Week 12 brought more signs of Spring: the Pella Tulip Time Queen and her court graced the Capitol with their presence and their Dutch letters. In March Madness news, the Sweet 16 weekend kicked off with the Iowa State Cyclone men ending a great season with a loss to Illinois. Continuing their domination, the Iowa Hawkeye women beat Colorado on Saturday and face LSU for a heated rematch on Monday evening.
Under the dome, Senator Dawson and Representative Abdul-Samad were the 2024 winners of the Herbert Hoover Uncommon Public Service Award, presented annually during the last week of March to a Senator and Representative who demonstrate uncommon service to the people of Iowa.
Last week was slow for bill introductions and floor work. Just 17 bills and resolutions were introduced or renumbered, just 4 bills were sent to the House, 17 were sent to the Senate, and another 17 were passed to the Governor. There is a stark contrast between the pace of action this year and last year. Bills are moving much slower in the second year of this General Assembly.
The major news of the week was the release of budget targets by House and Senate Republicans on Thursday, just three weeks before the scheduled last day of session. The two chambers have differing ideas about funding in Fiscal Year 2025, with an $82 million gap to reconcile. Leadership will work together and with the Governor to decide on a state budget in the coming weeks.
School Reform
Governor Reynolds signed her major education plan into law on Wednesday. HF 2612 passed the Senate on Tuesday 30-18 with three Republicans voting with the Democrats against the bill. The bill was signed by the Governor shortly after its passage.
This bill combines several major education priorities that have dominated the conversation at the capitol this year:
- Increases starting teacher pay to $50,000
- Establishes the State Supplemental Aid at 2.5% (lower than the 3% the House originally pushed for)
- Gives school districts control of spending for media and general education services.
- Does not make any change to funding for special education in the 2024-25 school year.
- In the 2024-25 school year, school districts would receive 60% of the state funding for media services and general education services and AEAs would receive 40%.
- In the 2025-26 school year and beyond, districts would receive the state special education funding that currently goes to the AEAs, but they would be required to send 90% of that money to the AEAs while keeping the remaining 10% of funds.
Governor Reynolds released a statement before signing the bill:
“I’m proud to sign legislation that further strengthens Iowa’s commitment to students, parents, teachers, and schools. This bill will improve special education for students with disabilities and raise salaries for new and experienced teachers – two foundational pillars of a world class education system which is exactly what we strive to provide for every student in our state. High quality teachers and instruction unlock the potential for student success, and this legislation delivers both.”
Budget Activity
The Iowa House and Senate Republicans have released their budget targets, initiating negotiations between the chambers on government spending for the upcoming fiscal year. Education funding takes up a majority of the state budget – with the signing this week of the major education plan, lawmakers have a clearer picture of the overall budget.
The REC estimates Iowa’s revenue at about $9.6 billion for FY 2025. By state law, the budget must not spend more than 99% of that estimate. As a reminder, Governor Kim Reynolds proposed a state budget of $8.919 billion in total appropriations at the beginning of the legislative session.
House Budget Proposal: $8.955 billion
This amount is $35 million higher than Governor Reynolds’ budget plan.
- $35 million higher than Governor Reynolds’ budget plan
- 4.71% increase in spending from FY 2024 ($8.552 billion)
Senate Budget Proposal: $8.872 billion
- $47 million lower than Governor Reynolds’ budget plan
- $82 million lower than the House Republicans’ target
The two chambers are roughly $82 million apart in their proposals. This may seem like an impassable gap but consider that last year the House and Senate were $90 million apart in their initial proposals.
The Governor and Republican lawmakers have also indicated they plan to further decrease Iowa’s income tax rates this session. Representative Kaufmann and Senator Dawson, chairs of the Ways and Means Committees, introduced legislation to cut the individual income tax rate, in part using the $2.74 billion in the state’s Taxpayer Relief Fund.
Leaders and budget chairs will need to engage in negotiations to finalize a statewide budget for FY 2025. How quickly they can work through the $82 million difference will be one of the major factors determining when session will conclude, as well as what major policy issues may be resolved via the budgeting process.
The first Appropriations bill moved even before targets were released – on Wednesday the House Transportation, Infrastructure and Capitals Appropriations Subcommittee met to approve the House version of the Transportation Budget (LSB 5016XG – FY 2025). The Senate will take up its version of the Transportation Budget (SSB3184) on Monday, April 1.
The Governor has introduced the following appropriations bills:
Gubernatorial Appointments
As the chief administrator of Iowa’s government, the Governor is responsible for the various state departments and agencies. The Governor appoints department and agency heads and other state officials not elected by the people. These appointments must be announced by March 1 and are generally subject to approval by the Senate.
Senate committees have been considering appointments all week during their regularly scheduled meetings. A full list of the Governor’s recommendations for these positions can be found here.
Soil Temperature
Two leading indicators as to when the Iowa General Assembly will adjourn sine die are the appropriations process and soil temperature.
According to Iowa State University Soil Monitoring, the current soil temperatures around the state are still in the mid-30s to low-40s, which is too cold to begin planting corn or soybeans. There is still much of the appropriations process ahead, and the ground is too cold for the farmer legislators to pressure the rest of the body for adjournment. Your Dentons Davis Brown team will continue to track both factors closely.
What’s next?
Final action on policy bills will need to be agreed upon soon or risk getting set aside as the budget process begins in earnest. Now that budget targets have been announced, the process of amending and approving the budget bills will continue until the final hours of the session. An annual procedural change designed to speed up progress at the end of session will take effect next week: House amendments typically must be filed on the day preceding floor debate, but this requirement is lifted after the twelfth week, allowing lawmakers to file amendments on the day of debate (House Rule 31.8).
There are just two and a half weeks, or 12 legislative days, left until the scheduled 110th day of session. The full 2024 Session Timetable can be found here.
