♪♪ The Iowa legislature enters a crucial time period for issues to either gather consensus or fall to partisan rancor.

We sit down with Iowa House Speaker Pat Grassley on this edition of Iowa Press.

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♪♪ For decades Iowa Press has brought you politicians and newsmakers from across Iowa and beyond.

Celebrating nearly 50 years of broadcast excellence on statewide Iowa PBS, this is the Friday, March 26 edition of Iowa Press.

Here is David Yepsen.

♪♪ Yepsen: Late March is crunch time for key issues in the Iowa legislature.

After bills were whittled down by an early March legislative deadline, the clock ticking on topics ranging from gun rights to voting to our state's budget.

We're joined today by Iowa House Speaker Pat Grassley, a republican from New Hartford.

Mr. Speaker, welcome back to the program.

Grassley: Thanks for having me.

I appreciate it.

Yepsen: Good to see you again.

Also joining us across the table is Lee Enterprises Des Moines Bureau Chief Erin Murphy and Radio Iowa News Director Kay Henderson.

Henderson: Mr. Speaker, let's start with tax policy.

The Iowa Senate has unanimously passed a bill that would eliminate the inheritance tax and speed up a series of income tax cuts that the legislature approved in 2018.

The Governor has expressed her support of that part of the bill.

Are you going to pass it in the House?

Grassley: Well, the first thing I'd say is the reason the triggers were put in there was that was one of the pieces that the House wanted to put in during negotiations back in 2018.

A reminder that was the largest tax cut in the history of the state.

Yepsen: Tell us what triggers are.

Grassley: The triggers are, so it has to hit a certain level of percentage of growth in tie revenue, 4% and then just over $8 billion worth of overall revenue.

So we put those in there so as revenue grew we would implement the tax cuts.

We didn't want to be in a position where something unforeseen, like we have found ourselves in right now, that both of those happened at the same time.

So they have been in there to make sure that we can stair step our way into it, provide that tax relief that we want without having to put the state's budget at risk.

So back to are we going to consider it?

We know the Senate is very adamant about that obviously passing that unanimously, the Governor has pushed it as a priority.

But again, our caucus has always taken the approach that whatever decision we're going to make, we want to make sure it's going to be sound long-term.

So we're working through internally right now what that would look like not just for this year's budget or next year's budget, but what does it look like the next five, ten years because we have put ourselves in a position, we have been in the majority in the House for 10 years now and I think a lot of that is because of the decisions we've made on the budget and the stability that we have brought to state government.

And so we're weighing that as part of the decision and what that would look like.

Murphy: Another big measure that the Senate has passed recently would shift the mental health funding in the state from local taxes to the state budget.

That was just recently approved.

Is that something that can be done in your mind?

Are House republicans ready to sign off on that?

Grassley: I think that issue is much bigger than just taking over the local levy that exists at the local level.

You're looking at about $115 million obligation that would be taken over by the state.

We want to provide property tax relief any time we can do that, but I always remind everyone that the way the current system is set up we would be basically writing the check without having any, very little if any input on how the money was spent on the back end.

So I think this conversation is much bigger than just saying, we're going to take over the mental health levy.

We have a lot of whether it's social programs or just programs at the state level that we have taken over as obligations that we have very little input.

Medicaid is a perfect example.

1 in 4 Iowans are on Medicaid.

That cost grows every year.

And we have very little input on how we can control the spending.

We have TIF in the state of Iowa, we backfill that for local school districts to the tune of $70 million each year.

We have no input.

So I think the conversation is much bigger than the state just taking over the mental health levy.

I've got you both raising your hands now so I must have said something.

Murphy: Is that conversation too big to have yet this session?

Grassley: Well, whether it's too big to have or not this session I think it is a much bigger conversation than is being had right now.

So I don't know, time wise it could be, but I think it's a much bigger conversation than just the focus on the tax itself.

Henderson: So when the 2021 legislature ends is it highly possible that you will not enact any tax cuts?

Grassley: I wouldn't say that that's the case.

But I just think my consistent message has been from my caucus and then through me would be that we're going to be cautious in our approach to that.

We're not going to just pass things that put our -- we have worked an awful long time to get the budget to where it is first in the country by our peers, we're not going to do anything that would jeopardize that moving forward.

Yepsen: There is language in that new federal stimulus legislation that says states can't cut taxes and use the stimulus money to backfill.

What is the work around here?

Grassley: Well, that's what is interesting about it is we've, at first everyone interpreted can't do anything.

Then we had a little guidance from the feds that maybe you could.

