10 issues likely on the agenda in the 2018 Iowa Legislature

Debate is brewing over the state budget, tax reform and abortion rights as the Iowa Legislature prepares to convene Monday for its 2018 session.

As legislators return to the Capitol, other issues that could be on the docket include water quality funding, a repeal of the state's 5-cent beverage deposit law, reinstatement of capital punishment, penalties for so-called "sanctuary cities," Medicaid and mental health care, education funding, and sports betting.

The House and Senate will gavel in at 10 a.m. for what Senate Majority Leader Bill Dix, R-Shell Rock, describes as "Chapter 2" of enacting a pro-business, conservative agenda to spur economic growth and create good-paying Iowa jobs. Republicans control both chambers, as well as the governor's office.

"The environment that we are all working in will get more competitive, and we need to embrace that. If you are not doing that, pretty soon your competitor will surpass you," Dix recently told the Iowa Chamber Alliance, which represents 16 chambers of commerce and economic development groups from Iowa's largest communities.

Chapter 1 of the Republicans' plans to restructure state government was written last year when GOP lawmakers delivered on a campaign promise to enact sweeping statutory changes promoted by anti-tax, free-market lobbying organizations; gun rights activists; and evangelical Christians.

Senate Minority Leader Janet Petersen, D-Des Moines, laments much of what happened last session. Some of those changes included a rollback of collective bargaining rights for public employees, a nullification of local minimum-wage increases for low-paid workers, changes in family planning programs that blocked funding to Planned Parenthood, and spending reductions in other programs she believes will negatively affect disabled children, pregnant women and others.

"We don't cut our way to prosperity," Petersen warned at a Greater Des Moines Partnership legislative forum. She chastised Republicans, saying that after last session "a lot of Iowans think they did a lot of bad things to good people."

This year's session is tentatively scheduled to adjourn around April 17, which is when legislators' daily expense payments end.

All 100 seats in the Iowa House will be up for re-election in November, while 25 of the 50 Senate seats will be on the ballot. Some lawmakers will also face party primary elections in June.

Here is a look at 10 key issues that could face intense debate

1. BUDGET: State revenue growth has been slower than expected, which means tough decisions must be made regarding a state budget for the current fiscal year that was already reduced last session. The latest revenue forecast anticipates general fund revenues of about $7.2 billion, up about 2 percent after reserve fund transfers are excluded, for the fiscal year ending June 30, 2018.

State fiscal analysts recently estimated the state faces a shortfall of about $37 million for the current budget year. But state revenue officials reported Friday the impact of federal tax reform could result in a windfall of $16 million in additional state tax revenue because of the impacts of federal tax deductibility. However, the full impact of federal tax reform is still undetermined, and Republican lawmakers say Iowa taxpayers shouldn't face higher state taxes simply because Congress has reduced federal taxes.

One key decision facing lawmakers is whether they will continue to provide state dollars to "backfill" local property tax cuts approved by the Legislature in 2013 that affect cities, counties and school districts. Gov. Kim Reynolds is expected to propose funding for the backfill dollars in her budget proposal, but legislative leaders aren't making any promises. The most recent payments have been $152 million annually.

2. TAX REFORM: Republicans have vowed to enacted a "fairer and flatter" state income tax system. But it's not clear exactly what the plan will look like. A recent memo from Senate Republicans signaled interest in a proposal that includes reductions to individual and corporate tax rates, slashing the number of tax brackets and an expansion of the sales tax base.

Democrats have repeatedly complained the state's budget has been starved by hundreds of millions of dollars in tax giveaways to businesses. But business lobbyists defends state tax incentives. They say state tax credits and other incentives have a demonstrated return on investment but should be focused on stimulating economic growth across diverse industry categories.

Tom Sands, president of the Iowa Taxpayers Association, said his organization is urging lawmakers to enact state tax reform in the wake of federal tax reform. But he suggested any final vote on state tax reform is more likely late in the session rather than early to ensure that lawmakers balance the state's budget. He also noted implementation of tax reform could be staggered over a period of years.

