Capitol Update - February 25, 2022
UEN Legislative Update
Feb. 25, 2022
Week Seven of the 2022 Session: Tax cut compromise goes to the Governor, other policy bills receive House or Senate approval, Governor’s school choice Omnibus proposal moves forward through Senate Appropriations Subcommittee while the House takes a different approach. This UEN Weekly Report from the 2022 Legislative Session includes:
- Historic Tax Cut Compromise Details
- School Choice Status Update
- Bills Debated in the House and Senate
- List of Bills Surviving the Funnel with new Bill Numbers and UEN Registration
- Advocacy Action Steps for This Week
- Links to Advocacy Resources
Historic Tax Cuts Agreed to in the House and Senate: HF 2317 was amended by the Senate and agreed to by the House late Thursday, sending it to the Governor. UEN is opposed to the Bill, which will reduce general fund revenue significantly, hindering the ability of the state to adequately fund schools and other essential state services. During the debate, there was strong difference of opinion, with the Republicans stating that these tax cuts will stimulate Iowa’s economic growth and the Democrats stating that other states’ experiences have not delivered such growth. The Bill contains the following components and fiscal impacts to the state General Fund as estimated by the LSA Fiscal Note:
- Division I — Stock Capital Gains Income Tax Exemption (lowers state GF by about $10 million annually by FY 2026)
- Division II — Farm Lease Income Tax Exemption for retired farmers (lowers state GF by about $2 million)
- Division III — Farm Capital Gains Income Tax Exemption (lowers state GF by about $6 million)
- Divisions IV, V, and VI — Income Tax Rate Reductions and Retirement Income Tax Exemption. Under existing law, Iowa’s TY 2023 and after top individual income tax rate is 6.50%. The Bill reduces the top tax rate to 6.00% for TY 2023, 5.70% for TY 2024, 4.82% for TY 2025, and 3.90% for TY 2026 and after. The number of brackets and the bracket income levels are also reduced over the years. Law changes that lower Iowa income tax liability also lower the amount of income surtax for schools (PPEL and ISL) owed by any taxpayer subject to the surtax. The individual income tax rate changes and retirement income exemption are projected to reduce net individual income tax liability and State General Fund revenue by the following amounts:
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- FY 2023 = $216.7 million
- FY 2024 = $482.0 million
- FY 2025 = $666.8 million
- FY 2026 = $1,227.4 million
- FY 2027 = $1,651.2 million
- FY 2028 = $1,690.3 million
- Division VII — Research Activities Tax Credit Changes, reducing refundability by ten percentage points annually beginning in TY 2023, resulting in tax credit refundability equal to 50.0% for TY 2027 and after, which increases state GF revenue:
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- FY 2024 = $13.1 million
- FY 2025 = $23.7 million
- FY 2026 = $30.0 million
- FY 2027 = $36.6 million
- FY 2028 = $44.8 million
- Division VIII — Other Tax Credit Changes, reducing refundability or eliminating several smaller tax credits (gradually increases state GF revenue up to about $5 million by 2028.) The School Tuition Organization and Tuition and Textbook tax credits are not changed by this Bill.
- Divisions IX and X — Corporate Income Tax Rate Reduction(reduces state GR revenue increasing annually, by $229.4 million in 2028). This Division includes a trigger mechanism before additional corporate income taxes are reduced. For years beyond FY 2028, the Bill’s process to lower the corporate income tax to a single tax rate of 5.50% over time will result in additional revenue reductions whenever the trigger mechanism activates a rate reduction the next tax year.
- Division XI — Tax Expenditure Committee Repealed. This committee has provided oversight to tax credits and expenditures. This oversight function is transferred to various departments and state agencies.
