House Appropriations Begins Review of Standing Appropriations

A new subcommittee of the House Appropriations Committee began the task of reviewing the standing appropriations within the state’s budget. The Budget Review Subcommittee, led by Rep. Ken Rizer, will help set the foundation for the Standing Appropriations bill that will be started in the House this year.

Unlike other line items in the state budget, there are a series of state appropriations that are established in either the Iowa Code or Iowa Constitution. These appropriations are known as standing appropriations.  The largest standing appropriation – State Foundation School Aid – is reviewed every year as the Legislature sets the annual Supplemental State Aid figure for growth in school funding.  But most of the remaining standing appropriations continue to be funded every year without serious legislative review.

The Budget Review Subcommittee will spend the next few weeks reviewing many of the existing standing appropriations. They will work to identify what each line item does, reviews its level of funding, and determine if any efficiencies or reforms can be implemented to improve that line item’s function.

The review will begin with an examination of Legislative budget. Funding for the Legislature is set out in the Iowa Code, which grants the General Assembly a standing unlimited appropriation.  These funds are used to cover the costs of the House of Representatives, the Senate, and the central non-partisan offices like the Legislative Services Agency and the State Ombudsman’s office.  Next week, the subcommittee will move on to look at local grant funding in the Department of Cultural Affairs and tourism funding under the Iowa Economic Development Authority.  On Wednesday, discussion will turn to child development funding distributed to local schools by the Department of Education and non-public school transportation funding.

The subcommittee is comprised of Representative Rizer, Representative Sexton, and Representative Dunkel as the Democratic member. Meetings will be held on Monday’s in room 102 and on Wednesday’s at noon in room 304.

Remember—Military Pension Income Now Excluded from Taxes

Home Base Iowa was signed into law back in 2014. That legislation did several things including a provision that excluded military retirement benefits from Iowa income tax. This provision was effective for tax years 2014 and subsequent tax years.

The pension exclusion also applies to military survivor benefits received under 10 U.S.C. 1447 and can be taken by both residents and nonresidents of Iowa. It is not an age-specific benefit and can be taken by anyone receiving a military pension. The exemption is in addition to the general $6,000/$12,000 pension exclusion available for Iowa individual income tax for taxpayers 55 years of age or older. Taxpayers receiving a military pension may want to change or eliminate the amount of Iowa tax withheld from their pension.

After 2014 tax returns came in, the Iowa Department of Revenue determined that some taxpayers might have unintentionally included military pension income in their taxable income. The Department sent out letters to those people letting them know of the legislative change and advising them they have the right to file an amended 2014 return. More tax information for veterans and those serving in the military and their spouses is available on IDR’s website at https://tax.iowa.gov/military-tax-information

NEWS FROM DISTRICT 96

It was a short but busy week.  Because of Martin Luther King Day, we did not return to the Capitol until on Tuesday.  The Soil Conservation Commissioners were in town, I met with Bob Ballou of Monticello and Steve Supple of Cascade to discuss soil conservation issues.

Wednesday was Veterans’ Day on the Hill.  Ron Struble, a past Department Commander of the American Legion in Manchester, stopped by to visit.  I appreciate both his service and the service of all Veterans.  Jim Greif from Prairieburg was also at the Capitol with the Iowa Corn Growers.

Thursday morning I met with the Governor to find out more about his proposal to direct some of the increasing revenue from one cent sales tax that currently goes to fund school infrastructure and property tax relief to water quality issues. We had a good discussion and I got more detailed information on how the money would be spent under his plan.  He asked for input and I gave some of my concerns.  This is just the start of the discussion and there will be more information as the issue moves forward.

As always if you have any concerns or questions feel free to get in touch.  My cell phone number is (319) 480-1997 and my email is lee.hein@legis.iowa.gov.  I look forward to hearing from you.