2017 Issue #6

Issue 6, 4/4/2017

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Legislators are now entering the final two weeks of the 2017 legislative session. There is still a lot of work to do, including making some very tough decisions about next year's budget.  It is going to take a lot of work if legislators want to wrap things up by April 18, when their daily expenses run out.

One thing slowing progress down is the condition of our state's economy. A slow economy means less is collected in taxes.  Fewer taxes paid means less money is available for things like education, Medicaid, tax reform, and water quality. Because the state doesn't have enough money to go around, the Governor had to revise his budget requests for next year.  Here are a few highlights from the Governor's revised budget:

  • The Governor borrows $131.1 million from the state's "rainy day fund" to help make it through the current fiscal year (which ends on June 30, 2017).  The Governor will repay these funds over two years - $104.8 million next year (FY18) and $26.3 million the following year (FY19).  
  • The Governor's new budget for next fiscal year (FY 2018) spends $7.284 billion, an increase of $24 million from the current year (after deappropriations and transfers). This is a decrease of $173.3 million from the budget the Governor presented earlier in the year.  The Governor's budget continues commitments made in prior years to pay for local government property tax cuts and adds $40.1 million to pay for commitments made to K-12 education.
There is a bit of good news in the slowing economy.  Iowa's Medicaid match rate was changed, saving the state $40 million.  The federal government will now pick up 59% of the state's Medicaid costs; up from 56% this year. You can read more about this change here.  But that is a drop in the bucket when it comes to the $1 billion Health/Human Services Budget.
There isn't a lot of detail available, but you can see the Governor's recommendations for the Health/Human Services budget here. The Governor cuts funding to state departments, but does not tell the departments how to make those cuts. That makes it hard for us to kniow what the impact of these cuts will be.  Here are a few highlights:
  • The Department of Public Health is cut by another $573,334.  This is $2,9 million (5%) less than what was originally appropriated to the department last session.  This department funds the state's brain injury program, direct caregiver support, epilepsy education, and health workforce shortage programs.
  • Medicaid is cut by $17.4 million.  But this is actually a $32.4 million cut below what was origianlly appropriated for Medicaid.  While the Governor recommends adding $34.5 million in new funds to pay for expected growth in the system, it is balanced by cuts, including the use of $22 million in one-time funds.   
  • Elminates $3 million paid to Scott County and Polk County to make up for shortfalls in their mental health and disability services (MH/DS) levies.  These funds were considered "one time" finds, because a permanent fix to the MH/DS system was to be passed this year. 

There isn't a lot of detail in the Governor's recommendations, but you can see more below:

  • Click here for the Governor's recommendations.
  • Click here for the the non-partisan Legislative Service Agency’s (LSA) review of the Governor's recommendations. 
  • Click here for the LSA's review of the Governor's HHS recommendations.
Legislative leaders announced this week they plan to spend a total of $7.245 billion - which is $38 million less than the Governor's revised budget.  Leaders announced their targets on Wednesday (April 5), but there is no detail beyond the targets for each budget subommittee.  Here is a quick review of the House/Senate joint budget targets:
  • Administration and Regulation:  $47.39 million
  • Agriculture and Natural Resources: $38.84 million
  • Economic Development: $38.41 million
  • Education: $908.41 million
  • Health and Human Services: $ 1.766 billion
  • Justice Systems: $734.95 million
  • Standings: $3.711 billion
  • TOTAL: $ 7.245 billion
Many of our readers are interested in the Health/Human Services (HHS) budget, because that is where Medicaid, managed care, and waiver programs are funded.  Here is a quick look at the total spending levels recommended for this area:
  • Joint HHS Budget Target: $1.766 billion
  • Governor Revised FY 18: $1.787 billion
  • Governor Original FY18: $1.862 billion
  • Revised FY17: $1.794 billion
  • Actual FY16: $1.9 billion
As you can see, the Joint Health/Human Services Budget Subcommittee has less money to spend this year. Joint legislative targets for HHS are:
  • $28 million less than REVISED FY17.
  • $21 million less than Governor’s revised FY18 budget request.
  • $96 million less than original Governor’s FY18 budget request.
  • $134 million less than actual FY16 expenditures.

What does this mean for you?  It’s not time to panic, but it is go time! Now is the time to reach out to your legislators and tell them what is important to you in the state budget and how cuts in those programs/services would impact you.  Use our grassroots action center to contact your legislators now.

