Transparent realities of bad law

To be transparent, lawmakers and the governor would admit they are enshrining minority rule, punishing public workers again, and penalizing economic growth and recovery.

curtains-tighterIn the closing nights of the 2019 session, while most Iowans slept, the Iowa Legislature enacted substantial changes to the way city and county governments fund public services.

There was no chance for public input, or for analysis by legislative staff. With no apparent sense of irony, the bill’s supporters argued the purpose was to increase transparency for voters.

On Thursday, Governor Reynolds signed the bill out of the public eye, issuing only a one-sentence statement repeating the same claims and ignoring the real impacts.

In this one bill, the Legislature managed to enshrine minority rule, punish public-sector workers (yet again), penalize economic growth, and hamstring cities and counties recovering from a natural disaster.

The bill will limit the growth of property taxes levied by cities and counties to 2 percent each year. Local elected officials will need a two-thirds vote to do more, if they find that their constituents’ needs demand it. So much for majority rule and local democracy.

The bill threatens city services and the local public workers who provide them. Employee benefits, such as health insurance and contributions to pension funds, until now could be financed by a special tax rate, in recognition that the rising cost of health insurance and fixed pension contributions are outside city or county control. These costs have been increasing more than 2 percent annually, often much more. But now they go under that arbitrary 2 percent cap.

There was much attention — deservedly so — to how various versions of the bill would affect IPERS pension benefits. This ultimately served to distract many from much broader impacts.

When pension contributions and health insurance premiums increase more than 2 percent, the city or county may have to reduce services, cut benefits, or lay off workers to keep overall tax growth under the cap. The bill pits taxpayers against the people who plow their streets, protect their homes, build roads, or maintain parks and libraries.

When services are cut, public employees can be portrayed as the scapegoats, which will be convenient to the forces that have threatened public employee pensions. Turning Iowa’s secure pension programs over to less-secure, privately run for-profit administrators remains a goal for those forces.

The new bill also penalizes local governments for pursuing growth. A last-minute change in the legislation puts revenue from new construction under the 2 percent cap.

As a result, cities and counties experiencing significant growth may be forced to cut rates year after year and will find themselves without the revenue to support the growth if they can’t muster the supermajority. For example, a city growing at 4 percent per year would face a revenue penalty of 17 percent within five years.

Another last-minute change left in place existing levy limits, which would have been abolished under both earlier bills. So now cities and counties face two limits, one on rates and another on revenue growth.

The combination could be devastating in some circumstances. Consider a flood, or a recession causing a loss of property value. The rate cap forces revenues to decline for any city or county at or near the rate limit, which includes the vast majority of localities.

Then, as the recession ends or the city rebuilds, the revenue cap could now undermine recovery. The reduced revenue becomes the new starting point, potentially leaving a city or county unable to restore revenues even to the previous level because of the 2 percent limit on revenue increases. And this just at a time when extraordinary measures are needed to help the recovery.

One has to wonder if more transparency in the process might have helped legislators find a better outcome — or at least helped their constituents to argue for one.

Peter Fisher is research director of the nonpartisan Iowa Policy Project in Iowa City. Contact: pfisher@iowapolicyproject.org

Editor’s Note: This post updates and expands upon a previous post about this legislation, prior to the governor’s signing of the bill.

Monopolies strangling solar, small business

Monopolies would destroy small business who make their money at the local level by insulating homes or installing solar panels.

In times like these, it is helpful to recall what our nation learned from the leadership of Teddy Roosevelt, who went after trusts and monopolies because he knew they used their huge size to strangle other businesses.

Iowa could use that kind of leadership. Our Iowa monopoly electric companies are strangling small businesses again. As monopolies they are guaranteed profits, only because of efficiencies seen as a public benefit in the production and distribution of power. And to make sure they do not abuse that power, they are regulated by a fairly powerful state regulatory agency, the Iowa Utilities Board (IUB).

Solar energy gives citizens control over part of their lives. Small customers who could not operate a coal plant can put up solar panels. MidAmerican Energy (MidAm) sees that and feels threatened. Even though only 750 of their 770,000 customers have solar panels on their property, MidAm wants this market to itself.

So now, MidAm is trying to bypass its IUB regulators by going to the Iowa Legislature to get what they want. MidAm’s approach is a job-killer for solar contractors and a few manufacturers in the state. Legislation the company is pushing would strip those small competitors of most of their market, reducing or even removing the benefits to people who chose to install solar panels.

In short, MidAm wants to put a tax on the sun.

