INFORMATION TECH UPGRADE: The state has conducted 25 information technology consolidation studies in 17 years, had multiple executive orders and legislative attempts at streamlining its various systems.
Although consolidation attempts have been resisted and stalled over the years, Iowa’s first chief information officer, Bob von Wolffradt, is confident strategic moves can reduce the $229 million a year it spends on information technology.
“A 15 percent reduction is very achievable,” he told the Senate State Government Committee.
Among his recommendations are reducing and eliminating duplicative purchases and personnel hires, reclassifying other personnel, leveraging private-sector partners and redeploying state IT positions into a new performance-based organization to improve accountability.
MEDICAID EXPANSION: Democrats on the House Human Resources Committee encouraged the Department of Human Services to pursue expansion of Medicaid through the health-care reform plan.
Republican Gov. Terry Branstad has opposed the expansion, arguing the federal government’s debt situation makes it questionable that it can honor its commitment to cover the full cost of the expansion for the first three years.
Jennifer Vermeer from the department said it’s not clear what savings could be achieved.
“There are a range of estimates,” she told lawmakers. “There’s savings in the early years. One estimate is that there would be savings only in the first year” depending on decisions the legislature would have to make.
TAX CODES: The Iowa Senate voted 48-0 Monday to approve changes designed to align the Iowa and federal tax codes.
Senate President Pam Jochum, D-Dubuque, the bill’s floor manager, said provisions of Senate File 106 would produce a benefit of $16.5 million in the current fiscal year and nearly $62.4 million in fiscal 2014. The legislation is the Iowa response to federal tax changes and quick action is needed to avoid delays in filing and refunds, she said. By matching federal tax provisions, Jochum said it makes it easier for Iowans to prepare their taxes and for the Iowa Department of Revenue to process tax returns.
With the passage of the federal American Taxpayer Relief Act on Jan. 1, most taxpayers avoided increases in their income tax rates and the loss of expanded tax credits, Jochum said. By passing Senate File 106, the legislature will enable Iowa taxpayers to take advantage of beneficial tax policy extensions that will help families, farmers and small businesses when filing their state income taxes, she noted. The bill, which goes to the Iowa House for expected approval, would permanently extend the child tax credit at its current level of $1,000; extend through 2017 expansions to the Earned Income Tax Credit for families with three or more children; permanently extend the child and dependent care tax credit at current levels; permanently extending the student loan interest deduction; extend the deduction for up to $250 of out-of-pocket expenses by teachers for two years; allow small businesses and farmers to expense — rather than depreciate — the first $500,000 of equipment cost for purchases in 2012 and 2013, which is estimated to save those taxpayers $10.2 million in fiscal 2013 and $8.5 million in fiscal 2014.
ECONOMIC INDICATORS: Iowa’s index of leading economic indicators marked its 11th straight month of positive growth for long-range change. Analysts with the state Department of Revenue said Monday that the index’s recent moves suggest that Iowa employment growth will remain positive into spring. The most positive contributor in December was the Iowa stock market index after being the largest negative contributor in November. Of the 34 stocks included in the index, 28 had positive gains in December — including 10 of the 11 financial-sector companies. Other positive contributors included diesel fuel consumption, unemployment insurance claims and the national yield spread. For the first time in six months, the number of residential building permits issued was a negative contributor. In December 2012, the 12-month moving average for building permits decreased to 823 from 826 in November. However, the most negative contributor was manufacturing hours. The 12-month moving average in December fell to 40.65 from 40.74 in November 2012. The average number of hours reported for December 2012 was over a full hour below the 41.9 hours reported in December 2011. The December report is available on the web at http://www.iowa.gov/tax/taxlaw/econindicators.html.
TEEN DATING VIOLENCE: About 80 students from across Iowa plan to meet with state lawmakers this week to discuss issues related to teen dating violence prevention and awareness. Thursday’s activities are part of an effort by the Iowa Coalition Against Domestic Violence to encourage parents, grandparents, aunts and uncles to help teens choose happy respectful lives free from violence. On Feb. 14, Gov. Terry Branstad plans to sign a proclamation acknowledging February as Teen Dating Violence Prevention and Awareness Month in Iowa. Coalition leaders say about one in three U.S. adolescents is a victim of physical, emotional or verbal abuse from a dating partner. A Domestic Violence Hotline (1-800-942-0333) is available to provide confidential help and information regarding violent teen dating situations or problems.
QUOTE OF THE DAY: “There is a long tail on this.” – Jeff Robinson of the Legislative Services Agency, noting that local governments report debt associated with tax-increment financing for slum and blight or economic development projects in their communities totaled $2.83 billion statewide as of Jan. 28 and that nearly 80 percent of that debt extends past fiscal 2017. TIF-related property tax revenue totaled $296.8 million in fiscal 2013 in 402 local entities – including 347 cities and 49 counties – with more than half of those proceeds connected to projects with base years of 1995 or before.