Trickle-down pain. With Iowa’s legislators adjourning the 2010 session after crafting next year's state budget, passing revenue shortages to school districts, counties, and cities to solve. Perspective from mayors of Iowa’s two largest cities, Des Moines' Frank Cownie and Cedar Rapids' Ron Corbett on this edition of Iowa Press.
Borg: The painfully slow recovery from economic recession is hitting government where it hurts the most, right in the tax revenue. Amid stimulus spending and job incentive legislation are painful realities, and that's keeping essential government services solvent until business recovers, hires workers, and tax revenues are flowing to pay for those services. For some, expenses and recovery from natural disasters, storms and floods, are adding to those expenses. And that's especially true in Cedar Rapids where, in January, Ron Corbett took over as mayor of a community that's only now demolishing flood damaged houses. He’s a former state legislator, serving as the youngest ever speaker of the House of Representatives in Iowa. Frank Cownie, now in his second term as Des Moines mayor is a seasoned political operative and civic activists in Iowa’s capital city. Gentlemen, welcome to Iowa Press.
Corbett: Thank you.
Cownie: Thank you.
Borg: And across the Iowa Press table, Mike Glover, who is a senior legislative and political writer with the Associated Press and Kay Henderson, News Director with Radio Iowa.
Glover: Mayor Cownie, let's start with you. Dean mentioned the legislature and we'll get to that in just a minute. But I’d like you to step back and look at the big picture, if I could, for a second. What’s the biggest problem you face as mayor of the state's largest city?
Cownie: The biggest problem that we face? You know, I think all cities always worry about revenues, and we also worry about expenses. And one of the issues that we have ongoing is sort of a structural deficit that occurs because of our increase in revenues fall short of our increase in expenses. So we have to find ways to always -- to work on that. And of course, this year we did it not only for this year but we did it for a 24-month budget. So we're pretty good for the next two years.
Glover: Mayor Corbett, same question to you. You’re a new mayor. But what's your take on the biggest problem in Cedar Rapids?
Corbett: Our biggest problem right now is just having the resources from flood recovery standpoint. We’re going to be taking probably 1200 to 1300 homes off the tax rolls as we demolish those homes. We’ve also lost a lot of businesses to the flood and to the economy, so having the resources to rebuild our town. And then probably just a close second is job creation. Cedar Rapids, Linn County, the corridor has always been a leader for job creation. And unfortunately, you know, embarrassing enough to say, that we lead the state now with the highest unemployment rate of all the urban areas. And that concerns me as mayor, and it has to be one of my top priorities.
Glover: And you're former speaker of the house. The legislature just adjourned. How did they do in terms urban issues? Did they help you out as much as you need?
Corbett: Well, no, they never do. I don't think the -- every year I think the legislature has its limited resources and they try to do the best job that they can. When it comes to helping the urban folks out, we wanted an option for a hotel/motel tax to help us fund a new convention center. They didn't pass that this year. Hopefully we'll have a chance for that. So although I’m disappointed in that, but they did put some more money in the I-jobs account and they did earmark some specific money for Cedar Rapids from flood recovery. So although we didn't get everything we wanted, we did get some pieces that help us in our venture to recover.
Glover: Mayor Cownie, how did the legislature do as far as the city of Des Moines is concerned? Did they give you what you need? You mentioned the resources are your problem. Did you get enough from them?
Cownie: Well, keep in mind we've got two separate issues. I mean we certainly have capital expenditures, and some of the things that Mayor Corbett mentioned Des Moines has faced. We’ve had two 500-year floods in the last 17 years, in '93 and 2008. And we're worried -- on the verge of yet another one this year. Of course, we're so early in. We usually look at that May, June, July, and here we were in March stepping up to try to figure out what we can do. So the legislature treated, I think, Des Moines well. But on the other hand, as Mayor Corbett said, you never get everything that you want, and certainly we think that there's lots of things that need to be addressed in the city of Des Moines, whether it's sewer issues. We have a DNR EPA agreement that we're working on that's over a $200-million project that we're working on and --
Borg: What -- what did you want that you didn't get? The hotel/motel tax Cedar Rapids didn't get. What didn't you get in Des Moines?
