Newsletter: Rozenboom Report (2/13/2015)

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Committee work continued in the Iowa Senate this week as we try to meet the first funnel deadline. Each day I find a new pile of bills on my desk that have been submitted for consideration this year. One of the interesting proposed bills includes raising the speed limit to 75 mph on interstate highways. Comments about this bill and other legislation are always welcome.

The Senate did run six bills on the floor on Tuesday, all dealing with education funding. Senate Democrats presented a bill that establishes Supplemental State Aid (allowable growth) at 4% for FY16 and 4% for FY17. That legislation passed on a 26-24 strictly partisan vote.

That compares to the House bill passed two weeks ago that set those numbers at 1.25% for each year. We need to analyze what that means in real numbers. A four percent increase in SSA for FY16 requires $140 million in new revenue. If we add the already committed $60 million of new spending for education reform, it means another $200 million in new dollars just for K-12 education.

A conservative estimate of additional requirements to fund Medicaid is $140 million for FY15. What this all means is that K -12 education and Medicaid would require $340 million of new taxpayer money for those two budget items alone. State revenues are expected to increase by $337 million. Itís apparent that the math doesnít add up when we add in the rest of state government budget obligations. The difference between the House and Senate education bills will be hammered out in conference committee.

The conversation on infrastructure funding began in earnest on Tuesday after the House and Senate dropped identical study bills to find ways to better maintain into our roads and bridges in Iowa. The primary feature of the proposed legislation is a 10 cent per gallon increase on the gasoline and diesel tax. In addition, annual permit fees and single trip permit fees for over-length, over-width and overweight vehicles will be raised. Some of those fees currently are quite low, certainly as compared to surrounding states.

The bill extends the two-cent gas tax differential on ethanol blended fuel through FY 2025, and establishes a three-cent gas tax differential on B-11 biodiesel blended fuel through FY 2025 under the same provisions as the ethanol differential. The ethanol and biodiesel formulas are subject to legislative review at least every six years. And the legislation provides intent language that the General Assembly wants the increased funding to be used on critical road and bridge repairs. If enacted, the fuel tax increase would take effect the first day of the month following enactment.

An important feature of this bill for rural counties is that the new dollars realized from this change will be distributed to counties, cities and the state under the original Road Use Tax Formula. This means counties will receive 32.5% of the new money rather that the 20% counties received under the Time 21 formula. The 20% city share has been the same under both formulas.

Please contact your state legislators about your views on legislation. I will be in Centerville at 10:00 AM on Saturday, February 21 at the Chariton Valley Planning and Development office and at Eggs and Issues in Oskaloosa on Saturday, February 28 at 8:30 AM. Thank you to all who send e-mails or call, and also to those who make the trip to Des Moines to visit with your local legislators personally.

Senator Ken Rozenboom

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