News from Des Moines

Week 16 saw the start of the budget bills moving on the floor of the House.

House File 2494 is the Transportation Operations Budget. This bill distributes the funds in the Road Use Tax Fund (RUTF) that is generated from the fuel tax and vehicle registration fees. This bill appropriates some of the RUTF funds “off the top” for various state-wide Department of Transportation (DOT) functions and then the remainder of the RUTF is distributed by formula. The state DOT receives 47.5 percent for the Primary Road System fund for state highways. The counties receive 24.5 percent for secondary county roads, and an additional 8 percent percent goes to county “farm-to-market” roads. The cities receive 24 percent for streets. In addition, 1.75 percent of the Primary Road System funds are paid to local governments for roadways that transferred from the state to city and county governments. This bill also funds specific rest area and maintenance garage projects around the state, including construction of new maintenance garages.

House File 2491 is the Iowa Department of Agriculture And Land Stewardship (IDALS), Department of Natural Resources (DNR), and Environment First Fund (EFF) appropriations budgets. This bill appropriates a total of $129 million, of which $39 million comes from the general fund (sales and income taxes) and the rest from funds such as the Environmental First Fund (EFF) at $42 million (casino tax funds), Ground Water Funds at $3.5 million (landfill fees, etc.) and the Fish and Game Protection Fund at $43.8 million (hunting licenses). These appropriations fund our DNR operations including our state parks, the IDALS administration and soil and water conservation programs, water quality initiatives, and many other functions. Of note in this bill is the appropriation of $12 million for the Resource Enhancement And Protection (REAP) program. Out of this REAP fund $2 million is specifically designated in 2019 for use by the DNR to improve our state parks for the 100th anniversary of our park system in 2020 with an optional $1 million more for park operations.

On Thursday we began debate on Senate File 2311, the Utilities Omnibus bill. This has been a very complex and difficult bill to manage. There are many players involved with delivering the electricity and gas to your home and business and each has a different perspective on how the utilities are regulated. The power generators, the large power line companies, the local distributors such as Alliant or the Rural Electric Cooperative, the municipal utilities, consumers that also provide power from solar and wind generators, and the companies that perform energy efficiency work. The most controversial portion of this bill was the hidden “energy efficiency” tax that has been included in our bills for decades. This program began in the late 1980s with a 2 percent tax on our utility bills and has steadily grown over the years. The public objected to this tax when it was included on the bill as a line item, so the legislature in 1990 made it illegal for the electric utility to show this as a separate line item, keeping it hidden. Also, over the years the 2 percent was allowed to be raised, becoming a statewide average of nearly 5 percent with some consumers paying as high as 10 percent. These funds, nearly $240 million annually, have been used for appliance rebates, efficient light bulb giveaways, insulation programs, and other projects that are implemented by a cottage industry of small businesses that administer these funds. These businesses use up to 20 percent of these funds for administrative costs that don’t benefit the consumer. This bill rescinds the ban on posting this tax as a line item on the bill so that the consumer will know what they are being charged for, and it limits the maximum to 2 percent per the original intent of the program. This will save our consumers roughly $100 million or more per year on their gas and electric bills, a huge win for those struggling to pay their utility bills.

The debate on this bill did not begin until after 10 p.m. Thursday because the House Democrats spent much of the day working up a long list of last minute amendments (several had nothing to do with energy efficiency or public utilities) to this bill, even though the bill had been in the House since March 7, nearly eight weeks. Debate went on through the night, concluding at 5:11 a.m. Friday after working through 48 filed amendments to the bill. During that time we had to deal with amendments that were not germane to utility regulation on topics such as gun control, sexual harassment and gender pay equity. We also accepted a few amendments that did improve the bill that had been offered by Republican members. The bill passed 52-42 and goes back to the Senate for concurrence on the amendments.

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State Rep. Dean Fisher can be reached at 641-750-3594 or via email at dean.fisher@legis.iowa.gov