Reshaping Iowa. Governor Terry Branstad envisioning improving schools, stimulating business and balancing budgets. A conversation with republican Governor Terry Branstad on this edition of Iowa Press.
Borg: Terry Branstad knows the Iowa statehouse -- first coming to the legislature in 1973 as a Winnebago County Representative. Six years later he was Lieutenant Governor. Four years after that moving into the Governor's office -- at that time the youngest governor in the nation. And after governing for 16 years he took twelve years off in the private sector, part of that time as president of Des Moines University but moving back a little over a year ago as Iowa's Chief Executive again. So looking at it another way, Terry Branstad has been governing Iowa for 17 of the last 29 years. So, not only does he know his way around the statehouse, all of state government is familiar territory. Governor, welcome back to Iowa Press. This is familiar territory too.
Governor Branstad: Thank you, Dean. Well, it is. I've been on Iowa Press a few times and it's always fun to do this and, you know, I'm enjoying the opportunity to serve the people of Iowa again. Kim Reynolds, the Lieutenant Governor, and I are really working as a team and we made great progress last year getting the state's financial house in order and this year we're really focusing on education and our jobs agenda.
Borg: We're going to ask you about that. We'll be asking. Across the table though, the people who will help in asking those questions, Associated Press Senior Political Writer Mike Glover and Radio Iowa News Director Kay Henderson.
Glover: Governor, it wouldn't be an official Iowa Press show if we didn't talk a little bit about politics. In this past week Matt Strawn, the chairman of the Republican Party resigned despite what a lot of people say was a pretty successful tenure. What went on there? And what role did you have in it?
Governor Branstad: Well, first of all, I really had no role in that except I was very supportive of Matt. I thought he did a good job as state chairman. When he came in as state chairman the party was in debt. He is leaving the state with a, the party in a good financial position. During the time that he was chairman of the party republican registration grew and democratic registration shrunk. He helped us win the governorship, the secretary of state's office and also gained control of the House of Representatives with 60 republicans out of 100 in the House and six seats in the Senate. So, I think his tenure of three years as state chairman will go down as one of the most successful.
Glover: Then what happened?
Governor Branstad: I think maybe he just got tired of it. It's a very demanding job and he just went through the rigors of the Iowa caucuses and obviously we had the biggest turnout in republican caucus history and the closest election. And I think after all of that -- and I think he had indicated before that it was a limited amount of time that he was willing to serve -- I appreciate the time and the commitment that he made and it was a personal decision that he made.
Glover: Then who do you have as a favorite for his replacement?
Governor Branstad: Well, I think the vice chairman ...
Glover: Bill Schickel.
Governor Branstad: ... Bill Schickel from Mason City. He has served on the central committee and he is now the vice chair. He also served in the legislature, was the Mayor of Mason City. He's a good guy. I'd certainly like to see him at least in an interim basis serve as state chairman and then there will be an election this spring of new members of the central committee and obviously the central committee chooses the state chairman. But I think Bill Schickel would be a good choice and certainly keep continuity.
Glover: Through the spring. Not just a temporary choice, through the spring until the new committee is elected and ...
Governor Branstad: Right, right.
Henderson: Last I checked 2012 was an election year. Isn't this bad timing to have the Iowa Republican Party without a leader?
Governor Branstad: Well, I don't think we're without a leader because Bill Schickel I think is in a position to step right in and certainly I appreciate the work that Matt Strawn did. But it's not easy to be state chairman of any political party and Matt did it during a challenging time and a time when we had great success and I'm very appreciative of all of the support and help that he gave me and how hard he worked to preserve our first-in-the-nation caucuses and keep them in 2012.
Henderson: Speaking of, what changes would you like to see in the caucus tabulation process?
Governor Branstad: Well, I think some of the local party officials have suggested that the form E be in triplicate -- we had I think eight precincts where they lost the documents to verify the outcome and so we don't want that to happen again. But when you have 1774 precincts and you have volunteers doing this it's not surprising you'd have some honest mistakes made. But I think for the most part they did a really good job and I think we can learn, however, from the mistakes that were made and hopefully avoid that by having this in triplicate and also additional training. And I know that they increased the training dramatically this time but we need to do even more.
