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January 22, 2016 | Week 2 Summary

Governor Branstad Doesn't Couple.

Bad for Trucking.

Governor Branstad surprised the business community by not budgeting for coupling with the Internal Revenue Code (specifically with Section 179). A proposal that will dramatically impact purchases of expensive equipment and will impact many IMTA members.

Section 179 expensing allows taxpayers with the ability to expense, rather than depreciate over a period of time, the first $500,000 of equipment costs. The federal government made Section 179 permanent after offering short term extensions for several years. Bonus depreciation provides businesses first year depreciation allowance of 50 % rather than a standard depreciation schedule. Bonus depreciation provides an accelerated reduction in taxes for the cost of equipment purchased.

Business owners who made large equipment purchases in 2015 anticipating the ability to claim the expense in taxes due in April will be most directly impacted.

Leaders in the House are looking for a path to couple with the IRS, but the price tag to do so is between $89 and $96 million. Finding that kind of money in an already tight budget is going to be a challenge.

The House Ways and Means Committee did move forward with a House Study Bill. House Study Bill 535 (HSB 535) temporarily couple for tax year 2015 the state tax code with all updates however it doesn't include bonus depreciation that the federal government made at the end of 2015.

Ban the Box (SF 84).

A proposal was introduced that is aimed at "banning the box" by seeking to remove from job applications the common question of whether an applicant has ever been convicted of a crime. An applicant could still be asked to provide this information, but not until after it has been determined the applicant is otherwise qualified for the job and is selected for an interview or a job is offered.

The prohibition would not apply for positions where federal law excludes such applicants or where a fidelity bond is required.

Backers said 19 states and at least 100 cities and counties nationwide have removed the question from initial job applications.

The bill is in the Senate labor committee.

Education Funding.

The good news is the legislature has already begun discussing education funding, which is always a contentious issue. The bad news is the House and the Senate are, not surprisingly, not anywhere close to being in agreement as to what to do with education funding.

The Governor called for a 2.45% increase in funding in his proposed budget. The Republican controlled House started the negotiations at 2%. The House Democrats are still holding out for 4%, but privately they know that is not going to happen.

The Senate Democrats will likely start their negotiations in the 3% range. There is little doubt the issue will be resolved soon, however, you can be sure the issue will not be left until the last day of the session, as was done last session, leaving the final decision in the hands of the Governor. This issue is probably going to continue to get the most attention during this legislative session.

CDL Testing by Third Party Providers.

In an effort to expedite the process of testing drivers for a CDL, the Iowa DOT is proposing legislation to allow third party for profit companies to provide training and testing in Iowa. Community colleges currently train and test their own students, but under this proposal they could also test drivers who were not their students. In addition to the community colleges, private companies could also begin offering the training and testing.

These providers would still be required to meet all state and federal regulations and would be subject to Iowa DOT inspections, record keeping, etc.

What initially sounded like a win-win for the state, drivers and trucking companies ran into an unexpected obstacle when AFSCME came out against the proposal sighting fear of state employees losing their jobs. IMTA is working with the Iowa DOT to see if these concerns can be addressed.

Caucus February 1.

You may have heard Iowa will caucus on February 1. For those who may have never attended a caucus, IMTA is a supporter of a nonpartisan website which provides attendees with all the information they need to know on how to caucus and what to expect at a caucus site. The website is caucus.iavotes.com. The site also includes information on where to caucus and even has some sample questions for the candidates or their representatives.

The website also includes some brief videos from some of the candidates and you can compare candidates' positions on several issues.

The website is a collaborative effort provided in Iowa by a business coalition called EPIC (Economic Progress for Iowa Citizens). IMTA serves on the Board of EPIC and is actively involved with EPIC.

2016 IMTA Platinum Sponsors

Dave Scott

IMTA Lobbyist

Brenda Neville

IMTA President