One ship, two captains. A republican and a democrat each steering Iowa's 85th General Assembly. A conversation with Republican House Speaker Kraig Paulsen and Senate Democratic Majority Leader Mike Gronstal at the Statehouse on this special legislative preview edition of Iowa Press.
Borg: We have left our traditional Iowa Press table for this special report from the Iowa Statehouse where the 85th General Assembly's second session is just underway. As is the custom, legislators first getting the executive branch's view in Tuesday morning's Condition of the State Address from republican Governor Terry Branstad. That's like a GPS routing from the Governor, if you will. Legislators can choose to follow that, including the Governor's budget recommendations or, as is often the case, they'll take a few legislative side roads. We might even hear some recalculating from the governor's office. And that is because deals have to be made, compromises the proper term there, between republicans controlling the House of Representatives, Kraig Paulsen is the Speaker of the House and the Senate's majority democrats led by Mike Gronstal. Gentlemen, we've come to your house here so it's a little awkward for me to say welcome back to Iowa Press but at any rate, thanks for having us here and welcome back to Iowa Press.
Gronstal: It is good to be here.
Borg: And across the Iowa Press table joining the conversation, James Lynch who writes for the Gazette published in Cedar Rapids and Radio Iowa News Director Kay Henderson.
Henderson: Mr. Speaker, before the session started you said this would be a year of first downs rather than touchdowns. I'm a football fan. I love touchdowns. Will voters be disappointed when you go you go out and ask them to re-elect you if it is a year of first downs rather than touchdowns?
Paulsen: First of all, the 85th General Assembly is going to be one of the most, if not the most successful general assemblies in Iowa's history. So I think from that standpoint this has been a huge success for this group of 150 people and this Governor. I believe that second of all, often times in the Iowa General Assembly things have to percolate and they take multiple years. We've got a whole lot of things that have been out there percolating done last year. So we're going to put some more things in the hopper and get them going. In the meantime, we're going to pick up several first downs and I think when we walk out of here we're going to have some successes and we're going to move the state forward.
Henderson: Mr. Gronstal, one of your colleagues, Jack Hatch, who is running for governor, referred to the Governor's speech this past week as timid. Would you agree that the Governor presented a timid proposal to legislators?
Gronstal: I think the Governor put together a set of proposals that can get broad bipartisan support inside the legislature. We look forward to working with the Governor on his agenda. Are there things that we would add to that agenda and will add to that agenda? Of course there are, as the House will as well I suspect. But I think it was a good speech by the Governor and I think it recognizes divided government and recognizes, to some degree, the success of last session and that by setting aside our differences and the things that severely divide us we were able to accomplish a lot of great things. Dealing with commercial property taxes, an issue that has been around for 35 years literally in this state, that was an important thing for us to do and we wanted to focus parts of that on small businesses. So I think the Governor, it was a recognition that maybe not press the envelope too much. If democrats controlled everything it would be a different agenda and if republicans controlled everything it would be a different agenda.
Borg: Talking about agendas, we have a little clip from the Governor's Tuesday morning speech in which he just sort of puts the top of his agenda -- let's listen to what he says.
Governor Branstad: And in Iowa we honor our veterans not only with words and ceremonies but with action. Today I call on the legislature to pass the Home Base Iowa Act. Join me in telling veterans that we will no longer tax their military pensions.
Borg: Jim, you heard the Governor say that and I know you have some questions.
Lynch: Well, I guess there seems to be very little opposition to what he has proposed. Everybody likes to help the veterans and attracting military veterans to Iowa and matching them up with jobs here in the state makes a lot of sense. But what are your expectations for this? How will you know that this program is working? Senator Gronstal, what are the benchmarks?
Gronstal: Well, here's one of the things. Let me say, people that have served our country whether just in the military or in the military and war, those folks understand teamwork and community. That's kind of the nature of their mission. I'm always impressed by the mission focus of our military. Those are great folks to add to our economy and the culture of our state and it fits very well with the culture of our state. That's the kind of state we are. We're a state that values community and values teamwork and I think, I just think bringing those kinds of folks, attracting them to Iowa -- so the measure will be did we bring new people to Iowa, new veterans to Iowa that didn't maybe originally come from here but we succeeded in bringing them to our state, adding them to our economy, adding them to our community.
