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Iowa Legislature Update – Week Ending Feb. 21, 2020

2/21/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Overview/Major Events
First funnel deadline passes
Scores of policy bills pending in the Legislature cleared their first major hurdle this week to remain alive for the rest of the legislative session. Lawmakers scrambled to gain committee passage by Thursday for bills they have prioritized for the year. They included changes to the state’s medical cannabis program. Changes in the state’s sustainable can and bottle deposit law were expected to clear the funnel later Thursday.

Some of the session’s most-watched issues, including proposed tax reform legislation and spending bills will be considered later in the session. Tax and spending bills are not subject to the legislative funnel deadlines.

The next funnel deadline is set for March 20, when bills must gain committee passage in the opposite chamber.

Lawmakers take another swing at medical cannabis
Fixes to Iowa’s medical cannabis program cleared a legislative deadline this week. Legislators passed a bill on the last day of the 2019 legislative session that would have substantially expanded the program, but it met Gov. Kim Reynolds’ veto pen. Reynolds said the issue needed further study, and lawmakers have tried to address those concerns this year.

Iowa Legislature Update – Week Ending Feb. 14, 2020

2/14/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Legislative “funnel” deadline looming
Lawmakers raced this week to advance bills before next Friday’s so-called “funnel” deadline. It’s the day policy bills must gain committee approval in one chamber to remain alive for the remainder of the legislative session.

Dozens of subcommittee meetings were scheduled each day this week, creating a chaotic atmosphere at the Capitol. Among some of the higher profile proposals to advance in the House included a constitutional amendment declaring there is not a right to an abortion.

Statehouse observers predict another hectic committee schedule next week. Tax and spending bills are not subject to the funnel and are often considered near the end of session. Key legislators will start crafting the fiscal year 2021 budget when they get a report in March projecting state revenues.

Iowa Legislature Update – Week Ending Feb. 7, 2020

2/7/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Overview/Major Events
Iowa presidential caucuses under fire after results delayed for days
Results of Iowa’s first-in-the-nation presidential caucuses were marred Monday night with delays and technical errors, with no definitive winner declared after months of intense campaigning. The caucuses came under a harsh national spotlight when networks that had come to Iowa to broadcast results had no winner to report on caucus night. One news outlet described the night as an “epic meltdown.” By Thursday morning, Democrats Pete Buttigieg and Bernie Sanders were locked in a dead heat as results trickled in from the last precincts.

The Iowa Democratic Party, which administers the caucuses, blamed the delays on a faulty phone app that precincts were supposed to use to report results. Instead, many of the local officials chose to report their results by phone, jamming phone lines for hours.

None of the large field of candidates got the type of media bounce a caucus winner typically enjoys. Soon after the caucuses were over, candidates and their campaigns already were headed to New Hampshire, which holds its presidential primary on Feb. 11.

Iowa Legislature Update – Week Ending Jan. 31, 2020

1/31/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Overview/Major Events
Trade deal praised as good for Iowa farmers and manufacturers
The North American trade deal inked this week known as USMCA earned praise from Gov. Kim Reynolds, who said it would expand markets for Iowa producers with Iowa’s top trading partners – Mexico and Canada.

“President Trump successfully negotiated a strong, balanced and reciprocal trade agreement that will benefit Iowa and the entire nation,” Reynolds said in a statement. “Years from now, USMCA will prove to be a major boost to Iowa’s economy, especially for families, farmers, manufacturers and small businesses.”

Gov. Reynolds makes appointment to the Iowa Supreme Court
Gov. Kim Reynolds this week appointed Swisher attorney Dana Oxley to serve as a new justice on the Iowa Supreme Court to fill a vacancy created by the death of Chief Justice Mark Cady last year. Oxley practices with a prominent Cedar Rapids law firm and serves as an adjunct law professor at the University of Iowa College of Law.

“Dana Oxley is an exceptional lawyer with a uniquely Iowa story,” Reynolds said in a statement announcing the appointment. “She will be a valuable new addition to the Iowa Supreme Court. I look forward to watching her serve Iowans in this important role for years to come.”

Iowa Legislature Update – Week Ending Jan. 24, 2020

1/24/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Overview/Major Events
Lawmakers gaveled in for a short week, with the Capitol and state government closed to mark the Martin Luther King Jr. holiday on Monday. Subcommittee meetings on bills, which allow stakeholders and the public to comment on legislation, began in earnest.

