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DES MOINES | Delivering her first Condition of the State speech Tuesday, Gov. Kim Reynolds was upbeat as she declared the condition of Iowa strong “because our ability to dream is infinite and the will of our people is great.”

Reynolds, however, used the annual report to a joint session of the Iowa House and Senate to address the “destructive force” of sexual harassment and problems in the management of the state’s Medicaid program that serve more than 600,000 low-income Iowans.

Reynolds praised women who have found the courage to speak out about the sexual harassment, which she called a “stain on our culture.” That would seem to include a former Republican Senate staffer who won a $1.75 million lawsuit settlement last year that involved claims of sexual misconduct.

“Everybody is awakening to (the fact) it’s time to fix this, and we’re certainly doing our part here,” House Speaker Linda Upmeyer, R-Clear Lake, said. In the wake of the lawsuit settlement, the Legislature has hired a human resources officer who will start later this month.

The governor raising the issue in the annual address to the Legislature is helpful, Senate Minority Leader Janet Petersen, D-Des Moines, said, “but we’ve yet to see any policy changes in the Senate that will make our environment more welcoming, an open, safe place.”

TAX REFORM

Reynolds, 58, who became the state’s first female governor in May when Gov. Terry Branstad resigned to become the U.S. ambassador to China, laid out an agenda for tax reform that includes ending federal deductibility, an initiative to expand broadband access in rural Iowa, a public-private effort to increase the number of Iowans with 21st century workplace skills, an expansion of mental health services and of efforts to combat the growing problem of opioid abuse.

Reactions to her policy proposals fell predictably along party lines. Republicans generally welcomed her call for lowering individual income tax rates so Iowans keep more of the benefits of federal tax reform.

“We need to make sure those dollars end up in taxpayers’ pockets,” Upmeyer said. “We’re not going to have the state hanging on to dollars that were intended for taxpayers.”

Democrats were less optimistic about tax relief.

“I don’t know how you cut taxes when we can’t even balance our budget now,” said Rep. Mary Mascher, D-Iowa City. “All I see is more cuts.”

But Sen. Randy Feenstra, R-Hull, chairman of the tax-writing Senate Ways and Means Committee, was “truly excited” by the governor’s tax proposal.

“This is a watershed year (because) when the federal government passed their tax reform, that really put a lot of pressure on us to do something,” Feenstra said. “Now it is our time to act.”

MEDICAID

Addressing the controversial transition from a state-run Medicaid program to a privately run, patient-centered approach similar to that in 39 other states, Reynolds allowed that mistakes have been made.

However, it was “a change that needed to be made” to stem the rising cost of providing health services to more than 600,000 low-income Iowans, many of them children or elderly.

She conceded the projected savings of $47 million is far less than estimated when Branstad made the change nearly two years ago.

However, she said, the Department of Human Services director she hired “has the passion, and — most importantly — the compassion to make this work,” and the state’s new Medicaid director has the experience “to get things turned around.”

Republican lawmakers stood and clapped with Democrats when Reynolds spoke of mistakes in the transition because, Upmeyer said, they, too, want to see improvements in the delivery of health services to their constituents.

“I think her commitment to solving some of our health care problems is one of the most inspirational things in her speech because we’ve all been hearing about the challenges that we’ve had facing us,” Upmeyer said.

Mascher was more cautious, but promised Democrats will “fight tooth and nail to make sure that we can get adequate funding for both our health care system and our Medicaid system as well as our mental health system.”

WORKFORCE

Reynolds also proposed partnering with the private sector to expand education and training opportunities for Iowa workers who lack necessary skills. Today, she said, just over half of Iowa’s workforce has training or education beyond high school. Reynolds wants to increase that to 70 percent.

Her plan calls for legislative approval of the Future Ready Iowa Act and $500,000 to expand programs like the one at the West Delaware school district in Manchester that teaches high school students vocational skills that lead directly to jobs in their communities.

Reynolds also included $1 million in her proposed budget to expand apprenticeship programs.

The governor offered to use state dollars to match private investment in an Iowa Employer Innovation Fund for training programs that best fit the needs of business and industry.

That was a highlight of the speech for Rep. Kirsten Running-Marquardt, D-Cedar Rapids. But, she said, the test will be “how are those words end up in actions, how are they going to be reflected in the budget.”

Acting Lt. Gov. Adam Gregg will lead an initiative focused on reviving rural Iowa because Reynolds believes “the heart, soul, and spirit of Iowa will always remain in our small towns and rural communities.”

The goal is to promote investment and connect rural Iowa by expanding broadband capabilities in every corner of our state in order to “keep and bring home Iowa’s sons and daughters and grow the next generation of community leaders,” Reynolds said.

‘DREAMS COME TRUE’

In closing, Reynolds returned to the positive themes she used to open her speech.

“I believe that Iowa is — and ought to be — a place where, if you’re willing to work for it, you can make your dreams come true,” she said. “My vision is to give the people of Iowa a place to call home that unleashes opportunity at every turn.”

She called for building a “future where our ability to dream is infinite and the will of our people remains eternally unbroken.”

Reach James Lynch at 319-398-8375 or james.lynch@thegazette.com

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