Too soon to consider recovery?

Even economists point the immediate focus to public health — and keep recovery in the wider view.

What is needed in a pandemic is for citizens to stay home, and for public policy to assure access to unemployment insurance and health care, and push support to the health system.

Economists such as former Labor Secretary Robert Reich are making these points — that limiting the spread of the coronavirus is the top priority to save lives.[1] When even economists are pressing the point about public health, our leaders should pay attention. Now is not the time to talk about being “open for business” prematurely, as President Trump once suggested we do by Easter.

That is not to say a public health spotlight precludes steps in the coming weeks and months to set up recovery when that can be the main focus.

Now, jobs remain in critical services in hospitals and electric stations, and some in construction. Factories where people stand next to each other on a production line have different social distancing from workers who build things in the open air. We could expand more of the latter jobs right now where the materials are at hand.

Good examples: Wind turbines and solar installations and the power lines that connect them to the electric grid. Right now we could be constructing clean energy facilities that can be producing electricity in six months or a year when we all want demand to expand. It is an opportune moment to think ahead and start replacing older coal production plants, which have their own health problems.

Public policy has a role here. Just before the Iowa legislators recessed because of the COVID-19 pandemic, they passed — and Governor Kim Reynolds signed — a bill to stabilize the solar industry. It would do this by setting the price for the next seven years for the electricity that MidAmerican and Alliant buy from homeowners and businesses.[2]

Another step the Legislature could take is lifting the limit on the tax credit for businesses and homeowners when they install solar.

The annual amount that could be taken on the credit was not fully used in the first year, but in all years since 2013 installations exceeded the cap, now at $5 million per year, pushing installations completed later in the year to a waitlist.[3] The tax credit eventually comes but not until at least a year later. While an installation completed today will get a federal tax credit when taxes are filed in April 2021, the Iowa tax credit will not happen until 2022 or later.

Why make these Iowa investors wait? Extending the total amount eligible for the credit from $5 million to perhaps $20 million would further stimulate the construction of solar panels just when the economy needs the jobs.

There also is a federal role, as the amount of that credit for both solar and wind is phasing out. This would be a good time to stop the phaseout for the next several years. Tax credits of electric cars could also be enhanced.

COVID-19 has slammed the economy. We need to think about when we will recover but also how we will recover. Jobs in clean energy have been on a growth curve that can be re-established quickly. And these jobs are creating a new energy system that will help us with the next crisis, climate change.

Most agree we should follow science to confront the pandemic. We should also follow the science to prepare for the next crisis — climate change.

David Osterberg is an economist and lead environmental researcher at the nonpartisan Iowa Policy Project in Iowa City. Contact: dosterberg@iowapolicyproject.org.

A version of this column also ran in the April 1 Quad-City Times.

 

 

 

 

[1] MSNBC interview, March 17, 2020. https://www.msnbc.com/the-beat-with-ari/watch/-our-economy-is-shutting-down-clinton-wh-veteran-pushes-lives-over-dollars-in-covid-19-crisis-80868933847

[2] O. Kay Henderson. Iowa House and Senate give solar bill unanimous support. Radio Iowa March 4, 2020. https://www.radioiowa.com/2020/03/04/iowa-house-and-senate-give-solar-bill-unanimous-support/

[3] Iowa Department of Revenue. Solar Energy System Tax Credit Annual Report for 2019. https://www.legis.iowa.gov/docs/publications/DF/1126111.pdf

Time for state to act

170118_capitol_170603-4x4The Pelosi-Mnuchin stimulus package that passed the U.S. House on Friday includes many measures to protect ordinary Americans who may see lost wages or who may need to stay away from work because someone in the family needs attention.

According to The Washington Post:

“The agreement reached Friday is primarily aimed at expanding the safety net to cope with the potentially catastrophic economic impact of the coronavirus. In addition to ensuring free coronavirus testing, the plan would dramatically increase several benefits, particularly family medical leave and paid sick leave, while also bolstering unemployment insurance; spending on health insurance for the poor; and food programs for children and the elderly.”[1]

The food program expansion “nullifies existing work requirements on the food stamp program.”[2] The medical leave and family leave section will allow up to two-thirds of salary to a great number of employees including full tax credits from employment tax for self-employed individuals.[3] The federal share of Medicaid is boosted and unemployment insurance is strengthened.