Among the issues considered and advancing at the committee or subcommittee level this week:

Ban on public vaping
Cost-share limits for patients using insulin with prescription drug coverage
Allowing emergency medical technicians to obtain professional gun permits
A ban on health policies excluding pre-existing conditions if the Affordable Care Act is struck down

Banking Issues
Two bills being closely followed by the banking industry regarding the grain coop lien issue have been introduced. HSB 500 is the Coop's preferred bill to put their claims ahead of banks' for stored grain. CBI is opposing this legislation. A second bill, HF 2047, is a compromise attempt to provide give grain coops a limited time for their claims to be superior to banks' claims in exchange for the development and required use of a central filing system, which has worked well in other states. CBI is still reviewing this legislation and has not yet taken a position.

Iowa Legislature Update – Week Ending Jan. 17, 2020

1/17/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

Legislature begins 2020 session with new leadership
Iowa lawmakers dropped the gavel on the 2020 session Monday, pledging to address challenges that include a shortage of skilled workers and limited access to affordable child care for some across the state.

The biggest change at the State Capitol for the 2020 session is the new leadership in the House. Republican Rep. Pat Grassley of New Hartford, grandson of U.S. Sen. Chuck Grassley, took over as Speaker. He assumes the role from retiring Speaker Linda Upmeyer, the first woman in Iowa to serve in the position. In another leadership change, Rep. Matt Windschitl of Missouri Valley is serving as the new House Majority Leader.

Speaker Pat Grassley was accompanied by his grandfather and family to mark the occasion. He previously served as chair of the powerful Ways and Means Committee, setting budget policy for the state. In his opening address, he called on fellow House members to work together in a bipartisan fashion to reach common goals and show they are not like their counterparts in Washington D.C.

November Rural Mainstreet Index Rises to Highest Reading for 2019: Bankers Expect Holiday Sales to Grow by only 1.3% from 2018

11/25/2019

November Survey Results at a Glance:

Overall index climbs to highest reading for 2019. It also marked the fourth time in the past five months that the overall index has risen above growth neutral.
The trade war with China and the lack of passage of the USMCA are driving confidence and the economic outlook lower for most areas of the region.
On average, bankers, expect a 1.3% expansion with 17.1% of bank CEOs anticipating a decline in retail sales from last year.
Bankers reported that approximately 16.7% of farmers and 5.5% of business owners in their area had no organization succession plan.

OMAHA, Neb. (Nov. 21, 2019) – The Creighton University Rural Mainstreet Index (RMI) for November climbed above growth neutral for the fourth time in the past five months, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The overall index rose to 54.2 from 51.4 in October. Although still tepid, this is the highest reading for 2019. It also marked the fourth time in the past five months that the overall index rose above growth neutral.

“Federal agriculture crop support payments and somewhat higher grain prices have boosted the Rural Mainstreet Index slightly above growth neutral for the month. Given a continued weak rural economy, bank CEOs, on average, expect holiday buying to increase by only 1.3% above last year’s levels,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

Jeff Bonnett, president of Havana National Bank in Havana, Illinois, reported that, “The latest harvests are showing significant declines in test weights leading to the point that 2019 harvest production looks to be running below average.” Bonnett goes on to say that grain prices are still sitting at extremely low levels for such yields.

Farming and Ranching: The farmland and ranchland-price index for November increased slightly to a weak 40.4 from October’s 40.3. This is the 72nd straight month the index has remained below growth neutral 50.0.

The November farm equipment-sales index declined to 37.5 from October’s 39.7. This marks the 74th month the reading has remained below growth neutral 50.0.

October Rural Mainstreet Index Climbs Again: Trade War and Stalled USMCA Batters Economic Confidence

10/21/2019

October Survey Results at a Glance:

After falling below growth neutral in August, the Rural Mainstreet Index jumped slightly above 50.0 for September and October.
Bank CEOs across the region reported significantly lower corn and soybean yields.
Economic confidence fell to lowest level in two years.
Almost three of four bankers reported negative impacts from the trade war.
Approximately 43% of bankers support halting Federal Reserve rate hikes over the next 12 months.

OMAHA, Neb. (Oct. 17, 2019) – The Creighton University Rural Mainstreet Index (RMI) for October climbed above growth neutral, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The overall index rose to 51.4 from 50.1 in September. Although still weak, this is the highest reading since June of this year. It also marked the third time in the past four months that the overall index has risen above growth neutral.

