Iowa 2021 Legislative Update - Week 16

Dentons Davis Brown
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Dentons Davis Brown

Today marks the 110th day of the legislative session.  The last scheduled week of session has ended and we are now into extra innings.  The legislature will need at least a week or two to finish, as there are still many negotiations in play.  Going forward, both chambers will be on-call for committee and floor work pending legislative deals as they are cut. 

What’s on the table?

  • Tax changes (Inheritance Tax/Tax Triggers (SF576), Property Tax Reform (SF87), Tax Credits/Tax Triggers (SF609)
  • Finalizing the FY 2022-2023 State Budget (see below)
  • A flurry of policy bills, including (but not limited to):

Renewable Fuel Standard (RFS) (HF859/SF549)

A Governor priority for 2021, the chambers will need to reconcile differences in their versions of the bill before RFS language can move forward this session.  The Governor commented this week that she will not give up on her plan to boost the sale of corn-based ethanol and biodiesel.  The Governor’s proposal would require gas stations and convenience stores to offer fuel with a 15% ethanol blend by 2026.  The proposal divides the retailers and the agriculture producers, and House Speaker Grassley believes that passing the RFS would be a difficult push this legislative session.

Back the Blue (SF534)

The House returned the bill to the Senate with a number of changes to the original Senate file, most notably–changes related to qualified immunity for police and increased penalties for crimes related to protests.  The Senate will either need to agree to these changes and send the bill to the Governor, or the bill will continue to bounce or end up in a Conference Committee.

Bottle Bill  

Is the bottle bill back on the table? The House advanced their version of the Bottle Bill (HF814)–which increases the handling fee for redemption centers and allows retailers to refuse to accept bottles and cans (see Week 15)–through Appropriations and the bill is now eligible for the full chamber to consider as early as next week.  Is this new life for a 40-year old unresolved controversy?

Affordable Housing

The Governor’s proposal to expand affordable housing remains on the table as a Ways and Means bill (SF295).  The Senate introduced and advanced a handful of their own housing proposals: Downtown Loan Guarantee (SSB1271), Disaster Housing Recovery (SSB1272), and RETT/Housing Trust (SSB1270) aimed at helping downtowns, homeowners, and renters recover from the pandemic and 2020 derecho.  It has been a priority of the Governor to address the current shortage of affordable homes in the state. 

Appropriations

On Wednesday, April 28, the Senate finished work on the Administration & Regulation Budget HF867 (the Senate substituted their version of the bill SF594 for the House file) and passed the bill unanimously.  This marks the first completed budget bill and will be on its way to the Governor after it is officially enrolled.  Both chambers agreed to a $100 million state investment for broadband grants, a follow-on to the unanimously approved Broadband Grant policy language HF848. These funds will be utilized to fund the grant program established in HF848, see more below.

Two additional appropriations bills were introduced in the Senate on Monday: SSB1275 Standings Appropriation (now SF615) and SSB1257 Federal Block Grant/COVID Funds (now SF614).  The Standings Appropriation bill is typically not introduced until the final days of session; the bill contains Standings appropriations and typically a number of outstanding policy provisions.  SF615, as introduced, contains a number of Standing appropriations and some corrective provisions, but serves as a placeholder; it is expected SF615 will go through a few iterations (amendments by both chambers if they utilize this bill as the Standings Appropriation vehicle) before the bill is final.

The House and the Senate still need to agree on an overall number for the FY2022-2023 budget as well as the details for every budget.  There are major funding differences between the chambers:

Budget House Proposed Senate Proposed Difference
Judicial Branch $193 million $190 million $3 million
Justice Systems $619 million $595 million $24 million
Education $570 million $576 million $6 million
Ag & Natural Resources $54 million $42 million $12 million
Economic Development $49.7 million $46.2 million $3.5 million
HHS $2.047 billion $2.025 billion $22 million
  • In the Education budget, the large difference is in the funding proposals for the Regent Universities.
  • The $12 million difference in the Ag & Natural Resources budget is mostly related to the support for renewable fuels.
  • A $25 million difference in Medicaid spending is causing some of the discord in the HHS budget.

Within a number of these budgets, specifically the HHS budget, the House and Senate also have significant policy differences that will need to be reconciled before the final budget bills are sent down to the Governor.

