Vander Linden Capitol Update – February 16, 2017

The Capitol has been busy and had a ton of activity this week. All the while, House Republicans kept pushing forward reforms that will benefit Iowa taxpayers. Below you will find some helpful information concerning some issues the legislature is addressing this session. Please contact me with any questions or concerns you may have.

Iowa’s Community Colleges Boost Iowa’s Economy

A new study put out by the Department of Education last week provides proof of the impact that Iowa’s Community Colleges have on the state’s economy. It points to a contributed $5.4 billion in income, the equivalent of creating 107,170 new jobs

House Republicans have been strong supporters of Community Colleges over the past 7 years, knowing the good work they do on behalf of Iowa’s students and continuing workforce needs. Prior to House Republican control, the Community Colleges weathered a $32 million reduction in state funding during the 2008 recession ($180 million to $148 million from 2009 to 2010). Since taking control in 2011, House Republicans have increased general fund appropriations to the community colleges by $55 million, a 37% increase in funding.

The study found that Iowa’s community colleges collectively contributed $5.4 billion into the state’s economy (equal to 3.3% of the state’s Gross State Product) and supported 107,170 jobs – roughly 6% of all jobs in Iowa – during fiscal year 2014-15.

Among the study’s findings:

• During the analysis year, past and present students generated $4.6 billion in added income for the state, which is equivalent to supporting 87,905 jobs
• The top industries impacted by Iowa’s community colleges include health care and social assistance; manufacturing; finance and insurance; and construction.
• For every dollar of public money invested in Iowa’s community colleges, $3.50 in benefits is returned to taxpayers and the average annual rate of return is 10.4%.
• For every dollar that a student spends on a community college education in Iowa, that student receives $6.50 per hour in higher future income with an average annual rate of return of 25.3%.
• The average associate degree completer will see an increase in earnings of $9,500 each year when compared to someone with a high school diploma or equivalent. Over a working lifetime, this increase in earnings amounts to an undiscounted value of approximately $418,000 in higher earnings.
• The total benefits to society, which include increased lifetime earnings, associated increases in business output and social savings, equal $15.2 billion (in present value form).

To read the full report, visit the Iowa Department of Education’s website: https://www.educateiowa.gov/documents/economic-impact-community-colleges/2017/02/analysis-economic-impact-and-return-investment

Alcoholic Beverage Division Completes Comprehensive Review

In August 2016 Governor Branstad and Lieutenant Governor Reynolds asked the Iowa Alcoholic Beverage Division, in partnership with the Iowa Economic Development Authority, to perform a comprehensive review of Iowa’s current alcohol laws housed in Iowa Code Chapter 123. To accomplish this request, the ABD and EDA created a working group taskforce that was comprised of members who represented breweries, wineries, distilleries, wholesalers, the restaurant association, public safety, the general public, and other interested parties. This working group met 8 times over the course of five months, and interested parties were able to express concerns, proposed changes, or benefits of the current 3-tier alcohol system outline by Chapter 123. In January 2017, the working group adjourned their final meeting, and on February 1 the ABD delivered the final comprehensive report to the Governor and Lieutenant Governor of their findings along with a bill request for the 87th General Assembly to consider.

The following five recommended changes to Iowa’s alcohol laws were made by the group:

1. Create greater parity among Iowa beer, wine, and spirits manufacturers
2. Streamline licensing for Iowa beer manufacturers and wholesalers
3. Allow a limited expansion of off-premises retail privileges for retailers manufacturing beer
4. Increase collaboration between the Iowa Alcoholic Beverage Commission and the Iowa Wine and Beer Promotion Board
5. Endorse a further review of licensing, administrative actions, and administrative appeals for reform opportunities

Currently assigned to the House State Government Committee is House Study Bill 108, a proposed bill that seeks to reform portions of Chapter 123 as proposed by the working group. Some highlights of the proposed legislation are as follows:

1. Makes technical corrections and updates the code where it was needed as advised by the Alcoholic Beverage Division
2. Streamlines the licensing process by combining certain licenses and licensing fees, removing a license class that was not widely used, and creating new categories of licenses that better fit the needs of establishments
3. Reforms micro-distillery regulations, allowing for more flexibility when selling product both on and off premise

The ABD reports that in the future they wish to continue to reform Chapter 123 to make it easier to understand, more efficient, and workable for all interested parties. When it comes to Iowa’s sale of alcoholic beverages, many parties have a stake. Working groups like this are an important step in the process of reforming state legislation that impacts such a wide ranging group of interests.