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Budget Bills in Position, Ready for Compromise

Friday, April 16, 2021

The budget is the one thing legislators must do before they leave town in a couple of weeks.  The state's new budget year (called a "fiscal year") begins on July 1, 2021 and ends on June 30, 2022.  It is referred to as "Fiscal Year 2022" and the budgets developed this legislative session will outline how the state will spend its money in that fiscal year.  For the first time in three decades, legislative leaders are not announcing their targets for each budget area.  This is probably a planned move.  

Legislative sessions are a lot like long chess matches, where legislators position the pieces (budgets, priorities, bills) in a way to help them "win." Many people think that because the Republicans control all parts of the decision-making process (Governor, Iowa Senate, Iowa House of Representatives) they would all agree.  That is absolutely not the case.  They have big disagreements, and will be trying to out-smart each other in order to get the advantage and win on their top priorities.  One example, the Iowa Senate and Governor want to remove a barrier to having income tax cuts made in 2018 go into effect this year (called "triggers" because the state must increase the amount of money it takes in by 4% before they "trigger" the income tax cuts).  The House prefers to take a more careful approach and see if the state will get to that 4% increase on its own over the next year, as state economic experts say will happen.  If the Senate and Governor want this, they will probably have to give in on something else the House wants. This end of session deal making is done in leadership rooms and away from the public; so we won't know the final "deal" until it's filed as an amendment sometime in the next few weeks.

This brings us full circle back to budgeting.  House and Senate leaders want budget bills in a place where they can move quickly once a deal is struck.  That's why we now have almost all of the budget bills on the House and Senate calendars.  There are only three of the eleven budget bills missing from the calendars.  

  • The final "standings" budget that usually is the catch-all bill where last-minute compromises are made.  So if you have bills that were important that didn't pass - you can ask your legislators to drop it into the standings bill.  There are always plenty of surprises when this bill comes out (and when you see it - you know session will be ending in the next few days).
  • The Federal Block Grant Bill (SSB 1257) is in the Senate Appropriations Committee awaiting action. Usually this is a simple, non-controversial bill that just passes federal block grants on to the appropriate agencies.  This year, however, legislators may want to add in directions on how to spend the last round of COVID-19 stimulus funds from the federal American Rescue Plan Act (ARPA). 
  • The Senate version of the Health/Human Services (HHS) Budget came out on Thursday, April 15.  The House has not yet released it's version.

You can see how the bills differ in a PDF spreadsheet attached at the end of this article.  Few things to note:

  • The Department of Transportation budgets include a $400,000 increase for interstate rest areas, including funding for adult changing tables!  
  • There is more money for children's mental health through the Area Education Agencies in the Education budget, along with new funding for new teacher training on dealing with challenging classroom behaviors and the new "therapeutic classrooms" that were approved last year (and were controversial - moving kids with challenging behaviors to separate focused classrooms that may/may not be in the same school).
  • The Senate HHS Budget includes $8 million to increase home and community based service (HCBS) and habilitation provider reimbursements and $3.9 million to increase reimbursements for psychiatric medical institutions for children (PMICs). It also requires the Department of Human Services (DHS) to review Medicare, state law, and administrative rules to identify changes needed to make sure physical therapy, occupational therapy, speech-language pathology, applied behavioral analysis, and other health services to Medicaid-eligible children are consistent with the Early Periodic Screening Diagnostic Treatment/EPSDT program (report due 10/1/21).
  • We mentioned several times in the past issues that budget bills can become the dumping grounds for bills that died in one of the two funnels. That's happened in the HHS Budget; Senators have included Senate File 389, the so-called "Pubic Assistance Oversight Bill."  This bill adds new asset tests for all household members, more frequent eligibility checks, and identify verification for public assistance programs, including food assistance (SNAP), Medicaid, and family support (FIP).  This effort is expected to save the state $11.8 million in the second year (FY 2023); when combined with federal funds, the total savings is $47.7 million.

Watch our social media feeds and our website breaking news to find out as things happen at the Capitol. 

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