Lynch: Speaker Paulsen, you're a veteran. Would you have come back to Iowa without some sort of -- will this attract other veterans to Iowa, folks who didn't grow up here?
Paulsen: Well, I believe I would and I actually was an Iowa resident even when I was in the service. So I was coming back no matter what. But yes, I think it will. I think when they complete their tour of service whether it's one enlistment or a full career enlisted or officers, I believe if we have an open door and show that there's opportunities here, opportunities for their families I think absolutely. At a minimum they're going to take a look and that's the first step. And I think this is going to be a proposal that the entire General Assembly is excited about. We'll have to work through it. I mean, there's always a lot of details. We may add, we may highlight something or color something a little different or whatever. But at the end of the day I think it's going to be a bill that we're going to be excited to pass and I think it's going to be a bill that the Governor is going to be excited to sign.
Borg: Well, Senator Gronstal, can the state afford it?
Gronstal: I think pretty clearly, it's a fairly modest impact on the state treasury when it's all said and done. We have a very large ending balance right now. Yeah, I mean, let's not -- of course we can afford it.
Borg: But what that says is we don't have many retired veterans then in Iowa if it's not going to hit the state treasury, the loss of that income tax?
Gronstal: When it's all said and done it's a fairly small part of our population, that's correct.
Henderson: Both of you gentlemen in the month or so leading up to the start of this legislative session said you might tinker with some of the hallmark accomplishments that were made in 2013. Mr. Speaker, what are you thinking of doing in the form of tinkering with, for instance, the commercial property tax bill? Is there some need for adjustment?
Paulsen: Well, actually what I think I said was it's going to be kind of a trust but verify. We think we know what we did. We're pretty confident what is happening is what we intended to happen and now we need to go back and just make sure that that is what's going on and how those bills are being -- whether it's the property tax bill, whether it's ed reform or healthy Iowans or any of the other things. I think we'll spend some time going through that and making sure that they're accomplishing the goals we laid out. And at this point I would say I think they are. I'm not sure that we have to go into any of those.
Borg: Speaking of -- go ahead.
Henderson: Senator Gronstal, do you agree?
Gronstal: I think it's important that we maintain our commitments and I'd say we think -- we did ed reform last year, we're asking local school districts to do a whole lot more and we think missing from the Governor's recommendations was doing something about how much resources local schools are going to have in 2015. We think that's important to do. We think there were some things in mental health reform that we did last year, the Governor vetoed some of those, we think we'd like to go back and revisit those either in a supplemental or for next year. So I think there are things like that, that probably do need some fine tuning.
Lynch: Talk about tinkering, it seems like you have a very limited agenda, maybe lower expectations. If a skeptic is out there watching this are they going to think that you guys are just sort of coasting on your laurels, coasting to re-election?
Gronstal: You'll have to ask the folks out there what they think about that. I think the Speaker is right. This General Assembly is going to go down in history as one of the most successful and what makes it even more amazing is it's a republican House and a democratic Senate and we accomplish things. I've talked to national audiences about what we accomplished last year at the end of last session, the compromises we put together and their first reaction is well gee, it must be great to come from a state where one party controls everything and then I point out, no, it's divided government in Iowa and we were able to accomplish all of those things, partly because the Speaker and I and our own caucuses said, let's not be like Washington, D.C., let's seek ways to solve Iowa's problems and face it and we faced a heck of a lot of problems this general assembly.
Borg: I interrupted here a couple of times and trying to get in a question related to when you were talking about tinkering, it reminded me of the Iowa Communications Network, we call it the ICN, which is an underwriter of this Iowa Press program. But back in the 1990s when that state-owned Iowa Communications Network was built, it was somewhat controversial because private companies at that time said, what is the state getting into this ICN business for? Now, Governor Branstad, Senator Gronstal, because you remember, I believe you were in the legislature when that ICN bill was passed and the ICN was built across Iowa costing several million dollars, now the Governor is proposing leasing out some of that capacity. Do you see that as a mistake back in the 1990s to have a state-owned communication like the ICN or is it a matter now of updating and catching up with where we have evolved?
