Tax reform, placemaking, broadband and child care are among the issues that are expected to take center stage during the 2022

legislative session.

 

All are cited as areas that would, if progress can be made, help address workforce issues and the labor shortage that continues to challenge Iowa’s businesses. That was the message from leaders of some of the state’s business and nonprofit organizations as this year’s session got underway at the Capitol in Des Moines.

 

Panelists shared their thoughts on those topics and others during the Business Record’s Legislative Forecast panel discussion on Jan. 11, a day after this year’s session convened.

 

Speakers included Joe Murphy, executive director of the Iowa Business Council, Brian Waller, president of the Technology Association of Iowa, Andrea Woodard, senior vice president of government relations and public policy at the Greater Des Moines Partnership, Dave Stone, advocacy officer for the United Way of Central Iowa, JD Davis, vice president of public policy at the Iowa Association of Business and Industry, and Dustin Miller, executive director of the Iowa Chamber Alliance.

 

Here are some of the highlights of the conversation:

Taxes

Joe Murphy: I think there is a very good opportunity to reduce that individual tax. Whether the Legislature will choose to go all the way to zero, that’s to be determined. That would obviously take a tremendous effort, and that’s something that we’re not advocating for. We think rates need to be more competitive, but we need to do it in a thoughtful and manageable way. I also think we need to address the corporate side as well. An effort to drive development, and drive population growth, all these things need to be taken into consideration and I do think there’s going to be a significant discussion this year. 

 

JD Davis: We have to thank the Legislature and the governor for putting us in a position where we can be talking about this.They’ve done that through some sound stewardship and sound budget practices, and I don’t see them violating that now to try to do more with taxes than they can actually sustain. They’ll be making several choices on whether to include corporate taxes and individual income taxes, and we’re going to advocate for as broad an application as possible. One tax that is often overlooked is unemployment taxes … so I think we’re going to have a very broad discussion on taxes. 

Dustin Miller: We’re huge proponents of looking at corporate rates. From an economic development perspective, we’re not on the playing field for a lot of site selectors so we’re not even in the game for potential expansion or relocation of businesses. Our big push is to make us competitive. We actually lost a pretty large expansion project in eastern Iowa because of our corporate rate. There will be a discussion about credits and how that gets balanced, but it’s important to understand that some of the largest employers are paying full freight corporate, and they employ a lot of people. How do you make sure their bottom line is better so they employ more people?

Child care

Dave Stone: Child care remains an issue we need to look at. We’ve made a lot of headway on areas such as the child care cliff effect, but accessibility, affordability and quality still remain. There are just fewer providers out there. Part of the problem is just access. One in four families in our state live in a community where there are not enough providers of child care, and child care still remains the largest expense for the typical Iowa family. [We] applaud the Governor’s Child Care Task Force recommendations. We’ll be looking to advance some of those, including making child care more affordable for our lowest-income families by increasing eligibility for the state’s child care assistance programs. But then also looking at providers themselves. How can we incentivize providers to expand existing facilities? And also look at businesses. How can we incentivize businesses to either create or expand on-site facilities? Or receive tax credit incentives for providing child care subsidies or benefits to their employees as part of a strategy that really puts an all-hands-on-deck approach from the government, business and nonprofit sectors. So we’re looking at ways to expand child care in this legislative session. There are significant federal investments coming our way as well as potential increases in state investment.

Technology

Brian Waller: Technology moves so fast, it’s really hard to future-proof a technology investment. If we want to compete globally, it’s going to have to be continued investment in emerging technologies. And that dovetails with once you give Iowans access to high-speed internet, do they have the ability to purchase that? So I think there’s something for the state of Iowa to not only invest in high-speed infrastructure, but also making sure all Iowans, especially low-to-moderate income, that have access to high-speed internet, and I think there’s something that the Legislature can do to make sure all Iowans can participate in that economy. I [also] think there is a conversation to be had around cybersecurity and how the state could have some resources for small and medium-sized businesses, whether that’s education around cyber threats, resources around funding and what you do to navigate that world. Much like workforce is a conversation today and it will be ongoing, I think cybersecurity and privacy is a conversation we’re going to have for decades around the state Legislature.

 

Placemaking

Andrea Woodard: This is one of those efforts that has a lot of opportunity with the large amount of funding we have available to us right now. There’s a lot of federal dollars pushed into the states, and I think community placemaking — you think of projects like ICON Water Trails and Pro Iowa soccer stadium — this is where we have a huge opportunity that each of us should be pushing for our state to take advantage of and really focus on how do we create that place that attracts the talent we’ve all been talking about.

Dustin Miller: Doing HR in the 1990s was simple arithmetic. It was salary plus benefits equals a person coming to get a job. Everything has become complicated calculus because it is people really trying to make decisions about what kind of lifestyle they want and things they want around them. This is really about creating a momentum of things for people to do. What you hear more and more is, and … certainly younger generations saying, I want to skateboard, I want to bike, I want to view public art. These are things that help them make decisions on where they land, and it isn’t just as simple as a high salary anymore. That’s the ultimate issue we’re talking about here is what are those attractive things to get somebody outside of Iowa to move here?

 

Housing

Dave Stone: We really need to keep a laser focus on affordable housing. The growth we will experience in the Central Iowa region over the next five to 10 years is largely going to be lower-income to middle-income families, who right now could very well be priced out of our housing market. There is no silver bullet solution when it comes to housing. We need continued investment at the state level but also policies at the community level. One other thing we need to talk about is natural affordable housing, or existing housing that maintains a low rate. Once we lose that, we never get them back, especially in integrated, mixed-use neighborhoods. There are a lot of approaches that we need to continue to work on, one of which is state investment, but also local as well and how we can expand and prepare for that workforce that’s moving here and won’t be able to afford $600, $700, $800 or higher rents every month.

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