Wednesday was a difficult day for The American Independent News Network, which is the larger entity that operates The Iowa Independent. Our chief executive and founder announced two of our sister sites would close and their content would be moved to The American Independent.
A recently introduced bill could have far-reaching impact on the U.S. sugar industry, including American Crystal Sugar, a farmer-owned cooperative that locked out 1,300 Midwest workers on Aug. 1.
The chairman for Herman Cain’s Iowa effort says the campaign “relied more on the word of farmers than Washington regulators” in deciding to run an ad containing claims the Environmental Protection Agency says are false.
The Iowa Senate will remain under the control of a slim 26-25 Democratic majority when it reconvenes in January 2012.
House and Senate Democrats Thursday released the details legislation to trim the state’s tax credit program by $115 million, or roughly 22 percent. Republicans immediately shot back that the changes were bad for business and the equivalent of a tax increase.
State Rep. Paul Shomshor, D-Council Bluffs, argues for tax credit reform at a Thursday news conference at the Iowa Statehouse. From left to right: State Sen. Joe Bolkcom, D-Iowa City, Shomshor, and state Sen. Matt McCoy, D-Des Moines.
The bill, House Study Bill 738, would suspend the film tax credit program for two years; lower the cap from $185 million to $120 million on business tax credits; cut the Iowa Fund of Funds contingent tax credits from $100 million to $60 million; cut the Supplemental Research Activities Tax Credit in half for large corporations; and overall cut 10 percent for many other tax credit programs.
The bill also calls for regular evaluation of credits, and those which do not produce results will be fixed or eliminated.
Business assistance tax credits increased from $144.3 million in FY2006 to $242.7 million in FY2008.
“Every part of the budget is being cut and that will now include tax credits,” said state Rep. Paul Shomshor, D-Council Bluffs, who chairs the House Ways & Means Committee. “The public will know who receives each tax credit, the purpose of that credit, and the dollar amount spent on it. As we give tax credit spending the same careful, regular, open examination as the rest of the budget, we will both save money and make sure the dollars we do spend benefit Iowa middle class families.”
Numerous groups have been pressing lawmakers to look at the state tax credit program for years. In an interview with The Iowa Independent, Victor Elias, senior policy analyst with the Iowa Child & Family Policy Center, said the legislature appeared to be focused solely on cuts and uninterested in reforms to the tax code to enhance revenue. That strategy might balance the budget but would cause long-term harm to the state’s economy and the state’s residents, he said.
“Tax subsidies can no longer trump educating our kids when it comes to our public spending priorities,” said Sen. Joe Bolkcom, D-Iowa City, who chairs the Senate Ways & Means Committee. “We all support effective economic development programs, but they must be far more transparent and accountable for creating good paying jobs.”
House Republican Leader Kraig Paulsen of Hiawatha was quick to attack the bill, telling The Des Moines Register that it amounts to a tax increase.
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