Gronstal: First of all, I think it's very much about where we've evolved and recognizing what that is and the changed circumstances. But I'd also tell you, the concept of lot of private -- look downtown Des Moines and you'll see satellite dishes on the top of some of those skyscrapers down there and what is that there for? It's because it is cheaper for them to do satellite communication and skip the switch network and build their own communications. That's what the state did. We saved -- we were saving $10 million a year with the ICN when it first started in terms of just the state traffic for long distance in the state of Iowa.
Borg: So it was a good idea at the time?
Gronstal: So it was a good idea at the time and now it's a good idea to figure out how it fits in the new world. Back when we created that there weren't cell phones, there was very little fiber in the state of Iowa, fiber optics. So I think it's important to revisit that. I think the Governor's ideas on that are certainly, are very much worth considering.
Henderson: Mr. Speaker, you are a lawyer, is this sort of a lawyer’s dream to have the state maybe leasing part of a state-owned right of way fiber optic line to a private company and then maybe the state will get sued by a company that didn't win that little stretch of fiber?
Paulsen: I don't know about it being a lawyer's dream. I'm excited about this proposal because I think that taking the ICN and using it as one of the vehicles to make sure that we have broadband access across the state is going to be an outstanding opportunity to grow the state of Iowa, provide a number of different opportunities in places right now where those opportunities don't exist. That having been said, I think it's also going to be a tricky bill to work to make sure that we don't upset the Apple card, as it were, between those whether they're the small telco's, whether they're some of the big players, by all of a sudden making someone who is competitive and investing in the state of Iowa right now all of a sudden uncompetitive. So we'll have to navigate all that. But the ICN has, I'm not an engineer, but it's my understanding has a huge amount of bandwidth that is unused right now. That is infrastructure that is already paid for by Iowans. There's no reason to have them pay for it again, private or public. Let's figure out a way that makes sense for all Iowans to have access to that.
Henderson: The other part of the Governor's proposal in regards to broadband is offering a property tax incentive, five years of no property taxes charged for companies that invest in broadband aside from use of the ICN. Do you think that is a live round in the legislative session?
Paulsen: Well, I think any time you start talking about tax relief we're ready to have that conversation, at least in the House republican caucus. So on its face, absolutely, we're going to have that conversation. Again, we've got to work through the details, so on and so forth, but I think this is a great opportunity for Iowa.
Lynch: You talk about being ready to talk about tax relief, let's talk about the budget the Governor laid out Tuesday calling for an overall increase of 7.8% in state spending. It would be the first time the state has a $7 billion budget. Can either party stomach that large of an increase in an election year?
Gronstal: Let me say, first of all, 7% is a significant exaggeration when you consider a big chunk of that is from new property tax relief that we're going to pay for with state dollars. So in that sense it is an increase in state expenditures in order to reduce commercial property taxes at the local level. Calling that an overall increase of over 7% exaggerates the reality. So I think you've got to be careful about those comparisons on the raw numbers.
Lynch: The Governor presented this I think as a 5% increase. Can you handle that going forward? I mean, is that something that legislators -- democrats we know always want to spend more, republicans want to spend less, where are you going to end up on this?
Paulsen: Here's what I know, is that first of all, the Governor's speech was on a Tuesday, we're actually taping this on Tuesday so we have to go through his budget. What I know is the state, we, along with Governor Branstad in partnership with the taxpayers of Iowa, have taken the state over the course of the last three years from an extremely difficult position to now, we're going to have another challenging budget year but the reality is we're in pretty good financial shape. We need to work through the budget, make sure we understand exactly what is in there, understand what's not in there and we'll get through it and at the end of the day we're going to have a budget that makes sense for Iowans. I can tell you that, you've heard me say this a number of times, House republicans we're going to balance ongoing revenue with ongoing expenses. That is a threshold item. So we'll work through it.
