Capitol Update: Week 6

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Amending House File 291

We spent this week discussing House File 291.  This is the collective bargaining legislation. We have listened to Iowans during the subcommittee and committee process, at the public hearing, at forums across the state, and through emails and phone calls.  During this process, a number of items were brought to our attention that needed to be addressed.  The amendment was a culmination of those discussions and addresses many of the concerns Iowans have expressed over the course of this debate.

It reinstates proper cause for suspensions and discharges. This means there will be still need to be documentation and a reasonable justification to terminate the employee.  There is also case law and court rulings that protect the employees from wrongful termination.

It removes some items from the list of prohibited negotiations.  They are release time, grievance procedures, Seniority and any benefits related to seniority.  It moves them to the permissive topics.   This means these topics can be discussed if both parties agree to discuss them.

The next part of the amendment reinstates the right to appeal a civil service commission’s decision to district court. It requires the court to give deference to the commission’s ruling. In the original bill we believed that the right to an appeal was a part of the process.  This makes the wording more clear.

We fixed a drafting error that could have affected firefighter and police pensions. We reduced the threshold to qualify as public safety employment to 30% (was previously 50%).   In small sheriff’s departments where deputies, jailers and dispatchers negotiate as one unit, if the makeup of deputies is more than 30% the unit can negotiate under the public safety part of the code. We added motor vehicle enforcement officers to the list of public safety employees.

Lastly I want you to understand how I reached my decision to support this legislation.  It actually started many years ago as a school board member in Monticello.  I was a part of the negotiation process each year.  I remember one evening when we were reducing a couple positions because of the poor financial state of the district.  The money was not there.

I sat that evening listening to a union steward from Des Moines tell us we had lots of money.  All we need was to raise taxes on the taxpayers of the district.  From that point on, I knew the law needed to be changed.

I supported a similar bill back in 2011 and 2015.  I believe this legislation will give more control back to the school boards, counties, and the cities. That is a good thing.   I appreciate all the email, phone calls and people who contacted me both for and against this bill.

Capitol Update: Week 5

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Discussion and Clarification on Chapter 20

A lot has been said about the bill to restructure collective bargaining.  This bill doesn’t affect private sector workers.  The Federal Government has always held jurisdiction over private sector labor relations and reforms to Chapter 20 does not change this fact.  The bill doesn’t take away or modify Iowa’s public pensions nor does it take away health insurance.  In Iowa, public pensions have always been excluded from the scope of collective bargaining.  HSB 84 explicitly states the employer must offer health insurance.  Public safety employees are exempt from the changes made.

Employees have protections against discrimination, harassment, retaliation or any other unlawful practices.  It is already illegal for employers to discriminate against employees on based on protected characteristics such as basis of race, color, religion, age, sex (including pregnancy), national origin, creed, sexual orientation, sexual identity or disability.  Iowa employers with four or more employees must comply with these laws.  This bill does nothing to undo those protections.

The scope of negotiations outlined in Chapter 20 only refers to the ability of a union to bargain those items with an employer. The changes in the bill have no effect on an individual employee’s rights to discuss or negotiate on their own accord with their employer about any topics they feel are imperative to their employment.

A pragmatic long-term change reflecting today’s economic realities is needed regarding Iowa’s collective bargaining law.

Constructive cooperation, not obstruction and fear-mongering, is needed regarding collective bargaining.  Collective bargaining advocates are arguing the law has worked well for 40 years and changes are not necessary.  Yet that did not stop those same advocates from serious attempts to significantly expand collective bargaining in 2007 and 2008.

The bottom line is that school boards, mayors, city councilors, county supervisors along with state government leaders will have more flexibility to do the jobs taxpayers elected them to do which is to manage state resources and quickly and effectively respond to their concerns.

News from District 96

This week’s focus revolved around Chapter 20.  However, we also found time to address other issues as well.  This week the Ag Committee welcomed Director Gipp of the DNR, Secretary Northey from IDALS, and Dr. John Lawrence from Iowa State.  They discussed ongoing water quality efforts in the state.  The information they provided will assist us in conversations going forward about Iowa’s rivers and streams.

