Like so many things in the world, the COVID-19 pandemic radically changed our legislative schedule. According to the original timetable, April 21 would have been the end of the per diem. Every session begins with the hope of ending sooner than the per diem and accomplishing great things, no matter which party. That was the plan for the 88th Iowa General Assembly. Unfortunately, no one saw what was coming as the session ended up extending the adjournment until April 30 (Senate Concurrent Resolution 102).
At this time, everyone remains stalled to see what happens. It remains to be seen whether the legislative leadership team will finish out all 30 days or if the session will be abridged, it will depend on when the general assembly is able to return.
There is still much unfinished business regarding the budget, which will be a top priority. So much has changed now, but in play before was the impact of the CARES Act on the state of Iowa and how those dollars will be used. Revenues may be totally changed now with the disruption in our state’s economy.
Lawmakers did set it up to have the ability to vote for the session to reconvene earlier than April 30 or vote to extend the suspension of the legislative session if conditions warrant.
The HBA of Iowa was working with the Governor’s office to ensure that construction remained on the essential list. Most states have done so and there is Federal language deeming it to be essential as well.
Overall, the session was heading towards being beneficial to our industry and our members, having been successful in getting many of our key initiatives through and successfully fought off several bills that would have been harmful to our members—it’s the routine and bad bills never really go away. The HBA of Iowa Legislative Committee took positions on 29 of them.
With our member’s livelihoods potentially affected by good or bad legislation, we have the responsibility to work diligently on helping to craft favorable bills, promote housing affordability and eliminate as many of those pitfalls and unnecessary regulatory burdens to help foster the American dream of home ownership.
- SF458: Liens Against Homestead. A bill for an act relating to debts for which the homestead is liable by providing that the homestead may be sold to satisfy debts secured by a mechanic’s lien, including principal, interest, attorney fees, and costs.
This bill has cost considerable amounts of time and money over the course of two sessions. It should have been straightforward, yet dozens of attorneys argued about every capped word, space and period. It was finally on the path of passage, until the virus delayed it yet again. So, then the problem is having to reeducate everyone on what it was intended to do. Here is a recap:
- Contractors in Iowa faced new uncertainty regarding the recovery of attorney’s fees, interest, and costs incurred while seeking to enforce a mechanic’s lien against a homestead property. This uncertainty results from a 2017 Polk County Court ruling, which noted an apparent conflict between the state’s homestead law and mechanic’s lien law.
- Iowa’s homestead law, codified in Iowa Code § 561, generally protects an individual’s primary residence from judicial sale. One of these long-standing exceptions to this rule is a mechanic’s lien. That is, a contractor may foreclose on a homestead to recover debts incurred for work and materials furnished to improve the home.However, there is now uncertainty regarding whether this exception also allows a contractor to recover interest, attorney’s fees and costs related to mechanic’s lien, in addition to the principal amount of the lien.
- Iowa’s mechanic’s lien law is codified in Iowa Code § 572. It provides that a mechanic’s lienholder may recover attorney’s fees arising from the enforcement of the lien. However, the above-noted Polk County Court concluded, in dicta, that the holder of a mechanic’s lien against a homestead property could recover only the principal amount of the lien, but could not recover interest, attorney’s fees and costs.
- SF2372: Building Code Requirements. An Act concerning government regulation relating to state building code requirements, private investigative agencies, and elevator regulation, and including applicability and effective date provisions.
This one was killed at the 11th hour by the Senate leadership because of lobbyists with a bigger stick and more power than we have. It was language copied from the State of Michigan, adopted back in 1999, that basically said that changes to the energy code would need to have a seven-year payback (the average flip of a house.) The 2021 energy code has egregious language estimated to add $8–14k to the cost of an average 1,500 square foot home. Socially engineered items that have nothing to do with health, safety, or efficiency. Electrical charging stations in every garage for electric cars, efforts to eliminate natural gas apparatuses, R60 attic and R20+5 wall insulation in our climate zone. Most importantly, there would be no tradeoffs for material installation.