Borg: Speaking of revenue, Iowa gets considerable gambling revenue. And I'm mindful of the fact that in Linn County, your home county Mr. Speaker, Cedar Rapids and Linn County are campaigning hard with the Iowa Racing and Gaming Commission right now to get a casino placed in downtown Cedar Rapids. And over in western Iowa, in the Jefferson, Greene County area they're doing the same thing. That means if it comes to pass, there will be expanded gambling, casino gambling in Iowa. Do you at all see, Senator Gronstal, the legislature speaking in a sense of the legislature and saying, that's too much expansion of gambling in Iowa, let's hold up Racing and Gaming Commission?
Gronstal: I think the Iowa legislature has wisely placed those decisions out of our hands and in the hands of the state commission, the state Racing and Gaming Commission, where we never get in the position where we're picking places and saying there's going to be a casino there, there's going to be one there, there's not going to be one there. We have never engaged in that. We have delegated that to an entity that is removed one step from the kind of politics that occur in this building. I think that was a wise choice by the state of Iowa. So the Racing and Gaming Commission is going to make an evaluation as to which ones of these make sense, they're going to do a study that looks at things like how much a new casino might impact other existing casinos and they're going to make a judgment. I don't think we want a situation where they approve so many that all of them, in essence, fail. So we're going to let them do that, we're going to let them make that decision. We have never once passed legislation that said a casino is going to go there and we have never passed a moratorium.
Lynch: There is one gaming decision you might be asked to make this year and that deals with dog racing in Council Bluffs, your hometown, and Dubuque. In Dubuque the chamber and city council have gone on record asking the state to end dog racing there. Council Bluffs there doesn't seem to be much opposition to that idea. This idea has been run up the flagpole a couple of times. Is this the year that the legislature ends dog racing?
Gronstal: I think that remains to be seen. What I have done is I have tried to encourage the entities involved to look for a way that doesn’t' just pull the rug out from under people that have put significant investment into dog racing, okay. And those folks are creating some mechanism that lets them exit this in Iowa in a reasonable way I think makes some sense. So we have encouraged the players on both sides to engage in that and have that kind of discussion and I'm hopeful that that bears fruit.
Henderson: Mr. Speaker, what will happen in the House regarding dog racing?
Paulsen: I think this is -- I always find it kind of fascinating and if you view the legislature as a body with its own personality and ego and stuff, it moves. And this is one of the issues that unquestionably has moved over the course of the last handful of years. Nobody really talked about this when I first got elected, in my first session in 2003 and each year the question you're asking, which is are we going to no longer mandate dog racing, which is what we do right now, seems to pick up speed. My preference is exactly what the Senator said. I think the interested parties ought to come back to us with a proposal that meets the needs and the concerns of those folks and then we can address it. But clearly this is something that has changed over the last handful of years.
Henderson: The Governor has decided that by the end of this week the Iowa juvenile home for troubled teenage girls will be closed. I'm wondering what both of you think should be the future for juvenile court officers who would like some sort of state facility in which to send troubled teenagers who have failed in other settings? And what is going to happen to the juvenile home for boys, the boys training school that is in Eldora? Mr. Speaker?
Paulsen: Well, time will tell on that. We are not going to be in a scenario where a juvenile court officer or judge does not have some place to place one of these children. And unquestionably I think that is where House republicans are on this issue is what are the needs of those kids and how can we best get them served? We're going to have to go through and figure that out. As far as the boys home, I haven't heard anybody have any conversations on that yet. Maybe that will come up, maybe it won't. I don’t know. But right now we're going to make sure that those folks that were in Toledo, those kids, get the services that they need.
Borg: Let me ask you, Senator Gronstal, in the Governor's speech Tuesday morning he referenced Lee County and the economic success there. Democrats have not been happy about the way that the economic development assistance to the fertilizer plant that is being developed there, that has put jobs in Lee County, is gone. Have you changed your mind on that?
Gronstal: We are very happy that there are jobs in Lee County. We are very happy the fertilizer plant came there. We are very happy to have well over a billion dollars of investment there. We think that is great. The only question is, did we cut a smart deal? And I think there are -- I think it's reasonable to raise that question. Were the incentives greater than they needed to be? That's got to be a decision that we make every day when we look at economic development projects. The incentives that we have put in, are they the ones enough to trigger the activity but not be overly generous? The more frugal we are with those, the more we're able to go to other people and incent their involvement. That's the question in Lee County. Did we end up getting taken?
