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Dem’s furious as Branstad seeks $37 million tax break for corporations

Statement by Senator Joe Bolkcom, Chair of the Senate Ways and Means Committee:

Senator Joe Bolkcom of Iowa City
Senator Joe Bolkcom of Iowa City

“This July, when Governor Branstad vetoed the $56 million, one-time funding compromise for Iowa’s local students, he claimed Iowa couldn’t afford it.

“This July, when Governor Branstad vetoed $2.5 million in one-time funding for Iowa’s community colleges, after failing to provide any increase in on-going funding, he claimed Iowa couldn’t afford it.

“This spring, when he failed to continue the Iowa student tuition freeze helping make college more affordable, he claimed Iowa couldn’t afford it.

Today, however, after large corporations lobbied him for a $37 million, on-going tax cut that legislators had rejected, Governor Branstad says Iowa can afford it. Furthermore, he says he doesn’t need the Legislature’s approval to do it.

“The agenda for the October 13 meeting of the Administrative Rules Review Committee reveals that the Branstad-Reynolds Administration is proposing a rule change to exempt consumable supplies used in manufacturing from the Iowa sales tax. If the Branstad-Reynolds Administration does not withdraw this rule, it will take effect on January 1, 2016, even though this $37 million annual tax cut has never been approved by the Iowa Legislature.

“This rule would change more than 15 years of existing policy.

“I believe it is illegal for the Branstad Administration to use the rule making process to create a massive corporate tax giveaway without approval by the Legislature.

“I believe such a substantial change in tax policy must first be approved by the Legislature. Two years ago, the Branstad-Reynolds Administration agreed with me. That’s why the Administration drafted SSB 1242 in 2013 for the consideration of the Senate Ways and Means Committee. It failed to advance out of committee. It is outrageous that after acknowledging two years ago that this change required legislative action, the Governor and Lt. Governor are now attempting to get it done by bypassing the 150 members of the House and Senate.

“Governor Branstad is skilled at getting what he wants. Unfortunately, what he wants is to give millions to large corporations and pay for it by vetoing investments in education.”

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