- SF2369: An Act relating to the creation of land banks. This bill provides for the establishment of land banks. Division I of the bill authorizes one or more municipalities to establish a land bank as a method to return dilapidated, abandoned, blighted, and tax-delinquent properties in their communities to economically productive status.
An established land bank is a public agency for the purpose of joint exercise of governmental powers, a governmental body for purposes of public meetings requirements of Code chapter 21, and a government body for purposes of public records requirements of Code chapter 22. Land banks are subject to periodic examination by the auditor of state under Code chapter 11. The bill sets membership requirements and term limits for a board of directors of a land bank, including interests that shall be represented on the board. The bill requires the board to establish bylaws relating to governance of the land bank.
- HF2454/SF2154: An Act relating to qualifications for community college career and technical education instructors. This bill provides another option by which an instructor may qualify to teach at a community college in the subject area of career and technical education (CTE). The bill permits an instructor to teach CTE classes at a community college if the instructor possesses an associate degree in the CTE field of instruction in which the person is teaching, if such degree is considered terminal for that field of instruction, and the instructor has at least 3,000 hours of recent and relevant work experience in the area in which the instructor teaches classes.
Currently, an instructor must have a baccalaureate or graduate degree relating to the area in which the instructor is teaching classes or, if the instructor possesses less than a baccalaureate degree, must have special training and at least 6,000 hours of recent and relevant work experience in the area in which the instructor teaches classes. In the latter case, if the instructor is a licensed practitioner who holds a career and technical endorsement under Code chapter 272, classroom instruction can be used to meet the requirement relating to relevant work experience, and the bill applies this language to the new option as well.
- SSB3116/HSB657: Invest in Iowa Act. This legislation, which Gov. Reynolds highlighted in her Condition of the State Address, was unveiled this week. The comprehensive bill includes several divisions. Key points include:
- Reduces individual income taxes—The top rate is 7.48% in 2021 and then that is lowered to 5.5% in 2023 if the revenue targets are met.
- Eliminates the 4% growth trigger currently in law.
- Increases the sales tax a full penny.
- Provides for the state general fund to cover the majority of cost that currently rests at the county level as it relates to mental health levies, which will reduce property taxes for businesses and individuals.
- Funds the Outdoor Recreation Trust Fund, but changes the percentages of monies going into the existing formula and strengthens language around the use of the dollars.
- Allows families with an income up to $90,000 to take the childcare tax credit, currently $45,000.
- Eliminates the excise tax on water.
- The bill does not address corporate tax rates.
- SF2363: Changes to Medical Cannabidiol Enhancements. This bill changes Iowa’s cap on Tetrahydrocannabinol (THC), the psychoactive part of cannabis, from 3 percent of a product to 25g per 90 days.
- SF2313/HF2384: Future Ready Iowa Enhancements. This bill would expand Iowa’s workforce through the Future Ready Iowa program. The bill aims to expand apprenticeship opportunities in high-demand jobs, help people complete their high school education, and learn computer and technical skills. In addition, this bill creates the Child Care Challenge program, which would encourage and enable businesses, nonprofit organizations, and consortiums to establish local childcare facilities and increase the availability of quality, affordable childcare for working Iowans.
- SF2296/HF2479: Independent Contractor Definition. This bill expands the definition of “owner-operator” to help protect companies who use independent contractors. This bill ensures companies using independent contractors for their businesses, like trucking companies, are not having burdens forced upon them that would raise their costs of business. It will help them continue to use independent contractors as they have been for years.
- SF2393: Reducing Barriers to Work. Iowa is one of the most heavily licensed states in the country. Nearly one-third of Iowans in the workforce are required to maintain a license to perform their jobs. Government licensing of many industries is appropriate, necessary, and in the interest of consumer safety. However, licensing in some professions is either unnecessary, too burdensome, or too expensive.