- Division XII — Taxpayer Relief Fund Transfers sets up a process for automatic transfers from the TRF if two conditions are met: 1) The actual ending balance of the State General Fund is less than 1.0% of the adjusted revenue estimate for the fiscal year. 2) State General Fund revenues plus the transfer to the State General Fund from the Economic Emergency Fund for the fiscal year is less than 103.5% of State General Fund actual receipts for the previous fiscal year. The LSA states that these specific financial conditions required to trigger a transfer are not predictable. The most likely outcome under current law and under the language of Division XII is that the balance in the Taxpayer Trust Fund will remain until utilized by the Legislature at a future date. The Taxpayer Trust Fund currently has a balance of more than $1.0 billion and the balance is projected to increase to almost $2.0 billion by the end of FY 2023.
This chart from the Fiscal Note shows the total estimated reduction of taxes:
School Choice Status:
The Governor’s School Choice Omnibus bill, now SF 2349, was approved by a subcommittee of the Senate Appropriations Committee, with a meeting for full Committee action scheduled for Monday upon adjournment of the Senate. The House has split the Governor’s concepts into several bills, two of which are on the House Calendar eligible for debate. See the UEN Call to Action, updated last week for talking points.
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Governor’s Omnibus part 1 |
A bill for an act relating to education, including modifying provisions related to open enrollment good cause siblings, teacher librarian endorsements, and the placement of children identified as requiring special education in competent private instruction. (Formerly HSB 705.) Registered as Undecided. |
House Calendar |
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Governor’s Omnibus part 2 |
A bill for an act relating to education, including requiring the boards of directors of school districts to publish certain specified information (transparency Provisions) and modifying provisions related to required social studies instruction (high stakes graduation test). (Formerly HSB 706.) Registered as Opposed. |
House Calendar |
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Governor’s Omnibus Vouchers |
Establishes a student first scholarship program (vouchers) and a student first enrollment supplement fund and includes a standing unlimited appropriation for up to 10,000 vouchers. No action in House Education. Was re-referred to Appropriations Committee. Registered as Opposed. |
House Appropriations Committee |
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Governor’s Omnibus Vouchers plus Parts 1 and 2 |
Establishes a student first scholarship program (vouchers) and a student first enrollment supplement fund (expected to be amended to instead increase operational sharing incentives typically used by smaller districts). Requires school boards to publish instructional materials, standards and whether standards are met and exceeded by grade, course and teacher, changes required social studies instruction including a high stakes test for graduation, and also changes some open enrollment provisions, teacher librarian endorsements, competent private instruction, and special education. Includes a standing unlimited appropriation for up to 10,000 vouchers. (Formerly SSB 3080.) Registered as Opposed. |
Senate Appropriations Committee |
House Floor Action This Week:
HF 2416 Transgender Girls Athletic Eligibility: (Formerly HF 2309) prohibits transgender girls from participating in girls’ varsity sports in a nonpublic school, public school, charter school, community college, or state university and defines “sex” as the biological sex assigned at birth. Approved 55:39, sending it to the Senate, where similar SF 2342 is on the Senate Calendar. UEN is opposed.
HF 2080 Operational Sharing: (formerly HF 2037) increases the supplementary weighting for districts that share a superintendent from 8 to 9 students and allows an individual to fill more than one shared position. Approved by the House 94:0. Assigned to the Senate Education Committee. UEN is undecided.
HF 2083 Teach Iowa Scholar Loan Forgiveness Grants: removes the requirement that an applicant must be in the top 25% of their class to receive the Scholarship. Requires 50% of the awards go to applicants who are teaching in small districts with 1,200 students or less and 50% of awards go to applicants who are teaching in large districts with more than 1,200 students, but if there are insufficient applicants in either category, the slot may be given to the other. Approved 97:0, sending it to the Senate Education Committee. A similar bill, SF 2202, is in the Senate Ways and Means Committee. SF 2202 includes new language allowing the district management levy to pay for costs of a teacher recruitment program and would require applicants to graduate in the top 50% of their class. UEN is registered in support of both bills.
SF 183 Maximum Price Contracts: Allows government entities to use guaranteed maximum price contracts. Deems such contracts to be with a construction manager-at-risk, with a maximum price guaranteed. Prohibits the use of design-build and guaranteed maximum price contracts for bridge and highway improvements. The Senate approved the Bill in the 2021 Session, 28:19. The House passed the Bill 53:44 on Thursday, sending it to the Governor. UEN is registered as undecided.
