HOUSE REPUBLICAN STAFF ANALYSIS

Transcription

1 HOUSE REPUBLICAN STAFF ANALYSIS Bill: House File 648 Committee: Appropriations Date: June 21, 2013 Floor Manager: Rep. Soderberg Staff: Brad Trow Debt Reduction, Pension Obligations, & One-time Appropriations House File 648 provides funding for the state to pay off four bonds, including those for Honey Creek and one of the I-Jobs bonds. By making this payment, $15.2 million of taxpayers funds that had been going to fund bond obligations can now be spent on priorities for Iowans. House File 648 provides one-time funding for economic development projects at the state s three universities; House File 648 also provides a $20 million of one-time funding into the water quality projects administered by the Department of Agriculture and Land Stewardship. Summary of Action Committee Action The House Appropriations Committee PASSED House File 648 on a vote of 24-1 on May 8, House Action The House PASSED House File 648 on a vote of 95-0 on May 22, Senate Action The Senate AMENDED and PASSED House File 648 on a vote of on May 22, Further House Action The House CONCURRED with the Senate Amendment and PASSED House File 648 on a vote of 97-0 on May 23, Final Action The Governor ITEM VETOED and SIGNED House File 648 on June 20, 2013.

2 Section-by-Section Analysis DIVISION I- STATE BOND REPAYMENT FUND Section 1. State Bond Repayment Fund Taxpayers Trust Fund This section states that after the Economic Emergency Fund has been filled to its statutory limit and $60 million is transferred in the Taxpayers Trust Fund, the next $113.8 million of FY 2013 ending balance will be transferred to the State Bond Repayment Fund, created in section 2 of the bill. If the treasurer determines that the amount transferred in the bill is insufficient to pay off all four bonds, the treasurer will go to DOM to certify the amount needed. If they both agree on the amount needed, they shall certify the amount and it shall be transferred to the State Bond Repayment Fund from the economic emergency fund. Notice of the transfer will be given to the chairs and ranking members of the Appropriations Committees in each chamber. The section directs that in FY 2014, the money that would have been used to pay the debt service on the bonds shall be transferred to the General Fund. Section 2 State Bond Repayment Fund The section creates Iowa Code section 8.57F, the State Bond Repayment Fund. Moneys placed in the Fund will be used to pay off state-issued revenue bonds that have a dedicated revenue source making the debt service payments. The section also lays out the accounting rules for how the fund is to be treated. Finally, the section sets out the four bonds that are to be paid off by the Fund. These are: Honey Creek Premier Destination Park Bonds 2002 Prison Infrastructure Revenue Bonds; 2010 Taxable I-Jobs Bonds; and School Infrastructure Bonds. Section 3 Exemption from Automatic Application The section amends Iowa Code section 8.58, by adding the State Bond Repayment Fund to the list of funds that are not to be considered in the application of any formula, index, or other trigger mechanism that affect appropriations, payments, taxation rates, or collective bargaining. Section 4 Effective Upon Enactment Applicability The section makes Division I effective upon the Governor s signature. It also provides that the FY 14 expenditure limitation is to be recalculated, based on these actions. DIVISION II PUBLIC RETIREMENT SYSTEMS Section 5- Judicial Retirement Fund The section appropriates $18,900,000 from the FY 2013 ending balance to the Judicial Retirement Fund. Section 6 Peace Officers Retirement, Accident, and Disability System Retirement Fund The section appropriates $91,300,000 from the FY 2013 ending balance to the PORS Fund. Section 7 Repeal The section repeals Iowa Code section 97A.11A, which requires an annual appropriation of $5 million from the state into the Peace Office Retirement System Fund until its amount equal 85% funded liabilities. 2

3 Section 8 Effective Upon Enactment The section makes Division II effective upon the Governor s signature. ITEM VETO: The Governor vetoed Division II of the bill, stating: While these retirement plans have funding shortfalls, trying to make up for these shortfalls should not be borne only by taxpayers of the State. Iowa needs a comprehensive, long-term, sustainable plan for making up the shortfall in these retirement funds. The plan should include both the State and the participants of the plan as financial partners in bringing these funds to financial balance. The division also eliminates the annual standing appropriation of $5,000,000 to the Peace Officer Retirement Fund. My disapproval of the division restores $5,000,000 in funding starting in fiscal year DIVISION III - MISCELLANEOUS APPROPRIATIONS Section 9 - FY 2013 Appropriations The section makes one-time appropriations to the following: Department of Administrative Services $2,700,000 for major maintenance issues including health, life, safety & ADA compliance $330,000 for lightning protection system for the Capitol Department of Agriculture $1,620,000 to cap ag drainage wells for which the design and engineering work has been completed Department of Commerce Banking Division $100,000 for financial literacy education The subsection provides the definitions and program eligibility rules for the program Department of Corrections $11,200,000 for completion of the construction project at the Mitchellville facility Iowa Economic Development Authority $3,500,000 for infrastructure and site development of the UNI/Techworks facility $500,000 for establishment of a regional hub for the national network for manufacturing innovation $250,000 for renovations to the adult day camp facility at Camp Sunnyside $500,000 for technical assistance and educational efforts regarding the ESOP program Department of Education $669,000 for one-time costs related to the establishment of the Reading Research Center $1,000,000 for final one-time costs related to statewide core curriculum $1,000,000 for community college major maintenance including health, life, safety & ADA compliance ITEM VETO: The Governor vetoed the funding for community college major maintenance, stating: I did not include this spending in my budget recommendation. Community colleges have received other increases and additional funding for the next fiscal year in other areas beyond my recommendations. Therefore, this funding is not approved. 3