And then the guidance was, well we're not quite sure now.

So, tax policy is always the last thing that we work on between that and the budget.

So as we get towards the end of session if we can get some further clarity, but it's the federal government, we're not getting any clarity right now.

Yepsen: The politics of this ought to be simple.

What is wrong with waiting a year to do tax cuts in an election year?

Grassley: Well, the first thing I would say is there's a growing frustration, I don't think it's just in Iowa, that the federal government is going to say -- look at our state budget, the reserves are full, a $500 million projected ending balance, yet the federal government is saying we couldn't do anything to pass any sort of tax cuts because you may comingle the money.

I think as a state we have to make the decision, we're in a sound fiscal policy, we would not be cutting taxes because of the federal dollars.

So that is just a decision we're going to have to make as a legislature collectively.

Yepsen: But the triggers are already in place.

Those can stay.

Grassley: But the triggers may not hit just due to revenue growth.

That would be the one argument for eliminating the triggers.

Revenue growth may not hit to enact those.

Murphy: So there was an incident this past week at the State Penitentiary in Anamosa where two staff members were killed during an attack.

In the picture of the state budget, the Senate republicans have talked about sending $4 million, adding $4 million to the Department of Corrections budget to help them boost staff.

Is that something House republicans are talking about as well?

Grassley: I think before this very unfortunate incident I still think you have seen a strong level of support for public safety as well as the Department of Corrections.

I can't tell you what that amount would be.

But I fully expect there to be an increase.

We're kind of at the point in session where our budget sub-chairs are identifying where those priorities are.

That would have been a priority before this unfortunate incident.

But I assume that continues to be the case, yes.

Henderson: Governor Reynolds in January asked the legislature to appropriate $150 million in each of the next three years to dramatically expand broadband access.

Why haven't legislators acted on that earlier?

Why are you still sort of mulling about how much to spend?

Grassley: Well, the bottom line is as we're putting the budget together that's going to be a general -- where we're at right now in the House we're going to have a general fund appropriation that will make a significant investment in broadband.

And so that isn't as simple as just saying, well we're going to put $100 million into this, without having the entire budget conversation.

We've approached it from the standpoint of, and I think kind of where we're landing on it in the House right now is going to be around that $100 million number.

So that way we can look at that in the entirety of the state budget.

We plan on using general fund dollars.

And so it isn't as simple as just saying, here's the amount, don't worry about the rest of the budget.

Again, back to what I talked about earlier, we look at everything whether it's tax policy, these new appropriations, as a global picture.

Henderson: The other part of that proposal was that the Governor wanted it to be "the best", the highest speed.

Will that be the criteria for these grants to companies?

Grassley: Yeah, so there's two different -- it's the same conversation but two different conversations.

The one conversation around the money, the bill that is moving through the legislature right now is dealing with the policy, what you just asked there, Kay.

So I think we're going to be able to achieve the goal of doing two things.

When the bill came from the Governor, we agree, we want world class speed.

However, we also want to make sure that those areas where there's one house every four miles does it make sense for those local providers or the state to be investing the top dollar amount to just do that?

How can we do it in a different way?

So we've actually in our bill taken it instead of 100/100 taken it to 100 as far as the download speed and lowered the bottom number because some of these fixed wireless providers, I have one in fact it's just between our farm and where my grandfather grew up in between us is a fixed wireless tower where they're providing service to dozens of homes with one place where fiber has been run.

So there's a way that we think we can do this to get world class speed as well as a quick rollout and hit some of those areas that are hard to reach.

Murphy: Another of the Governor's priorities was her ethanol bill that would require ethanol, a higher blend of ethanol at every gas station.

That was moved through the first funnel but has been quiet since.

Has that one been put on the shelf for this session?

Grassley: So I think as of right now I think you're going to see some activity on the ways and means committee next week.

I think it's Wednesday potentially.

Now I've locked them in.

They're going to love that I did that for them.

But sometime next week we'd like to bring that bill up.

And so the question I've been getting is, why are we doing this?

It usually is a federal policy, that's where it gets all the news and from talking to the committee members and members of the caucus we have seen both parties at the federal level from the administrations regardless of party not always the best friend of ethanol.

And so what I've been advocating for, and I think members of our caucus, is that we need to stand up and send a message to the country that we're going to do what we have to do in the state of Iowa to also promote the product.

So the bill that you're going to see move forward at the end of the day is going to do everything it can to increase infrastructure because I think long-term to use more ethanol you're going to have to have the infrastructure in the state.