Capitol Update: Week 4

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State Revenue Growth Stays at 1.2 Percent Through January

State revenue showed some improvement over last January.  But that improvement was not enough to raise the year to date revenue growth above December’s level.  The non-partisan Legislative Services Agency released the January 2017 revenue report on Wednesday afternoon.  For the month, state revenue grew by 0.8 percent over January 2016.  For the fiscal year, revenue growth remained at 1.2 percent growth level.

Personal income tax suffered a rare negative month in January.  State tax collections in this category fell by 24.1 percent, or 5.8 percent.  But that reduction is not entirely correct, as January 2016’s personal income tax collections were $23 million higher than what they should have been, as a taxpayer mistakenly sent in $23 million of withholding tax in January 2016.  Without that abnormality, January 2017 personal income tax revenue would have been down $1.1 million.

For the fiscal year, personal income tax revenue is up 1.5 percent.  For the year, growth in this category is projected to be 5.8 percent.  So while this may be a cautionary sign, it is important to note that a significant part of the year’s collections will come in during the spring.

As for sales tax revenue, the state had a very strong January.  But just like personal income tax collections, this too is a bit deceptive.  January sales tax was up $34.5 million, or 22.5 percent, over last January.  The significant increase is due to a major return date being on a Sunday, and thus artificially lowering January 2016’s figure.  For the year, sales tax is up 2.7 percent.  This is higher than the REC’s projection of 1.9 percent growth.

Corporate income tax collections in January rose by 7.7 percent over January 2016.  For the year, corporate returns are a negative 0.5 percent.  The REC projection is for 2.1 percent growth in this category.  January was also a strong month in inheritance tax collections, coming in 40.5 percent higher than last January.  Even with this strong month, inheritance tax is still running 13.3 percent behind for the fiscal year.  Tax refunds also were significantly higher this January.

News from District 96

Monday night we addressed the FY16 budget shortfall.  There was a large amount of debate and we had to make tough choices.  However, we made K12 education funding a priority and left it off the cutting block.  I am confident that the decisions we made uphold our state’s budget in a strong fiscal manner.

This week Major Genera Orr gave the annual condition of the National Guard address. He stated in his speech that the 178 year old Iowa National Guard continues to be “mission focused and warrior ready.” Orr outlined how the 9,000 members of the Iowa National Guard play an integral part of national security by supporting the U.S. Army and Airforce. He stated that Iowa currently has 425 soldiers and airmen mobilized in combat operations around the world because the Iowa National Guard is no longer just called upon for natural disasters in Iowa.  I was honored to have the opportunity to escort the Governor to the House Chamber as part of this event and I appreciate the service of our Iowa Guardsmen.

The rest of the week I was able to speak with various groups about important issues.  Tuesday afternoon the Anamosa FFA talked about Agriculture Education and issues affecting their program.  I am excited to see what these students for agriculture and for our state in the future.  Tuesday evening I visited with the state patrol and had a chance to participate in an active shooter simulation.  These simulated scenarios are part of what officers go through in training on when and when not to use deadly force.  This unique experience gave me a greater appreciation for our law enforcement community.

Wednesday I had the chance to visit with the Farm Machinery Dealers Association.  I visited with Jim Johnson from the Anamosa Eureka at the Newspaper Association Reception that night as well.

Three of the superintendents from District 96 came to visit about State Supplemental Aid for our schools.  Dr. Rickey from West Delaware, Doug Tuetken from Maquoketa Valley, and Lisa Beams from Anamosa also shared their thoughts about upcoming issues this legislative session.

Capitol Update: Week 3

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FY 2017 Deappropriations Bill

The state is facing a $117 million shortfall in revenues that is needed to meet the spending levels approved by the 2016 Legislature.  To fix this problem, the 2017 Legislature needs to reduce spending levels so that they do not exceed revenue.  The state cannot spend money it does not have.  The FY17 Deappropriations bill conforms to these strong budgeting principles.

When the Legislature adjourned in April, total spending was less than expected revenue.  Since then the revenue estimate was lowered creating the need to reduce costs in order to prevent a tax increase and maintain a balanced budget.  FY 2017 is the fourth consecutive year where actual revenue to the state will not meet the official forecast from the Revenue Estimating Conference.  We may need to look for ways to improve the accuracy of the REC’s revenue projections in the future.

