|
Iowa House
Republicans Enact Sweeping Changes through Landmark Economic
Development Package
(DES MOINES) – House Republicans
finished special session early this morning, passing an economic
development package and making good on their promise to generate
wealth for Iowans. While other states like Nebraska are raising
taxes, House Republicans paved the way by offering true income and
property tax reform, lifted regulatory burdens and offered a fund
to jump-start Iowa’s economy.
“Change in this state has never
been easy, and this is a testament to the resolve of the Iowa
House Republicans,” said House Speaker Christopher Rants. “This
legislation is a signal to the people of Iowa that the status quo
is over and this state is ready to move forward. House Republicans
enacted bold change for businesses and put more money into the
pockets of Iowa’s taxpayers. This is a landmark finish to a
landmark session.”
A key component of the package is
the Iowa Values Fund. $100 million from Congress’
recently-passed economic stimulus package will fund the first two
years of the Iowa Values Fund. The next five years will be funded
by the streamlined sales tax, which collects sales tax from remote
sellers such as catalogs and Internet businesses.
The fund focuses mainly on business
development ($178 million) and will be overseen by an 11-member
board appointed by the governor and confirmed by the Senate.
Within the board, a five member due diligence committee will
review applications and provide recommendations to the full board.
The values fund also focuses on
marketing the state ($20 million), loan guarantees ($22.5
million), workforce development ($25 million), university research
and development ($27 million), and money for the Cultural Trust
Fund and state parks ($1 million each).
Policy for how the funds are spent
extends through FY 2007 at a total of $278 million, and a future
Legislature will determine how the remainder of the funds ($225
million) shall be spent from FY 2008 to FY 2010.
“This is an exciting time for the
people of Iowa,” said House Majority Leader Chuck Gipp. “What
we accomplished this session is truly historic. All Iowans will
benefit from the actions House Republicans took today.”
|
Also enacted was a
state income tax cut, bringing the uncompetitive nine rates down to
three, and scheduled to put $308 million back into the hands of Iowa
taxpayers in FY 2008. The property tax structure was overhauled,
making the system transparent and simple, removing the undue burdens
of the current system.
Finally, regulatory reform was also
included, making Iowa a business-friendly state by lifting onerous
business regulations and eliminating outdated burdens on Iowa
businesses. The regulatory reform portion focuses on five specific
areas: Liability Reform, Worker’s Compensation (Apportionment),
Financial Services, Unemployment Compensation Surcharge, and
Economic Development (Regulatory Assistance).
“This will tell businesses all over
the country that Iowa is ‘Open for Business,’” said Rep. Lance
Horbach (R-Tama), sponsor of the original House bill on regulatory
reform. “With this legislation, Iowa will be creating the business
environment that employers have been seeking for years.”
According to some estimates, the
worker’s compensation piece will add $8.85 million to businesses’
bottom line in insurance savings alone. When the governor vetoed
this piece in May of ‘02, the insurance commissioner increased the
worker’s compensation premium rate by 2.4%. Passage of this bill
would likely roll back that increase and save businesses $8.85
million per year. This, and other provisions of the bill, have
leading business executives estimating that there will be a
significant possibility for millions more in savings for Iowa
businesses.
“In any session, if only one of
these things passed, it would be hailed as the landmark of the
entire year,” said Rep. Clarence Hoffman (R-Charter Oak), floor
manager of the bill. “We have passed four such pieces of
significant legislation today.”
The package will be debated by the
Iowa Senate later today.
Ways
& Means Update
Bills
introduced to and passed out of committee this week:
-No
ways & Means bills passed committee during the special session.
|
Week
in Review Archives