to regions;
• Changing the basis for determining financial responsibility from the rule of legal settlement to a determination of residency; and
• Establishing core services that will be available throughout the entire state.

One new element in this bill is the issue of future funding for the system.  Under the language passed in Senate File 209 last year, the current mental health levy is phased out at the end of FY 2013.  The statewide amount generated by the current levy is $125 million.  The House study bill will call for a four year phase out to begin in FY 2014, with the state providing dollar for dollar property tax relief

If you have any questions, comments or concerns about these topics or any others please feel free to contact me by e-mail at lee.hein@legis.state.ia.us or by phone at (515) 281-7330.

Sincerely,

Lee Hein

Recap of Week 5

This week I had the pleasure to meet with three area superintendents; Chris Anderson from Monticello, Brian Ney from Anamosa, and Brian Rodenberg from Midland.

On Friday I will be meeting with the Soil Conservation Board in Anamosa and I will tour the Penn Center in Delhi.

This Saturday, the 9^th, there will be a forum at the Legion Hall in Ryan at 8:30. Please come and share your thoughts or questions with me.

Saturday, February 18^th, there will be a forum at the Maquoketa Valley REC in Anamosa at 9:00 as well as at City Hall in Monticello at 11:00. I encourage everyone to come and share any thoughts you may have on issues concerning our area or state.

Now is the time for property tax reform

Over the last ten years, property taxes collected on a statewide basis for schools, counties and cities have increased over 60%, or over $1.7 billion dollars.  Those numbers are truly staggering and the Legislature can’t afford to do nothing.

Residential property taxes will naturally increase in the coming years.  Over the next 10 years, property taxes paid by homeowners will increase from $2.3 billion in 2012 to $3.9 billion in 2022 – a 73% increase.  This must be addressed.

The 2010 Business Tax index ranked Iowa’s business tax climate 46^th out of 50 states.  Commercial property in Iowa is taxed at 100 percent of assessed value and is a major drawback to attracting and keeping businesses of all types and sizes.

Property tax reform has been studied and debated for the last 30 years.  Now is the time to act.  House Republicans have proposed a comprehensive plan with the following principles:

• Rollback commercial property taxes from 100% to 60% over an eight year period with small businesses seeing the greatest benefits first, then large businesses seeing the same benefits by year eight.
• Increase the regular school foundation formula from 87.5% to 100% over an eight year      period. This will help mitigate or prevent any shift to residential and provides homeowners with dollar for dollar property tax relief.
• Aligns local government spending with the rate of inflation plus new growth.  Local budgets would be tied to a Midwest CPI index, plus net new growth and closely align their spending with the income growth for those who pay for the services.
• Provide backfill dollars for local governments that don’t see growth, to help them adjust and allows local governments to exceed their budget by a vote of the people.

It is a bold plan, and one that if enacted would help spur growth, provide property tax relief to all classes of property while allowing local government budgets to continue to grow, albeit at a more sustainable pace. I sit on the Ways and Means Committee and we moved this bill through this week. It will be debated on the floor in the coming week.

2012 Century and Heritage Farm Program

On Wednesday, February 1, 2012, the Iowa Department of Agriculture and Land Stewardship (IDALS) issued a press release in which Iowa Secretary of Agriculture Bill Northey encouraged eligible farm owners to apply for the 2012 Century and Heritage Farm Program.  The program is sponsored by IDALS and the Iowa Farm Bureau and recognizes families that have owned their farm for 100 years in the case of Century Farms and 150 years for Heritage Farms. 

Applications are available on the Department’s website at www.IowaAgriculture.gov  by clicking on the Century Farm or Heritage Farm link under “Hot Topics.”  Applications may also be requested from Becky Lorenz, Coordinator of the Century and Heritage Farm Program via phone at 515-281-3645, email at Becky.Lorenz@IowaAgriculture.gov  or by writing to Century or Heritage Farms Program, Iowa Department of Agriculture and Land Stewardship, Henry A. Wallace Building, 502 E. 9th St., Des Moines, IA 50319.

Farm families seeking to qualify for the Century or Heritage Farms Program must submit an application to the Department no later than June 1, 2012.  The ceremony to recognize the 2012 Century and Heritage Farms will be held at the Iowa State Fair and is scheduled for Tuesday, August 14th. 

The Century Farm program began in 1976 as part of the Nation’s Bicentennial Celebration and over 17,000 farms from across the state have received this recognition.  The Heritage Farm program was started in 2006, on the 30th anniversary of the Century Farm program, and more than 500 farms have been recognized.  Last year 341 Century Farms and 56 Heritage Farms were recognized.

