March 17, 2017

    State Budget Goes in Red for 2nd Time This Year
    Lower Wages for 65,000 Iowans Passes House
    State Income Tax Refund Delays
    Bills Allow Schools Flexibility in Funding
    Medicaid MCO Re-Enrollment Period
    House Considers Bicycle Safety Bill
    Hirschman to be New State Ombudsman
    Emerald Ash Borer Now in 43 Iowa Counties

    State Budget Goes in Red for 2nd Time This Year

    The state’s non-partisan budget experts said the state budget is in deficit again and lawmakers will have to find another $131 million to keep the state budget balanced this year.

    The non-partisan Revenue Estimating Conference (REC) met on Tuesday and reduced their projected revenue for fiscal year 2017 (FY17), which ends on June 30, 2017, to $7.1 billion. The Governor and Republicans are signaling that they plan on taking the $131 million shortfall from the state’s reserve funds, which are full at $738 million.

    The members of the REC noted that the growth in Iowa’s economy is slow, but we still have unprecedentedly low unemployment rates, commodity prices seem to be stabilizing, and home sales remain strong. Two revenue items that didn’t meet their expected levels are sales taxes and income taxes.

    Earlier this year, Republican lawmakers had to make an additional $114 million in budget adjustments and those have already been signed into law.

    FY 2018 & 2019

    For the fiscal year 2018 state budget, which the Legislature must approve before adjourning this year, budget experts told lawmakers there will be $192 million less in revenue than previously predicted with revenues totaling $7.36 billion. After applying Iowa’s 99% expenditure limitation, the Legislature can appropriate just under $7.3 billion for FY 2018. Fiscal year 2018 begins on July 1, 2017, and runs through June 30, 2018.

    This was the first time that the REC made a prediction for FY 2019, and they predicted 3.6% growth, showing revenue at $7.6 billion.

    Lower Wages for 65,000 Iowans Passes House

    Instead of increasing the minimum wage, Republican lawmakers approved a bill last week that lowers wages for 65,000 Iowans.

    Passed on a party line vote, the bill would preempt local ordinances on wages and products sold. After waiting for Iowa lawmakers to act for nearly a decade, four counties have recently increased the minimum wage in their own community to finally give a boost to the lowest wage earners. The bill, House File 295, takes away the minimum wage increases already approved in some Iowa communities.

    Now set at $7.25 per hour, Iowa’s minimum wage was last increased in 2008 and every state surrounding Iowa (except Wisconsin) has increased their minimum wage above $7.25. To meet basic living expenses, a single person in Iowa resident should make at least $13.16 an hour and that rises to $21.52 an hour for a single parent with one child. One of the counties that took action to increase the minimum wage is Wapello County, which has the 3rd highest poverty rate in Iowa and 2nd lowest per-capita income.

    The bill will now go to the Iowa Senate for further consideration.

    State Income Tax Refund Delays

    The regular deadline for filing an Iowa state income tax return is quickly approaching. Since Iowa’s regular due date is on Sunday this year, income tax returns are due on the following Monday, May 1, 2017. Request for extensions to file Iowa taxes are also due on May 1. Federal income taxes must still be filed by April 18.

    Refund Delays

    The Department of Revenue offers a free tool for Iowan’s to check their state income tax refunds. The status of a refund can be checked at https://www.idr.iowa.gov/wheresmyrefund. According to the Department of Revenue, because of new fraud protections built into the processing of returns this year it may take more time to process returns. The Department stated that while it is still focused on efficiently processing returns it is more important to protect taxpayers confidential information.

    Tax Filing Services

    There are a variety of ways of filing your taxes for free in the state. The AARP Foundation provides free tax assistance and preparation through its Tax-Aide program. The service offers free tax preparation at a variety of physical locations across the state to anyone who cannot afford a tax preparation service, especially those 50 and older. In addition, the Department of Revenue offers a variety of free options through Free File. A list of other free filing options can be found at https://tax.iowa.gov/tax-year-2016-file-free.

    Earned Income Tax Credit

    Iowans that qualify are also encouraged to apply for the Earned Income Tax Credit (EITC). The credit is available to working families and individuals if you worked any time in the last year and meet certain income limitations. If you qualify for the federal Earned Income Tax Credit you can likely claim a similar tax credit on your state income taxes. For additional information about the Earned Income Tax Credit see https://dhs.iowa.gov/EITC.

    Bills Allow Schools Flexibility in Funding

    Two bills have passed the Statehouse that allows school districts flexibility in using funds after they have met the obligations of their intended purpose. This would allow school districts to fill in some gaps in educational programing.

    Democrats warned that this should not be seen as a cure-all of the underfunding of our K-12 school system for the last seven years, but welcomed the local flexibility to school districts these bills will provide. Statewide, districts have millions of dollars in unspent balances, and in creating a flexibility account for schools, they could better meet the needs of students.

