Posted on

EDITORIALS ELSEWHERE A major tax cut is approved without lawmakers’ approval

EDITORIALS ELSEWHERE

A major tax cut is approved without lawmakers’ approval

Once again, Gov. Terry Branstad has decided to enact new state policy without involving the Iowa Legislature.

Beginning next year, Iowa will no longer collect a sales tax on certain items purchased for use in the manufacturing of other items. This is expected to cost the state treasury as much as $349 million over the next several years.

Two years ago, the Iowa Legislature rejected this idea. But the Branstad administration recently brought the issue before the Administrative Rules Review Committee, which gave its approval.

The Iowa Department of Revenue argues that because the state is only interpreting and 'clarifying' existing rules, the matter is best handled through administrative rule-making rather than legislative action.

That argument conveniently ignores the fact that the state has already interpreted these long-standing rules to allow for the taxation of items used in manufacturing — which is why the state now stands to lose so much money. Lawmakers refused to second-guess that decision.

The committee did agree to move the implementation of the tax exemption from Jan. 1, 2016, to July 1, 2016, so legislators can have their say on the matter in the coming session, but that move is largely symbolic. The department knows that the GOP-controlled House is not going to approve legislation blocking the exemption.

Jim Larew, who served as legal counsel for former Gov. Chet Culver, calls the process used for enacting this tax break 'an expansive use of an executive agency's interpretive power to transform the meaning of specific code language to create a new state government taxing policy.'

He's right. Yes, the rule-making process is intended to establish how laws are interpreted and applied, but when new interpretations conflict with long-standing policy, and they result in the loss of hundreds of millions of dollars, that's a matter that ought to go before the Legislature.

— The Des Moines Register. Oct. 24

Growth in exports boosts Iowa economy

When Terry Branstad emerged from political retirement as a candidate for governor in 2010, one of his campaign promises was to expand markets for Iowa products.

Promise kept.

In 2014, Iowa exports reached a record $15.1 billion, according to the U.S. Department of Commerce. Iowa was one of 26 states (including Nebraska, $7.9 billion) to set a record for exports last year.

According to the Commerce Department, machinery and food exports accounted for more than half of Iowa's total dollar amount; Canada, Mexico, Japan and China were the leading destinations for Iowa products. China, in fact, is Iowa's fastest-growing trade partner.

An Oct. 11 story from The Journal's Des Moines bureau outlined the aggressive strategy employed by the Branstad administration to grow Iowa exports.

Since Branstad returned to office in 2011, more than two dozen international trade missions have been completed. Destinations include Mexico, Peru, Columbia, Brazil, Chile, Taiwan, South Korea, China, Japan, Guatemala, El Salvador, Honduras, Vietnam, the Philippines, South Africa, Italy, Switzerland, Kosovo, Israel and Turkey.

'The world really is flat,' Iowa Economic Development Authority Director Debi Durham said for the Oct. 11 story. 'When you see how successful these trips have been and what opportunities and doors it opens for Iowa, it's an important part of the work that we do here.'

We commend the Branstad team for its export strategy and success. Growth in exports translates to profits for Iowa companies, both large and small (more than 3,300 Iowa companies exported products in 2014 and the vast majority of those companies employed fewer than 500 workers, the Commerce Department report said), and jobs for Iowans (the Commerce Department estimates $1 billion in exports supports approximately 5,000 jobs).

'With more than 95 percent of the world's population and 80 percent of the world's purchasing power outside the United States, future economic growth and jobs for Iowa and America increasingly depend on expanding U.S. trade and investment opportunities in the global marketplace,' according to the Business Roundtable, an association of chief executive officers of leading U.S. companies working to promote 'sound public policy and a thriving U.S. economy.'

To this end, Iowa is, indeed, on the right track.

— The Sioux City Journal. Oct. 20

Smoke-free casino? How about all of them?

Members of Iowa's Gambling Casino Restricted License Study Committee believe Iowa needs a smoke-free casino.

They're right — to a point. They shouldn't have stopped there. How about making all of the casinos smoke-free?

After a pitch for a smoke-free casino in Cedar Rapids failed in the 2015 Iowa legislative session, a group of lawmakers formed this study committee to keep the issue alive.

This shouldn't be that difficult. Is a smoke-free casino a good idea? It's a great idea. If restaurants, bars, government buildings, hospitals, workplaces and virtually all other facilities of public accommodation are smoke-free, why not casinos?

Iowa shouldn't feel compelled to OK a new casino just so it has one that is smoke-free. Instead, lawmakers should undo the poor, even duplicitous decision they made years ago when they handed gambling facilities a huge loophole in the state smoking ban.

The message they sent was this: What's good for the health of Iowa workers and customers just isn't that important if it might interfere with the state's revenue streams from gambling.

It's as if some state officials haven't noticed the reams of evidence that have stacked up over the last 50 years making the case against smoking and second-hand smoke.

The committee this week met with the director of the Iowa Racing and Gaming Commission to talk over the possibility of licensing a smoke-free casino in Cedar Rapids.

According to a report on Iowa Public Radio, the exchange went like this: Democrat Kirsten Running-Marquardt asked Gaming Commission Administrator Brian Ohorilko about the safety standards the casinos are supposed to have in place.

'Is smoking and second-hand smoke a safety issue?' Running-Marquardt asked.

'I don't think we have the answer to that,' Ohorilko said. And then: 'It depends on who you ask.'

'It's been determined,' Running-Marquardt said. 'Scientists and health experts have determined that second-hand smoke is a safety concern. Why don't they consider it a safety issue?' she asked.

'I'm not trying to dodge your question, Representative,' Ohorilka said. 'It's not something that's been asked of the commission.'

Right.

So, the director of the Iowa Racing and Gaming Commission isn't sure if second-hand smoke is a safety concern. He thinks it depends who you ask. And personally, his committee hasn't been asked.

Well, let's just say we're asking, Director. Let's just say the people of Iowa and the workers in Iowa casinos would like to know if you consider second-hand smoke a safety concern. If it's not, why did the state ban smoking in public places in 2008? Lawmakers congratulated themselves on doing the right thing to protect the health of Iowa workers. Except for casino workers. What was that all about if not second-hand smoke?

In fact, it is a safety concern, no matter what Ohorilka or any other official says. A 2010 study showed more than 600,000 people worldwide die of second-hand smoke every year.

The Cedar Rapids lawmakers and others on the committee aren't just motivated by wanting a healthier gambling atmosphere. They're hoping the smoke-free approach allows them a back door to a casino license. In 2014, the same lawmakers were hoping for a gaming license for Cedar Rapids, cigarettes and all. The IRGC rejected that bid, citing studies showing that the casino market is saturated.

Now those same lawmakers are back, this time making the case for a casino that's smokefree.

Even taking into consideration those mixed motivations, the arguments the Cedar Rapids folks are making aren't wrong. A smoke-free casino would be better for Iowans. If Iowa wants to be known as the healthiest state, it makes sense that we have smoke-free casinos.

But if state officials are really concerned about the health of citizens — beyond any healthy state designation — it makes far more sense to have all casinos smoke-free, not just one.

— The Dubuque Telegraph Herald. Oct. 23

Social Share

LATEST NEWS