Democrats’ Budget Spends More than the State Takes In

On Thursday, February 2, Senate Democrats released partial targets for the FY 2013 budget.  Unlike the proposals by the Governor and Legislative Republicans, Senate Democrats’ blueprint spends more than the state takes in.

House and Senate Republican budget targets appropriate $6.059 billion from the general fund and $106 million from the Health Care Trust Fund (HCTF).  The Governor appropriates $6.244 billion from the GF and $106 million from the HCTF.  (The $106 million is the same amount for the HCTF as FY 2012.)  Both of these amounts represent a figure that is lower than ongoing general fund revenue.

The Senate Democrats appropriate $6.218 billion from the general fund.  While this appears to be $25 million less than the Governor, in reality it is $88 million more than the Governor because the Senate Democrats recommend taking an additional $113 million of tobacco tax revenue and transferring it to the HCTF.  The transfer reduces ongoing revenue from $6.251 billion to $6.134 billion.

House Republicans have three budget principles.  First, the budget cannot spend more than the state takes in. Second, it should not use one-time money to balance the budget.  Finally, it cannot purposefully underfund entitlements like Medicaid and commitments like the property tax credits.

The Senate Democrats’ budget violates the first budgeting principle.  Therefore, House Republicans will insist that the final budget spends less than ongoing revenue.

Comparison of Budget Plans

                         Governor         House GOP      Senate Dems

Available Rev    $6.538              $6.538                    $6.538

Ongoing Rev    $6.251              $6.251                      $6.134

Net Approps       $6.244            $6.059                       $6.218

Health Care Trust Fund$106M   $106 M                     $219M

Taxpayer Trust Fund $46M       $336 M                      $46M

Amount Over/Under *$7M under  $192M under        $84M over

*This is the amount the Governor and House / Senate Republicans are under the ongoing revenue.  The Senate Democrats’ budget plan spends $84 million more than ongoing revenue.

If you have any questions, comments or concerns about these topics or any others please feel free to contact me by e-mail at lee.hein@legis.state.ia.us or by phone at (515) 281-7330.

Sincerely,

Lee Hein

Recap of Week 4

This week I had the privilege of meeting with the Jones County Safe and Healthy Youth Coalition. The group of students are working hard to promote the dangers of underage drinking and to encourage harsher penalties for those who supply alcohol to minors.

Tuesday was Insurance Day at the Capitol and I had the opportunity to meet with Scott De Sousa of Dubuque. I also met with Doug Martin of Wendling Quarries this week.

On Saturday, February 4^th, the Director of the Iowa Department of Human Services, Chuck Palmer, will be giving a presentation on the Mental Health Reform Bill. The event will be held in the Harbor Room at the Diamond Jo Casino, located in the Port of Dubuque, from 11:30-1:30. Also on Saturday there will be a forum in Olin at Selma’s Kitchen at 9:00 am, weather permitting.

Next Saturday, February 11^th, I will be holding a forum with Rep. Steve Lukan at the American Legion in Ryan at 8:30 am. Everyone is invited to attend and share any comments or concerns you may have.

House Republicans Propose Conservative Budget Blueprint

On Thursday, February 2, House Republicans announced targets for the Fiscal Year 2013 budget.  House Republicans have proposed a budget that is honest, transparent, and sustainable.  The budget does not spend more than the state takes in, and will provide for priority services in the areas of education, health and human services, and public safety.  It also does not use one-time money to balance the budget and it does not purposefully underfund commitments like the property tax credits.

The House Republican Budget proposal spends $6.059 billion or $313 million less than the total overall spending for FY 2011 and $59.9 million more than the FY 2012 budget.  The increase is almost all due to $55 million to fully fund the property tax credits.  If enacted, this will be the first time the property tax credits have been fully-funded since FY 2000.  Despite the increase to fund the property tax credits, it is still only a 1 percent budget growth over FY 2012.

A key component of the targets is $42.9 million for state employees, including legislators, to contribute to the cost of their health insurance.  This assumes that all state employees, including legislators, will pay at least $200 per month for their premiums.  This is a reasonable thing to ask considering the private sector premiums.

Another key component is $20 million in efficiency savings.  The bill, which will originate in the State Government Committee, shows House Republicans are committed to the most efficient government possible.  House Republicans will continue to find efficiencies that the taxpayers demand.

The FY 2011 budget spent $6.372 billion in total.  This includes $5.344 billion from the general fund, $872 million in other funds used for ongoing spending and $156 million of underfunded K-12 spending.