According to the Center on Budget and Policy Priorities (CBPP), the Medicaid boost means an additional $240 million is available for Iowa.[4] Noted CBPP’s Jennifer Sullivan:

The House COVID-19 bill’s temporary Medicaid funding boost, if in effect for all of calendar year 2020, would deliver roughly $35 billion in immediate, needed relief to states, which will face growing costs due to the virus and a likely economic downturn. … Similar measures have been a critical part of economic stimulus packages under both Democratic and Republican administrations….

The bill, expected to pass the Senate in a few days, addresses what many expect to be a downturn in the economy caused by the pandemic reaching U.S. shores.

Responsible actions at the federal level require a state response as well. Iowa Policy Project blog posts in recent days have noted good opportunities:

First, Iowa needs improvements in the unemployment system: (1) Relax the job search requirements to enable individuals forced into unemployment by the virus to collect UI benefits; (2) Allow individuals forced to take a leave of absence to collect UI during that period; (3) Establish procedures for individuals losing a job for health safety reasons or to care for a family member with the virus to qualify for UI, and (4) Establish rules under which employers’ unemployment experience rating is not harmed by virus-related layoffs.[5]

Second, Iowans need strong Medicaid and SNAP benefits now more than ever. The safety net helps us all — not just current beneficiaries, but also those on the edge of financial security and the general economy. Any legislation, such as SF430 and HF2030, that imposes new bureaucratic hurdles for struggling Iowans not only will take food and doctor’s visits away when people need them the most, but hurt local communities as well.[6]

[1] Erica WernerMike DeBonisPaul Kane and. Jeff Stein. The Washington Post, “House passes coronavirus economic relief package with Trump’s support,” March 14, 2020. https://www.washingtonpost.com/us-policy/2020/03/13/paid-leave-democrats-trump-deal-coronavirus/
[2] Ibid

[3] H. R. 6201 Making emergency supplemental appropriations for the fiscal year ending September 30, 2020, and for other purposes. Page 93 and 103. https://docs.house.gov/billsthisweek/20200309/BILLS-116hr6201-SUS.pdf

[4] Jennifer Sullivan, Center on Budget and Policy Priorities, “Medicaid Funding Boost for States Can’t Wait,” updated March 13, 2020. https://bit.ly/3d1jPBQ

[5] Peter Fisher. IowaPolicyPoints.org blog post,Protecting workers from coronavirus impacts.” March 14, 2020.

[6] Natalie Veldhouse. IowaPolicyPoints.org blog post, “Make Iowa resilient: Strengthen supports for working families.” March 13, 2020.

osterberg_david_095115David Osterberg co-founded the Iowa Policy Project and is a researcher with the organization.

dosterberg@iowapolicyproject.org

 

Tax plan harms most seniors

For seniors especially, new tax-cut promises are hollow — just like, if the Governor gets her way, the promises that came with the 2010 constitutional amendment.

iowacapitol-rotundaSeniors in particular should be wary of Governor Reynolds’ tax-shift plan because, like most Iowans they would, in general, see little or no benefit and could even be worse off.

The list of those harmed by this plan is significant already.

  • Poor and moderate-income Iowans will lose income and services.
  • Environmental and outdoor recreation advocates who sought a sales-tax increase to fund their priorities will get far less than they expected because the Governor proposes to change the rules.
  • Education, law enforcement and other services will suffer with net losses in general fund revenues that the governor is demanding.

Add seniors to the list. It is clear seniors are among the losers in this legislation unless they are (1) rich or (2) not concerned about the public services that will be lost.

Iowans at low and moderate incomes already can count on paying a greater share of their income in state and local tax under the plan. That’s because it trades a sales tax increase, which disproportionately affects those at lower incomes, for cuts in the income tax and property tax, which helps wealthier filers.

To get her way at the expense of low-income Iowans no matter their age, the Governor wants to change the law that set up the constitutional amendment approved by voters in 2010. The amendment directed the next three-eighths-cent sales tax to a Natural Resources and Outdoor Recreation Trust Fund. That law, set up to implement the fund, said trust fund moneys would “supplement and not replace” appropriations for the purposes named for the fund.

That is important on two counts. Besides throwing aside the expectation of all of the designated sales tax increase providing new money for those purposes, her plan shortchanges the specified purposes, cutting trails, REAP, and much of the funding for the Department of Natural Resources.

Beyond the formula change that should concern anyone who voted for the amendment in 2010, seniors in particular should be wary because the Governor is embracing the voters’ consent to a tax increase only if she can cut other taxes by a greater amount. Her proposed income tax cuts are guaranteed to hinder Iowa’s long-term commitments to other services, from education funding for grandchildren’s schools, to corrections to safety-net supports — and make the overall tax system less fair to the poor and middle-income Iowans and especially seniors.