You're going to see more dollars going towards infrastructure as well as making sure that we can try to get to some level of a standard and send a message to the country that we aren't just going to tell the feds to always do it, we need to step up to the plate and do it here in Iowa.

Murphy: So, speaking of why are we doing this, how long should state and local governments -- I'm sorry, federal and state governments continue to subsidize the ethanol industry?

We talk about cars that get more fuel efficient and gasoline consumption in general will go down.

Grassley: So, in this bill you're really looking at more, for the tax credits, for example, those are retail tax credits and from the standpoint of infrastructure you're looking at if a local station wanted to get some level of a grant or whatever that is what I'd be more talking about.

As far as the direct subsidy, these are more through the retail side of the equation.

And I think, quite honestly, it's so important for us to promote ethanol in the state, I feel comfortable in us making, we're not making those complete investments, but being a partner in that to make sure we can continue to promote it.

Yepsen: Why do you think ethanol is such a great bet, aside from the fact you're an Iowa politician?

Why do you think ethanol is such a great bet when the whole arc of the country is moving toward electric cars?

Grassley: Well, I wouldn't know if that's the whole arc of the country.

I think there's some folks that would like to make us think that that's going to be an overnight solution to whatever problem is trying to be solved with it.

But I think that we can show here in Iowa you can utilize these fuel sources and be able to do it, still have cleaner burning fuel.

I don't think that there is going to be just an overnight -- I was asked this question, how in the heck do they expect us to farm, run our trucks, all of these things just off electricity?

Don't forget, that does take some level of -- electricity doesn't just appear out of thin air.

So it does take some level of fuel to get the electricity.

So I always tell everyone we have to continue to promote -- this is a clean burning fuel that is grown right here in Iowa and I think it's just a clear, it's a very simple choice for me.

Yepsen: Another issue that always comes up in the legislature, the bottle bill.

It's back again.

What's going to happen?

Grassley: Well, here's what I have found in 15 years of the bottle bill.

I will tell you the only thing that I do -- so you guys always want me to share something about my grandpa, the first, when I got elected the only issue he has ever weighed in on as a constituent of mine, not because he's my grandpa, he said don't get rid of the bottle bill.

So I can tell you as I'm Speaker I don't think I could ever allow that to happen.

So I can lay that to rest.

Yepsen: Do you still go out and pick up cans with your grandpa?

Grassley: I may or may not bring a bag of cans home every once in a while from Des Moines.

But what I'll say to the bottle bill -- here's what I'll say about the bottle bill.

Next week my plan is we have sat down since the beginning of session, some of our members, Representatives Kaufmann and Lundgren have been meeting with folks that we have been trying to bring to the table.

And to be quite honest with you, the reason nothing ever happens with the bottle bill, this year if it does the only reason would be because we have made an effort to force people to the table because every time you sit around a table like this it's a bunch of finger pointing.

So I think what is going to have to happen if anything is going to happen with the bottle bill, the legislature has to make a decision what is best for our constituents?

What is best for the long-term viability of the program?

And just go forward and the folks in the industry may not love that solution but at some point we're going to just have to do it.

Yepsen: What does that look like?

Grassley: Well, I think that obviously there is a situation where we want to get more dollars into the system from the standpoint of so that way we can have an increase for the redemption centers.

The approach that I kind of laid out earlier in session with the industry was they want to get them out of their stores.

I get that, with the health risk more and more stores are selling food as you walk out with it.

And I think that what I said is okay, let's find a way in which we can get them out of the stores.

And to get them out of the stores, if you choose to make that business decision it's probably going to cost you some money to pay someone else to take those cans because in the state one of the pieces that we struggle with is it's not enforced that everyone that sells the product has to take them back.

So I think requiring everyone to take them back and if you don't want to take them back you either have to contract with someone or pay an additional fee to get them out of your store.

I think that, like I said, at the end of the day whatever we're going to do I'm not sure that everyone in the industry is going to love it, but that's the reason why nothing has happened for it in probably before my lifetime.

Henderson: You are fond of saying that Iowa House republicans represent 97 of Iowa's 99 counties.

And you and other legislators have long talked about the lack of housing in rural Iowa.

So, show and tell time.

What have you done so far this session to resolve that issue?

Grassley: Well, the first thing, I appreciate you bringing that up.

I might have missed that one in my working on prepping here.

I was trying to get it in as many times as possible.

So I appreciate that, Kay.

But you're right, we represent 97 of 99 counties.

I've got to get that plug in again.

