DES MOINES | Majority Senate Republicans passed a sweeping tax relief and simplification plan Wednesday they called a “bold” initiative that will cut individual and corporate income tax rates by $1 billion and spur growth, but a minority Democrat warned they are riding “a bobsled to bankruptcy.”
Sen. Randy Feenstra, R-Hull, chairman of the Senate Ways and Means Committee, called the plan a bold approach that simplifies Iowa’s complicated system, improves the state’s competitive position and delivers “the largest tax cut in history of the state of Iowa.”
Senators voted 29-21 to approve Senate File 2383 and sent it to the Iowa House. All 29 GOP senators voted for the bill while independent Sen. David Johnson joined 20 Democrats in opposing the measure.
“Today is a monumental day for Iowa families and Iowa workers,” said Feenstra. “Today we’ll vote on a bill that lets hard-working Iowans keep more of their paychecks because this will be the largest tax cut in Iowa history.
“Today we’re taking a bold step in making Iowa’s economy more competitive. Currently Iowa has the most complicated tax system in the nation. These issues have been stifling the Iowa economy,” he added. “Yes, this is bold. Senators, we must be bold if we want to drive Iowa’s economy by creating higher wages, more jobs and more opportunities.”
The plan, called the Iowa Working Families Tax Relief Act, seeks to eliminate Iowa’s federal deductibility feature in favor of cutting personal income taxes by 30 percent over a two-and-a-half year period of indexing. Iowa’s top individual income tax rate will be lowered from 8.98 percent to 6.3 percent and the corporate income tax rate will come down from 12 percent to 7 percent. The number of brackets will be compressed from nine rates to five for individuals. On the corporate side, Iowa’s four brackets will be reduced to two rates of 7 percent and 5.5 percent, providing about $240 million in relief over five years.
However, minority Democrats questioned how Republicans would pay for the massive cuts, noting the state budget lawmakers have to put together yet this session would take a $246 million hit in revenue under the Senate GOP plan. They also noted that majority Republicans in the Iowa House planned to work off Gov. Kim Reynolds’ tax cut plan rather than the Senate approach.
“This is a bill that’s going nowhere,” said Sen. Matt McCoy, D-Des Moines, noting the bill was put on a one-week fast track from the time it was introduced until it came before senators on Wednesday. “We literally were flying blind into the abyss and I believe that this is the height of fiscal irresponsibility and mismanagement.”
Democrats said the plan was being pushed with no public input and they predicted the tax cut would have “catastrophic consequences” for public education, public safety, managed health care or other vital services with the affect felt hardest in rural Iowa. They also said 4 percent of Iowans in the upper tax brackets would reap 22 percent of the benefits.
“We are taking a drastic, dark and disastrous path tonight,” said McCoy. “We seem to be on a fast track. Sen. Feenstra, I know you mean well, but you are about to pilot a bobsled to bankruptcy for the state of Iowa, I have no doubt about it.”
According to a state Department of Revenue analysis, the 566,405 Iowa income-tax filers who make $10,000 or less in 2023 would see an average cut in their individual income tax liability of $178, or 240 percent. The dollar averages would grow, but the percentage increases would decline among the various income brackets with those making $250,000 experiencing a $1,702 reduction and the 11,017 Iowans making over $1 million annually would receive a 12.7 percent tax cut averaging $5,796. Overall, state income tax collections would drop by $1.031 billion, an average cut of $610 or 22.7 percent, for the estimated 1,690,920 state income-tax filers.
A separate analysis of S.F. 2383 by the nonpartisan Legislative Services Agency indicated that the multi-year GOP tax plan would reduce general fund revenue by more than $1.163 billion in fiscal 2023 in a state that has an annual budget currently at $7.2 billion. The cumulative effect of the yearly tax reductions would top $4 billion by fiscal 2023.
According to the LSA analysis, the state general fund impact of the Senate GOP plan would be a reduction of $207.8 million in the 2019 fiscal year that begins July 1. In the following fiscal years, the revenue impact is a $770 million reduction in fiscal 2020, $941.3 million in fiscal 2021, $1.069 billion in fiscal 2022, and a $1.163 billion overall revenue reduction in fiscal 2023. The overall reduction to the state individual income tax collection would be $979.4 million and $267.4 million in state corporate income tax receipts by fiscal 2023.
Reynolds told reporters Wednesday it was a “positive” development that elected officials were discussing Iowa tax-law changes which she said was made possible by a federal tax package that was signed into law by President Trump last December.