“Federal agriculture crop support payments and somewhat higher grain prices have boosted the Rural Mainstreet Index slightly above growth neutral for the month. Even so, almost three of four bank CEOs, or 73%, reported continuing negative impacts from the trade war,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

But as stated by Jim Stanosheck, CEO of State Bank in Odell, Nebraska, “What is happening in the economy today is exactly what voters voted for.”

Farming and Ranching: The farmland and ranchland-price index for October slumped to a weak 40.3 from September’s 43.1. This is the lowest reading since March of this year and the 71st straight month that the index has remained below growth neutral 50.0.

Jeff Bonnett, president of Havana National Bank in Havana Illinois, said, “Hopefully the true corn acres planted, and more importantly, overall yields will be made public here soon now that we are well into harvesting this year's crop. I am not sure why this is such a secret and why we do not get more accurate information based upon certification of acres planted back in July?”

The October farm equipment-sales index improved to 39.7 from September’s 35.9. This is the highest reading for the index since June of this year, but marks the 73rd month that the reading has remained below growth neutral 50.0.

September Rural Mainstreet Index Bounces Back Above Growth Neutral: Four of 10 Bankers Report Recessionary Conditions

9/23/2019

September Survey Results at a Glance:

After falling below growth neutral for August the Rural Mainstreet Index jumped slightly above the 50.0 reading for September.
More than four in 10 bank CEOs report that their local economy is in a recession.
As a result of continuing weakness in the farm sector, more than half of bankers reported increasing collateral for farm loans, and one in four rejected a higher percent of farm loan applications.
Bankers expect farm equipment sales in their area to decline by another 7.4% over the next 12 months.

OMAHA, Neb. (Sept. 19, 2019) – The Creighton University Rural Mainstreet Index (RMI) for September climbed above growth neutral according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The overall index rose to 50.1 from 46.5 in August. This marks the third time in the past five months that the overall index has risen above growth neutral.

The trade war with China and the lack of passage of the USMCA (NAFTA’s replacement) are driving confidence and growth lower for most areas of the region.

“Despite a $16 billion federal government support package this year and somewhat stronger grain prices, more than four in 10 bankers are reporting that their local economy is in a recession,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

As reported by Dale L. Leighty, chairman and CEO at First National Bank of Las Animas, Colorado, “Grain prices are (still) a big negative for our customers.”

Rural Mainstreet Index Drops to Lowest Level in Two Years: Trade War Having Negative Impacts

8/19/2019

August Survey Results at a Glance:

The Rural Mainstreet Index fell below growth neutral to its lowest level in almost two year.
Three of four bank CEOs reported the trade war was having a negative impact on their local economy.
Seven of 10 bankers support continuing, or even raising tariffs on imported Chinese goods.
Despite worsening economic conditions on the farm, bankers expect only a modest 4% rate of farm loan defaults over the next year.
Business confidence index plummeted to its lowest level since October 2017.

OMAHA, Neb. (Aug. 15, 2019) – The Creighton University Rural Mainstreet Index (RMI) fell below growth neutral for the only the second time this year. According to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy, the RMI for August indicated negative growth for the region.

Overall: The overall index slumped to 46.5 from 50.2 in July. This is the lowest reading for the index since October 2017. The index ranges between 0 and 100 with 50.0 representing growth neutral, and an RMI below the growth neutral threshold. 50.0, indicates negative growth for the month.

“The trade war with China and the lack of passage of the USMCA (NAFTA’s replacement) are driving growth lower for areas of the region with close ties to agriculture. Despite a $16 billion federal government support package coming soon, a drop in farm income is negatively affecting the Rural Mainstreet Economy,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

Three of four bankers reported the trade war was having a negative impact on their local economy.

As stated by Jeffrey Gerhart, CEO of the Bank of Newman Grove in Newman Grove, Nebraska, “Trade wars have been and will continue to be a drain on our ag economy”.

“Despite the negative impact of tariffs and the trade war, only 28.2% of bankers support cutting tariffs on imported goods from China,” said Goss.

Rod Cornelius, market president for Pinnacle Bank in Grand Island, Nebraska reported, “I quickly surveyed 12 local producers, a majority indicated (U.S. should) increase tariff pressure - go big or go home. Although the majority again indicated the tariffs are negatively impacting the local economy.”