Government Affairs Weekly Report - Week 4: Jan. 30-Feb. 2, 2017

by CBI Lobbyist Jeff Boeyink - Partner, LS2 Group
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​Overview / Major Events
This week marked final resolution on the legislation to reduce state spending in the current fiscal year by around $100 million—with the House passing the bill on Monday (the Senate had done so late last week) and Governor Branstad signing the bill on Wednesday.
 
The spending reductions became necessary to satisfy the state’s spending limitation law that limits general fund spending to no more than 99% of estimated revenue (based on the December revenue estimate).
 
When the December 2016 revenue estimate came in lower than the estimate that was used to craft the FY17 budget, it became clear that spending reductions would be required to ensure spending would not exceed the legal limit once the books close on the 2017 budget year (which ends on June 30, 2017).
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Senate Moves Drug Testing Legislation – Precursor to Work Comp Reform
This week the Iowa Senate passed a revision to Iowa’s private employer drug testing law by adding “hair” to the list of substances that can be used to test employees for the presence of illegal drugs.

Iowa is one of only three states (the others being Hawaii and Oregon) that do NOT allow hair testing for pre-employment drug screening or other employee drug testing requirements. Currently, the state allows only blood, urine, and saliva.

The bill picked up bipartisan support with 35 of the 50 members voting YES on final passage. That said, the debate sparked some passionate rhetoric on the floor and it served as a precursor to what is likely to be a very contentious process to pass reforms to Iowa’s worker compensation laws.

Latest discussions with House and Senate leaders suggest the comprehensive work comp legislation is nearly ready for prime time (and might be introduced some time next week – and, if not then, for certain the week of February 13).

Next Week (week of February 6) Begins Stretch Drive to First Funnel
The first legislative funnel date is Friday, March 3. That means there is roughly one month left to introduce key priorities and move them through at least ONE legislative committee to keep the bill alive for further consideration.
 
Next week I expect to see work begin (or at least legislation introduced) on three major issues that will ALL cause significant conflict between the majority and minority parties in the House and Senate.

1. K-12 School Aid: the House and Senate are ready to complete action next week on legislation to increase state spending on K-12 schools by $40 million. This 1.11% increase is being panned by education interests, but applauded by those who understand the FY18 budget will be tight and there is little room for spending increases. Action starts Monday @ 11 am with a public hearing in the House.
2. State Preemption of Local Ordinances: legislation to ensure that local governments do NOT pass local ordinances that conflict with state law on issues such as minimum wage, plastic bags, and other issues is set to move next week. It was sparked by a number of local governments adopting local minimum wage requirements in excess of the minimum wage set in Iowa law and that is causing compliance difficulties and costs (especially to those businesses that have multiple locations throughout the state).
3. Collective Bargaining Reform: prepare to see the long-awaited legislation regarding collective bargaining reform to surface and begin movement next week. Given the likely government employee union opposition to any changes in Iowa’s Chapter 20 (the collective bargaining code section), House and Senate leaders are likely to set an aggressive “start to finish” schedule that sends this legislation to the Governor in something less than two weeks (and maybe even less than that).

Efforts on Behalf of Community Bankers of Iowa

• Senate Commerce Committee passed SSB 1016, legislation to allow the deferral of unpaid loan installments. The bill is now SF 177 and is on the Senate Debate Calendar.
• The bill was amended to limit the deferral charge to a ONE-TIME $20 charge. Original bill language appeared to allow a recurring charge for the same deferral.
• Senate Commerce approved SSB 1015, the annual departmental bill for the Iowa Economic Development Authority. The bill is now SF 176 and is on the Senate Debate Calendar.