Hello from Des Moines! We passed SF 432 this morning. This bill deals with regulating the spreading of liquid manure on frozen ground and the stockpiling of dry manure. The bill was amended to tweak a few areas. Overall this is a good bill. It gives the producers guidance on proper manure management and helps them be better stewards of the environment. The most important function of the Legislature is now in full swing, the budgeting process. I serve on the Economic Growth Committee. We deal with programs that help existing businesses and give incentives to bring new companies to Iowa, help new entrepreneurs with an idea, and to develop and start companies. We also help the regents institutions as well as the community colleges with programs developing new businesses. We also work with Workforce Development. We all know that economic development is what will help bring Iowa out of decline. Many of these programs will have a direct impact on our future, both in the availability of quality jobs and quality of life here in Iowa. So, as you can see, deciding where to cut and where to maintain certain levels of funding becomes quite a balancing act. Workforce Development is responsible for helping retrain workers for new jobs and manage unemployment programs in the state. We know that some Iowans will be in need of these services with unemployment rates at current levels. This week it was announced that there will be an attempt to eliminate federal deductibility. The message signals that Iowans should brace themselves for a tax increase. Based on the most recent information, eliminating federal deductibility would be a tax increase of $594 million. An Iowa household earning $45,000 would receive an average 5% increase in their taxes or $222. Iowa is one of a handful of states that allows a 100% deduction for federal income tax payments on the state individual tax return. It protects Iowans from paying a state income tax on money used to pay their federal income tax. It is the largest way some Iowans may lessen their tax burden. Proponents of the elimination of federal deductibility claim the deduction allows “wealthy” Iowans to avoid paying their “fair share” of Iowa personal income taxes. This data shows that the top income earners in the state are already paying a significant share of the total Iowa personal income tax burden. In fact, the top 10% of Iowa taxpayers pay about 40% of all Iowa personal income taxes. The next 20% pay about 30% of the burden, the next 20% pay less than 20%, and the bottom 50% of all Iowa income taxpayers pay less than 10% of the total Iowa personal income taxes. We’re still waiting for legislation to be introduced. And with the state looking for a way to pay for more of its spending, the elimination of federal deductibility could be their ticket to get back in the black. When talk turns to eliminating federal deductibility and promises to reduce tax rates, Iowans should understand it is simply a shell game and they should get ready to pay more. Don’t forget to come and join us for coffee at 10:00 AM on April 11th at the Gathering Place on Main Street in Dysart. Lance and Dawn also. As always, I welcome your questions and comments. Thank you for letting me represent you at the capitol. Please feel free to contact me: tim.kapucian@legis.state.ia.us or 515 281-3371. Senator Tim Kapucian Grundy, Tama, Benton & Iowa Counties