Cownie: Well, certainly a hotel/motel tax, an increase in that would help the city of Des Moines as well. If we had options for other sources of revenue in the city of Des Moines -- certainly we're like most cities in the state of Iowa, kind of wedded to property taxes. The city of Des Moines, for instance, we've been unsuccessful in getting a one-cent sales tax, but there's certainly -- I think those are some of the things that we need to address long term is what are those revenue sources and revenue lines that are most fair to the taxpayer as opposed to putting all the burden on the backs of the property tax owners.
Henderson: Mayor Corbett, when you were in the legislature, you were an advocate of a statewide property tax freeze. Now that you are a mayor, has your perspective changed on what policy should be regarding property taxes?
Corbett: No, actually we did this year not increase our levy. We felt that where we were with the economy and what businesses were still struggling through, we made it a conscious effort to go line by line, look at our budget, look at where we're spending our money, and we froze property taxes. Now, we ended up dipping into our reserve fund this year to do that. Now, long term that isn't a good budgeting strategy, but historically Cedar Rapids has had that triple A bond rating, and to get that bond rating, you have a healthy reserve fund. So we decided to bridge our revenue gap this year using our reserve fund, but we really did want to send a signal to the businesses in the community that, hey, we know you're struggling so we're going to hold the line on property taxes this year.
Henderson: Mr. Cownie, how have you as a city council in Des Moines addressed the property tax issue? It’s one of the bugaboos for voters that their property tax bills continue to rise.
Cownie: In the city of Des Moines, we have not raised our levy. As a matter of fact, I think our levy today is less than it was when I took office. So we've been pretty dedicated, the city council and our staff at the direction of the city council and the mayor, to hold the line on property taxes because we need to support business, support residents, and continue to make Des Moines a great place to live. So we try to stick to that. Now, how do we do it? Over the last four, five years, we essentially have made long-term savings in our budget by cuts in various areas, but not across-the-board cuts, very strategic cuts, that covers about $24 million of ongoing savings. So we have been very diligent in looking at every possible opportunities at ways to deliver better services at a better value for our taxpayer.
Henderson: If I could get both of you to offer your views on how to change the state's tax system. Critics say there's an overreliance on property taxes. Mayor Corbett, as a former legislator, how would you advise legislators to revamp the entire system, to give counties and cities and the state the revenue and give some relief to property owners?
Corbett: Well, it's certainly things that has to be a partnership, a shared arrangement. It can't be a hundred percent revenue stream for the cities and then one revenue stream for the state. Let me just give you an example maybe from a job creation standpoint. Everybody wants job creation, so when it comes to creating a new job, one hundred percent of the income taxes go to the state. But yet requirement from a local standpoint, the local government has to come up with some matches. So I would look at sharing revenue, so as the city benefits, so does the state. When the state benefits, so does the city. so those would be areas that you would look at to start with is where can you share revenue verses just say cities gets this, state gets this.
Henderson: Mayor Cownie, what is your view on revamping the entire system of tax collection in Iowa?
Cownie: Well, certainly I’d go back to my earlier statement about diversification of revenue. I think that we have to look at other sources and not put the sole burden of local government on the backs of property tax owners. We have to look at how that can happen. But I think in addition to that, in looking at some of the suggestions that Mayor Corbett had, we have to look at ways that we can share some of the services and regionalize them. Now, we have good examples of how we did that in Des Moines with waste water treatment, with Metro Waste, with DART, our Des Moines Area Regional Transit and bus system. But I think there's other opportunities, whether it's parks or whether it's a variety of other things, including IT and human resources, that we can regionalize and begin to either with our taxpayer base, which would be essentially the Des Moines Public Schools and Polk County, find ways that we can all work together. We’ve been very successful in Polk County, and we're reaching out to our --
Glover: Mayor Corbett, I’d like get you to -- you mentioned the flooding and the damage that the city of Cedar Rapids has suffered. Everybody is aware of that. Mayor Cownie mentioned the flood of '93 and the flood of 2008. What are you doing in Cedar Rapids for flood prevention, to prevent this from happening again beyond building levees a little higher? I’m talking about development in flood areas.