“I’m excited that we’re talking about tax cuts,” the governor said. “They put a plan together, I put a plan together and now the conversation begins.” She said any changes to the state’s tax code have to be “responsible.”
Reynolds unveiled her plan last month to cut Iowans personal income taxes by $1.7 billion over five years, revamp rates by phasing out federal deductibility and equalize sales tax collections by treating Main Street and online businesses alike. Her plan did not address corporate income tax changes.
“I feel very good about the proposal that we put forward,” Reynolds said. “It reduces taxes, reduces rates and really modernizes the tax code, which needs to happen.”
David Roederer, leader of the state Department of Management who also serves as the Reynolds-Gregg administration budget di director, said the governor’s tax-cut proposal fits within the five-year state budget projections and includes triggers that delay implementation if the economy slows down or stops growing.
“We need to be able to sustain it, we need to do it in a responsible manner,” Reynolds said of state tax reductions, adding that she also wants to honor commitments that have been made to education and to “continue to fund priorities of our administration” which her approach would do.
“I want to make sure that we can continue to do that and it’s sustainable and I believe that the proposal that I put forward is. But I’m interested in looking at other things. I’m not saying it’s my way or the highway. This is a vehicle, it’s a place to start,” Reynolds said, noting there are similarities between her plan and the Senate GOP approach that form the basis for finding common ground.
Officials with the Iowa Fiscal Partnership, a progressive think tank based in Iowa City, issued an analysis of the Senate GOP plan Wednesday indicating that Senate File 2383 would cut taxes and state revenue “well below what is required to maintain Iowa’s current budget for education, health, public safety, and other services — and its phase-in sets out large structural deficits for the years ahead.”
IFP officials concluded that Iowa’s income and corporate income taxes are average in comparison with other states and could be made more equitable by eliminating tax preferences and loopholes and better recognizing living costs for moderate and middle-income families rather than cutting taxes.
“Senate File 2383 cuts taxes and state revenue well below what is required to maintain Iowa’s current budget for education, health, public safety, and other services — and its phase-in sets out large structural deficits for the years ahead,” according to the IFP analysis. “While S.F. 2383 would take small steps toward curbing a few costly tax expenditures, overall it would erode revenues, create structural budget deficits for years to come, and force cuts certain to imperil Iowa’s basic infrastructure and traditionally accepted responsibilities for its residents.”
INDEPENDENCE — A patient at the Independence Mental Health Institute with a history of threatening U.S. presidents has been charged with attempting to smother a fellow patient and threatening to kill a staff member.
The incidents happened months apart, and Buchanan County sheriff’s deputies arrested Terrance David Rooney Jr., 44, Friday for attempted murder, first-degree harassment and assault on a health care worker.
Rooney remains at the county jail with bond set at $500,000 cash only.
According to court records, Rooney was at the MHI facility Nov. 18 when he tried to suffocate another patient with a pillow. Rooney had made comments about killing the man several days before and had planned the attack, waiting for him to be in his room asleep while no staff was around, records state.
Then on Feb. 13, Rooney allegedly grabbed the thumb of a staff member who was trying to restrain him. He twisted the thumb and told the worker he was going to kill her, records state. The employee suffered a sprained thumb and was unable to work.
This isn’t the first time Rooney has been charged with attacking MHI staff. In August 2016, he swung at the head of a female employee and pulled out chunks of her hair. He was arrested for assault on a health care worker and later pleaded guilty.
In the 1998, Rooney was indicted for mailing threats to then-President Bill Clinton. He pleaded guilty and was committed for a mental health condition, records state.
In August 2004, he assaulted a nurse at University of Iowa Hospitals and Clinics in Iowa City, and when authorities there detained him he said he was going to “get a gun and shoot the president,” records state. Secret Service members questioned him about the statement, and he said he remembered hearing voiced that told him to hurt the nurse, but he said he had no memory of threatening the president.
He was committed to a psychiatric ward at Mercy Medical Center in Dubuque, and while there in November 2004 wrote a letter that contained threats against President George W. Bush, past President George H.W. Bush, Gov. Terry Branstad and lawmakers Charles Grassley, Tom Harkin, John Kerry and their families, record state.
Another letter in December 2004 stated Rooney was hearing voices in his head telling him to kill President Bush and the vice president and then to kill himself, court records state. Days later, while in the Dubuque County Jail, Rooney was heard screaming he was going to kill the president and Judge Randall Nigg, who had presided over portions of one of his cases.