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It was the end of the line for hundreds of bills last week, as the second "funnel" deadline closed in on bills that had not yet made it far enough in the legislative process.  If a bill had not been passed out of both House and Senate committee by March 31, it is no longer eligible for debate. Tax, spending, and government oversight bills are exempt from deadlines.

The following bills died during this second (and final) deadline:

  • Health Coverage for Dependents (HF 466): Allows dependents to continue to be covered by their parent's health insurance until they turn 26. This is a current requirement of the Affordable Care Act (aka Obamacare).
  • MH/DS/SA Planning (HF 546): Convenes a statewide stakeholder workgroup (which includes law enforcement, MH/DS regions, DHS, community mental health centers, and others) to make recommendations on the delivery of, access to, and coordination and continuity of mental health and disability services for individuals with complex mental health, disability, and substance use disorder needs. These recommendations are due by December 1, 2017.  Directs each region to develop a local plan to address this population's service needs as well, with a report due to DHS by October 1, 2017.   Requires the state Mental Health Institutes and hospitals with psychiatric inpatient beds to participate in the psychiatric bed tracking system.
  • Mental Health Information Disclosure (SF 453):  Allows a mental health professional to disclose mental health information (without written or oral consent of the person) to a police officer, parole/probation officer, county attorney, or jailer if it is in line with ethical standards, and the person is a danger to themself or others.  Gives a provider immunity for failing to disclose the information.  
  • Psychiatric Practitioner Loan Repayment Program (SF 458):  Creates a psychiatric practitioner loan repayment program in community mental health centers or non-profit health care providers located outside of federally designated shortage areas and serving a patient population mix that is at least 40% Medicaid.  Psychiatric practitioners are eligible for up to 4 years of loan repayments.
  • Medicaid MCO Interest Penalty (SF 477): Requires Medicaid managed care organizations to pay an interest penalty of 1.5% for any clean claim not paid within 90 days. Requires MCOs to allow Medicaid providers 365 days from the date of service to submit a claim.
  • Supported Community Living Services (SF 478): Directs DHS to make Medicaid waiver-funded supported community living services available at a daily rate to persons living in the home of a family member, effective March 1, 2017.   Family member includes siblings and parents, and requires Medicaid MCO contracts to be amended to include this requirement.

You can see  a list of bills that are still eligible for debate in the infoNET Bill Tracker.

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The state’s 14 mental health and disability services (MH/DS) regions asked legislators to consider their plan to stabilize funding for services by allowing each region to adjust their property taxes to collect up to $47.28 per person.  Sen. David Johnson, an Independent from Northwest Iowa, sponsored a bill to do this (Senate File 365).  Unfortunately, the Iowa Farm Bureau opposed this approach, and has made passage of it unlikely.

A new plan to fund these services surfaced in the Iowa Senate two weeks ago and passed out of Senate Ways & Means Commitee on Thursday, April 6 (SSB 1187).  Last week, the House introduced a similar plan (HSB 194), which has not yet passed out of House Ways & Means Committee.  The House and Senate are actively working with county supervisors, MH/DS regions, advocates for mental health and disabilities services, providers, faith community, and Farm Bureau to come up with a bill that is workable financially and politically.  (Politically because, one way or another, property taxes will increase to pay for these services).

Like all things MH/DS - this is complicated.  Here is a quick review of SSB 1187 and HSB 194:

