May 3 Capitol Report

May Day, May Day. On Monday, April 27, Governor Reynolds signed a new proclamation continuing the State Public Health Emergency Declaration until May 27, 2020. The proclamation eased some of the COVID-19 restrictions, effective May 1, in 77 counties where there has been no or diminishing coronavirus activity. In those counties, restaurants, fitness facilities, and libraries can open up but only to 50 percent of capacity and with lots of social distancing. And farmers markets can operate if they sell only farm and food products and don’t provide common seating areas or entertainment. The Governor’s proclamation also lifted the restrictions statewide on religious and spiritual gatherings, again as long as they social distance and increase hygiene measures. Restaurants, bars and most other retail businesses in the other 22 counties, where the restrictions were not relaxed, must remain closed until May 15.

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Help is On the Way. Two days later, on Wednesday, April 29, the Legislative Council met by phone and voted unanimously to extend the suspension of the legislative session until May 15. The suspension was set to expire on April 30. During the meeting, Speaker Pat Grassley said the suspension could be extended again depending on when it is safe to return to the Capitol and began hinting that when the legislature does reconvene it will be for hours, not days. Senate Majority Leader Jack Whitver said the focus will be on the FY2021 state budget, which under the current deadline must be adopted by August 31. House and Senate Minority Leaders Todd Prichard and Janet Peterson asked a number of questions about measures that would be put in place to ensure safety and public access. Following the meeting, Prichard and Peterson submitted a Memo outlining their recommendations for “re-opening” the Capitol which includes health screens, face masks and 72 hour public posting of legislation and amendments prior to action by the legislature.

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Fairer Days are Coming. This past week the Legislative Services Agency issued a Fiscal Update Article reporting on the State Tax Revenue Update through April 24. The article describes actions taken by the Governor to close businesses and the Iowa Department of Revenue to grant deadline extensions for the payment of tax returns due to COVID-19. The article includes a graph that shows annual tax revenue, both gross and net, began to decline around April 8 and that net state tax revenue has declined by $307 million or 48% from March 19 through April 24, 2020, as compared to the same time period in 2019. The article indicates that “Much of the significant decrease experienced over the time frame resulted not from the business closures and other impacts of COVID-19, but instead from the tax due date delays.” And concludes by stating, “It will not be until the delayed tax payments have been deposited that the economic impact of recent events can be reasonably estimated.”

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Final Words. Don’t expect the legislature to return to the Capitol until after the June 2 primary elections. There is still too much that needs to happen before they can come back and “efficiently” finish their work. The Revenue Estimating Conference needs to update its numbers and the Governor needs to revise her budget. Legislative leaders need to decide how they will conduct business and everyone needs to feel comfortable the process will be safe and transparent. In the meantime, there is an election coming up - so don’t forget to mail in your absentee ballot request form. And wash your hands.