A bad deal for seniors

The Governor’s plan would raise the sales tax by a full penny, not just three-eighths of a cent for the trust fund, and use the majority of the increased revenue to cut income taxes. That would be a bad deal for most seniors.

The Iowa Department of Revenue has estimated that an additional penny sales tax would cost the average lower income household in Iowa without children about $40 on average (with a range of $30 to $50). That includes all households making less than $30,000. Those in the $30,000 to $50,000 gross income range would pay $68 to $90 more.  Data from the Institute on Taxation and Economic Policy indicate that 40 percent of Iowa households earn under $50,000.[1]

But estimates from the Iowa Department of Revenue show that the income tax cuts would not provide any measurable benefit for the lowest-income 40 percent of seniors — an average tax savings of just one dollar, for those with taxable income under $10,000. Because of favorable tax treatment for seniors, many currently pay no income tax and thus would get no benefit.

Those earning $50,000 to $75,000 total income represent the middle 20 percent of Iowa households. They would pay $100 to $120 more a year in sales tax under the Reynolds plan, but save only about $33 in income taxes. At least 60 percent of seniors, in other words, pay more under this proposal — and they are paying more largely to finance bigger tax cuts for the wealthiest Iowans.

Seniors count on many public services that are funded by state and local government. So while seniors largely will not benefit on the revenue side, they will also lose on the expenditure side, in lost services. These services cannot avoid cuts if the Governor gets her way. Under her proposal, there will be about $175 million less revenue in the general fund each year, which means less funding for education, health care, and other services.

A key reason most seniors do not benefit

It also is helpful to remember that many seniors have several built-in exceptions to income tax. These exceptions make new income-tax cuts meaningless or minimal to them, unless they are quite well off already:

  • All Social Security benefits already are exempt from state tax in Iowa.
  • The first $6,000 in pension benefits per person ($12,000 per married couple) is exempt from tax.
  • Those age 65 or older receive an additional $20 personal credit.
  • While non-elderly taxpayers are exempt from tax on the first $9,000 of income, for those age 65 or older, the exemption rises to $24,000. For married couples, the threshold is $13,500 for the non-elderly, but $32,000 for seniors.

In short, under current Iowa tax law, seniors get very substantial income tax breaks.

For seniors especially, new tax-cut promises are hollow — just like, if the Governor gets her way, the promises that came with the 2010 campaign for a constitutional amendment for a sales tax increase to fund water quality and recreation.

 

[1]   Those with taxable income under $10,000 account for 41 percent of senior tax filers for Tax Year 2022, according to Table 5 in the Iowa Department of Revenue memo to Jeff Robinson on the impact of SSB3116 on seniors, Feb. 14, 2020. Those with $10,000 to $20,000 taxable income account for another 17 percent of senior taxpayers.

2010-PFw5464Peter Fisher is research director of the nonpartisan Iowa Policy Project.

 

osterberg_david_095115David Osterberg is IPP’s environmental researcher and co-founded the organization in 2001.

Iowans: Act on CAFO moratorium

It is clear advocates for a CAFO moratorium have science, the future and the public on their side. Will that outweigh the wishes of industrial agriculture?

Basic RGB

Two years ago this week the Iowa Policy Project published our paper on industrial hog facilities: The Explosion of CAFOs in Iowa and Its Impact on Water Quality and Public Health.

We showed the industry’s Concentrated Animal Feeding Operations (CAFOs) were responsible for manure leaks and spills, fish kills, nitrate and ammonia pollution, antibiotic-hormone and bacterial contamination, algae blooms, impaired waterways and closed beaches.

Most important to both of us, as emeritus professors in Public Health, was that CAFO neighbors suffer increased childhood asthma and adult asthma, bronchitis, airway obstruction, nasal and eye irritation. Animal agriculture still consumes, largely for growth promotion, over 70 percent of medically important antibiotics. This practice promotes antibiotic resistant infections.

CAFO neighbors also suffer odor-associated increases in stress, tension, depression, confusion, less vigor, and decreases in measures of quality-of-life and well-being. And, CAFO neighbor property values, depending on distance and prevailing winds, decrease 20-40 percent.

We called for a moratorium on new facilities, a position with growing support. The American Public Health Association’s Governing Council’s called in November 2019 for a national moratorium on new or expanded CAFOs, citing their “threat to air quality, drinking water and human health” and to “stop using medically important antibiotics in healthy animals.”