Senate Floor Action This Week:
SF 2081 Computer Science Grants: allows recipients of grants for computer science professional development to spend the money until September 30th past the fiscal year during which the grants were awarded. Approved 48:0 sending it to the House. UEN is registered in support.
SF 2128 ELL Terminology: changes limited English Proficient terminology throughout the Code of Iowa to English learner (EL). Approved 48:0 sending it to the House, where similar HF 2429 is on the House Calendar. The Bill does not change any weightings or years of eligibility for EL students. UEN is undecided.
SF 2266 IPERS Retirement Earnings Cap: increases the cap on income earnings for an IPERS eligible retiree employed by an IPERS employer from $30,000 to $50,000 before losing some IPERS income. The Bill also increases the income threshold from $6,000 to $20,000 that a school board member can earn before triggering a conflict of interest. The Bill passed the Senate 49:0, sending it to the House. The Bill is attached to HF 2170 which has the same IPERS language but does not include the school board member income threshold. UEN is registered in support.
SF 2279 Electronic Bids: allows governments to accept electronic bids for public improvements. The Bill passed the Senate 48:0 sending it to the House, where it is on the House Calendar, attached to similar HF 2279. UEN is registered in support.
SF 2322 Fees for Public Records: requires fees for access to public records to be reasonable. Although the Bill originally prohibited legal fees for redacting information, the Bill was amended to allow such fees if the redacting was for confidential information. Approved 48:0 sending it to the House Ways and Means Committee. UEN was originally opposed, but with the amendment, has changed our registration to undecided.
SF 2362 Electronic Notice/School Health: includes the following provisions:
- Bonds: Allows notice for bonds to be published electronically and allows bids to be received electronically. Authorizes notice for school bonds to be published electronically.
- School Board Vacancy: Allows school boards to publish a notice of vacancy on the website for the school board.
- Electronic Signatures: Allows boards to use electronic signatures and contracts in specific circumstances.
- Pledge of Allegiance: Requires schools, rather than school boards, to administer the Pledge of Allegiance daily.
- Health Trainings Work Group: Requires DE to convene a workgroup on health care training for schools. Requires a report by December 2022. Requires the DE to work with the DPH on a school health care training task force.
- Conference Boards: Allows a mayor to appoint a designee to serve instead of the mayor and strikes the requirements that the school boards in the county appoint members to the board.
- Background Checks: Deems that the BOEE or a school district can issue a license or authorization, or hire a teacher, before the national criminal history background check is received, contingent on the candidate passing such a check.
The Bill originally included mandated training for seizure disorder, but that provision was amended out of the Bill during floor debate in the Senate. The Senate approved the Bill as amended, 48:0, sending it to the House Education Committee. UEN was originally undecided, but with the amendment, has changed our registration to support.