Henderson: You needn't make a campaign speech but both of you have decided that you will not seek a different office in 2014. Mr. Speaker, what were the factors, real briefly, in that decision?
Paulsen: I mean, pretty simple. If it comes down to service and it comes down to serving Iowans, where did I think that my service would be the most beneficial and I think right now the work we're doing in Iowa's General Assembly is exciting, we're moving the state forward, we're making things happen and that would be as opposed to Washington, D.C. and it just made sense for me to stay here and I'm excited about doing that.
Henderson: Senator, you decided against running for governor. Why?
Gronstal: You could take his words, word for word, and it's exactly -- we were able to accomplish great things last year. The Iowa Senate is going to be able to continue to accomplish great things, move our state forward. I'm very excited about that. I enjoy it. And a few people have alleged I do it reasonably well. So I think it's great fun to affect public policy. I think it's great fun to provide an opportunity for kids, I mentioned in my opening day speech, for three young people I know that got a ticket to a better life because of what we together did last year on the skilled workforce.
Borg: Let me take you back a little bit, 2014 launches more than another legislative session here at the Statehouse. Throughout the year, Iowa Public Television will be celebrating its 45th anniversary and that includes 45 years of public affairs programming. Back in 1984, IPTV chronicled the Iowa legislative session in a program that they called Fight to the Finish. Now, here's a segment from that 1984 program, behind the scenes with then House Speaker Don Avenson of Oelwein.
1984 - Fight to the Finish: Well, if it fails I'm telling you, I'm going to take you really seriously back to Congress and we're going to find a guy that cuts. Ain't going to be any fooling around, we're going to find the cuts to the tax increases and you're going to vote for them if you don't vote for this.
1984 - Fight to the Finish: A good share of the important bill writing goes on in this House. It would be difficult to get a piece to the floor that I didn't want to the floor. As Speaker of the House if he wants to can change the course of the state, can change the face of a great deal of legislation, a great deal of law. You can change the relationships between interest groups, you can have a tremendous affect as Speaker of the House if the House is willing to let you do that.
Borg: Well, Mr. Speaker, Kraig Paulsen, is that how you view the job as Speaker of the House in the way that you're weighing a possible federal job, you can influence the state?
Paulsen: Oh, yes, absolutely. We've had an opportunity to do some great things here. It's exciting. It's exciting to do the work on behalf of Iowans. So yeah, that's -- all 150 of us, even when we disagree, we're all here because we want to move the state forward.
Henderson: Mr. Gronstal, is that your leadership style?
Gronstal: I'm just amazed that he was still smoking back in 1984. That's what surprised me. Yeah, listen, I think we both enjoy our jobs here. Kraig and I both get along very well, we have learned to figure out the things that we disagree on and focus on the things we agree on. I just wish the folks in Washington, D.C. did more of that. But I'm happy to continue to do that stuff here and move the state forward and I think we've been able to do that.
Henderson: Are you finding people who want this job, given the level of distaste for politics, are you finding it hard to recruit candidates? Mr. Paulsen?
Paulsen: Actually, through the fall, through the shutdown unquestionably there was not quite as much energy. Subsequent to that, I will tell you, we're going to have another very talented group of candidates running as republicans for the Iowa House of Representatives. I'm very excited. There's a lot of energy. I think we're going to have a good group.
Gronstal: I think we saw, we see people that saw us succeed at solving some problems in the state of Iowa, move this state forward and we've seen a lot of candidates, we're going to have a great recruiting year too. A lot of candidates feel like there is a place to go to actually get something done.
Borg: Well, we'll have you back during the session to update us and also will be looking at how those candidates are faring out on the campaign trail. Thank you gentlemen for having us here in your house today.
Gronstal: The people's house.
Borg: Thank you. Next week on Iowa Press we'll be back in our usual studio setting and we'll be talking with billionaire T. Boone Pickens, the energy magnate who has used some of that money to finance conservative policies across the nation. Same Iowa Press times, 7:30 Friday night and noon on Sunday. I'm Dean Borg. Thanks for joining us for this special edition from the Iowa Statehouse.