So a lot of that is through the tax policy so at this point the Governor submitted a bill to us earlier in session.

In fact, I just had two or three meetings this week with the ways and means folks to try to look at what some of these programs are going to look like and where we can provide those incentives.

I can tell you I think it needs to be a combination of two things.

New housing, but we also need to focus on where in some of the communities, you probably go to some of the communities around where you grew up and there's those houses that probably with very little investment could be utilized as housing stock.

So I think it's a combination of two things and I'd like to see us work down that.

But that will be all part of the global picture of the budget rolled in with the tax pieces because obviously more than likely it will take some level of an incentive to be a part of that program.

Yepsen: What about child care in rural Iowa?

Grassley: Child care in rural Iowa, we've passed I think we're closing in on 10 bills out of the House.

This is I think the second or third year in a row that we've passed those.

And you guys are prepping right off of the things, my talking points from the standpoint of, you're right, that's a perfect example of what the state needs to be tackling.

We have passed closing in on 10 bills now that would deal with infrastructure from the standpoint of facilities, making sure that we can get rid of the cliff effect so people can keep their benefits as they move into their career, doubling the child care tax credit from $45,000 worth of income to $90,000 worth of income.

All those bills continue to sit in the Senate.

I think they have acted on one of them.

And I can tell you that I feel very strongly that our caucus wants to see more action in the Senate on those child care bills.

Those are non-partisan and I think that they're what we're hearing from Iowans.

I don't do a forum or a Zoom call with any group that does not bring up the issue of child care.

Murphy: The House and Senate both have passed legislation that eliminates the requirement for a permit to carry a firearm.

Procedurally has that bill been sent to Governor Reynolds' desk yet?

Grassley: Yesterday, I just would have signed that yesterday before I went home.

So that then would now be signed and ready to go there.

And to that point, I don't know if you were going to ask a follow up with the bill specifically.

I know it has been talked about and the kind -- I know not everyone tunes into the debate on the floor.

But I think it's very important for us to remind you, before this bill is signed into law, currently you can get a permit for five years and in that five year period you don't have to have any sort of background check or anything.

But this making it optional I really believe will increase the amount of background checks that are going to happen because now if I walk in and I choose not to have the permit, every time I go in to a dealer, wherever that would be, I'm going to have to fill out that same background check.

So, I didn't know if you were going to ask about that, but I want to clarify that every time I talk about it because that's what we're hearing from the other side.

Murphy: What I did want to ask about -- and the reason I asked about whether you had sent it to the Governor -- was the timing of it.

Was there any discussion or concern about the timing of signing a bill like that given the recent -- Grassley: Quite honestly, the reason I hadn't had a chance to get to signing it yet was because what Kay was touching on before we got on is we had the late night of debate and we were trying to prepare for that and so it had nothing to do with trying to -- Murphy: Do you have any concern about optics of that?

Grassley: I guess there's -- every bill that we pass there's probably some level of optics but again, I would say that the bill that we passed I actually think strengthens the amount of background checks and from the standpoint of us passing this bill, every time we have done anything our caucus has been very pro-Second Amendment and we continue to always hear these same pushbacks and then I think that we've proven we can pass good legislation and make sure that these background checks are still happening and that the laws are still being followed.

Yepsen: Do you think the Governor will sign the bill?

Grassley: I'm not going to speak for the Governor, David.

I haven't even had a conversation since we passed it.

Yepsen: It's hard for me, Mr. Speaker, to believe that a republican legislature would send a bill like that to the Governor without getting some okay, some signoff from her that yeah, this is fine, send it on down.

Grassley: I think you would be surprised -- even though we're all a republican legislature I think we kind of know each -- I have an idea on Senator Whitver and the Senate caucus, I have an idea where the Governor stand on a lot of issues.

I'm not going to speak directly for that.

And we have general conversations but we don't ever sit down at a table and walk through every line of a bill together and make sure we're on the same page.

I think you see a lot of bills that come from the House to the Senate, we amend each other's bills and do a lot of work.

So I think philosophically we all know where we stand and so I feel comfortable in that.

Henderson: You mentioned child tax credits just moments ago, a bill that the House passed on Thursday would double the tuition and textbook tax credit.

A few years ago you were talking about a review of tax credits to reduce tax credits.

So what is going on?

Grassley: And you saw how successful I was in that endeavor, Kay.

I can tell you whenever you talk about tax credits and you try to do the review, I was the spearhead for that and I was, you saw how far I made it, I couldn't do any more than in my own committee.

