Challenging tenure. State Senator Jack Hatch seeking to deny incumbent Governor Terry Branstad's re-election. We're questioning Senator Hatch on this edition of Iowa Press.
Borg: Democrat Jack Hatch has been a part of Iowa government for nearly 30 years, first serving in the House of Representatives in Iowa, then on Senator Tom Harkin's Iowa staff and for the past 14 years back in the Iowa legislature where he is now serving a third term representing central and south Des Moines. Senator Hatch is now campaigning to move into Iowa's executive branch, denying republican Terry Branstad's bid for a sixth term. Senator Hatch, you've been here before, welcome back to Iowa Press.
Hatch: Thank you, Dean. It's good to be here again.
Borg: And you know the people across the table here, Des Moines Register Political Columnist Kathie Obradovich and Radio Iowa News Director Kay Henderson:
Henderson: Senator, you have run two campaign ads, one last summer critical of the Governor, the one that you're running this month talks a lot about Governor Branstad. You haven't yet introduced yourself to Iowans and many polls show Iowans have no idea who you are. Who are you?
Hatch: Well, I'm an Iowan that went to school here, married here, raised a family here, grew a business. My wife and I are business partners in affordable housing and property management for the last 13 years. We have built over $100 million worth of affordable housing in two cities. We have contributed a great deal to this state. I've been an accomplished legislator and now I want to put those skills to work for Iowans being the next governor.
Obradovich: Tell us briefly why you are running. And also, if you can boil it down into just a few words, what your vision is for the state of Iowa.
Hatch: Sure. Iowa is a state right now that is coasting. We have lost opportunities and we have not taken advantage of the opportunities that are ahead of us. We have a governor that is in the middle of a scandal-ridden administration. He has more scandals than any governor in the history of this state. It is diverting him from taking his eye on what should be the vision and moving Iowa forward. I have a different vision, a different view. I'm going to focus on security and what I call the four securities, education security, energy security, environmental security and economic and job development security. When it comes to education security I want Iowa schools to be restored to the prominence it had, that we had once before. I want every four-year-old to go to early childhood education. Every kid who wants to go to college can go to an affordable college and get the training they need for their life careers. I want adults to be trained so that they can continue to meet the demands that are here. I want our kids to swim in rivers and lakes. I want us to be prepared for the extreme conditions of our climate. I want to continue the energy proposals that have been here for the past 20 years. When Governor Branstad left office we were importing 98% of our energy. Now we are exporting 25% because of wind and solar. And economic development and economic security means that we want to have jobs that are ready for everybody in this state.
Obradovich: You mentioned lost opportunities. What do you mean by that?
Hatch: Lost opportunities is where we really have not been funding our public education, where he is the first governor in the past 50 years that did not recommend additional funding for education. We didn't have the money provided to make sure that our kids got the proper education that they need. Education is now becoming unaffordable for a lot of people. He's just waking up to that. His economic development strategy is to bring in out-of-state, foreign corporations, bringing lots of money to bring them here instead of making sure that we have an economic development policy that comes from the community up. We don't want to put all of our money in one company in one part of the state. We want to broaden it out so small businesses and communities can grow.
Borg: You're going to have to communicate that across Iowa because you run only in Des Moines area elections right now. Many people are going to be meeting you for the first time. In fact, I might say that I've known you for a long time, but I would have done a double take in meeting you right now because you have shaved a mustache, which really was a trademark. Why did you shave the mustache?
Hatch: Well, it was done purposely. We need a fresh start in this state with a new agenda for the future and the best way to --
Borg: So, it's part of the campaign.
Hatch: So, part of expressing that is to let people see me for the first time and understand that I'm serious about making a new, fresh start. I'll do anything to do that. It took me a while to convince my wife. You have to remember that she has only seen me this for 26 years and I've had it for 46 years. But we know we need it and we need that fresh start in this state.
Henderson: Senator, the Branstad campaign and its allies are attacking you suggesting you have something to hide because you haven't released tax returns for the past five years, only the past year. And specifically they're talking about tax credits, which you may have sought as a property developer. What is your response to that?
Hatch: Well, I was the first candidate in this race to release our state and federal tax returns. I paid -- I think my wife and I paid $88,000 in federal returns --
Borg: Completely released returns?
Hatch: Yes, we completely released the 2013 returns. It's a stack, I think some of you were there, you had time to look through it. The entire tax return was released to the press on April 15th. I paid $88,000 in federal, $28,000 in state tax.
Henderson: They're suggesting you have something to hide in the previous four years.
Hatch: Well, we have followed the tradition of every governor and every candidate, to release the tax returns of the year before the election and that is what we've done. It's tradition that governors and candidates have followed. I think it's a good tradition. Governor Branstad didn't release any of his returns prior to 2010 during the time he was in between his terms. So we're understanding that what we think he's really doing is diverting from his own troubles and he is trying to create a situation because of the Orascom tax credit deal in southeast Iowa and I get tax credits in my business, which are federal tax credits. I get very few state tax credits.
Borg: Well, I mean, if it isn't a big deal then why not go ahead and release those?
