DES MOINES — Gov. Terry Branstad’s plan to fund water quality improvements by extending a school infrastructure tax cleared one hurdle in the Iowa House on Monday, but lawmakers heard concerns from several groups representing school interests.
After hearing from more than a dozen lobbyists, two members of a House Agriculture subcommittee signed off on House Study Bill 601.
“This the first step in maybe a long process,” Rep. Lee Hein, R-Monticello, chairman of the subcommittee and Agriculture Committee, told more than 60 people who attended the subcommittee hearing. “We’ll at least try to keep the conversation going.”
In his Condition of the State address in January, Branstad proposed addressing statewide water-quality by extending the state sales tax dedicated for school infrastructure for 20 years. The first $10 million collected each year would go to support school infrastructure. Revenue over and above that would go toward the water quality initiative.
Branstad projected schools still would be getting $20.7 billion for infrastructure otherwise funded by property taxes, while $4.7 billion would be channeled to improving Iowa waterways.
Subcommittee member Rep. Peter Cownie, R-West Des Moines, welcomed the proposal because of the growing tension between agricultural interests and those concerned with water quality.
He said two proposals for addressing water quality have been put forward in the past year — the Des Moines Water Works suing northwest Iowa counties and the governor’s plan.
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“I like this way a lot better,” he said, adding that the lawsuit has brought attention to a “serious issue that affects Iowans.”
Rep. Helen Miller, D-Fort Dodge, didn’t sign off on the bill, Although she’s pleased lawmakers are “continuing to move the ball forwards,” she said she’s “not convinced this is the only way to do this.”
Speakers representing school boards and administrators, as well as the state’s largest schools and rural schools, voiced concerns that if some sales tax revenue is diverted there won’t be enough funding for infrastructure needs. The way HSB 601 is written, it could reduce funds earmarked for property tax relief from $6 million to $210,000 a year.
Municipal and private water utilities and rural water associations were concerned that the bill, as written, excludes them from being eligible for funds. They are eligible now for funds from many state water infrastructure programs.
Representatives of farms groups and commodity organizations were supportive, saying their members want to be part of water quality efforts and HSB 601 would provide a source of cost-share funding.
Ted Stopulos of the Governor’s Office offered an amendment to give schools flexibility to use the funds for transportation needs, for example. However, the funds could not be used to build stadiums and projects with a price tag of $1 million nor more would be subject to voter approval.
Hein said the bill appears to be on track to meet the Friday deadline for legislation to make it out of a full committee and remain eligible for consideration.