116 3rd St SE
Cedar Rapids, Iowa 52401
Iowa lawmakers give final approval to sweeping tax changes
Governor hails mental health funding; Democrats decry loss of promised local ’backfill’ aid
May. 18, 2021 9:07 pm, Updated: May. 19, 2021 3:00 pm
DES MOINES — House Democrats unanimously supported a wide-ranging Republican tax plan at the committee level because House File 893 “included at least 10 platforms of the Iowa Democratic Party,” Rep. Dave Jacoby, D-Coralville, said Tuesday.
But when Jacoby and fellow Democrats later saw the deal struck by the Republican majorities in the House and Senate, they didn’t like it nearly as much.
Democrats objected to the a trade-off called for in the compromise, Senate File 619. In it, Republicans are promising the state would take over from local property taxes the funding of mental health services at the same time they would phase out state payments to local governments that were promised as part of a bipartisan commercial and industrial property tax reduction in 2013.
“My mom made it clear to me you can't make a promise and not do everything you can to keep that promise,” Jacoby said about ending the “backfill” aid to local governments. That move will result in a $153 million increase in property taxes, Democrats said.
Approved 64-28 with nine Democratic votes, SF 619 goes to Gov. Kim Reynolds, who is eager to sign it.
“This legislation is a WIN for Iowans,” she posted on Twitter. In addition to $100 million in property tax relief for the change in mental health funding, “It also creates a long-term, sustainable funding stream for Iowa’s mental health system.”
The bill also calls for investments in what Reynolds called “foundational priorities,” many of them the same as the Democratic ideals Jacoby mentioned — child care, workforce housing, ending federal income tax deductibility and protecting COVID-19 relief payments from taxation.
Meanwhile, the Republican-majority Senate approved a $1 billion education budget, which represents a $24 million increase over the previous year. But Senate Democrats lamented the lack of any increase for the state’s public universities: the University of Iowa, Iowa State University and the University of Northern Iowa.
The public universities are “three of the biggest economic engines in this state,” Sen. Eric Giddens, D-Cedar Falls, said during debate. “It we’re going to jump-start the Iowa economy, part of the answer is to attract and retain talent to this state. … The Legislature needs to step up.”
Democrats proposed for the regents schools a 3.1 percent funding increase, which Democrats said matches the budgeted increase for community colleges and the same amount proposed by Reynolds. That proposed amendment was voted down by Senate Republicans.
HF 868 passed on a party-line 28-17 vote and returned it to the House, which concurred 54-35.
Also Tuesday, the House and Senate:
- Approved House File F 708, a public safety equipment fund, without appropriating any money. The Department of Public Safety told lawmakers 98 percent of its budget is for salaries and benefits and the remaining 2 percent does not cover equipment needs. It estimates that over the next 15 years the department will need about $83 million for equipment or about $5.5 million each year. The department uses cost savings from vacancies to fund needed equipment. Establishing a consistent revenue stream would allow it to fill those vacancies as well as allow the department to plan for its equipment needs rather be dependent on money from the Rebuild Iowa Infrastructure Fund and Technology Reinvestment Fund.
- Approved House File 860 to provide $54.8 million from the general fund to the departments of Agriculture and Natural Resources, an increase of $11.6 million. The Environment First Fund appropriates $42 million, including $12 million for Resource Enhancement and Protection fund.
- Approved House File 871 providing $48 million for economic development, which funds the Department of Cultural Affairs, Economic Development Authority, Iowa Finance Authority, Public Employment Relations Board, Iowa Workforce Development, and some Board of Regents functions. That’s an increase of $6.4 million. HF 871 also appropriates $29.8 million from other funds, an increase of $1.75 million.
- The Senate gave unanimous approval to a $638 million justice systems budget, HF 861. Despite the bipartisan support, legislators debated whether that is sufficient funding to help address any issues in the state’s prisons after two workers were killed by inmates during an attack in March. Democrats argued even more funding is needed to boost staffing levels and training, and upgrade workers’ equipment.
Comments: (319) 398-8375; james.lynch@thegazette.com
(File photo) The dome of the Iowa State Capitol building from the rotunda in Des Moines on Tuesday, Jan. 10, 2017. (The Gazette)
Daily Newsletters