Its proposed changes greatly reduce the incentive to generate one’s own electricity. As it works now, customers with solar panels sometimes produce more electricity than they use. This is often during the middle of a sunny day in the summer when electric prices are at their highest.

Currently, these customers are compensated for the excess energy they provide back to the grid at the same price they pay the electric monopoly. HSB185 would allow MidAm or any investor-owned utility to charge extra fees, or cut compensation, to homeowners and businesses that have clean energy systems. This would discourage solar projects by making them cost-prohibitive.

MidAm — like all utilities — charges a fixed, mandatory fee each month to all customers, which proves false MidAm’s principal argument that the clean-energy customers aren’t paying their share for lines, transformers and billing expenses of the company. Already, they pay.

But MidAm at least is consistent in its attempts to undermine smart-energy choices and the role of small users and businesses in providing it. We saw it last year as well, when MidAm and Alliant Energy successfully bypassed the IUB by dismantling Iowa’s requirement that they help their customers be more efficient. Previously, electric monopolies rewarded a customer who bought a more efficient refrigerator, or efficient light bulbs, or put in more insulation. No more.

Now MidAm is using the same game plan. Go to the Legislature and convince the members to allow monopolies to destroy small business who make their money at the local level by insulating homes or installing solar panels.

What would Teddy Roosevelt have done? He would stand up to stop utilities’ bullying of fair competition and the freedom of citizens to generate their own electricity. Small businesses, conservationists and citizens who just want more control of their lives are looking for that kind of champion.

David Osterberg is lead environment/energy researcher, founder and former executive director of the nonpartisan Iowa Policy Project in Iowa City.

dosterberg@iowapolicyproject.org

Public hearing: Public concerns distracted

Iowa can have responsible tax reform that does not lose money needed for traditional, critical public services that benefit all Iowans. Our focus should be there.

If the goal of a “tax reform” public hearing Monday was to distract Iowans from the massive impact the Governor’s $1.7 billion tax cut would have on their lives, it succeeded.

The media attention on the hearing in the old Supreme Court Chamber in the State Capitol focused heavily on the perennial fight between banks and credit unions — one that won’t be settled whatever happens in 2018, and not the most important issue to be settled in 2018. Therefore, we won’t link to those stories here and add to the distraction.

But, those folks on both sides of the bank-credit union fight took many of the limited speaking slots, so the media focus followed. For their part, House Ways and Means Committee members listened politely, asked no questions and let 30 or so people — including this writer — have their say in three-minute chunks.

It was the public’s only chance thus far to speak on a bill that was introduced two months ago … that may barely resemble what House leaders actually plan to pass … with no disclosure about which of the public speakers may be getting more than three minutes behind closed doors as well.
We should all have been brought to the table long before this, and attention directed to what is really on that table about the future of our state.

Iowans need to focus on the very real threat to public services, from education to law enforcement to water quality to human services that have gone lacking as our state has increasingly directed subsidies and tax breaks to corporations and the wealthy, neither of whom need help.

One good resource for all lawmakers, advocates and the public at-large is a series of concise, fact-based two-pagers in the 2018 Tax Policy Kit from the Iowa Fiscal Partnership. Find those pieces here.

If they were listening closely, lawmakers on Monday will have gleaned some important perspectives on the monumental tax changes that are being contemplated without sufficient review.

Lawmakers still have an opportunity to do this right — to steer Iowa’s tax system to a more stable, accountable and fair system that assures giant companies are paying their fair share and the poor are not penalized for their low incomes. Iowa can have responsible tax reform that does not lose money needed for traditional, critical public services that benefit all Iowans. Our focus should be there.

Mike Owen is executive director of the Iowa Policy Project. mikeowen@iowapolicyproject.org
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Protect Iowa taxpayers from bad spin

Let’s protect taxpayers from thumb-on-the-scale rules that give a minority viewpoint a decided and sometimes insurmountable advantage over the majority.

“Protecting Iowa’s taxpayers,” reads the headline on the newspaper column, but the column contradicts that.

On the pages of major state newspapers this week, Iowans for Tax Relief (ITR) is offering its predictable and tired promotion of tax and spending limitations that are neither necessary nor fair.

Instead of protecting taxpayers who live in Iowa and do business here, these gimmicky limitations promote an ideological agenda that fails to offer prosperity — ask Kansas — and is a poor solution to imagined problems invented by its authors.

The limits advocated by ITR never are necessary or fair, but this is especially so where we see K-12 school spending held below needs, where higher-education spending is cut and tuitions raised, and where worldwide corporate giants are taking bites out of Iowa millions of dollars at a time — over $200 million in the case of Apple last week.

