Education

Time running out to extend Iowa sales tax for schools

Iowa House overwhelmingly passed it, but Senate hasn't

Cedar Rapids Community School District buses at the Education Leadership Support Center in Cedar Rapids on Thursday, August 7, 2014. (Adam Wesley/The Gazette)
Cedar Rapids Community School District buses at the Education Leadership Support Center in Cedar Rapids on Thursday, August 7, 2014. (Adam Wesley/The Gazette)

As lawmakers near the end of this year’s legislative session, educators are hopeful one of their final actions will be to extend the state penny sales tax for school infrastructure needs.

The Iowa House last Tuesday overwhelmingly approved House File 2481, extending the sunset on the Secure an Advanced Future for Education, or SAVE, tax in a 95-3 vote.

But a version of the bill still is in the Senate.

The legislation would extend the SAVE tax until 2050, removing the 2029 sunset provision that education leaders have said limited their ability to issue bonds as the date gets closer.

“We’re really excited with what the House did,” said Emily Piper, a lobbyist for the Iowa Association of School Boards. “It sends a really strong message that this is a priority, and it recognizes how important this is not only to schools … but also to help reduce the reliance on property taxes at a local level.”

The 20-year extension of the 1 percent sales tax would provide more than $16 billion in school infrastructure projects and property tax relief.

The legislation extending the tax’s sunset also introduces new restrictions on school boards when issuing bonds against the tax funds.

Under current law, there is no mechanism that allows the public to block a school board’s decisions with SAVE, except, Piper said, “they can say we disagree.”

“Honestly, the only mechanism in law currently is the school board elections,” Piper said.

Both the legislation passed by the House and the bill still in the Senate would require school boards, before issuing bonds against SAVE, to give voters the opportunity to petition for special elections on the projects.

Those requirements, which would apply to athletic facilities projects as well, came about in response to calls for more public input on the use of SAVE, said Margaret Buckton, a lobbyist for the Urban Education Network and the Rural School Advocates of Iowa.

“It’s an opportunity for the public to weigh in,” Buckton said. “And most of our school folks would tell you, if they get so far away from their community, they shouldn’t be doing the project anyway. We should be able to convince them it’s the right thing to do.”

Piper said Iowa school boards “aren’t afraid of having that kind of engagement.”

“But we want and we need the certainty of this going forward,” Piper said. “Districts are relying more and more on property taxes to do their infrastructure improvements, and that was the whole point of the statewide penny — to make sure that didn’t happen.”

With an eye on the 2029 sunset, a growing number of districts have asked residents to increase their property tax rates in recent years.

Buckton and Piper both said they are optimistic the Senate will take up the SAVE extension in the waning days of this session.

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“This is one of those things where they could deliver something very meaningful for schools in an otherwise pretty bleak budget year,” Buckton said.

l Comments: (319) 398-8330; molly.duffy@thegazette.com

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