Corbett: Well, one, we're trying to remove 1,200 homes, Mike, out of the really -- of the flood -- the major area where it was flooded. Remove people out of harm's way. Obviously it's a two-prong approach. It’s watershed management that goes well beyond the city of Cedar Rapids, so we need to be a partner in that. But upstream all the players need to come to the table. that is really primary, the number one thing to try to prevent floods, because even if we're successful at getting financial help from the federal government, the Corps of Engineers, the state and putting local, flood protection systems aren't a hundred percent foolproof. So we know that the Coralville reservoir has failed the last couple of years. So it's a two-prong approach: try to get as much of the property out of harm's way, try to put a reasonable protection system in place locally, but then work at the watershed upstream.
Glover: Mayor Cownie, I recall during the flood of 1993 interviewing a home owner over on the Mississippi river who is rebuilding for about the fifth time. I said, "Why don't you move?" He said, "Why should I? They’ll just pay to rebuild my house." At what point do you tell people who live in the floodplains you're on your own, if you get flooded it's yours?
Cownie: Good question. In the city of Des Moines like on four-mile creek where there is very little protection, we put a moratorium on building and have been in the process of buying out certain homes that are in perpetual harm's way, so it seems. So I think that you have to look at that because you don't want to have that happen. It’s not government's responsibility to keep buying people out on natural disasters. But as Mayor Corbett said, I look at the statistics having spent so many years on planning and zoning and looking at the Four-Mile Creek area and everywhere else. And then you look at the history and the statistics in the state of Iowa and you realize that pre-settlement times, 85 percent of the water that fell on a site across this state was absorbed there. Now that number, as I understand it, is around the 15-percent area. There is the issue that --
Glover: And Mayor Corbett, you mentioned that it's bigger than a Cedar Rapids problem, that talk about a water shed. Does the state need to act on this? I mean they've been unable to find the political will at the statehouse to put some kind of a statewide moratorium on building. Is that what's needed?
Corbett: Well, I don't know that's it's necessarily a moratorium on building. Remember now, mike, there are people that are rebuilding in the flood area but they're not getting any financial assistance from the state. None of your state income tax dollar or your federal income tax dollar is going into that. It’s going in to help buy those properties out to remove them out of the floodplain. People that are rebuilding in the floodplain from a home owner standpoint are redoing -- are doing that on their own nickel. It isn't doing it on the taxpayer. So I want to make sure that there's a clarification. It isn't just restricting where you're building. It’s controlling the watershed. So this involves more than Cedar Rapids. It involves the farm community. And obviously, when you have different players like that, it isn't going to happen overnight. But, yeah, the state needs to be more aggressive in convening watershed management ideas and not just restricting cities on where they can or cannot build. That doesn't solve the problem.
Borg: Mayor Corbett, I was just looking at Cedar Rapids. Cedar Rapids has been hit hard economically. You just said one of the highest unemployment rates in the state. Dubuque has the highest. You have the second highest in the last couple of months. How long before Cedar Rapids can get back on its feet again, because realistically right now it's hurting.
Corbett: Sure. Realistically I think in the next probably three to five years to where we can get to a level where we were the job creation hub of eastern Iowa. And it's imperative that the state help us. Most of the counties in the state of Iowa receive net dollars from the state. We’re a county that contributes more resources than we give. We have to be that economic engine. So in this short-term period, this next -- well, it's been one or two years. In the next three to four, we're going to continue to need help from the state to rebuild. Some of our largest employers have stopped lying off, so we've seen probably a low point there between Rockwell and AEGON, and hopefully we see them start to increase from a job standpoint. We have a lot of construction that's going on now. We have two new projects, a big federal courthouse and a human service campus. So I think we're going to start seeing the construction effort come forward, and that should help on our unemployment rate.