By all means, let’s protect taxpayers from thumb-on-the-scale rules that give a minority viewpoint a decided and sometimes insurmountable advantage over the majority. The big money put behind these ideas make elections less meaningful, and erode Iowans’ ability to govern themselves.

The real path to prosperity for Iowa is a high-road path that rests upon sensible investments in education and public infrastructure that accommodates commerce and sets a level playing field for business and individuals. It means promoting better pay to keep and attract workers who want to raise their families here, and sustaining critical services.

Time and time again, we and others have shown irrefutably that Iowa is a low-tax and low-wage state. We already are “competitive” to the small degree that taxes play a role in business location decisions; even conservative analysts such as Anderson Economic Group and Ernst & Young put Iowa in the middle of the pack on business taxes.

Suffice it to say, you are being peddled a load of garbage by the far right and the privileged, who take what they can from our public structures and policies, and attempt to deny others not only public services, but also a say in the funding of programs that promote opportunity and prosperity for all.

The same suppression mindset prevailed in the Iowa Legislature in 2017 as a majority bullied public workers and decimated workers’ rights. Now they are taking on tax policy in 2018, plus the possibility of new assaults on retirement security and renewed neglect of our natural assets of air and water.

Shake your head at the headlines, throw a shoe through the TV if you must, but only by engaging these issues at every step of the political process will we turn Iowa back from our low-road course.

This is the battle of the 21st century. We are living it. May we survive it.

Mike Owen, executive director of the nonpartisan Iowa Policy Project

mikeowen@iowapolicyproject.org

Session Recap: ‘Historic’ — not label of pride

Some legislators may boast of a “historic” session. History will mark 2017 as a low point in Iowans’ respect and care for each other.

By

4/22/17

IFP Statement: ‘Historic’ session not a label of pride

Legislative session hits working families and traditions of good governance

Basic RGB

Statement of Iowa Fiscal Partnership • Mike Owen, Iowa Policy Project

To describe the 2017 Iowa legislative session as “historic” is not a label its leaders should wear with pride.

Iowans needed a legislative session that worked to raise family incomes and expand educational opportunity. Iowans had long demanded water-quality improvement measures. Many called for lawmakers to address the lack of fairness, adequacy and accountability in a tax system laden with special-interest breaks and costly subsidies to corporations.

Instead, Iowans got a continued ratcheting down of funding for PK-12 public education. There were significant and serious cuts in post-secondary education that will lead to tuition increases. We saw cuts to early-childhood education and other programs that serve our most at-risk children and neglect of the child-care assistance program that helps working families struggling to get by.

The Legislature continues to demand little or nothing of industrial agriculture in cleaning up the mess it has left in our waters. Lawmakers tried to dismantle the Des Moines Water Works board, limited neighbors’ right to complain in court about pollution, and eliminated scientific research at the Leopold Center. Their ultimate action on water merely diverts resources from other priorities, such as education and public safety.

Lawmakers largely left the tax issue to the next session. An overture in the House to reform Iowa’s reckless system of tax credits was a welcome acknowledgment that this issue needs attention, but devils in the details make further discussion of this issue during the interim even more welcome.

Perhaps as troubling as the destructive nature of policy content this session, Iowa’s image of adherence to good governance took a big hit. The most controversial policy changes came not through collaborative, public discussion in committee, let alone the 2016 political campaigns, but were often dumped into lawmakers’ laps with little opportunity for amendments.

In what could accurately be called a “session of suppression,” lawmakers achieved:

  • Wage suppression, with a bill to preempt local minimum wage increases while refusing to raise Iowa’s repressive, 9-year-old minimum of $7.25.
  • Workplace suppression, gutting collective bargaining protections for public employees, and making it more difficult for Iowans recover financially from injuries on the job.
  • Health-care suppression, achieved in workers’ compensation legislation while also refusing to reverse Governor Branstad’s disastrous move to privatize Medicaid.
  • Local suppression, whacking at local government control in a variety of areas: minimum wage, legal defenses against concentrated animal feeding operations (CAFOs), fireworks sales, and collective bargaining options.
  • Voter suppression, with a bill to make it more difficult for many citizens, particularly low-income and senior voters, to exercise their right to vote.
  • Suppression of children’s healthy development, with additional cuts to Early Childhood Iowa and Shared Visions that will reduce access to critical home visitation, child care and preschool services for some of our most at-risk youngsters.

Some legislators may boast of a “historic” session. History will mark 2017 as a low point in Iowans’ respect and care for each other, a legacy that will not be celebrated when future Iowans look back on this session and the closing act of Governor Branstad’s long tenure in office.

