Branstad plan: Shift some school tax revenue to water quality programs

DES MOINES - A 1-cent sales tax earmarked for school infrastructure would be extended 20 years, but the revenue would be shared with water quality programs under an ambitious proposal unveiled Tuesday by Gov. Terry Branstad.

Under Branstad's plan, which requires legislative approval, the school infrastructure sales tax, which is set to expire in 2029, would be extended to 2049, and annual revenue increases would be divided: The first $10 million in new revenue each year would go to schools, and the remaining would go to water quality programs.

Branstad's office estimates the proposal would generate $7.5 million for water quality programs in the first year and $4.7 billion over the next 32 years.

Branstad called his plan a win-win situation, saying it creates revenue for water quality programs without raising taxes and still provides reliable funding for school infrastructure projects.

'This is probably the biggest and boldest proposal I've put together in all my years as governor,” Branstad, the longest-serving governor in the nation's history, said Tuesday during his meeting with Statehouse media to preview the upcoming legislative session.

The Republican governor's plan was endorsed Tuesday by former Democratic Iowa governor and current U.S. Agriculture Secretary Tom Vilsack.

Vilsack sat next to Branstad at Tuesday's meeting and called the governor's plan a 'solid framework” that promptly addresses an issue that needs immediate attention.

Iowa is one of the leading contributors of nutrients that have flowed down the Mississippi River into the Gulf of Mexico, creating a so-called 'dead zone” where oxygen is insufficient to sustain fish and marine life. The federal government has required Mississippi River states, including Iowa, to develop solutions to reduce the amount of nutrients flowing into the river.

'There is a limited period of time to work on this water quality issue,” Vilsack said. 'The reality is we need to work on it now.”

Branstad and legislative leaders said they support funding water quality programs but are hesitant to fund them with tax increases.

Branstad's proposal was met with hesitation from Democratic Senate Majority Leader Mike Gronstal, who criticized the plan for using future school infrastructure funding to pay for water quality programs.

'Sacrificing that (future school infrastructure funding) for the sake of another priority, for water, I don't think makes a lot of sense,” Gronstal said. 'It is a solution, an effort that undercuts local schools.”

Iowa State Education Association President Tammy Wawro echoed Gronstal's sentiment that Branstad's plan equates to 'robbing Peter to pay Paul.” Wawro expressed exasperation that Branstad's plan includes reducing future school infrastructure funding after years of what she and many schools think has been inadequate state funding for school districts.

'I'm really at a loss, to be honest, that we're even having a discussion about this,” Wawro said. 'The fact that we're even having a conversation about this, taking even part of the pie meant for kids to take care of another important priority, it's just very disturbing right now for us.”

Sioux City School District Superintendent Paul Gausman appeared at Tuesday's news conference at the Capitol and expressed support for the governor's proposal. Gausman said he approves the plan because it ensures the school infrastructure sales tax will be extended, which would allow schools to use long-term loans to fund infrastructure projects.

'The way I look at this is in 2029 that number goes to zero,” Gausman said. 'With this extension, that number continues for us, with $10 million in annual growth.”

Branstad declined to say whether he would approve extending the school infrastructure sales tax without the provision for water quality programs.

House Speaker-select Linda Upmeyer said House Republicans have been divided on whether to extend the school infrastructure sales tax beyond 2029.