4 Department of Human Rights $100,000 for Individual Development Accounts Department of Human Services $1,000,000 to fund infrastructure improvements at Four Oaks PMIC facility $800,000 to fund infrastructure improvements at the Homestead autism treatment facility $1,000,000 for matching grants for food purchases by the Iowa Food Bank Association Judicial Branch $3,000,000 for implementation of the Electronic Document Management System (EDMS) Department of Public Safety $1,000,000 for non-radio equipment upgrades $50,000 to staff the Public Safety Training & Facilities Task Force created in SF 447 ITEM VETO: The Governor vetoed the funding for the Public Safety Training & Facilities Task Force, stating: This funding is no longer necessary due to the fact that the new task force was disapproved in Senate File 447. $150,000 for Regional Emergency Response Training Centers ITEM VETO: The Governor vetoed the funding for the Regional Emergency Response Training Centers, stating: Providing funding to entities without guidance or oversight is not an efficient use of taxpayer funds. Board of Regents $2,000,000 for major maintenance including health, life, safety & ADA compliance at Regents facilities $1,000,000 for construction of a multi-purpose training facility at the State Hygienic Lab $10,000,000 to UNI for use in FY 14 & FY 15 to address tuition issues related to the high number of in-state students $7,500,000 to Iowa State University for the implementation of their Bioeconomy initiative $1,000,000 to Iowa State University for College of Veterinary Medicine facility upgrades $12,000,000 to Iowa State University for the economic development core facility at the ISU Research Park $3,000,000 to the University of Iowa for initial work on the construction of a new facility for the College of Pharmacy ITEM VETO: The Governor vetoed the funding for the College of Pharmacy, saying: Early estimates reveal an anticipated cost of at least $67,600,000. Until strategic plans and sustainable financing are secure, it is not appropriate to spend taxpayer money designing and planning the project. The Iowa Board of Regents should continue to engage in a long-term strategic planning process to review infrastructure needs in light of changes in educational technology. Technology and innovation should make it feasible to deliver high-quality education to students at a lower tuition and infrastructure cost, as delivery of educational services will require less physical presence on college campuses in the future. 4

5 $2,500,000 to Iowa State University for initial work on construction of a new biosciences facility ITEM VETO: The Governor vetoed the funding for Biosciences facility, stating: Early estimates reveal an anticipated cost of at least $42,500,000. Until strategic plans and sustainable financing are secure, it is not appropriate to spend taxpayer money designing and planning the project. The Iowa Board of Regents should continue to engage in a long-term strategic planning process to review infrastructure needs in light of changes in educational technology. Technology and innovation should make it feasible to deliver high-quality education to students at a lower tuition and infrastructure cost, as delivery of educational services will require less physical presence on college campuses in the future. $1,500,000 to UNI for initial work on modernization of the Schindler Education Center ITEM VETO: The Governor vetoed the funding for the Schindler Education Center renovation, stating: Early estimates reveal an anticipated cost of at least $31,600,000. Until strategic plans and sustainable financing are secure, it is not appropriate to spend taxpayer money designing and planning the project. The Iowa Board of Regents should continue to engage in a long-term strategic planning process to review infrastructure needs in light of changes in educational technology. Technology and innovation should make it feasible to deliver high-quality education to students at a lower tuition and infrastructure cost, as delivery of educational services will require less physical presence on college campuses in the future. Department of Transportation $150,000 to maintain air traffic control services at the Dubuque airport, which has a contract air traffic control tower ITEM VETO: The Governor vetoed the funding for the air traffic control at the Dubuque airport, stating: Earlier this year, concerns existed that federal sequestration of funds could withhold funds and affect operation of this control tower. However, federal funding was restored. The state funds are no longer needed. Department of Veterans Affairs $137,940 to remodel and upgrade facilities for the Department s offices at Camp Dodge $600,000 to provide a grant to assist in funding a community center outside the Iowa Veterans Cemetery Iowa Workforce Development $300,000 for education and training for occupations in renewable energy production and related opportunites ITEM VETO: The Governor vetoed the funding for the renewable energy workforce training, stating: While I support renewable energy and the job opportunities associated with it, this spending providers state taxpayer dollars for a program pursuant to a federal grant with no state guidance or oversight. This is not the best use of state taxpayer funds. We have already provided $15.8 million in fiscal year 2014 for workforce training through the Iowa Skilled Worker and Job Creating Fund, and increase of $7.8 million over fiscal year State Fair Authority $1,000,000 for construction of a plaza on the Fairgrounds $250,000 for completion of the renovation of the Cultural Center 5