Glover: Mayor Cownie, I want to give you a chance to anger a whole bunch of your colleagues. In the greater Des Moines area, I haven't counted the number of municipalities that there are, but there are a whole bunch of them. Why do we have so many municipalities? People complain about layers of government. Why don't we have a metropolitan government here?
Cownie: Well, I think that there's a lot of people that look at their autonomy, their community, or their suburb or their other governmental entity. Now keep in mind that in this region, not only are we talking about 15, 16 cities, we're talking about counties, we're talking about townships, we're talking about school districts. And quite frankly, to I think add more fuel to your question, there's 64 of them, I think, that we looked at. Now, there's got to be ways to hopefully combine school districts, combine services, as I mentioned earlier. We’ve gone to the voters a few times over consolidation efforts, and it appears as though they don't feel that's appropriate, keeping in mind that at the turn of the 20th century that the legislature just said, hey, there's too much government, you just all need to be one, and you've got a year or something to figure it out. I don't see that happening. But I do think that we have to be very forceful in our communication with our friends and neighbors in the suburbs and consolidate services and be able to lower the cost of --
Glover: Mayor Corbett, the same question to you. As a legislator you were a small-government republican. You now preside over a whole maze of government in the Cedar Rapids area. Isn’t there too much government there?
Corbett: Well, I think the key is how you're delivering services to the people. So you may have government entities, which is a city council, variety of city councils, but when it comes to our landfill and our solid waste, that's a regional service delivery. All the different governments have a seat at the table, and that runs independent --
Glover: Why isn't there more than that?
Corbett: Why isn't there more of that? I think maybe leadership. We’re looking at other issues. They’re going to be boring to most people, but animal control. Can we regionalize our animal control system, because Hiawatha subcontracts with Linn County and all of that? Those are some issues that we're certainly looking at.
Glover: If it's my property tax dollars, I’m not likely to find it boring, Speaker Corbett.
Henderson: Let's talk about voter attitudes. Mayor Cownie mentioned voter attitudes in the Des Moines area. Mayor Corbett, do you think voters are ready for consolidation?
Corbett: Well, I don't know that they're ready to consolidate one community's government entity with another, but I certainly think they're all in favor of sharing and more arrangements between governments sharing and regional approach to delivering services. So, yes, I think there is a mood from the voters to move forward with that. But when it says you're going to combine the city of Hiawatha and the city of Cedar Rapids, they're probably not in favor of that because they like their own little entity there. But services is what costs them money. It isn't the elected officials. Most of the elected officials are part time and don't have any. So it's the services that you need to look at.
Glover: Mayor Cownie, it wouldn't be an official Iowa Press show if we didn't talk a little bit about politics. You both ran not on a partisan label, but I’d like you to take back -- you're a democrat. Give me an assessment of the health of the Democratic Party in this state.
Cownie: I think politics in general are alive and well. I, quite frankly, as sort of a nonpartisan person who is registered as a democrat, I’d -- and I guess I’m going to frame it. I’d like to see both parties work together because we at the local level are elected by constituents and they have certain expectations whether democrats or republicans or no parties which seem to outnumber everybody else. I think that we have to realize that when we step up as we do at every city council meeting, and I think the legislature needs to as well. And they have to find ways to reach across party lines in as many ways as possible and say what's best for the citizens of the state of Iowa. And I think that's what we have to focus on rather than partisanship.
Glover: Right. Speaker Corbett, you’re a republican. What’s the health of the Republican Party? You’ve lost the legislature. You’ve lost the governor's office?
Corbett: I’m not that close to the party structure like I used to be, Mike, to be able to say what the health is. I mean really I’ve taken this approach as mayor to be a nonpartisan mayor. You need to have friends on both sides of the aisle representing everyone in Cedar Rapids. And so during my course of my campaign I said I wasn't going to endorse in primaries or even general elections and I was going to stay out of the partisan aspect of stuff. We need partnerships in both parties at all levels of state government, and it's incumbent on me to have as many friends as I possibly can get.
Henderson: Mayor Corbett, you surprised some of your former republican colleagues by pushing through a proposal that would pay the prevailing wage in your county to people who are working on public projects in Cedar Rapids. Why did you make that move?