3. EDUCATION FUNDING/SCHOOL CHOICE: Parents, teachers and school administrators annually plead for more money for K-12 programs, saying it's important for quality education. Look for lawmakers and Reynolds to make efforts to avoid spending cuts in state aid to school districts, although any increases are likely be minimal.

Meanwhile, community colleges and the state's three public universities face question marks regarding their funding levels, despite Reynolds' pledge to develop more skilled workers and highly educated people for a 21st-century Iowa labor force. University and college administrators say they have already tightened their belts and have enacted cost savings, which means further spending cuts could lead to big tuition hikes in the coming years. That could make it harder for many Iowans to obtain post-secondary educations and training to qualify for better-paying jobs.

Supporters of school choice say they will push for several key issues and programs in the upcoming session: These include establishing Education Savings Accounts for parents to pay for their children's private educations; expanding the state's tuition tax credit program that funds nonpublic school scholarships; and altering Iowa law to allow for charter schools to be run by private organizations.

4. WATER QUALITY: Republican leaders predict quick, early action to approve long-term, sustainable funding for statewide water quality projects. Both the House and Senate have developed proposals, and lawmakers say the final version could include pieces of both plans.

The Senate bill would redirect about $12 million in sales tax money that Iowans already pay on their water bills as well as $15 million now used to pay off Vision Iowa project bonds. It would provide funding for projects detailed by the Iowa Nutrient Reduction Strategy and would be fully funded in 2021.

The House bill would set up a financing structure that would grant priority to groups with multiple stakeholders who come up with water quality improvement projects at a regional watershed level. It would also divert sales taxes imposed on metered drinking water and would ramp up over time until it provides about $26 million annually.

Many minority Democrats opposed majority Republicans' plans last session to shift money to pay for water quality initiatives, calling it a shell game. They said new tax revenue is needed for water quality, contending Republicans' plans to rely on existing revenue would require cuts in spending for education and other state programs.

A coalition of environmental and outdoor advocacy groups has repeatedly proposed an alternative approach to raise the state's sales tax by three-eighths of one cent to fund water quality initiatives and other programs. However, that proposal has been dead on arrival, with many conservative legislators who oppose any form of a tax increase.

5. MEDICAID/MENTAL HEALTH SERVICES: The state's shift to private management of the $5 billion Medicaid health care program for 600,000 low-income and disabled Iowans remains mired in controversy. Former Gov. Terry Branstad implemented the changes in an effort to contain soaring health care costs that Republicans contend were unsustainable. But patients and providers are still angrily lodging complaints about coverage and payment problems.

The majority of Iowans do not approve of how Medicaid is being handled by state leaders, according to a recent Des Moines Register/Mediacom Iowa Poll. Reynolds has indicated she doesn't want the Iowa Legislature to intervene by proposing bills to fix Medicaid, but Iowa House Speaker Linda Upmeyer, R-Clear Lake, has suggested the patience of GOP lawmakers is wearing thin.

Similarly, nearly two-thirds of Iowans surveyed disapprove of how state leaders are handling mental health issues, the Iowa Poll shows. Critics contend Iowa has far too few resources, including hospital beds and crisis centers for people suffering problems such as psychoses or deep depression.

Iowa’s mental health system has been in flux for several years. Branstad closed two of Iowa’s four state mental hospitals in 2015. He noted that the facilities’ patient load had shrunk significantly, and he contended the state hospitals’ services could be better provided by private agencies. Critics said the state facilities still provided important services, and they say the loss is still being felt in southern Iowa.

Iowa also has recently shifted to a 14-region system of overseeing many mental health services, after decades of having each county oversee those services. Proponents of the shift, including Reynolds, say it allows more efficient and fair distribution of mental health services, including efforts to keep people from becoming so ill that they need hospitalization or wind up in jail.

6. ABORTION/FAMILY PLANNING: Abortion opponents plan a push for so-called "personhood" legislation that declares life begins at conception; further efforts to cut the state's ties to Planned Parenthood; and moves to outlaw the sale of fetal body parts.