Glover: And what is the damage to the caucuses? I mean, look at the way we look around the country. On caucus night we declared Mitt Romney the winner, a couple of weeks later we say we really don't know who won and then a little bit later we say Rick Santorum won. A lot of people are making fun of the Iowa caucuses. What is the damage of this?
Governor Branstad: Well, any time you have a close election you're going to have things like that. Even in a primary election sometimes you have -- I think caucus night it was eight votes and then finally they determined Santorum won by 34 votes. But when you have, you know, of 221,000 votes cast less than a 100 vote difference it's not surprising that you'd have that. But that is just kind of the nature of it. I think one point to make, however, is we've never said that Iowa necessarily always chooses the winner. We do winnow the field and there's still four candidates left and they are the people that came in one, two, three and four in Iowa. So, I think it does show Iowa did perform its function of winnowing the field and many of the others have now dropped out and it is down to the four that came in in the top four positions in Iowa.
Borg: Let's go back to the appointment of a new party chair. You have a major role in that if not the role in picking that party chair.
Governor Branstad: Well, the Governor -- hopefully the party's central committee will listen to the wishes of the Governor and the legislative leadership but it is really the central committee that makes that decision and I respect that. But I want to work with them and I believe that with Bill Schickel we've got an experienced vice chairman who is ready to step in and that is certainly my recommendation.
Borg: But within the party there are deep divisions within the Republican Party of Iowa. That's no secret. Matt Strawn tried to bridge those and did it very diplomatically.
Governor Branstad: I think he did a great job.
Borg: That is the kind of a person you're going to have to have back in there again. So, will you do some influencing on that?
Governor Branstad: Well, as I said, I respect the fact ...
Borg: What kind of a person do you want?
Governor Branstad: Well, I think Bill Schickel is the kind of person that we want. He is somebody that treats everybody with respect and dignity. He is somebody that served in the legislature. He served on the state's central committee. He has also served in local government as the Mayor of Mason City. So, I think he is an ideal person for that kind of position.
Borg: He can bridge those factions?
Governor Branstad: I think so. And I think he has done that in the past and he worked very well with Matt Strawn. I think he would be ideal.
Glover: Governor, Kay mentioned this is an election year and as you look around the map in this election year it strikes me that one of the most hotly contested contests on the ballot will be the fight to see who controls the Iowa Senate. Republicans have a big lead in the House, democrats have a very narrow lead in the Senate. Can you get the Senate? And what role do you want to play in helping republicans take the Senate?
Governor Branstad: I think we've got an outstanding opportunity to gain control of the Senate. There is a number of open seats. Up in my home territory, for instance, Jim Black who served in the Senate for a short period of time, is running in an open seat and that includes Winnebago County in that, Kossuth County, Emmet County, Hancock County. It's an area that I think we can win. There's many others like that around the state. There's one over in eastern Iowa where Andrew Naeve lost by 70 votes last time. Under reapportionment the part that he lost was Jackson County. He's not even in the district. He's got Clinton County, northern Scott County and there's several -- I could go around the state of Iowa and identify several other seats I think we could pick up. The key is quality candidates, people that will work hard and I believe that we're going to have that and Jerry Behn is the new party leader. He and I are friends. We are neighbors from Boone County and I think that -- I'm working with him and helping him recruit candidates and I'm going to do -- the Lieutenant Governor and I are both going to campaign aggressively for those candidates.
Glover: And there are those who suggest you ought to hold off on some of your big initiatives. I'm thinking property tax overhaul, reforming Iowa schools. Because next year you're likely to have a republican Senate.
Governor Branstad: Well, I don't think we should hold off. I think we should move forward and accomplish as much as we can this year. My approach is always get as much done as you can and you never know what the future is going to be. But we have a very focused agenda this year. Basically we have an action plan for jobs and we have education reform. And we've been working and building to try to get a broad-based consensus on those issues over the summer and fall and we're ready to go. We think those things can be accomplished this year and there's more obviously we want to do next year too.