Bills Surviving the Funnel and Status (many with new bill numbers) and UEN Registration
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Bill Number |
Senate Education Committee |
Status |
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A bill for an act relating to limitations on the immunization of children for enrollment in any licensed child care center or elementary or secondary school in the state and including effective date provisions. (Formerly SSB 3004.) Undecided |
Senate Calendar |
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A bill for an act relating to the administration of certain physical examinations and student health screenings by school districts, charter schools, or innovation zone schools. (Formerly SSB 3005.) Undecided |
Senate Calendar |
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A bill for an act relating to disbursements from the computer science professional development incentive fund. (Formerly SSB 3002.) Supports |
House Education |
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A bill for an act relating to education, including the education of students who are not fully English proficient and the standards applicable to the hiring, developing, and evaluation of community college faculty. (Formerly SSB 3047.) Undecided |
House Calendar |
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A bill for an act relating to students who are eligible to receive a scholarship from the future ready Iowa skilled workforce last-dollar scholarship fund. (Formerly SSB 3046.) Undecided |
Senate Calendar |
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A bill for an act relating to schools that are required to register with the college student aid commission. (Formerly SSB 3048.) Undecided |
House Calendar |
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A bill for an act establishing the mental health professional loan repayment program within the college student aid commission. (Formerly SSB 3003.) Supports |
Senate Calendar |
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A bill for an act providing for the establishment of a task force related to special education support for students at nonpublic schools. (Formerly SF 168.) Undecided |
House Education |
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A bill for an act relating to education, including eligibility for grants under the teach Iowa scholar program, licenses issued by the board of educational examiners, and the use of revenues from the district management levy. (Formerly SSB 3067.) Supports |
Senate Ways and Means Committee |
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A bill for an act relating to public school funding by establishing the state percent of growth and the categorical state percent of growth for the budget year beginning July 1, 2022, modifying provisions relating to the regular program state cost per pupil, modifying provisions relating to the property tax replacement payment and the transportation equity payments. (Formerly SSB 3090.) Opposed |
Gov. Signed HF 2316 |
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A bill for an act relating to the rights of students enrolled in school districts or charter schools and the rights of parents and guardians of those students. (Formerly SSB 3079.) Undecided |
Senate Calendar |
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A bill for an act relating to student eligibility requirements in school district, accredited nonpublic school, charter school, community college, and regent institution athletics based on sex, which prohibits transgender girls from competing in girls’ sports. (Formerly SSB 3146.) Opposed |
Senate Calendar |
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A bill for an act relating to supplemental aid and modified supplemental amounts for certain school districts relating to excessive open enrollment. (Formerly SSB 3103.) Undecided |
Senate Calendar |
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A bill for an act relating to education, including establishing a student first scholarship program and a student first enrollment supplement fund, requiring the boards of directors of school districts to publish certain specified information, modifying provisions related to required social studies instruction, open enrollment, teacher librarian endorsements, competent private instruction, and special education, making appropriations, providing penalties, and including effective date, applicability, and retroactive applicability provisions. (Formerly SSB 3080.) Opposed |
Senate Approps Committee |
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A bill for an act requiring cursive instruction for students enrolled in public elementary schools. (Formerly SF 89.) Opposed |
Senate Calendar |
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A bill for an act authorizing the boards of directors of school districts to engage certain specified individuals to serve without compensation as substitute teachers. (Formerly SSB 3085.) Undecided |
Senate Calendar |
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A bill for an act relating to voting during meetings of the boards of directors of school districts. (Formerly SF 2203.) Undecided |
Senate Calendar |
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A bill for an act directing the department of education to convene an achievement gap working group. (Formerly SF 2112.) Undecided |
Senate Calendar |
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A bill for an act directing the department of education to convene a working group to study the impact of technology on the cognitive function of students. (Formerly SF 2107.) Undecided |
Senate Calendar |
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A bill for an act relating to entities supported in whole or in part by public moneys, including the sale of public bonds, the duties and responsibilities of school boards, school districts, the department of education, accredited nonpublic schools, charter schools, and children’s residential facilities, and the membership and voting units of county and city conference boards. (Formerly SSB 3104.) Supports |
House Education Committee |
