Capitol Report -- May 31

Times They Are A-Changing. On Tuesday, May 26, Governor Reynolds signed a new proclamation extending until June 25 the original health emergency proclamation that was set to expire on Wednesday, May 27.  In the proclamation, she allowed bars, wineries, breweries and distilleries to open up on May 28 subject to the same public health measures as restaurants. The Governor also said establishments like racetracks, casinos and amusement parks could re-open on June 1, and community, recreational and sports gatherings of more than 10 people could resume on June 1, as well. All are subject to capacity and social distancing restrictions. What remains closed? Not much. Indoor venues hosting live performances, indoor playgrounds, senior centers and adult day care facilities.

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Time is Money. On Friday, May 29, Governor Reynolds announced how the state intends to spend the $1.25 billion Iowa has received in CARES Act funding. The Governor said that $700 million would be allocated immediately and $550 million would be held back as they continue to monitor the status of the Unemployment Trust Fund and any other unforeseen expenses related to COVID-19.  She detailed the spending of the $700 million as follows:

• $215 million for Iowa businesses, renters and homeowners, workforce initiatives and food banks
• $100 million for Iowa farmers
• $125 million for Iowa cities and counties
• $50 million for health care providers that offer substance abuse and behavioral health programs
• $85 million for broadband expansion to support telehealth, telework and telelearning
• $125 million for the state’s COVID-19 response including personal protective equipment and overtime for frontline employees 

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Still Uncertain Times. Also on Friday, the Revenue Estimating Conference (REC) met to update their state revenue estimates for the current (FY 20) and next fiscal year (FY 21). The REC typically meets three time a year, in October, December and March, but held a special meeting at the Governor’s and legislative leaders’ request. When it last met in March, the REC members said it was too early to know what effect the coronavirus would have on the state’s tax revenues. While all three members struggled with the continued uncertainty about the longer-term impact of COVID-19 on state’s economy, they reached a consensus and lowered their estimates for FY 20 by $149.5 million and for FY 21 by $360.1 million. The Governor and legislature must use the new lower numbers in the state budget they develop when the legislature returns to the Capitol this Wednesday, June 3.

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Final Words… from Governor Reynolds, “The unsettling and criminal act of violence that robbed George Floyd of his rights and life was unconscionable and must be met with swift justice. As Iowans, it is right for us to react in different ways, from sadness to ourtage. But it is never right to react with violence.”