Following three weeks of overtime this month, the Iowa Legislative Session adjourned Sine Die, Wednesday, May 19, 2021, at 11:45 pm. The 2021 General Assembly concluded after settling negotiations over tax policy, the budget, mental health funding, and other contentious topics. While the House and Senate had significant differences at times, there was significant legislation passed and many housing priorities were moved forward this year. While this is not an exhaustive list, please find highlights about housing and other legislation you may find of interest below. If you would like additional information, please contact us.
Affordable Housing
SF619: The housing initiatives contained in this bill increased resources significantly to housing development in Iowa.
Tax Reform
SF619: This legislation had several divisions, including the tax reform compromise led by Governor Reynolds and the Senate. The tax provisions of the bill remove the 2018 revenue growth triggers, exempts COVID-19 grants issued by certain state agencies from income tax, and phases out and eliminate the inheritance tax over four years, and phases out the county mental health property tax levy.
High Speed Broadband
HF848: Expanding broadband access, one of Governor Reynolds’ priorities, was unanimously approved with bipartisan support and dedicated $100 million to improve Iowans access to high-speed broadband service and help connect Iowans in underserved areas.
Child Care
HF302: This legislation fixes the “Cliff Effect” – or abrupt loss of benefits – that families receiving childcare assistance may face by taking a promotion or raise and provides a gradual phase out of their assistance.
SF619: Allows the Iowa Economic Development Authority (IEDA) to consider the creation of a childcare facility as “bonus criteria” when a project is being considered under the High Quality Jobs Program.
HF893: This bill increases the income limits for families to be able to claim child-care and dependent tax credits from $45,000 to $90,000.
Health Care
SF619: Phases out the county mental health property tax levy, shifting funding responsibility for mental health services from counties to the state.
SF619: Increases Iowans’ access to mental health care by making permanent telehealth payment parity for mental health services.
HF889: Prohibits state and local governments from issuing an ID card that identifies a person’s COVID-19 vaccination status and prevents any business that does business or accepts grants from the State from doing the same.
We would like to thank High Development (Des Moines) and Perennial Properties (Cedar Rapids) for their renewal this past week!
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The 2021 Iowa Legislative session wrapped up this week. We started with high hopes in January, and through the combined efforts of many affordable housing advocates, the state of Iowa is better our legislative successes with increased dedicated monies for the State Housing Trust Funds and increased funding for the Workforce Housing Credit, among others.
I would be remiss if on behalf of the Iowa Housing Partnership if we don’t acknowledge the efforts of Bob Rafferty and Rachel Ong, of The Rafferty Group. Without their commitment, I firmly believe we would not be in the position we are in now, and we truly thank them for how hard they worked (and talked a certain unnamed person, off the ledge numerous times).
While we were able to start the conversation and educate many, we were not able to establish a state-level affordable housing tax credit this year. This would have been paired with the federal low-income housing 4% (or bond) tax credit and would have been a significant aid to making many projects feasible.
Recently I enjoyed a podcast held by the Greater Des Moines Partnership, where they talked about affordable housing. The guests were Kris Saddoris of Hubbell Realty, Ashley Aust, also of Hubbell Realty and Iowa Finance Authority (IFA) Board member, and Brian Sullivan, Chief Operations Officer of IFA.
The podcast covered a lot of topics, including terminology. Let me talk about the term, “low income,” which was given to the Low-Income Housing Tax Credit. This credit is considered to be the most successful government-initiated program in the history of our government, in terms of private investment and product (affordable housing) units produced.
Think about that! In the history of our government. Too often we, as a society, forget we need all parts of our society to work, in order to be successful. Too often people forget where they came from.
When I graduated college, my first professional job was working for a U.S. Congressman in their Eastern Iowa office. My starting wage in 1990 was $12,000, or $5.76 an hour. Three months later, I got a raise to $14,000, meaning I now was making $6.73 an hour. I had a cheap apartment ($250 a month), a student loan payments, a child to support, and by the end of the month, I was close to zero, often relying on credit cards. For example, I could not afford car insurance or life insurance.
I was low income. Did not know it. And remember, I worked for a US Congressman!
That is an example of people in Iowa who can benefit from affordable housing efforts. The next time you complain that HyVee does not have enough checkers, the next time the drive-through line is super long, take a minute to think about that.
We should not shy away from a successful program because it has a “name,” or it will help “those kinds of people.” I recall meeting with a very successful banker in their main branch in Northwest Iowa, and the first thing this President stated was “I do not think our community would want those kinds of people.” With that, I pointed to his bank teller and said, “You mean her?” Taken aback, he could not say a word. I went to explain the people who benefit from this kind of a program. In the end the President not only supported a project but invested into a fund to help fund that project.
Twenty-three (23) states in our country have a state housing tax credit. Iowa needs one. And before anyone states, “we cannot afford another credit program,” Kris Saddoris during the podcast shared fantastic comment: if you have a mortgage loan, you are taking advantage of the biggest credit program in our county, the mortgage interest credit on your taxes. So, yes we can not only afford it, but have to have it to grow Iowa.
Affordable housing had a good legislature session in terms of increasing resources for affordable housing, but we need to do more. IHP is committed to doing more. We will be dedicated to outreach with our members, through meetings and other avenues, to promote affordable housing in Iowa.
—Dan Garrett
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