A poll from the Johns Hopkins Center for a Livable Future finds that a majority of registered Iowa voters support a moratorium.

  • Sixty-three percent (81 percent of Democrats, 60 percent of independents, and 51 percent of Republicans) deemed it important for the General Assembly to pass legislation to ban new CAFOs or expand existing CAFOs.
  • Eight in 10 of those surveyed expressed concern about the threat of water and/or air pollution on CAFO workers and nearby communities.
  • A majority (51 percent) agreed that CAFOs contribute a “significant amount” to water pollution, and 49 percent agreed that CAFOs contribute significantly to air pollution in nearby communities.

On Thursday, January 23, the Iowa Alliance for Responsible Agriculture (IARA) and other advocates for a moratorium on new or expanded CAFOs will be rallying at the State Capitol. It is clear they have science, the future and the public on their side. The General Assembly must decide if those constituencies outweigh the wishes of industrial agriculture.

2017-Merchant-095115James Merchant is Professor Emeritus of Public Health and Medicine and Founding Dean Emeritus of the College of Public Health.

 

 

osterberg_david_095115

David Osterberg is Professor Emeritus of Public Health and co-founder of the nonpartisan Iowa Policy Project.

 

 

Also see:

Alliant proposal: Equity, efficiency failure

The proposed Alliant rate increase is a sweeping denial of equitable treatment of customers and a rejection of environmental responsibility.

Alliant Energy, called Interstate Power and Light (IPL) in Iowa, is proposing a nearly 25 percent increase in its basic service rate. Since Alliant divides its charges to customers into energy, transmission, and basic service, the total bill increase will not be that large but it is a pretty big increase.

Since electric utilities are monopolies, some entity needs to “regulate” their actions. In Iowa this is the role of the Iowa Utilities Board (IUB), which must decide on the rate increase. The IUB can certainly reduce the proposed rate and can change the way IPL wants to charge individual customers.

Several electricity users in the Decorah area (the city of Decorah, Luther College, Winneshiek Energy District, and others). formed the Decorah Area Group (DAG) and intervened before the IUB to challenge the proposed rate increase. I wrote testimony on rate design for the DAG, and the following is the conclusion of my testimony:

It is apparent to me that IPL’s overriding desire is to sell more electricity at exactly the wrong times. The Company proposes in this case to:

•    Raise the Basic Customer Charge, which is already much higher than that of the other investor-owned electric company in the state; [$13.00 compared to $8.50 charged by MidAmerican Energy. Low-income customers use less electricity so boosting this charge hits them hardest.]

•    Reintroduce declining block rates during the summer peak period, which will likely cause IPL to add capacity for its system; [few utilities give large residential users a break for using more electricity in the summer and so again the smallest users — low income and conservationists are hurt again by this proposal.]

•    Discourage the production of solar power, when encouraging development of solar generation might help IPL to avoid adding generation do accommodate the super peak days; and,

•    Refrain from introducing a “super” off-peak rate that could redirect demand away from peak periods. [Their new meters allow them to make electricity really cheap around midnight so customers could charge electric cars or big capacity water heaters, but they aren’t doing it.]

These proposals, combined with IPL’s actions to convince the Iowa General Assembly to completely bypass the Board and greatly dismantle the state’s energy efficiency programs [in 2017], compels the conclusion that IPL wants to sell more power — not less — especially during the times of the day when IPL’s system is more costly to operate so that IPL will reap more profits.

As noted in the testimony, the Alliant/IPL proposal goes backward on both equity and energy efficiency, which are responsibilities of the IUB to ensure.

IUB’s own mission states that it “regulates utilities to ensure that reasonably priced, reliable, environmentally responsible, and safe utility services are available to all Iowans.” Note — “all Iowans.” This is IUB’s own assurance to even the least-powerful among us that they will be protected in the monopoly marketplace for electricity.

State law [476.1(5)] demands that the IUB “promote the use of energy efficiency strategies by gas and electric utilities required to be rate-regulated.” The Alliant proposal, by contrast, is a recipe for energy inefficiency.

The IUB has limited latitude to deny this rate increase. However, this rate increase is such a sweeping denial of equitable treatment of customers and a rejection of environmental responsibility that they might. The decision will only come after months of more filings and hearings. Stay tuned.

David Osterberg is co-founder and former executive director of the nonpartisan Iowa Policy Project. He is a former state legislator and is IPP’s lead researcher on energy and environment issues.

dosterberg@iowapolicyproject.org

Science change and climate change

Science is ever changing. It is now possible to show that some of the increase in rainfall from storms and consequent flooding has a human fingerprint.