The 2018 session follows one of the most divisive debates ever on abortion rights at the Iowa Capitol. The past session saw hundreds of pink-clad supporters of Planned Parenthood rallying against Republican-sponsored bills and chanting "Our body, our choice." At the same time, scores of abortion foes sang Christian hymns and lobbied for passage of legislation they believe will help protect the sanctity of life.

Branstad signed a bill after last year's session that bans most abortions after 20 weeks. The measure also requires a three-day waiting period for abortions, although those provisions are being challenged in the Iowa Supreme Court. Republican lawmakers also blocked public money for family planning services to abortion providers, which led Planned Parenthood to announce it was closing four of its 12 Iowa clinics.

7. SANCTUARY CITIES: Iowa's cities and counties would be banned from enacting "sanctuary" policies that provide safe havens for undocumented immigrants under a bill that won Senate approval last session and is pending in the Iowa House.

The legislation would bar a local government from receiving state funds if the provisions were violated. This includes requiring law enforcement agencies to comply with federal immigration detainer requests for people in their custody. In addition, the bill would prohibit local governments from discouraging local law enforcement officers or others from activities related to enforcing immigration laws.

National polling has consistently shown such legislation is popular among the public, but many Iowa lobbying groups have registered against the bill. These opponents include including the Iowa League of Cities, Iowa State Bar Association, Iowa Police Chiefs Association, Iowa County Attorneys Association, Interfaith Alliance of Iowa, American Civil Liberties Union of Iowa, Iowa Catholic Conference, Iowa Annual Conference of the United Methodist Church, and others.

8. BOTTLE BILL: Grocers and convenience store chains are lobbying hard to scrap the state's 5-cent bottle deposit law and replace it with an expanded statewide recycling program. Opponents say the state's roadsides will be filled with litter if business lobbyists get their way.

Iowa currently recovers 86 percent of its beverage containers, according to the Iowa Department of Natural Resources. The law covers all carbonated and alcoholic beverages, and about 1.65 billion containers are redeemed annually in Iowa. The combination of the beverage container law and existing curbside recycling makes Iowa one of the top recycling states in the nation.

If the Legislature repeals the deposit law, the percentage of beverage containers recycled would be expected to drop to the national average of 29 percent, opponents say.

9. DEATH PENALTY: State Sen. Jerry Behn, R-Boone, says he will seek consideration of Senate File 335, which would reinstate the death penalty for multiple offenses in which a minor is kidnapped, raped and murdered. It's doubtful his bill can gain enough support to win final passage, and it may not even receive a Senate subcommittee hearing, but any discussion of the issue sparks emotional debate.

Behn told the Des Moines Register he wants to prevent deaths like that of 10-year-old Jetseta Gage, who was abducted from her grandmother's residence in March 2005 and found slain the next day in a mobile home southwest of Iowa City. The girl had been sexually abused, and two men remain in prison for crimes against her.

Death penalty opponents are vowing a fight if there is a serious push to reinstate capital punishment. They point out that offenders convicted of first-degree murder in Iowa are rarely released on parole; instead they usually die in prison. They also note that Iowa has one of the lowest murder rates in the nation. In 2016, Iowa's murder rate was 2.3 per 100,000 people, less than half the national average of 5.3 percent.

10. SPORTS BETTING: The Iowa Gaming Association, which represents the state's 19 commercial casinos, is asking lawmakers to pass a bill during the upcoming legislative session that would allow sports betting on professional and college sports, said Wes Ehrecke, the association's president.

Ehrecke's organization wants the Iowa Legislature to act now in anticipation that the Supreme Court will side with New Jersey in a pending case that could open the floodgates for legal sports betting nationally. A decision by the high court is expected this spring or summer.

How the Legislature responds to the Gaming Association's proposal is uncertain. Upmeyer said that there are House members on both sides of the sports betting issue, and that she wants to hear more about what Iowans have to say on the topic.

Register reporters Mackenzie Ryan and Tony Leys contributed to this story.