And so from that standpoint if we're in a situation where there's not going to be a holistic review of tax credits, again it's just like the bottle bill, everyone in the industry comes to everyone else's defense, it's impossible to do anything.

So if we have to use the mechanisms we have before us I think we need to be willing to do it.

Henderson: House republicans have discussed and partially advanced bills that they say are intended to send a message to the state universities in Ames, Iowa City and Cedar Falls that you're unhappy with conservative students' free speech rights, one bill would deal with tenure.

Are those tabled?

Have you made your point?

Grassley: No, I think we've passed -- so we've passed some bills and there's other that are sitting, you touched on them, making sure that we have freedom of speech on our campuses.

And it's more than just that legislators are upset.

We don't just come up with these ideas off the top of our heads because we're upset, it's what we're hearing from our constituents.

And when it comes to the tenure bill, as far as I know we've gotten a lot of pushback on that as a whole, but I think we're to a point where either in session we need to have some level of tenure reform, continue those conversations.

So no, I don't think that that bill would be tabled.

And I think it's bigger than just the bills that we've passed.

It's also from the standpoint of finances with the Regents.

Over the last 10 years their administrative cost has grown 25% while their student enrollment has grown by 3%.

And so it's more than just the freedom of speech issues.

This is a problem that every time we try to take any action there is never any sort of action taken by the Regents.

Yepsen: Too many questions, not enough time.

Erin?

Murphy: We wanted to ask you, Speaker, have you received your COVID-19 vaccination yet?

Grassley: Well, no I haven't.

I shouldn't even answer the question as far as a personal standpoint.

But no I have not.

Murphy: Do you plan to?

Grassley: I have chosen not to at this point.

Yepsen: Are you going to take it?

Grassley: At some point, I'm assuming it will get to the point where we'll all be required to do it if we want to do any sort of traveling.

Yepsen: Well, the reason I ask is that we're seeing 40% of people aren't, there's a partisan breakdown on who takes the shot and who doesn't.

And some republican leaders are worried that they're coming off as being so anti-vaccine that it could hurt the effort.

Grassley: I don't -- my personal choice as far as what I do has nothing to do with a political stance or anything like that.

So I think anyone that is eligible, when the eligibility comes, should be in line to do that.

I just have chosen not to.

Yepsen: Mr. Speaker, I want to ask you about, talk about optics and sending signals.

You guys in the legislature have spent years trying to make this state more attractive for economic growth and development.

And yet the sum total of these bills on transgrander issues, tenure that Kay mentioned, attacking big tech, that is counterproductive according to people in the economic development world.

What are you saying here to people that say you're turning off people to Iowa?

Grassley: Here's what I would directly say to any of those people in the economic development world that wants to make those claims.

It seems to be the first party that they run to, to fix any of their problems, whether it's regulatory or it's tax policy as a republican caucus and we have done a lot of things to be supportive of growth here within the state.

So any of those groups -- after some of these articles have been coming out I have been having conversations with these groups and that is not the message that I'm being told.

So it's one of two things, they're either just saying one thing and doing another.

But again, the first party they always run to, to try to reduce regulation and the tax burden, it's always the republican caucus, it's never the democrats.

Henderson: We've got about a minute left.

Real quickly, will you sue the U.S. Census Bureau to get the data so that you can redistrict, redraw the map for Iowa legislative districts?

Grassley: I think as this process unfolds, we've seen a little bit of action in the last couple of weeks from the Census Bureau.

So the answer to that question, I'm not going to say yes or no, I'm going to say all options need to stay on the table.

We have the best system in the entire country and we need to make sure that we maintain it that way.

It's non-partisan.

So I would say at this point in time every option needs to be on the table.

I would hope that we could find other solutions though.

Yepsen: Mr. Speaker, is your grandfather going to run for re-election?

Grassley: Well, I can tell you that he doesn't show any signs of slowing down everything that I'm seeing.

Yepsen: And if he does not run for re-election, will you run for the seat?

Grassley: That's a very simple answer.

This is the only question that I prep for every day before I come in here.

But I can tell you right now I see now reason on why he wouldn't run for re-election and nothing has changed from that standpoint for him.

Yepsen: One thing that hasn't changed for me is the clock and we're out of time.

Grassley: Thank you.

Yepsen: Thank you for being with us today.

Grassley: Yep, thanks.

Yepsen: And we'll be back next week with another edition of Iowa Press at our regular times, 7:30 Friday night and Noon on Sunday.

For all of us here at Iowa PBS, I'm David Yepsen.

Thanks for joining us today.

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