Henderson: The premier race in 2012 is the presidential race. Is it harder for a republican candidate to win Iowa, which is always a battleground state, if the economy continues to show signs of improvement as it has this past week reflecting improved unemployment numbers?
Governor Branstad: Well, I'm proud of the fact that we have made progress in Iowa, particularly focusing on reducing the tax and regulatory burdens. A lot of other governors have been doing that. But the federal government is in a mess. Under Obama we have this health care plan that is unaffordable and non-sustainable ...
Henderson: So, why is the economy getting better?
Governor Branstad: The economy is getting better but not nearly as fast as it did after previous recessions and I think part of the reason for that is this massive debt that has been imposed on us and the fact that the President keeps threatening the very people we need to invest and create jobs in this country. I as Governor am doing all I can to try to reduce the tax and regulatory burden and attract more business and jobs. We're going to keep working on that. I'm proud of the progress we're making.
Borg: I find, you just criticized President Obama but you're going to have a joint appearance with Michelle Obama pretty soon. A little bipartisan campaigning there?
Governor Branstad: Well, it's not a campaign. This is all about ...
Borg: Everything is campaigning in an election year.
Governor Branstad: I suppose you could say that. I went to see the President when he came to Cedar Rapids because the President of the United States is the President of all of the people and I just felt as Governor if he comes to my state, invites me to be there and meet him I should go. Michelle Obama is coming here to focus on health issues and we want to be the healthiest state in the nation. She chose Iowa because of my initiative with the private sector working with the goal of being the healthiest state in the nation. So, we share the goal of a healthier nation and people taking ownership for their own health.
Glover: Let's go back to the legislature if we could for a second. You have proposed that we reduce commercial property taxes. Democrats who run the Senate are very interested in increasing the earned income tax credit which would be a tax break for low-income workers. Is there a deal there?
Governor Branstad: I think there's possibility of working something out there. I think that it is critically important that we address the commercial property tax. It's been a problem for 30 years. Two previous governors and I don't know how many general assemblies have failed to address it. We worked all summer, we have revised our plan. It is not an eight-year plan. It treats new and existing the same. We have a trigger protecting local governments so their revenue is going to continue to go up and we have a trigger to say if there's ever a year where it wouldn't then we would delay this. So, we think we've got a good plan there. I'm willing to consider the earned income tax credit as part of an overall comprehensive tax reform package. We also need to limit agricultural and residential property because of the dramatic increase in commodity prices over the last five years. We're going to see massive increase, $2.3 billion increase in property taxes primarily on ag and residential if we don't take action. And I recommend that we reduce the amount of growth there from 4% to 2%.
Glover: And what are you hearing from legislators about that potential? Are you -- do they seem open to it?
Governor Branstad: Yes. I think there's a lot more openness to it this year. Everybody says that this is something that needs to be done this year. We still have a long ways to go. It's complicated and there's a lot of learning and educating to do. For instance, we need to educate people that a lot of times it is the small business tenants that are paying these property taxes because the way commercial property is leased it is under a net-net lease and so the tenant actually has to pay the property tax for their footprint. That's why I had Ying Sa at the State of the State Address because she is a small business entrepreneur who works with, as a CPA with a lot of other small businesses and knows how critical reducing the commercial property tax burden is to growing small businesses in our state.
Henderson: Let's throw another tax into this mix. The gas tax. You told city and county officials recently that if they work with you on reducing commercial property taxes, you would work with them on raising the gas tax.
Governor Branstad: Well, here's what I've said. First of all, you've got to remember, I appointed the transportation 2020 task force to look at what the needs are for cities, counties and the state in terms of motor fuel user fees. And I think you've got to look at beyond just gas and diesel fuel because you've got to look at those vehicles that don't use gas and diesel fuel so that all users pay their fair share. But what I said is we don't need to and shouldn't this year with the financial problems that many people are having raise the tax. However, in future years I'm open to considering that provided that we show that we are doing all we can to reduce administrative costs and duplication in transportation. Paul Trombino is already ...