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The Iowa Fiscal Partnership is a joint public policy analysis initiative of two nonpartisan, nonprofit, Iowa-based organizations — the Iowa Policy Project in Iowa City, and the Child & Family Policy Center in Des Moines. Reports are available at www.iowafiscal.org, and on the websites of the two partner organizations, www.iowapolicyproject.org and www.cfpciowa.org.

Lost legacy of science and research?

You drink the water. You breathe the air. Concerned Iowans may yet save the Leopold Center, but the clock is ticking.

Editor’s Note: The Cedar Rapids Gazette published a version of this piece online Tuesday, April 18, 2017.

While Iowans and others celebrate Earth Day on Saturday with a March for Science, many legislators have already tripped over their own votes.

Besides several cuts to higher education Iowa legislators have taken aim at particular scientific centers at the University of Iowa and Iowa State University.

With the state’s second largest city and its largest university both almost recovered from massive flooding, they attacked the Flood Center at the UI, which may survive with a 20 percent cut to reward how its data and research have helped citizens of the state.

Certainly as troubling is the pending elimination of the Leopold Center for Sustainable Agriculture at ISU, and the farming out of duties at the Energy Center at ISU to the Iowa Economic Development Authority. So much for independent research.

One thing lost in these assaults is a sense of institutional memory. Those of us who started the Leopold Center some 30 years ago found agreement to assure Iowans a lasting resource independent of industry control and other research funding. And it has worked.

Much of the research on how to reduce agricultural damage to water quality has been started by the Leopold Center — more than 600 research projects, according to Leopold’s director, Professor Mark Rasmussen.

You drink the water. You breathe the air. Are you comfortable that Iowa’s premier research universities are being blocked from conducting research on topics including water quality, manure management, livestock grazing, cover crops, alternative conservation practices, biomass production, soil health and local food systems development?

In fact, as Rasmussen notes, many practices recommended in Iowa’s Nutrient Reduction Strategy to reduce agricultural pollution — including streamside buffers, erosion control measures, and bioreactors — “were first researched through Leopold Center funding.”

Now, the history of the Leopold Center is being reinvented by lawmakers attempting to erase a three-decade, bipartisan commitment to sustainable funding of independent research. They would eliminate the publicly directed mission and turn it over to businesses.

It is hard to know if these attacks are driven by politics or corporate interest. Maybe it is just Iowa’s version of an attack on science generally.

Either way, the bill eliminating the Leopold Center has passed the Senate and Iowans have only a short time to demand more from their elected officials in the House and the Governor. Voices rising helped to save the Flood Center with only a cut. Concerned Iowans may yet save the Leopold Center, but the clock is ticking.

 

David Osterberg, a state representative from Mount Vernon from 1983-1994, is co-founder and lead environmental researcher at the nonpartisan Iowa Policy Project. Osterberg and fellow legislators Ralph Rosenberg and Paul Johnson were co-authors of the law that created the Leopold Center at Iowa State University.

Today’s virtual House graphic: Iowa impacts of ACA repeal

Repeal of the Affordable Care Act will leave fewer people in Iowa with insurance than before the law took effect.

Editor’s Note: The Iowa House of Representatives voted Monday to deny the ability of lawmakers to use visual aids in debate on the floor. To help Iowans visualize what kinds of graphics might be useful in these debates to illustrate facts, we will offer examples. Here is today’s graphic, to illustrate what could be expected to happen in Iowa if Congress repeals the Affordable Care Act.

170119-IFP-ACA-F2xxRepealing the Affordable Care Act (ACA) without an adequate replacement, as Congress and the incoming Trump administration appear poised to do, jeopardizes the health care coverage and economic well-being of the most vulnerable Iowans. About 230,000 fewer Iowans would have health coverage in 2019 if the law is repealed, including 25,000 children.

In fact, repeal of the ACA could leave tens of thousands of adults uninsured who actually had insurance prior to the ACA. Some 69,000 Iowans covered by an Iowa program, IowaCare, became part of the Iowa Health and Wellness Program with the advent of the ACA, while even more Iowans had insurance with the help of ACA subsidies.

Repeal leaves all three of those programs gone — IowaCare, Iowa Health and Wellness, and the ACA subsidies. Thus, fewer will have insurance than in 2013, prior to the ACA, and low-income Iowans will be worse off. This is an issue that state legislators may be left to address with no help from the U.S. Congress, but is not getting attention at the Iowa Statehouse.

For more information, see this Iowa Fiscal Partnership policy brief by Iowa Policy Project Research Director Peter Fisher.