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Bill Number |
House Education Committee |
Status |
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A bill for an act relating to school districts that share operational functions, including operational functions in the areas of superintendent management and special education director. (Formerly HF 2307) Undecided |
Senate Education Committee |
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A bill for an act relating to teachers, including the assessments administered to practitioner preparation program admission candidates and to practitioner preparation program students prior to students’ completion of a practitioner preparation program, and certain specified licenses for teachers created by the board of educational examiners. (Formerly HSB 520.) Supports |
House Calendar |
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A bill for an act relating to the division of certain school taxes collected in urban renewal areas containing wind energy conversion property. (Formerly HSB 521.) Supports |
House Ways/Means |
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A bill for an act relating to matters under the purview of the college student aid commission, including grant programs and the definition of accredited private institutions. (Formerly HSB 519.) Undecided |
Senate Education Committee |
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A bill for an act relating to a teacher’s filing of a written resignation with the board of directors of a school district. (Formerly HSB 518.) Opposes |
House Calendar |
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A bill for an act relating to students who are eligible to receive a scholarship from the future ready Iowa skilled workforce last-dollar scholarship fund. (Formerly HSB 541.) Undecided |
House Calendar |
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A bill for an act relating to public school internet filtering of social media sites. (Formerly HF 2052.) Undecided |
House Calendar |
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A bill for an act relating to the inclusion of the telephone and text numbers for the Your Life Iowa program on public school student identification cards. (Formerly HF 2109.) Undecided |
House Calendar |
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A bill for an act relating to immunization against COVID-19 requirements for enrollment in any licensed child care center, elementary or secondary school, or postsecondary school in Iowa. (Formerly HF 2040.) Undecided |
House Calendar |
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A bill for an act relating to public school funding by establishing the state percent of growth and the categorical state percent of growth for the budget year beginning July 1, 2022, modifying provisions relating to the regular program state cost per pupil, modifying provisions relating to the property tax replacement payment and the transportation equity payments, and including effective date provisions. (Formerly HSB 658.) Effective date: Enactment, 02/17/2022. Undecided |
Signed by Governor |
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A bill for an act relating to renewal requirements for licenses issued by the board of educational examiners to practitioners with master’s or doctoral degrees. (Formerly HSB 656.) Undecided |
House Calendar |
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A bill for an act relating to education, including the education of students who are not fully English proficient and the standards applicable to the hiring, developing, and evaluation of community college faculty. (Formerly HSB 611.) Undecided |
House Calendar |
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A bill for an act requiring radon testing and mitigation in public schools, and including applicability provisions. (Formerly HF 2264.) Supports |
House Calendar |
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A bill for an act relating to student eligibility requirements in school district, accredited nonpublic school, regent institution, community college, and certain other institution of higher education athletics based on sex, which prohibits transgender girls from competing in girls’ sports. (Formerly HF 2309.) Opposes |
Senate Calendar |
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A bill for an act concerning the eligibility of students who transfer or open enroll to participate in varsity interscholastic athletic contests. (Formerly HF 2139.) Undecided |
House Calendar |
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A bill for an act relating to social studies instruction in public schools and requiring a new half-unit of civil discourse as a condition of graduation. (Formerly HF 2099.) Opposes |
House Calendar |
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A bill for an act relating to education, including requirements related to teacher intern license programs and licenses and authorizations issued by the board of educational examiners. (Formerly HSB 632.) Supports |
House Calendar |
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A bill for an act establishing the comprehensive transition and postsecondary program scholarship program. (Formerly HF 2306.) Undecided |
House Calendar |
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A bill for an act relating to education, including modifying provisions related to open enrollment, teacher librarian endorsements, and the placement of children identified as requiring special education in competent private instruction. (Governor’s School Choice Omnibus Part 1) (Formerly HSB 705.) Undecided |
House Calendar |
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A bill for an act relating to education, including requiring the boards of directors of school districts to publish certain specified information and modifying provisions related to required social studies instruction including a high stakes test for graduation. (Governor’s School Choice Omnibus Part 2) (Formerly HSB 706.) Opposes |
House Calendar |
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A bill for an act establishing a new license to be issued by the board of educational examiners. (Formerly HF 2085.) Opposes |
