Iowa Legislative Update—Jan. 25, 2022

Environment
Small Towns

We’re in the third week of Iowa’s legislative session, and the Center for Rural Affairs continues to track bills and the activities that impact rural Iowa. 

The opening weeks of the session confirmed that a top priority of Republican leaders will be tax reform. In her Condition of the State address, Gov. Kim Reynolds announced a proposal for a 4% flat income tax and soon after, Senate Ways & Means Committee Chair Sen. Dan Dawson noted that if Senate Republicans were to introduce a tax bill, it would include provisions involving Iowa’s Natural Resources and Outdoor Recreation Trust Fund, also known as IWILL. We will continue to monitor these discussions, particularly relating to raising the sales tax and funding the trust.   

Below are the issues and a bill we are keeping a close eye on.

Thank you for making your rural voice heard. 

Water quality

The first few weeks of session confirmed that a top priority of Republican leaders will be tax reform. It is likely that part of this discussion will include Iowa’s Natural Resources and Outdoor Recreation Trust Fund, also known as IWILL. The trust was created when it received the support from 63 percent of Iowa voters on the ballot in 2010. As written, the first three-eighths cent of any sales tax increase must be designated for the trust. Iowa has not raised its sales tax since, and IWILL has remained unfunded for more than a decade. 

Recent comments by Republican leaders suggest raising the sales tax, and thereby funding IWILL, may be on the table this session. In a Jan. 12 Senate Ways & Means Committee meeting, Chair Sen. Dan Dawson noted that a Senate Republican tax bill “will constitutionally enact IWILL.” We will continue to monitor these discussions.

House Study Bill (HSB) 536 - Undecided—Introduced by Commerce Chair Rep. Shannon Lundgren, this bill proposes to restrict counties and cities from adopting, enforcing, or otherwise administering regulations on stormwater that exceed or conflict with federal or state regulations.

Renewable energy

So far, it has been relatively quiet on the clean energy front. We are working with our coalitions and partners to proactively identify any legislation that may be coming forward. For example, we are now hearing of potential legislation to assist the homeowners who applied for the Iowa Solar Tax Credit but were not paid before funding ran out. These homeowners made significant investments in solar energy and should receive the tax credit they were expecting.

Read more about that issue in this story from Public News Service.