Licensing can even be a method for some to reduce or eliminate potential competitors. It can also be a barrier to employment and with unemployment in Iowa below three percent for more than two years, reducing the hurdles for employers to find qualified workers has been a priority for legislators all session.
In order to address these problems, Senate File 2114 reforms occupational licensing in Iowa. First, it provides for universal recognition of licenses from other states for most licenses. With this change, someone may relocate to Iowa for family or career related reasons and not be required to go through redundant licensing requirements.
This bill also streamlines the process for some felons to obtain licenses after they have completed their sentences by applying a uniform standard for criminal convictions. A good job is one of the most important factors for felons in their efforts to avoid recidivism.
One final piece of the bill lowers the fees for low-income Iowans applying for a professional license for the first time. A trade is often an accessible path out of poverty. Lowering the barrier to obtaining a license eliminates one more obstacle low-income Iowans face in rising out of poverty.
- HF2309: Criminal Background Check Local Ordinances. A law passed in 2017 prevents cities and counties from passing local ordinances affecting hiring practices or the setting of minimum wages and other business practices. Nonetheless, the city of Waterloo passed an ordinance that would prohibit businesses from asking about an applicant’s criminal history or conducting background checks until individuals are well into the hiring process.
HF2309 puts teeth into the 2017 law by awarding attorney fees to parties that successfully challenge such ordinances. The bill has passed the House Judiciary Committee and is eligible for debate on the House floor.
- SF2273/HF2473: Penalties for Synthetic Urine Prohibition. The bill creates criminal penalties for those who would use synthetic urine to defraud an alcohol or drug screening test. The purpose of the legislation is to deter individuals from attempting this activity. Both bills had passed House and Senate committees.
- SF2350: Employer Protections for Marijuana Usage. The bill explicitly spells out that employers have a right to maintain a zero-tolerance drug-free workplace. The legislation ensures that employers cannot face a cause of action for discrimination if they dismiss someone for violating that policy.
- SF2333/HF2462: Unemployment Benefits. This Iowa Workforce Development legislation repeals the provisions of the code that automatically increase wage credits to 50% versus 33% when a business closing is involved. It also repeals the additional 13 weeks of unemployment benefits under this scenario.
- HF2593: Child Care Access and Affordability.Legislators have introduced a wide-ranging package of legislation this session to improve access to affordable childcare for families. Several committees have advanced common-sense solutions to make childcare more affordable for families, increase access to providers, incentivize employers to offer and expand childcare to their employees, and address the “cliff effect” by easing Iowans off of government childcare assistance programs. Legislators are also continuing to work with the Senate to expand eligibility of the childcare tax credit program by doubling the household income threshold.
- HF2463: Access to Affordable Health Care. Legislators have also been looking for ways to increase access to high quality and affordable health care. Committees have advanced several pieces of legislation that provide more transparency and reduce the cost of prescription drugs, increase access to health services, and attract and retain more health care professionals to our state.
- HF2459/SF2400: Expanding High-Speed Internet to Underserved state Areas. Legislators have also made the expansion of high-speed broadband to underserved parts of the state a top priority this session. Reliable internet has become a necessity in today’s economy and both employers and workers are depending on a steady connection to conduct business online or work from home. To help expediate this expansion, the Commerce committee has passed multiple bills to improve internet access and bring faster speeds to Iowa’s rural communities.
- HSB590: The installation of radon abatement systems in new residential construction. Any new residential construction for which an initial building permit is issued on or after July 1, 2020, shall include the installation of a radon abatement system consistent with the provisions of section 136B.1. This bill relates to the installation of active radon abatement systems in all new residential buildings. The bill requires all new residential construction for which an initial building permit is issued on or after July 1, 2020, to include the installation of an active radon abatement system.
This bill did not make it out of committee and the HBA of Iowa was against it based on government overreach and mandates adding to the cost of construction.