Lawmakers are once again stepping up committee work to beat the second legislative funnel deadline. Most bills that haven’t passed one chamber plus committee in the other by Friday, April 2 will be dead for the rest of the session. The main exceptions are tax, spending, and government oversight legislation. After that, the legislature will focus on crafting a budget for the fiscal year that begins July 1 and holding floor votes for some of the policy bills that survived the funnel.
To that end, Senate Republicans released their budget targets this week, laying the groundwork for spending negotiations with the GOP-controlled House in the coming weeks.
The Senate plan calls for $7.999 billion in state spending for the next fiscal year—a $195 million increase over this year. In addition to funding things like education and health care, the proposal would also phase out the inheritance tax; eliminate the property tax mental health levy; and repeal the state revenue benchmarks, or “triggers” that must be met before the 2018 income tax cuts can go into effect. These same provisions are part of a separate bill, SF 576 which passed the chamber unanimously last week, 46-0.
Under the proposed Senate budget, health care funding would increase by $98.1 million, with $60 million going toward mental health services and $15 million for nursing homes and home and community-based providers. Education spending would go up by more than $80 million, including both K-12 funding and post-secondary education, such as Last Dollar Scholarships. And, an additional $13 million would be appropriated for public safety, with the Iowa Department of Public Safety receiving nearly $5 million and more than $4 million going to the Department of Corrections.
The Senate proposal would spend 94% of state revenue. The Iowa Constitution allows lawmakers to appropriate up to 99% of revenue. Majority Leader Jack Whitver (R-Ankeny) said in a written statement, “This budget keeps the promise our members made to Iowans to reduce taxes on Iowa families, small businesses, and farmers by accounting for the removal of triggers, phasing out the inheritance tax, and over $100 million in property tax relief.”
Appropriations Committee Ranking Member Joe Bolkcom (D-Iowa City) said in a statement that the GOP budget “ignores” the financial impact of COVID-19 on “thousands and thousands of working Iowans.” He said he was thankful the $1.9 trillion American Rescue Plan Act would put “money directly into the hands of Iowans.”
House Republicans have yet to release their budget targets.
BrownWinick Government Relations:
To view additional summaries from the 2021 Iowa Legislative session or to learn more about BrownWinick’s Government Relations Team, click here.