  • Set a new base "per capita" levy for each region.  Multi-county regions would combine their 1995 revenue caps, then divide by population. That is the new “regional per capita” rate.  The new regional per capita rates could not exceed $47.28 per capita.  Multi-county regions would determine the amount each county would contribute from levies, but the total of those levies couldn’t be more than the new regional per capita rate. 
    • This plan supposedly fixes all but one multi-county region (Eastern Iowa Region).  They would be able to generate $9 million in funds from property taxes, but their budgets are currently $12 million.  They are $3 million short, with now way to bridge that gap.  Both House & Senate are trying to find a way to fix this issue.
    • Polk County is locked in at the very same $14.4 million cap they have now (which equates to $31.40 per capita). But Polk's budget is $44.47 per capita - so they are $6.3 million short.  The bills take different approaches to fix this problem, both using funding from Broadlawns (county hospital in Polk) to offset some of the costs.  HSB 194 lowers the Broadlawns levy by $6.3 million for five years, and permanently raises Polk County's per capita rate at $45.  The Senate is working on its approach, which will involve a combination of Broadlawns providing some funds for three years, and allowing Polk County's per capita levy rate to increase over that time. 
  • Regions with fund balances exceeding 25% (20% in the House) would be required to lower their levies by the amount they are over that allowed reserve  (that is - they have to spend down their excess fund balance before taxing more). SSB 1187 allows reserves in excess of 25% to be spent down over three years; HSB 194 allows counties to pay for up to 50% of their budgets with reserve funds (allowing htem to spend down over time aas well).  This is also an area both chambers are still working on; counties would like more flexibility in this area to spend down reserves that may build up right before launching a new service.
  • Regions/counties would be able to levy the new per capita rate, which adjusts for population each year (so if population grows - levy capacity grows) - it is not a hard dollar cap moving forward, so it is more sustainable than the current system.   
  • Regions/counties would also be able to adjust their per capita rate for inflation each year - 1% for FY19, FY20; 2% for FY21, FY22.  Farm Bureau is actively lobbying to eliminate this allowed growth factor.
  • Another study committee is appointed to evaluate how the funding is working, and determine if this is a sustainable long-term fix.
The plan gets mixed reviews from advocates - the formula creates stability and equalizes taxes within regions, but it starts with $114 million in taxing authority despite region budgets for next year being set at $132 million.  That means the formula is about $18 million short from the beginning- $3 million short for Scott County, and $7 million short for Polk County.  For Polk County, Broadlawns Hospital will help pay for MH/DS services in the Polk County region until the county's levy gets to a sustainable level (currently $45/per capita; eventually $47.28 per capita).  There is no "solution" yet for Scott County (Eastern Iowa Region).  

Stay tuned - this will move quickly once a deal is reached.

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Republican leaders in the Iowa Legislature came into the session promising to pass a Voter ID bill, and they are well on their way to checking that off their to-do list.  Earlier in session, the Iowa House passed House FIle 516, which requires all Iowa voters to show a valid ID before being allowed to vote.  Acceptable forms of ID include Iowa driver's licenses, Iowa non-operators IDs, military IDs, and passports.  For those without one of these IDs, the Secretary of State will issue a free non-photo voter registration card to be used as an ID.  

The House-passed bill also allows pollworkers to question a person's identity if their signature does not match what is on their ID, which caused some concern among advocates for older Iowans and Iowans with disabilities.  Signatures change with time, injury, disease, or disability.  Some people "make their mark" using a stamp or by drawing an X.  Others ask loved ones to sign for them.  Questions remain as to how that would be addressed at polling sites, and if there would be sufficient funding for poll worker training to make sure poll workers used the same standards for questioning identity statewide.

The House passed House File 516 on a party-line vote (58-41).  The Senate debated the bill two weeks ago, but made some significant changes, including shortening the early voting time by 11 days (from 40 days to 29 days before the election). The Senate also added language to allow 17-year-olds to register to vote and to vote in a primary election, if they will be 18 years olf at the time of the general election.   The House must accept these changes before it can go to the Governor and be signed into law.  

The House had planned to take up the bill on Thursday (April 6), but ran out of time.  There are currently 18 amendments filed in the House, so debate will start early next week on the bill, but could last for several hours.  

  • You can see how your Senator voted on this bill here.
  • You can see how your  Representative voted on this bill here.  
  • You can read more about Voter ID laws here.
  • If you care about this issue, call your State Representatives on Monday at 515/281-3221 or email them here..

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You can now download and print the 2017-2018 Guide to the Iowa Legislature.  All current infoNET subscribers will receive one free printed copy of the Guide later this year, so if you want to receive a copy, make sure we have your correct address and you are signed up to receive it.  You can sign up here.  

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You can see the most current status of bills we are tracking in our infoNET Bill Tracker.  Updates are made daily. 

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PUBLICATION REMINDER (Last Regular Issue of Session)

Unless legislators go into overtime this year, this issue of infoNET will be the final biweekly session issue for 2017.  We will publish a final "End of Session" issue after the session wraps up, and another issue 30 days later (outlining Governor's actions).  Our summer schedule will return to every-other-month rotations.  

In the meantime, watch for breaking news and action alerts posted on our social media sites and website (www.infonetiowa.org). 

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