The Iowa House of Representatives should definitely not pass HF 230 – to extend the school infrastructure sales tax for another 21 years – to 2050!
In 1998, we were told that the 1% local option tax for school infrastructure would be temporary – for 10 years. In 2008 the temporary tax was changed from a local option to a state-wide sales tax, and was extended for another 22 years – to expire in 2029. Even though we still have 12 years left of the tax, school districts are pressuring the legislature to extend the tax for an additional 21 years!
Why would they want to do this? Because years ago, they borrowed against the future taxes and have already spent the taxes that will be collected during the remaining 12 years. If the tax is extended again, you can bet that some school districts will again quickly borrow against the future taxes and spend the money decades before the taxes are collected.
Do we really need this much money for school infrastructure. Some school districts might need the money, but it appears that many school districts are flush with money and already have excellent facilities. We really should wait until 2029, then allow local school districts have their own local option tax if the local taxpayers believe there is still a need.
Governor Brandstad said he is open to increasing the sales tax to improve water quality in Iowa. (Des Moines Register, 5/3/2016, “Branstad open to sales tax for water quality” – link below) Specifically, he wants to implement the Natural Resources and Outdoor Recreations Trust Fund. Under the Iowa Constitutional amendment passed in 2010, the next three-eights of a penny increase in the sales tax must go to the Trust Fund. He suggested offsetting the tax increase by a decrease in the income tax – to make the change revenue neutral.
We all want clean water and nice recreation opportunities. But, what I don’t want is to pay farmers rent to not pollute. It appears that up to 50% of the tax collected could go to farmers to entice them to not pollute. The Constitutional amendment was a mistake. People want clean water and good recreational opportunities, but the way the Consitutional amendment was structured was a mistake. I think most Iowans voted their emotions, but would really not agree with the structure of the amendment. We need to repeal this amendment.
Today, the Des Moines Register reported that the group charged with bringing a hotel to the Iowa Events Center is suggesting that the hotel be managed by a nonprofit organization. (See link below.) It appears from the report that the hotel would have a separate private owner. I don’t get it. Wouldn’t the owner decide who would manage the hotel? The project has already been scaled back from 450 room to 300 rooms due to project costs. The current proposal is relying on, “a number of city, county and state incentives.” It appear pretty clear that the private sector thinks such a hotel does not make good economic sense. Given the vitality of the downtown Des Moines area, we need to ask when, if ever, are the taxpayer subsidies going to end for what should be private investments.
Contrary to the Des Moines Sunday Register opinion essay on 12/14/2014, Iowans did not vote four years ago to increase the Iowa sales tax by 3/8ths of a percent to fund conservation and recreation. Instead, Iowa voters made the easy choice to show emotional support for recreation and the environment without having to actually pay anything. Iowa is already doing very well on the recreational front without increasing taxes. We also already have substantial subsidies and other incentives to promote conservation and reduce pollution. If we want more funding for recreation, establish user fees. If we need to take further steps to reduce pollution, we should assess fines against the polluters. We do not need to tax ourselves $150 million per year in perpetuity. We made a mistake by amending our Constitution to commit any future sales tax increase to specific, narrowly defined purposes. We will not be able to change how we use the proceeds of any future tax increase without an amendment to our Iowa Constitution. We should not compound our mistake now by increasing our sales tax.
Link to Register opinion essay: http://www.desmoinesregister.com/story/opinion/editorials/2014/12/13/editorial-pressure-lawmakers-outdoor-fund/20387043/