Category: Political
Click here: Here’s something that many Americans — including some of the smartest and most educated among us — don’t know: The official unemployment rate, as reported by the U.S. Department of Labor, is extremely misleading.
There’s no other way to say this. The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployed, amounts to a Big Lie.
News from the Hill…
This past week the Iowa House held the first debate for the year. It was a six hour debate that included some caucus time. The bill established the increased growth of state aid for schools for fiscal year 2016. The debate centered around those who wanted to spend more than what the state has to spend and those of us who are fiscally responsible to keep spending in line with revenue. Some seem to find it easy to make promises that simply cannot be kept. Iowa’s economy is stable but the agricultural economy is simply not as robust as it has been in the past. For instance, John Deere has announced over nine hundred layoffs at several different plants. The layoffs in the Ankeny plant will be its biggest layoff in it’s history. So I believe it is very prudent to steady the growth with the uncertainty of actual funding revenue for the next year. The State funding for school aid for this next fiscal year increases approximately $50 million dollars for school aid and $50 million for Teacher Leadership Compensation. This total is one half of the available growth of additional dollars for the projected state revenues.
Commerce Committee…
In the Commerce Committee this week, we had a presentation from the ICN, about Broadband in Iowa. In the past the ICN has tried to get a bigger piece of business from the private sector. But it appears at this time they have received the message from the legislature that government ran entities should not be competing with the private sector as it is an uneven playing field tilted in the favor of government. The Governor has mentioned “connecting farms, schools and communities” last year in his campaign and this year in his state of the state speech. The governor’s office will be submitting a bill on broadband which I have just now received a personal copy and will read this weekend. The biggest question that will need to be answered is this, what is the role of government (taxpayers) in connecting every farm, school and community? The cost of laying fiber optics is very expensive. There has to be a significant rate of return for companies to be able to afford the investment of laying fiber optics. If taxpayers are asked to make some type of investment, there still needs to be a worthy rate of return on investment. There will be much more on this subject in the near future. I have been assigned to the subcommittee on HSB 96 that is in the Commerce Committee. This bill is an act exempting internet protocol-enabled service and voice over internet protocol service from specified regulatory authority known as VOIP. This bill has been very controversial in the past. While this may be the direction many are going in the industry, it cannot be at the expense of rate payers. There will be much more on this bill in the future, also.
Ways and Means Committee…
The Ways and Means Committee passed two bills out of committee this past week that I wrote about in last week’s newsletter. One of the bills, HSB 67, is very time sensitive. This bill decides whether the State of Iowa is going to couple with Federal Tax Laws for tax year 2014. The bill we passed will not couple with the Federal Bonus Depreciation, but it will couple with everything else including 179 expensing. This is very important for small business and farm businesses. This will lower the projected ending balance for fiscal year 2015, but increase the ongoing revenue for fiscal year 2016. The bill will now move to the house floor for further consideration. The other bill we passed out of committee was HSB 63, which modifies the deductions for 529 college savings plans. I wrote about both of these bills in last week’s newsletter. Both of these bills passed unanimously in committee and now move to the house floor for further consideration. They will become a House File and be assigned a new number.
“The Constitution only gives people the right to pursue happiness. You have to catch it yourself.” – Benjamin Franklin
For more information on these and other bills: www.legis.iowa.gov
Until next time,
Tom Sands
News from the Hill…
The second week will be complete by the time you read this. It seems to take week three before I can get into the different routine and feel like I can work on several different tasks at the same time. So I am always glad to get the first two weeks behind me. None the less, bills are being filed, meetings are being held and the legislative work is beginning. There have been lots of different presentations in the different committees to educate new legislators and to help remind those who have been there awhile. This week in the Commerce Committee the Insurance Commissioner gave an update on the Insurance Division. There has been one newer health insurance company that is in financial trouble. They grew the company too fast, didn’t have enough equity and underpriced their product. That would be a perfect recipe for failure.
Ways and Means Committee…
I assigned three bills in the Ways and Means Committee this week. One of the bills is known as the coupling bill. Iowa has to decide whether or not to “couple “with the Federal government on it’s tax policy. This bill is HSB 67. I hope to move this bill fairly quickly as we are in the tax preparation period. Taxpayers and tax preparers deserve need to know what the state plans to do. The dysfunctional Federal government affects states and taxpayers in many ways. The Federal Governments lack of being able to decide tax policy until the last two weeks of the year is a terrible way to establish tax policy. So now we are forced to decide tax policy on a year that is already over. If the bill moves as written it will lower the revenue in fiscal year 2015 approximately 99 million dollars. However it would increase revenue for following fiscal years. One of the other bills is HSB 63 which deals with Iowa educational savings plan trust also known as the Iowa college savings 529 plan. The bill would allow a participant who makes a contribution to the trust on or before the Iowa income tax return filing deadline to elect to have that contribution treated as though it was made on the last day of the preceding calendar year. This would be very similar to contributions to IRA’s under present law. This bill would be a planning tool for participants of the plans and help people plan for the recipient’s college in the future. The third bill assigned in committee was HSB 64 which exempts the sales tax from the use of self-pay washers and dryers. This is a bill that we passed a couple of years ago but never was passed by the senate. So once again, we will attempt to get the bill to the Governor’s desk for his consideration. The committee will have two meetings next week and I have two more presentations scheduled for those meetings. I hope to have a bill or two ready for passing also.
Budget Presentation…
This week in the Ways and Means Committee the Legislative Service Agency Fiscal Services Division gave a presentation on the General Fund Budget overview. When we look at revenue sources for the state government, tax payers fund the government with approximately half of the revenue coming from personal individual income tax returns and approximately one-third coming from sales tax receipts. Those two categories alone bring in over $5.3 billion annually. The total net revenue receipts for budget year 2016 are projected to be $6.489 billion. On the expenditure side, School Aid and Medicaid are the two biggest appropriations that make up approximately 60 percent of the total expenditures. Approximately 80 percent of the general fund budget is spent on Education and Health/Human Services. Since 2005 school aid has increased 4.2 percent annually or 834 million dollars and Medicaid has increased 11.7 percent annually or 721 million dollars. When you have the two biggest areas of the budget growing that fast and revenues growing at a slower rate spending has to be slowed.
“If we ever forget that we are One Nation Under God, then we will be a nation gone under.” – Ronald Reagan
For more information on these and other bills: www.legis.iowa.gov
Until next time,
Tom Sands
https://www.youtube.com/watch?v=slNMObuRcHk