House Calendar |
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A bill for an act relating to education, including requirements related to mandatory reporters, the department of education, school districts, including creation of a committee of public members to investigate allegations of teacher misconduct, and accredited nonpublic schools, and the responsibilities and membership of the BOEE. (Formerly HSB 702.) Opposes |
House Calendar |
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Bill Number |
Bills from Other Committees |
Status |
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Allows schools to receive electronic Bids. Supports |
House Calendar |
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HF 2366 |
Allows schools to receive electronic Bids. Supports |
House Calendar |
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Obscene Materials in Schools Prohibited: Requires schools designate an administrator |
Senate Calendar |
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Mandatory reporters and sexual exploitation of a minor. Mandates mandatory reporters to |
House Calendar |
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HSB 704 |
Wind Energy Property not Revalued with Repair. Supports |
House Ways and Means |
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Wind Energy Property not Revalued with Repair. Supports |
Senate Calendar |
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Para-educator Substitutes (ARRC) with BOEE waiver for 2021-22 school year. Supports |
Senate Education |
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IPERS income Threshold for Reemployment $50,000 and Board Members Conflict of Interest $20,000. Supports |
House Calendar |
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IPERS income Threshold for Reemployment $50,000. Supports |
House Calendar |
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Fees for Public Records must be reasonable (attorney fees to redact only if confidential information). Undecided |
House Ways and Means |
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Income Tax Cuts flat tax to 3.9%, corporate income tax cuts and others. Opposed |
To the Governor |
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Prohibits school districts from charging high school event admission fees for people |
Senate Appropriations Committee |
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Governor's Workforce Bill. Undecided |
Senate Ways and Means |
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Governor's Workforce Bill. Undecided |
House Ways and Means |
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Maximum Price Contracts. Undecided |
To the Governor |
Advocacy Actions This Week:
- Always start with a thank you! See the 2021 Legislative Session Successes on the UEN website and find one you are grateful for them accomplishing. Weigh in your support on the additional flexibility to recruit and retain teachers and grow our teacher workforce. Tell your legislators and the Governor thank you for getting SSA decided at the beginning of Session so you can work on your budgets within the mandated timelines. You can also tell both chambers thank you for work on raising the IPERS earning caps and considering electronic means for public notice and other communications that were previously costly for school districts.
- Funding: now that SSA is done, advocate with the Senate to approve HF 2315, which provides $19.2 million in supplemental funding to help schools with inflationary costs. Explain that federal pandemic funds are (pick the one or two that apply to your district): 1) already exhausted, 2) obligated but waiting for labor/materials/other supply chain issues that have slowed HVAC construction or simply no applicants for instructional positions, 3) local district must have the funds to expend first, and then seek reimbursement, which can take time to properly document and obtain approval and for all districts, the federal pandemic funds are to be used through Sept. 2024, but then are gone. Adequate state funding would provide sustainability for many of the programs districts have been able to fund with the pandemic funds, but only for a limited time.
- Shore up Voucher Opposition: Circle back with House legislators and reiterate key messages:
- Use public dollars for public schools. Period.
- Public funds require public accountability and transparency.
- Private and public schools do not have a level playing field. If privates are to receive public money, they must have the same regulations and requirements.
- This is a slippery slope toward a costly an expansive voucher program.
- Iowa already has many parent choice options and financial support for private schools, scholarships and tax credits to help parents making that choice.
- The state has not been able to adequately fund one education system and should not commit to the hefty price tag of funding another.
Connecting with Legislators: To call and leave a message at the Statehouse during the legislative session, the House switchboard operator number is 515.281.3221 and the Senate switchboard operator number is 515.281.3371. You can ask if they are available or leave a message for them to call you back. You can also ask them what’s the best way to contact them during session. They may prefer email or text message or phone call based on their personal preferences.
UEN Advocacy Resources: Check out the UEN Website at www.uen-ia.org to find Advocacy Resources such as Issue Briefs, UEN Weekly Legislative Reports and video updates, UEN Calls to Action when immediate advocacy action is required, testimony presented to the State Board of Education, the DE or any legislative committee or public hearing, and links to fiscal information that may inform your work. The latest legislative actions from the Statehouse will be posted at: www.uen-ia.org/blogs-list. See the 2022 UEN Advocacy Handbook, which is also available from the subscriber section of the UEN website.
Contact us with any questions, feedback or suggestions to better prepare your advocacy work:
Margaret Buckton
UEN Executive Director/Legislative Analyst
margaret@iowaschoolfinance.com
515.201.3755 Cell