Within the bill, state agencies have flexibility to implement the cuts in the best way possible for their agency.  This will help agencies to avoid program disruptions that impact the public.  While the bill includes reduction to state universities, the reductions in the bill are less than the amount in the Governor’s proposal.  The president of the Board of Regents, Bruce Rastetter, has told the media that this reduction will not result in a tuition increase.  We have been working towards this agreement since the beginning of the session.  Through this thoughtful approach, we’ve prevented any cuts to K-12 education and we were able to protect key priorities like public safety and community colleges from drastic cuts.  Overall I believe this bill represents smart decisions made in tough times to keep our state moving forward in a sound fiscal manner.

News from District 96

As Chair of the House Agriculture Committee this week was very busy.  I enjoyed attending both the Iowa Soybean Association and the Iowa Pork Producers Legislative Receptions.  I was able to visit with both Bob Ballou and Kevin Glanz to discuss issues that are important to soybean producers.  I appreciated their insight on challenges facing the industry.  I would like to congratulate Alan Wulfekuhle as he finishes his term as President of the Iowa Pork Producers.  He did a great job for his association and pork producers.

The Iowa Pork Congress was recognized this week in a resolution.  The Pork Congress takes place annually in Des Moines.  It is a gathering of producers who contribute 36.7 billion dollars to Iowa’s economy and 141,000 jobs.  Pork Producers play a large part in Iowa’s Ag Economy.

This week the Governor signed a proclamation declaring February 19th-February 25th, 2017 as Grain Bin Safety Week.  I had a chance to participate in a grain bin rescue exercise at the Farm Progress Show.  It was an eye-opening experience and I hope that this proclamation reminds Iowa’s farmers to be cautious near their storage sites.

Capitol Update: Week 2

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Tax Refunds Will Come Later This Year

The Iowa Department of Revenue is again working with the Internal Revenue Service, other state revenue agencies, and the tax filing software industry to fight tax-related identity theft and refund fraud. Operation “Security Summit,” aims for stronger protections for taxpayers in the upcoming tax filing season that begins January 23rd, 2017.

Because advances in technology have made it much easier, faster, and more profitable for criminals to steal tax information, Iowa taxpayers should be aware of some changes for this year’s tax filing season. Refunds from the Iowa Department of Revenue may take longer. The Department has extensive fraud software built into the tax processing systems—and this means dedicating more time to verifying the validity of tax refund claims before sending out refunds. The hope is that the extra time helps to ensure the right person gets the right refund and that criminals get no refund.

Another thing for Iowa taxpayers to be aware of is that no Earned Income Tax Credit refunds will be paid until early March. Beginning in 2017, the IRS will be holding onto refunds of tax returns claiming the Earned Income Tax Credit until mid-February. This delay was created to protect taxpayers by giving the IRS more time to detect and prevent fraud. The Iowa Department of Revenue will also need to take extra time to apply its own fraud checks to those refund claims.

FY 2017 Deappropriations Bill

The state is facing a $117 million shortfall in revenues to maintain the spending levels approved by the 2016 Legislature.  To fix this problem, the 2017 Legislature needs to reduce spending levels so they do not exceed revenue.

The state cannot spend money it does not have.  When the Legislature adjourned in April, total spending was less than available revenue.  Since then revenue has dropped creating the need to reduce costs to maintain a balanced budget and prevent a tax increase.

In the future it may be wise to hold down overall spending below amounts allowed by the state’s 99% Expenditure Limitation Law.  This law only allows the state to spend 99% of our total revenue and leaves the other 1% in reserve.

News from District 96

It was a short week in Des Moines because of Martin Luther King Jr. Day.  We did not gavel in until Tuesday.  The Iowa Turkey Federation spoke to the Ag Committee on Wednesday about the turkey industry and issues that were important to the group.  I enjoyed their presentation.

It was an honor to welcome Ron Struble to the Capitol this week. Ron is a veteran and a member of American Legion Post 45 in Manchester.  Being new to serving on the Veterans Affairs Committee I appreciated his thoughts on the needs of the Veterans Community.  I am grateful for his and all of our veterans’ services.

 

Capitol Update: Week 1

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Water Impairments Do Not Mean Pollution

Each year thousands of Iowans enjoy swimming, fishing, and boating in our state’s waterways.  Yet, many people continue to be concerned about the number of water impairments in Iowa.  I firmly believe that Iowans can safely use the vast majority of our state’s waterways and the water impairments are broadly overstated.