Henderson: He is the director of your Department of Transportation.
Governor Branstad: Right, he is the director and he has already identified $50 million worth of savings. They did a great job of repairing the roads and bridges damaged by the flooding in western Iowa. And he has been able to move forward I think it's $128 million in additional funding for roads this year. So, we don't have a problem this year. It is in subsequent years.
Henderson: But is there going to be some massive tax proposal that would raise the gas tax in January of next year, reduce commercial property taxes and deal with this tax cut, the earned income tax credit for low-income Iowans? Is there going to be some sort of massive tax deal coming together?
Governor Branstad: I don't know about that. I guess ...
Henderson: Wouldn't that improve prospects of all three of those things happening?
Governor Branstad: Well, we'll have to see. And obviously I have to work with both the House, which is controlled by republicans, the Senate controlled by democrats. We also want to work with the minority members of the House and Senate as well. I think it's going to have to be bipartisan to get these things accomplished and we want to work with everybody. I want to see us accomplish as much as we can this session and I'm certainly open to trying to find a way that we can make this a win-win situation. Mainly I want it to be a win for Iowa taxpayers by reducing the tax burden and making Iowa more attractive for growth in jobs and businesses.
Glover: Legislators seem a bit receptive to your proposal to overhaul the state's education system. A lot of them seem to like a lot of it. But there are a couple of sticking points that I hear a lot about. One is ending social promotion for third graders who can't demonstrate the ability to read. And the other is requiring all 11th graders to take an ACT test. There seems to be some pushback on those two things. How do you overcome it?
Governor Branstad: Well, first of all, let's take the ACT test. Des Moines Schools are already doing that and Nancy Sebring is saying really good things about what that has done for Des Moines and how they had kids that hadn't thought that they could go on to college now see because they have taken that ACT test they do have the ability to do that. So, I'd like to see us make that available for the whole state. On the question of the third grade retention, remember this is an early literacy focus and that is just the last resort. We want to start in preschool, first, second and third grade and work intensively with kids that are having trouble learning to read and doing everything we can to help them including summer school, including different techniques.
Borg: Is that something to throw overboard though in order to get ...
Governor Branstad: No.
Borg: You wouldn't.
Governor Branstad: I don't want to throw anything overboard. And what we've seen in the state of Florida when we started this ten years ago they have gone from being a very low performing state to now they exceed us. Fourth graders in Florida are, their scores now exceed on the NAEP test in reading exceed what we have in Iowa. They have increased dramatically with this approach and we have talked with the people from I think it is Jeb Bush's foundation, he was the Governor that started this and they continue to work on this project and I think as people learn about the success and the benefit that it has had and they can see that retention is just one part of it but it does get the parent's attention if they know that their child is not going to be just passed along. If they don't get involved with their kids learning how to read -- by the time you get to third grade you move from learning to read to reading to learn your other subjects.
Henderson: Senate democrats this week plan to advance a bill which would provide 4% more in general per pupil state aid to schools in the school year that starts two years from now. You have said that you wish them not to do that. Why?
Governor Branstad: Well, first of all, as you said it's two years from now. And, first of all, we put together a two-year budget and last year we approved school aid for both years. And now we're working on major education reform and because of the concern expressed by many we have put off until next year addressing a new teacher compensation system and the possibility of longer school days and school years. These are going to cost some money and I think we ought to target our resources in education to things that are going to improve student achievement instead of just focusing on the old battle over allowable growth which went on for decades and decades and didn't do anything. During the time that we were fighting over that our test scores have been stagnant and other states have gotten ahead of us.
Henderson: How do you deal with the sticker shock that people are going to have next year when you combine those two things, enhanced teacher pay and extending the school year?
