Capitol Comments
Two weeks. Two weeks is my prediction of the time left in this year’s legislative session. Little to no progress has been made since last week’s update. The Senate and Governor have not come to agreement with the House on the overall spending number and budget conference committees still have not started their work.
The conference committee working on education reform has made some progress closing the differences between the House and the Senate. My understanding is the Governor’s office insists on including mandatory third grade retention, even talking privately about vetoing any reform package that does not include the arbitrary measure.
My push this year to begin the transformational, systemic change needed in our schools was included in both the House and Senate versions. While it is just a first step, it starts to move the state in the right direction. We should not cement the current system where students enter and move through the system on the same timeline without regard for individual learning styles and interests. Mandatory retention at an arbitrary point in a student’s career because of an arbitrary score on an arbitrary test moves us farther from our goal.
I discussed these issues a length on the House floor as we debated the original House education proposal (video is available here). I have also covered the topic in some of my weekly video updates from the Capitol. The Cedar Rapids Gazette ran a story this week on the videos and other ways legislators use technology to communicate with constituents.
On to the update…
In This Issue
1. Legislation Broadening Innovation Tax Credit Advances
2. Supply Chain Incentive Clears Iowa House
3. Tobacco Cessation & Prevention Funding Update
4. Capitol Visits
Legislation Broadening Innovation Tax Credit Advances
Last year the legislature authorized the Iowa Department of Economic Development (now IPEP) to issue non-transferable tax credits equal to 20 percent of a taxpayer’s equity investment in an innovation fund. IPEP made $8 million in tax credits available. HF 2454 transfers the innovation fund tax credit program to the Iowa Innovation Corporation (IIC).
The 20% credit cap has not been successful encouraging investment, so the legislation removes the limit. The IIC plans to leverage the tax credits to create a $16 million innovation seed fund. The federal government will match investment in the fund should it reach $20 million.
Encouraging innovation is key to Iowa’s economic future. I am very optimistic about expanding research and development activities in the state, private partnerships to commercialize research done in public institutions and an entrepreneurial community that is reaching critical mass. Companies like Seed Here, CR Vault and RecBob and many others have chosen Cedar Rapids as a place to grow. I also recently visited Foundry CoWork and StartupCity Des Moines on Silicon Sixth in downtown Des Moines, two places where companies are forming and seeing major growth.
Iowa needs to focus more of its economic development resources toward encouraging innovation and this bill is a start. Recruiting and retaining talent and creating a sense of place in Iowa communities are equally important. Technology allows someone to perform many jobs from anywhere in the world. We need to do all we can to make sure they want to do it in Iowa.
Supply Chain Incentive Clears Iowa House
Businesses supplying Iowa’s biggest manufacturers could receive a boost after actions taken by the Iowa House this week.
Firms supplying parts and materials to anchor manufacturers would be eligible for an income tax rebate based on their growth. Any growth over 105 percent of the firm’s previous year income would be exempted from income tax. For example, if a company had $100,000 in year one, anything over $105,000 in year two would be exempt.
In addition to helping the manufacturing businesses already in Iowa, it’s hoped that the legislation will entice businesses to move closer to the firms they are supplying. These supply chain businesses moving closer to large anchor manufacturers will lower costs for all involved and create good paying jobs. Cedar Rapids economic development groups have found success using this strategy. Clustering has long been a focus of community growth plans to capitalize on the presence of large food processors in the community.
HF 2471 passed the House and now moves to the Senate for further consideration.
Tobacco Cessation & Prevention Funding Update
The smoking rate among adults in Iowa dropped 31% between 2000 to 2010, beating the national decrease by 6%. There is an even more dramatic drop for young adults; a 61% decrease in Iowa compared to a 36% decrease across the country. The number of Iowans admitted for heart attacks has dropped, as well.
A large part of these reductions are due to Iowa increasing the tobacco tax in 2007 and passing the Smoke Free Air Act in 2008 which ended smoking in public establishments. Unfortunately the rates are starting to level off and climb back up because of reductions in funding for smoking prevention and cessation programs in Iowa.
The Health and Human Services budget bill, Senate File 2336, is going to conference committee to resolve funding differences between the House and Senate, including the amount dedicated to tobacco cessation and prevention. The Senate proposed $5.4 million in funding, while the House only maintains last year’s level of $2.8 million. I will continue working with the conferees to negotiate the highest level of funding possible.
Capitol Visits
Linn County Supervisor Linda Langston visited the Capitol on Tuesday. We talked about the mental health system redesign and ways to ensure veterans have access to services across the state.
Have a great weekend!
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