Appropriations bills House Senate Final
Supplemental FY21   SF284 SF284 (Signed by Gov 2/23)
SSA In-Person HF532    
Admin & Regulation HF 867
Amended & Passed 55-37 (4/21)
SF594 Substituted for HF867; Passed 47-0 (4/28) To Governor
Ag & Natural Resources HF860 SF598  
Economic Development HF871 SF595  
Education HF 868 SF596  
HHS HF891 SF606  
Judicial Branch HF864 SF597  
Justice System HF861 SF599  
Rebuild Iowa Infrastructure Fund (RIIF) HF862 SF600  
Transportation HF863 SF592  
Standings SF615    
Block Grant/Covid Funds SF614    

Banning COVID Passports

Last Friday, April 23, House leadership gaveled in to introduce a new bill HF889 Banning COVID Passports, a leadership bill from House Majority Leader Windschitl and Senate Majority Leader Whitver.  Since it is a leadership bill, it is exempt from the funnel.  The bill prohibits state and local governments from noting on an ID that the ID holder has received a COVID vaccination and prohibits businesses and governments from requiring proof of vaccination before a person can enter.  Businesses and local governments can be disqualified from receiving state contracts or grants if they do require proof of vaccination.  The most controversial provision of the bill that drew a lot of attention in committee and on the floor is the exemption for hospitals and health care facilities.

The House advanced the bill through Judiciary Committee (16-5) on Monday as a subcommittee of the whole (allowing about an hour of public remarks) and the companion Senate version SF610 was introduced on Monday and advanced through the Senate Commerce Committee (11-4) on Tuesday.  On Wednesday evening, the House approved HF889 on a 58-35 vote.  Those advancing the bill believe this is a liberty issue for Iowans but support the exemption for hospitals and health care facilities understanding these institutions must follow federal guidelines.  It is expected that the Senate will quickly take up this issue and send the bill down to the Governor for her signature.  Earlier this year, Governor Reynolds indicated that she would ban vaccination passports by Executive Order if the legislature did not act.

Executive Branch Update

On Wednesday, April 28, the Governor signed HF848 Broadband Grants into law.  The law will require Empower Rural Iowa grants to be made to broadband services providers to expand service statewide, particularly to underserved areas.  Funding for the expansion will come from the state’s general fund and be administered through the Empower Rural Iowa grant program.  In her Condition of the State address, Governor Reynolds proposed $450 million to be invested in the program over the next three years.  With the passage of HF867, the Administration and Regulation Budget, the legislature has appropriated $100 million to the program for FY2022-2023.

Last month, Governor Reynolds signed Executive Order 8 launching a new Childcare Task Force to develop a comprehensive strategy to address the childcare shortage and barriers to childcare in Iowa.  As part of this effort, the Task Force wants to hear directly from parents and childcare providers. 

The Governor will be holding two virtual town halls to receive insight into the current state of childcare and ideas to improve upon it; the meetings are May 6, from 6-8 PM, and on June 1, from 6-8 PM.  Those interested in participating are asked to send an email to Ryan.Capps@governor.iowa.gov with their name, affiliation (if any), and which town hall they are requesting to participate in. Registrants will receive a link to the meeting and sign-in information.

Judicial Branch Update

Chief Justice Christensen has announced a Lessons Learned Task Force to make recommendations to the Iowa Supreme Court on the rule and practice changes that were made during the COVID pandemic. The Chief Justice will head the Task Force, which includes judges and lawyers, in reviewing the rule and practice changes and determining what policies and practices should be retained, modified, or stopped.  The Task Force is expected to make recommendations by June 4, 2021.

Redistricting

The U.S. Census Bureau released its first final results from the 2020 Census on Monday, April 26.  Apportionment determines which states gain or lose congressional districts based on their total population.  Several southern and western states have gained seats in the U.S. House of Representatives according to the apportionment counts released. Iowa will retain its four U.S. House seats, with a population of 3,190,369 in 2020 (an increase of around 144,000 from 2010). 

The state expects to receive census data for state redistricting by August 16 in an older format from the Bureau.  The Iowa Legislative Services Agency has confirmed that will take at least five business days to convert that data into a format that can be used for redistricting, allowing for just about four weeks for the Constitutional redistricting process to unfold and conclude by the September 15 deadline.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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