6 Section 10 Risk Pool Transfer The section transfers $13,000,000 in FY 13 from the ending balance to the Mental Health Risk Pool. The funds would be available for distribution in FY 14 and the Risk Pool Board shall create the rules for the application and distribution process. Priority for the funds shall be given to those counties who are required to reduce their mental health property tax levy to reach the $47.28 per capita amount. If funds remain, then the remaining counties may request funds for the continuation of county mental health services that are not funded by Medicaid but are covered by the county s management plan. The Risk Pool board shall determine what is required to be in a county s application, which may include fund balances, budget revenue and expenditures, and other materials to support the amount requested. If the Board needs administrative rules to implement these provisions, they are allowed to use emergency rules. Funds un-used at the end of FY 2014 shall revert to the General Fund. ITEM VETO: The Governor vetoed section 10, stating: Under the new Iowa Health and Wellness Plan, Iowans will have access to high quality mental health services. These services will be fully funded by federal dollars which greatly reduces the demand on county mental health funds. Counties are already receiving additional funds aiding the redesign of the mental health system, including $11,628,317 in transition funds and $29,820,478 in equalization funding, as well as the $110, 656,258 to be collected statewide in property taxes to support mental health services. The additional risk pool funding is not necessary at this time. Section 11 Department of Veterans Affairs The section appropriates $250,000 from the Rebuild Iowa Infrastructure Fund in FY 2014 to pay for construction costs of an expansion of a equipment storage facility at the Iowa Veterans Home. Section 12 Reporting The section implements the reporting language provided annually in the RIIF budget bill regarding the status of infrastructure projects. Section 13 Reversion The section provides that if a project does not have specific reversion language attached to their appropriation, the project has four years to expend the funds. This is in line with the reversion language provided to infrastructure projects in the RIIF budget bill. Section 14 Mental Health Regions The section creates Iowa Code section , which provides that the newly formed mental health regions shall be considered to be a governmental body for the purposes of open meetings and open record requirements in the Code. Section 15 The section removes the appropriation from the 2012 RIIF bill for the 2014 portion of the renovations to the State Fair s Cultural Center. Section 16 The section amends House File 638 (FY 14 & FY 15 RIIF) by reducing the appropriation to the Department of Administrative Services for major maintenance projects by $200,000. 6

7 Section 17 Iowa Tuition Grants The section provides an additional $500,000 for the Iowa Tuition Grant program, in addition to what is appropriated in HF 604. Section 18 Effective Upon Enactment This makes Division III of the bill effective upon the Governor s signature. DIVISION IV SOIL AND WATER CONSERVATION AND WATER QUALITY Section 19 Soil and Water Conservation - General This section provides $7,000,000 to IDALS for soil conservation programs and cost-share. It includes default intent language on how to spend the funds that accompany this money each year with: no more than 5% for soil erosion complaints, 5% to establish practices above publically owned lakes; no more than 30% for financial incentives to establish soil erosion control management practices; the state soil conservation committee may allocate funds to conduct research and demonstration projects that promote conservation tillage and nonpoint source pollution control practices; funds used as financial incentives may be used be used in combination of DNR moneys; not more than 15% may be used for administration and implementation expenses; but moneys may not be used for administrative support of the Watershed Improvement Review Board. Section 20 Water Quality Initiative Special Projects This section appropriates $10,000,000 and includes implementation intent language acceptable to IDALS to support Water Quality Initiative fund moneys for water quality initiative nutrient reduction projects with 70% for use in high-priority watersheds, and 30% in watersheds generally. IDALS Soil Conservation Division is directed to use the funds for water quality practices described in the Iowa Nutrient reduction Strategy for establishment of water quality projects on a cost-share basis no higher than 50% of estimated or actual costs. IDALS may use these funds in conjunction with other environment first fund appropriations or federal USDA wetland reserve enhancement program monies. Section 21 Water Quality Initiative Appropriations Federal Moneys The section provides that federal moneys may be used with the water quality initiative appropriations in the bill. Section 22 Water Quality Initiative - Report This section directs IDALS to prepare and deliver a report in an interim and final report to Governor and General Assembly how these funds were used by January 15, 2014 and January 15, 2015 respectively. Section 23 Watershed Improvement Fund This section provides $3-million to the Watershed Improvement fund to be distributed by the Watershed Improvement Review Board (WIRB) for supporting water quality improvement projects with 50% to be used for the purpose of supporting special projects initiated by IDALS Soil Conservation division. Section 24 Nonreversion The section provides that the funds appropriated in Division IV shall not revert until the end of FY 18. Section 25 Effective Upon Enactment The section makes Division IV effective upon the Governor s signature. 7