The FY 2012 budget spends $6.137 billion in total.  This includes $5.999 billion from the general fund, $106 million from the Health Care Trust Fund and $32.5 million in commerce revolving fund.  This is $235 million less than total spending in FY 2011.

Under current law, the Legislative Services Agency estimates the expenditure limitation is $6.475 billion for FY 2013.  However, this includes ending balance funds that should not be used to support ongoing spending.  The Governor’s budget recommendations appropriate $6.244 billion in general fund spending and leaves an ending balance of $296 million.  The Governor’s budget aligns ongoing spending with ongoing revenue.

These targets will not be easily achieved without difficult work being done to eliminate unnecessary and duplicative programs and spending.  But this work must be done in order to ensure the state has the ability to fund Iowans’ priorities.

The budget subcommittees will have to approve the bills by February 9^th and the House Appropriations Committee will approve House-originated bills by February 16^th.  The hope is that the Senate Appropriations Committee will approve Senate-originated bills by that date as well.  Then after the first funnel the House and Senate will begin approving the budget bills on the floor.

House Republicans believe that ongoing spending must be aligned with ongoing revenue to ensure that the budget is sustainable in the future and to create a climate that encourages job creation.

Iowa’s Unemployment Rate Drops to 5.6% in December

Iowa Workforce Development announced last week that Iowa’s unemployment rate had dipped to 5.6% in the month of December.  This marks the second month in a row that the rate has dropped.  In October, Iowa’s unemployment rate was at 6.0% and in November it had dropped to 5.7%.  The drop in to December places Iowa as the state with the 6^th lowest unemployment rate in the nation.  The national average also fell to 8.5% for the month of December.

Despite the percentage drop, nonfarm employment actually fell from 1,487,100 to 1,482,400, a net loss of 4,700.  The sector reflecting the biggest drop was ‘leisure and hospitality’, while the ‘manufacturing’ sector actually saw an increase of 800 jobs.

For the whole of 2011, the state’s unemployment rate dropped .5% and the state saw nonfarm employment increase by a net of 9,000. The sectors most responsible for the increases were ‘manufacturing’ (+8,500) and ‘educational and health’ (+3,900).  Over the last year the sectors that saw the largest decreases in employment were ‘government’ (-3,000) and ‘financial activities’ (-1,800).

Human Services Moves Child Abuse Registry Reforms

The House Human Resources Committee continued its work to balance the due process rights of Iowans while protecting Iowa’s children with the discussion of House Study Bill 510.

During the 2011 session, the Legislature passed legislation calling for steps to be taken by state agencies to speed up appeals for those challenging placement on the state’s child abuse registry.  One of these efforts was the creation of a work group to examine many of the concerns people had about the registry process.

The group brought together state agencies as well as child protection advocates and those representing people accused of abuse.  The group met through the fall and identified a series of issues related to the speed of appeals, the parties that have the right to appeal child abuse assessment decisions, and how to handle those who are on the Registry now but should not be on there for the full ten years.  A number of items have already been implemented by the Department of Human Services, Attorney General’s office, and Department of Inspections and Appeals that have significantly sped up placement appeals.  These steps have enabled the Department of Inspections and Appeals to hear an appeal within 6 weeks of a party receiving notice.

The group also identified a series of actions that they felt would improve the Registry, but required legislative action.  These recommendations have become House Study Bill 510.  Among these are clarifying who has a right to appeal a child abuse assessment decision, ensuring people have the right to provide information to DHS on their case, and the ability to hold off Registry decisions if there is an ongoing court case. 

Currently, a person who is found to have committed child abuse is placed on the Registry for 10 years.  There is no distinction for the circumstances of the case, meaning a mother whose child slipped out of their apartment to play in the sandbox outside is on the Registry as long as a person who commits sexual abuse.  The group felt DHS should be given the authority to remove people from the Registry prior to passage of the ten years when the Department feels it would be prudent to do so.  The bill requires DHS to come forward with a plan for implementing this by December 2012.

The bill also calls on the Department to study changing Iowa’s child abuse assessment system to create a differential response where cases would be triaged at intake and those that are do not rise to a level are not placed on the Registry.  The federal Department of Health and Human Services is encouraging states to consider this change.  Finally, the bill requires DHS to report back to the Legislature on the impact the proposed and implemented changes have had on the timeliness of appeals.

If you have any questions, comments or concerns about these topics or any others please feel free to contact me by e-mail at lee.hein@legis.state.ia.us or by phone at (515) 281-7330.

Sincerely,

Lee Hein