Corbett: Because we needed to. We had the highest unemployment rate in the community. Labor is an important part of Cedar Rapids history. Most of these neighborhoods were flooded, were neighbors that come from middle or lower income, and these folks need to get back to work. All they want to do is get up in the morning, make a good living, and take care of their families. And I have to look at the entire town of Cedar Rapids. I don't have the shackles of a partisan label on me. I’m a nonpartisan guy trying to take care of our town.
Henderson: Mayor Cownie, you endorsed Barack Obama right before the Iowa caucuses in 2008. You were hanging out with mitt Romney this past week. What are your political aspirations for the future?
Cownie: I want -- I want to see a great city of Des Moines --
Henderson: So you want to be mayor for the rest of your life?
Cownie: I don't know that I want to be mayor the rest of my life, but I certainly want to -- as long as we're effective and we're able to reach across those party lines and work with a Mitt Romney and a Barack Obama and all the other myriad of politicians that seem to come here over either on a national level or a state level -- I think, as Mayor Corbett said, we've got to -- at the local level of government, we have to have as many friends as possible on both sides of the aisle because the needs of our citizens are not partisan.
Glover: Mayor Corbett, I know that you're not as active in the Republican Party as you once used to be, but I suspect you're probably aware that there's a republican gubernatorial primary going on as we speak. Is it inevitable that a four-term former governor, Terry Branstad, will win that primary?
Corbett: Well, again, I’m not as close to it, as you said. But it appears that the polling would indicate that he would come out of this republican primary in the lead. So it's probably looking good for him and his team at this time.
Glover: Mayor Cownie, you, as Kay mentioned, endorsed president Obama. He’s been in office a little over a year now. How’s he doing?
Cownie: Well, I don't agree with everything that the president has moved on, but I certainly am amazed by the effort that this administration has taken in so many different aspects to try to tackle everything from the environment to health care, to jobs, just to begin a few, is amazing. They are absolutely at work on all fronts, and I’d love to sit in there and hope that we can bring both sides of the aisle together, again, in a nonpartisan kind of way, to make America better for all Americans --
Glover: Some are worried he's trying to do too much. Do you share that?
Cownie: Sometimes it appears it but there's so much to do. I mean he inherited a mess unlike anything that had preceded him. And so, you know -- and on the verge of another great depression. So I think that it took a lot of effort, and I think we're lucky. At least we had an individual that was willing to attack it all.
Borg: Last question, Kay.
Henderson: About thirty seconds left. Mayor Corbett, what are the prospects for flooding, and how would that impact the psyche of Cedar Rapids if it happens?
Corbett: If we have another major flood like that, it would kill the psychology and the whole reinvestment. I mean we have a window of opportunity to try and get this flood protection system, to give people that sense of security, a sense that they can move back and they can invest. So that's what we're going to try to push hard for a flood protection system and working with the Army Corps of Engineers to get it done.
Borg: Gentlemen, we're out of time. Thanks so much for being with us today.
Cownie: You bet.
Borg: On our next edition of Iowa Press, we're talking with former Iowa Governor Terry Branstad. It’s the first of three consecutive programs where we'll be questioning the candidates seeking to run against incumbent democrat Chet Culver. We’ll be discussing the issues driving Branstad's encore campaign and the republican primary election on Tuesday, June 8. You’ll see that conversation with former Governor Branstad at the usual Iowa Press times, 7:30 Friday night and 11:30 Sunday morning. And we close with this program reminder too. On Wednesday of this coming week, along the same topic, that's April 7th, KTIV television station in Sioux City will be airing a live debate between the three republican candidates for the GOP nomination for governor, Terry Branstad, Rod Roberts, and Bob Vander Plaats. They’ll be meeting to discuss the issues in the primary and general election campaigns. Now each, as we say, is seeking to run against incumbent Chet Culver in the fall. Iowa Public Television will rebroadcast that debate at 8:00 Thursday night, April 8. It’s promised to be a lively session. I hope you'll watch. I’m Dean Borg. Thanks for joining us today.