Science is getting better, and that is bad news for climate change deniers.

Only two years ago when I last taught a climate change course at the University of Iowa, I informed students that claiming any extreme weather event came from changes in the climate was too uncertain.

Now, that view needs revising. After working with Dr. James Boulter, professor of Chemistry in the Watershed Institute for Collaborative Environmental Studies at the University of Wisconsin–Eau Claire, I have learned more.

The Iowa Policy Project worked with the Environmental Defense Fund to have Professor Boulter produce a report on climate change and flooding in Iowa. Working on this paper, I read material from the last three years that that brought me up to date on science’s ability to attribute extreme weather events to greenhouse gas effects on the climate.

Here is one source for my new understanding of what is known as “event attribution.” It is a statement from a report of the state of science relating to climate change and its physical impacts, in the Fourth National Climate Assessment (NCA4), by the U.S. Global Change Research Program (USGCRP).[1]

“…(T)he science of event attribution is rapidly advancing, including the understanding of the mechanisms that produce extreme events and the rapid progress in development of methods used for event attribution.”

Attribution has also been a subject addressed in a recent report of the National Academies of Sciences, Engineering and Medicine.[2]

Science is ever changing. It is now possible to show that some of the increase in rainfall from storms and consequent flooding has a human fingerprint. We should not deny that, even as fossil-fuel supporters recklessly deny the existence of climate change or that we can already see its effects.

As Professor Boulter stated in his conclusion to the IPP report, “Now, as national politics begin to inundate Iowa’s media landscape — much as the floodwaters overran the physical landscape — it is crucial that science-informed discussions of policy responses to climate change be prominent in our personal conversations, candidates’ political statements and debates, and our community discussions across all forms of media.”

 

[1] Fourth National Climate Assessment (NCA4), by the U.S. Global Change Research Program (USGCRP). https://science2017.globalchange.gov/chapter/3/

[2] National Academies of Sciences, Engineering and Medicine: “Attribution of Extreme Weather Events in the Context of Climate Change,” 2016. https://www.nap.edu/read/21852/chapter/1#x

David Osterberg is founder and former executive director of the nonpartisan Iowa Policy Project and is IPP’s lead researcher on the environment and energy issues. He is professor emeritus of occupational and environmental health at the University of Iowa.

dosterberg@iowapolicyproject.org

Ignoring still-serious water threat

Last year, we issued a report on toxic algae and three weeks later the city of Greenfield lost its drinking water. Now we see that the Environmental Working Group has found no improvement. How long before another town faces the same problem Greenfield did?

Iowa detail of map in report showing water test results.

About a year ago the Iowa Policy Project released a report on cyanobacteria in drinking water supplies and recreational waters. A new report from the Environmental Working Group shows things have not gotten better.

Microcystin and other cyanotoxins are still not regulated by the U.S. Safe Drinking Water Act. Thus, few drinking water systems test for them. These very dangerous natural chemicals are still on EPA’s candidate list for regulated contaminants but they have made it no further.

When it comes to beach monitoring for the same substances, Iowa still does not use the EPA’s recommended action level and prefers to use on more than twice as high, making any notice to beachgoers of the presence of microcystin less likely.

In high amounts cyanotoxins can make you sick and cause serious long term damage to human health. There are many reports of dogs dying after playing in ponds and licking their fur after.

The EWG report also found further evidence of what we reported last year in our report.

“The late summer months are usually the peak of the algae bloom season, though recent outbreaks are starting earlier and lasting longer. Increased rainfall and rising temperatures caused by the climate crisis are exacerbating the issue.”[1]

Later peaks in blooms and toxins means that the beach monitoring system will not see them since it ends in Iowa on Labor Day. True fewer people will be at beaches, but water supplies are vulnerable later into the year and no one is looking for microcystin in October.

Three weeks after IPP released its report in June 2018, the city of Greenfield, Iowa, closed its drinking water system for about a week because microsystin got in finished water. One wonders if in another three weeks after Thursday’s release we might see another town in the same predicament.

[1] Environmental Working Group, Aug. 8, 2019: “Report: Toxins From Algae Outbreaks Plague Hundreds of Lakes in 48 States,” https://www.ewg.org/release/report-toxins-algae-outbreaks-plague-hundreds-lakes-48-states

David Osterberg is former director and currently lead environmental researcher for the nonpartisan Iowa Policy Project.

dosterberg@iowapolicyproject.org