He pleaded to two counts of threatening the president in 2006 and was sentenced to 27 months in prison with placement in a federal medical facility.
DES MOINES — Legislation that would make it illegal for a doctor to perform an abortion in Iowa once a fetal heartbeat is detected won Senate approval this week as a first step toward what many see as a legal battle aimed at overturning the 1973 landmark U.S. Supreme Court decision legalizing abortion.
Senators approved Senate File 2281 by a 30-20 margin with Ocheyedan independent Sen. David Johnson joining 29 majority Republicans in passing the measure and sending it to the Iowa House where Republicans hold a 59-41 majority and have a similar measure moving through the process.
“This bill is the logical beginning point for all of civil governance,” noted Sen. Amy Sinclair, R-Allerton, floor manager of a bill she said strikes “at the very heart and soul of what it means to be an American, what it means to be a person.”
However, Senate Democrats who opposed the measure called it unconstitutional and another “assault” on Iowa women in a chamber where the state was forced to pay a $1.75 million sexual harassment settlement by a former female staffer who brought a successful lawsuit against Senate Republicans.
“The bill before us today is the new form of GOP coercion of Iowa women,” said Sen. Joe Bolkcom, D-Iowa City. “It is time for Republican politicians to stop playing politics and stop using your positions of power to harass and disrespect girls and women. Enough is enough.”
The measure would bar a physician from performing an abortion when tests determine a heartbeat is present unless a medical emergency exists that warrants the procedure.
Violation of the bill’s provisions would subject a doctor to a felony charge carrying a five-year prison term and a fine of $750 to $7,500 but there would be no penalty for the woman.
Backers said the bill is the strongest effort to date to protect the sanctity of life but opponents countered that the measure would encroach on medical decisions made by a woman in consultation with her doctor.
“This bill is dangerous. This bill is unconstitutional. This bill devalues Iowa women,” said Senate Minority Leader Janet Petersen, a Des Moines Democrat. “This bill impacts every girl and every woman in our state from the time they get their period to the time they take their last breath.
“This bill puts a six-week ban on abortion,” added Petersen, who noted that prison inmates, livestock and corpses have more medical rights than Iowa women and girls under the bill. “The only exception to this medical ban is if a woman’s life is at stake. The only exception is to prevent death.”
Sinclair responded to the bill’s critics by telling Democrats “please, this is not a war on women and, in fact, roughly 50 percent of the people we are electing to protect here are indeed women so in fact a failure to pass this bill would be the true war on women in its most pure sense.”
Sinclair referenced the first time she heard her son’s heartbeat as a pregnant 19-year-old and the last time she heard her father’s heartbeat as emblematic of the bill’s purpose, telling senators “In each of those cases, I know that the heartbeats or the lack of one was the indication of another human being’s life.”
Bob Vander Plaats, president and chief executive officer of The Family Leader, said if the bill makes it through the Iowa House and gets signed by Gov. Kim Reynolds, “Iowa would be the first state to recognize what science already affirms: a baby in the womb has her own unique DNA, her own unique heartbeat, is her own unique person. She’s a baby and she deserves to have her birthday.”
Erin Davison-Rippey, public affairs director for Planned Parenthood of the Heartland, Planned Parenthood Voters of Iowa, called Wednesday’s vote “unpopular, unconstitutional, and unconscionable.”
“Plain and simple, Iowa women do not want to be dragged back to 1972, and taxpayers do not want to pay the cost of a lengthy, divisive legal battle to challenge Roe -- especially when seven in 10 Americans agree that abortion should remain safe and legal,” she added. “We call on reasonable members of the House to do the right thing and stop this attack on women’s health and rights.”
CRESCO | The Iowa DCI is assisting the Cresco Police Department with a death investigation Thursday where a person was shot and a male taken into custody.
The Cresco Police Department was called to 700 S. Elm St. about 1:30 a.m. for a report of shots fired, according to a news release.
Officers arrived and located a subject barricaded in a residence near that location.
Police and the Iowa State Patrol negotiated with an individual for several hours and were able to take him into custody without incident. Officers then located a deceased individual inside the residence.
Law enforcement said the investigation is ongoing. The names of the people involved are not being released at this time pending notification of relatives.
The Howard County Sheriff's Office is also assisting in the investigation.
— Courtney Fiorini