It takes very little for a body of water to be ‘impaired.’  At the time the Clean Water Act was created our waters were truly polluted with industrial waste, plastic, and other chemicals.  The Clean Water Act created broad designations for water uses.  The EPA has used these guidelines to create standards that are difficult if not impossible to meet.  A lake or river may have many uses or designations and if just one does not meet these strict EPA standards then the waterbody is declared impaired.

The vast majority of Iowa’s water impairments are considered low priority.  This essentially means that very little can be done to take the stream or lake to get off of the impairment list.  It also means that a cause for impairment may be impossible to determine.  Possible causes may be that there is not enough shade over a stream resulting in warmer water than required or that carp have stirred up too much sediment.   These impairments are simply caused by Mother Nature and do not affect Iowan’s opportunities to enjoy their waterways.

News from District 96

This was a busy first week back in Des Moines that was filled with speeches and new introductions.  I am humbled that Iowans from House District 96 have once again reelected me to serve as their Representative.  This session we have fifteen new representatives and eight new senators.

On Tuesday the Governor gave what he called his final State of the State Address.  Governor Branstad reflected on various items from his time in office as well as his excitement to serve as Ambassador to China.  The Governor talked about increased highway deaths and urged the legislature to approach the issue of distracted driving.  Governor Branstad also discussed the current 110 million dollar shortfall in the FY 17 budget ending in June.  The Governor recommended various approaches to addressing the shortfall that the legislature will need to look at.

Upcoming Forums:

January 21st 9:00 am-11:00 am Jones County Farm Bureau Forum at the National Motorcycle Museum

January 27th 12:00 pm-1:00 pm Jones County Economic Development Forum at the Monticello City Council Chambers

February 3rd 9:00 am-11:00 am Delaware County Farm Bureau Forum at the Delaware County Farm Bureau Office

Please get in touch with me about your thoughts and concerns as we move through the legislative session.

 

December Capitol Update

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Revenue Estimating Conference Moves FY 2017, 2018 Revenue Down Again

December 12th meeting of the Revenue Estimating Conference was one of the more lengthy meetings of this body in recent memory.  There was good reason for additional time and discussion as the three members agreed to significantly lower their projection for the current fiscal year and to again lower their forecast for Fiscal Year 2018.

All three members acknowledged the difficulty of finding confidence in the revenue number for FY 2017 due to several unsettled factors.  The agriculture sector and related manufacturing industries are still feeling the impact of lower commodity prices being compounded by the strength of the dollar.  The group believes ag-related income collections are bottoming out in tax year 2016.

In the end, the REC lowered their estimate for FY 2017 to $7.2119 billion.  This is $96.2 million lower than the October estimate of $7.3081 billion for the current fiscal year.    After the October estimate, the non-partisan Legislative Services Agency calculated that the state needed to find $14.6 million to balance the state budget.  With the new figure, the revenue shortfall is projected to be $110.8 million.  LSA is also projecting that Medicaid may need an FY 2017 supplemental appropriation of $22 million, which would add to the overall amount.  This will more than likely force us to go back in to last year’s budget and do a de-appropriation.

As for FY 2018, all three members of the REC were significantly more confident when compared to FY 2017.  It is believed that many businesses are taking losses in tax year 2016, which should help corporate tax collections.  Also, any improvement in agricultural income has a substantial impact on state revenue.  The continued wage pressure due to a shortage of qualified workers to fill many of the open jobs in the state should also drive up income tax collections.

The REC agreed to a revenue estimate of $7.5563 billion for FY 2018.  This amount is $51 million lower than the October estimate of 7.6073 billion.  With the official estimate now set, LSA has calculated that the expenditure limitation for Fiscal Year 2018 would be $7.4807 billion.  This figure is $268.8 million above the new revenue level for FY 2017, or an increase of 4.2 percent in collections.

NEWS FROM DISTRICT 96

November and December have been filled with meetings both here in the district and in Des Moines.  As we prepare to start the session, many issues are being discussed as the agenda is being set.

Once again, I will be chairing the Agriculture Committee and serving on State Government.  I have been assigned to the Labor and Veterans Affairs Committees too.   These are two committees that I have not served on before but I am looking forward to new challenges.

If you have any issues you think need to be looked at or addressed in the upcoming session please feel free to contact me.  My email address is lee.hein@leigis.iowa.gov Or by phone 319-480-1997.

I wish everyone a Merry Christmas and a very Happy New Year.