    After hearing concerns from Talented and Gifted educators and those that work with at-risk programs, the funding from those programs would not contribute to the flexibility accounts, but could receive funds from the flexibility accounts. In addition, Democrats advocated for and were able to change the bill so the flexibility accounts could be used the following budget year, as opposed to sitting idle for one year as the bill was originally drafted.

    Medicaid MCO Re-Enrollment Period

    Thousands of Iowans on Medicaid will receive an enrollment packet with information about re-enrollment options with one of the three privately managed care organizations (MCO) this month. During the ninety day re-enrollment period, a member can choose to stay with their current MCO, or they can change to a different MCO to better meet their needs.

    After multiple delays last year, Iowa’s Medicaid system was privatized by the Branstad/Reynolds Administration. Medicaid members, adults enrolled in the Iowa Health and Wellness Plan or the Dental Wellness Plan, and children enrolled in the HAWK-I Program were all assigned or selected a private managed care organization (MCO) as part of IA Health Link.

    As part of the program, enrollees are allowed to re-enroll annually, twelve months from their enrollment date. With the vast majority of the members initially enrolling in April of 2016, it is now time to re-enroll.

    Iowa Medicaid Member Services can help members learn more about the re-enrollment process and the three MCOs they have to choose from. They can be contacted at 1-800-338-8366. In addition, members may contact each MCO through the following phone numbers:

    • Amerigroup: 1-800-600-4441
    • AmeriHealth Caritas: 1-855-332-2440
    • UnitedHealthcare: 1-800-464-9484

    House Considers Bicycle Safety Bill

    Bicycle safety advocates have long expressed concern for the safety of riders on Iowa’s roads. Lawmakers will look to address those safety concerns for bicyclists across the state as they look to expand laws while passing a bicycle.

    The law will require changes from both bicyclists and those driving motor vehicles on the road passing bicyclists. Bicyclists will now have to have lights on both the front and back of the bike while riding at night, currently they only need a reflector on the back of their bike. Drivers passing a bike will now be required to change to an adjacent travel lane if passing bicyclists traveling in the same direction, if they are not in a bike lane or on the shoulder.

    There were a total of 11 bicycle deaths in 2016, nine of which involved the bicyclists being struck by a motor vehicle.

    Hirschman to be New State Ombudsman

    Lawmakers are hiring a new leader for the independent and impartial agency to which citizens and whistleblowers can air grievances about state government.

    Ms. Katie Hirschman, who is currently the acting Ombudsman, must be confirmed by both the House and Senate. The resolution lawmakers are considering confirms Ms. Hirschman to a four-year term that commences July 1, 2017.

    By facilitating communications between citizens and government and making recommendations to improve administrative practices and procedures, the Ombudsman promotes responsiveness and quality in government. The Ombudsman has authority to investigate complaints about state and local government, with certain exceptions.

    The Ombudsman attempts to resolve most problems informally. Following an investigation, the Ombudsman may make findings and recommendations and publish a report. The Office of the Ombudsman provides the following services:

    • Investigate a complaint against an agency, official or employee of Iowa state and local government independently and impartially, and in a confidential manner, to the extent possible as provided by law.
    • Work with an agency to attempt to resolve a problem when an investigation shows that the agency has acted contrary to law, unreasonably or unfairly, or has made a mistake.
    • Make recommendations to agencies for administrative or policy changes, when appropriate.

    More information about the Office of Ombudsman’s can be found at: https://www.legis.iowa.gov/Ombudsman/. Or by contacting by email at: ombudsman@legis.iowa.gov.

    Emerald Ash Borer Now in 43 Iowa Counties

    The Iowa Department of Natural Resources (DNR) recently announced that Emerald Ash Borer (EAB) has been found in both Greene and Wayne counties, bringing the total number of Iowa counties with the invasive pest up to 43.

    EAB was first detected in Iowa in 2010. Since its discovery in Michigan back in 2002, tens of millions of ash trees have been killed in the United States. EAB are small, shiny green beetles and their larvae are found under the bark of ash trees, where they feed. Once infected, a tree can be killed in as little as two years. These pests are thought to have arrived from their native Asia in wooden crates and shipping materials. Currently, EAB has been found in 27 states.

    There are ways to protect ash trees from EAB. Homeowners may soil drench their trees in insecticide, or use trunk injections. However, these treatments depend on the overall health of the tree, soil compaction, and other environmental factors to be effective.

    To help curb the spread of the pest, there is a quarantine of firewood, logs, and wood chips within all 99 Iowa counties. This means that wood cannot be moved out of the area without a permit, and all wood found within a county must be used within that same county.

    For more information regarding the Emerald Ash Borer, please visit http://www.iowatreepests.com/eab_home.html.