Governor Branstad: Well, I think we have to look at it realistically. And, first of all, we've got to get a consensus on how to best approach that and recognize that when you ask people to do more you also need to make sure that you have the resources to do that. And so that is going to be carefully studied and Jason Glass is appointing a task force of citizens that are going to come up with recommendations there. And it may be some of that has to be phased in over a period of time. We have said this is a ten-year commitment. We want it to be a sustainable commitment that will survive changes in administration and changes in control of the legislature so it really needs to be something that has broad-based bipartisan support.
Borg: You mentioned control of the legislature. I use control again. Local control comes up again and again and again as a complaint about what is happening in this administration. And that is in the education reform, commercial property tax, cutting that by 40%. Local cities and towns are worried about the encrosion on their tax base. And also in the little thing on traffic cameras. Local control there being because you said you would sign a bill if it came to you banning red light cameras. Is local control being eroded by state government needlessly or is it necessary?
Governor Branstad: Well, first of all, local control has never included taxes. We have home rule but it doesn't include taxes, never has. And the state has always been involved in determining regulations with regard to property taxes and indeed in the time that I've been involved in the state government we have dramatically reduced the property tax share of the cost of education and increased the state aid. And I think most people would agree that has been a good thing. Property taxes are still very unpopular and local control, to have a $2.3 billion increase in property tax, I think most Iowans would say thank God you're looking out for our interest instead of letting them just dramatically increase our taxes just because farm commodity prices have gone up and remember, residential is tied to it. So, it's not just farmers who are going to see a massive property tax increase, it's also residential.
Borg: So philosophically you have no problem with the state taking control of some of these things?
Governor Branstad: Absolutely. From the day that I came to the legislature one of the first things we worked on is getting rid of some of the unfair taxes like we had personal property tax on livestock. We had personal property tax on farm machinery and all of this stuff. And I've worked as Governor, but before that as a Legislator and as Lieutenant Governor to reduce some of these tax burdens. And I hear from a lot of citizens that strongly object to having some camera decide that they're going to have to pay a fine, not even see their accuser ad the person that has to pay it is the person that owns the vehicle, not the driver. I think there's a lot of problems with that. 10,000 people have signed a petition saying that they object to it. My personal experience in Arizona in the middle of the desert going 10 miles over and it cost $200. I didn't think that was very fair. It was a rental car.
Glover: Doesn't that mean local control is local control as long as you do what we want?
Governor Branstad: Well, there's a lot of places where there's local control. But, as I said, when we gave home rule to cities and counties we never gave them control over the tax structure because the state has a responsibility to control -- and the most unpopular tax in this state is the property tax. And we have continued to look at ways that we can reduce the property tax burden and replace it with state revenue.
Henderson: Governor, in December one of your former aides Doug Gross was on this program and he said he expects you to run for re-election. Talk about that. Do you intend to run for an unprecedented in Iowa sixth term?
Governor Branstad: I don't know at this point. I love what I'm doing. I'm honored and proud to have the opportunity to serve the people of Iowa again. And I'm feeling good and enjoying what I'm doing and we'll make that decision come 2014. That is a long time off. In the meantime, I'm going to work hard every day, go to every county every year and do everything I can to accomplish as much as possible.
Henderson: But if you do run you would hold the nationwide record. You would eclipse someone named George Clinton who was New York Governor. Does that mean something to you?
Governor Branstad: Well, George Clinton was the Governor of New York back in 1777 under the Articles of the Confederation. That's a long time ago. I never met the guy.
Glover: Isn't that kind of a long winded way of saying yes?
Governor Branstad: No. It just says we haven't made that decision. I don't believe in making the decision that doesn't have to be made until March of 2014 until we get to 2014. This is 2012. I'm focused on what we can accomplish in this session and how we can make more progress.
Borg: I'm focused on time right now and we're out of it. Thanks Governor for being with us today.
Governor Branstad: Thanks, Dean. Thank you.
Borg: We'll be back with another edition of Iowa Press next weekend 7:30 Friday night and our new time at noon on Sunday. I'm Dean Borg. Thanks for joining us today.