March 16, 2018
Friday is our second major legislative deadline as we make our way towards adjournment. These deadlines help us focus on our priorities during the session and spend time on the issues that have enough support to pass through both chambers of the Iowa Legislature.
Since our first day, our focus has been on a pro-growth agenda for our state and keeping more money in the pockets of hard-working Iowans. The bills we have passed in these weeks during the session have made our agenda clear.
We passed a tax relief package for hard-working Iowa families. This proposal would simplify the tax code for farmers, families and our state’s businesses. It provides Iowans and families with an average of $1,000 in tax relief per year and cuts taxes by $1 billion dollars annually.
For years funding inequities existed between urban and rural school districts. This year we took the first step to even out the costs of transporting students and the unequal state funding for school districts. We have long believed a student’s zip code should not affect the quality of their education. The proposal we passed sets up the framework for us to address this inequity in the long-term and starts to equal out the costs of transporting students to and from school.
We also passed two bills to address the dwindling health insurance options available to Iowans. As individuals slowly lost the options they have for health insurance, we found a solution that gives our citizens options for their health care.
One of those options was Senate File 2349, which provided an option for small businesses and sole proprietors to band together to purchase health insurance through Multiple Employer Welfare Arrangements (MEWA). Another bill, Senate File 2329, would allow agricultural organizations to offer health benefit plans. Plans utilized under Senate File 2329 would not be considered insurance under state or federal law, which takes these plans out of the ACA requirements and gives Iowans other options for their buying their health insurance.
We are committed to reducing the tax burden on all Iowans and creating a tax policy that is simple and fair. We are working to ensure our children have every educational opportunity available to them and help them flourish and succeed. Our goal is to enact policies that will continually help our state grow, and make it a great place to live and work.
Tax relief would grow our economy – We remain focused on moving legislation to grow Iowa’s economy. For the last two years, we have passed pro-growth legislation to encourage job growth in Iowa, stimulate the economy and put more money into the pockets of hard-working Iowans. Friday’s Revenue Estimating Conference meeting further demonstrated why addressing tax reform is necessary.
The state received a $28.4 million bump in revenues as a result of the federal tax plan Congress passed late last year. Not counting this bump in revenues from the federal tax cut, the revenue estimate increased by only $4.9 million in March compared to the December estimate. Compared to last fiscal year, revenues for this fiscal year are up by less than 2 percent after removing the $144 million we had to borrow from the cash reserve fund last year. Yes, Iowa’s economy continues to grow, but it is growing at a slower pace than originally anticipated.
As we continue to move forward this legislative session, it is evident the positive impact tax reform can have on economic growth. The REC is projecting 6.4 percent growth in revenues for the 2019 fiscal year.
One of the key reasons for a larger than normal percentage of growth is again due to the federal tax bill, which is $188.3 million coming to the state. Remove the bump from the federal tax bill, the projected increase is around 4.2 percent. This increase is only a 0.2 percent above the December estimate and is only slightly higher than Iowa’s historic revenue growth over a 10-year period.
We need to reform our tax code so we can assist job creators in creating new career opportunities and doing their part to grow the economy. Just as important, it will ensure hard-working Iowans keep more of what they earn. It also will grow state revenues and help us fund Iowans priorities in education, health care, and public safety.
If we truly want to avoid making mid-year cuts and holding our breath every time the REC meets, then growing the economy is necessary – and that must include tax reform.
REC Day on the Hill – This Wednesday the Iowa Capitol hosted another successful REC Day on the Hill. Rural electric cooperatives from multiple counties gathered in the rotunda to meet with legislators and discuss the importance of renewable energy in the Iowa infrastructure. Iowa’s RECs play a critical role in our state’s infrastructure by providing power to roughly 650,000 Iowans throughout all of our 99 counties. RECs provide power that is affordable, reliable and importantly, environmentally responsible.
I enjoyed meeting with a variety of individuals from the 44 rural electrical cooperatives and appreciate them taking the time out of their busy day to come meet with us at the capitol. It is always great to meet and speak with constituents about the issues important to them and we always value their input when we consider legislation. Support of our RECs is important. Reliable and affordable electricity in rural Iowa is key to economic development and quality of life for many Iowans.
As always, I want to hear from you. My Senate number is (515) 281-3371 and my home number is (515) 432-7327 or write me at: State Capitol, Des Moines, IA 50319 or at my home address: 1313 Quill Avenue, Boone, IA 50036 or email me at jerry.behn@legis.iowa.gov