Hatch: Well, because I think we have to understand the tradition of what it takes to run for office and we want more people to run for office and not to be completely deterred because of their business and their personal finances. We want to make sure that Iowans understand that I released my returns, complete returns in 2013 and they're very substantial and they're very comprehensive. I think that's what we have to do.
Henderson: You have twice now mentioned the Iowa fertilizer plant, which is being built by Orascom, an Egyptian company. People in southeast Iowa were happy to see those jobs. What do you say to people who are happy to see jobs in their area when you are attacking the awarding of the tax incentives for that project?
Hatch: That has been described by an ISU economist as the worst economic deal in the state's history. It has been disproportionate with the amount of state tax credits we provided that plant. $110 million, equivalent to about $700,000 a job. Just two months later he made another deal with a fertilizer plant up in Sioux City but it was for half as much. And then a third deal that was a quarter as much. What we're complaining about --
Borg: But Senator, how would you grow -- in competing with other states, how would you grow Iowa's economy, which is very competitive in attracting industry -- what are the other options you would propose?
Hatch: Well, we have to make sure that we have a finite amount of money, credits, to provide as incentives. And I don't disagree with those tax credits as incentives. But to put so much into one company that is providing so little return to the state of Iowa was a terrible deal. It is the worst economic deal that he negotiated in the state of Iowa, putting only 165 jobs there, knowing that the building and construction of that plant is going to attract builders and contractors from Illinois and Missouri and Iowa, it's not creating the economic boom for Iowans that he is pretending. It is also a company that is still under federal investigation by the federal government. So, we have been snookered by this Governor by giving it to a company that is undeserving, and that's the word I used in my ad, undeserving corporations. You know, not all corporations are undeserving. You've got Rockwell-Collins, you've got Deere, you've got John Deere, we give tax credits to them for researchers because they keep their jobs here. That is what you want to do, provide income incentives to ensure that the growth is with Iowa companies.
Henderson: Senator, before we move on, the ad that is running against you right now accuses you of lining your own pockets with tax credits that you voted for as a senator.
Hatch: Yeah, it was interesting because it's kind of an odd attack on me. I have a letter, I even asked the Branstad administration in 2011 to see if I had a conflict of interest in my business as a state senator. They wrote back, and I think I released that to the press yesterday, that said, they said, there's no conflict of interest. And I didn't vote for any of those bills. If you look at my record, and we also have that available, I have abstained from committee and on the floor for any kind of appropriations or tax credits for the Iowa Finance Authority that would be, that would appear to help me as a developer. We have a citizen legislature, we have teachers and farmers and everybody else that benefits in an indirect way. I am no different. But I even went a step further. To ensure that that's not a criticism I abstained from voting. I think this is an attempt by the Branstad administration and his campaign and his friends to deflect from their scandal-ridden administration.
Obradovich: Another issue raised related to your job as a property developer is the use of eminent domain, which is the phrase means the government forces property owners to sell their land for some sort of development that is in the public interest. And so as a property developer you know how this works and you also know as a state senator how much of a hot button issue this is in areas of the state. What would your policy be as governor for when you would take land for the public good even though the property owners may not want to sell?
Hatch: Let me answer the first part of your question. I have never used eminent domain in any of my properties. We have built in Des Moines and in Cedar Rapids. We built where no other developer would build. We're building in the inner city of Des Moines and the flood ravaged area of Cedar Rapids after the floods receded. We did infill housing. None of that was eminent domain. We actually bought some of those properties from the city and from other property owners. And so I don't use it.
Borg: Why do you think it is being raised against you now then?
Hatch: Because I think this is a desperate attempt because it is a, the taking of land, private land by a government --
Borg: But you're saying it has no basis?
Hatch: Has no basis at all, none whatsoever.
Obradovich: So, would you use it as governor?
Hatch: Well, every -- the governor uses eminent domain right now. In the paper today, Larry, is it Cleverley, the farmer up in Marshalltown, Marshall County, they had his land, they took his land away from him just yesterday. And that was on 330, he was a farmer, he was doing, he was selling it at markets. The state of Iowa took his land after great controversy. They felt that he didn't have the right to keep that land they needed for public purpose to build and expand that highway.
Obradovich: So would you stop that?
Hatch: Well, you don't stop eminent domain, what you do is you create new categories for the departments to understand that there's something more important than just widening a road. And that is the quality of life and these people have had that land forever. You know, we need to have kind of the personal touch in government that we haven't seen in a long time. We have a governor right now that is really having attack on state government and his employees. I want to make sure that we have a new category in all of our policies that represent the hard working ideals of Iowans.
Borg: Are you saying, to answer Kathie's question definitively, are you saying you wouldn't use, as governor if you were elected, eminent domain?
Hatch: No, no, no. Every governor has used eminent domain. This governor has used eminent domain. They're using it in Lieutenant Governor Reynolds' own county wanting to have water and a lake for drinking water. It is a responsible public policy procedure but it has to be done right. What I said to Kathie was I wanted to add a new category of review that made sure that we weren’t doing anything that couldn't have been done differently.
Borg: You brought up Lieutenant Governor Kim Reynolds so let’s talk about your choice for lieutenant governor. Lieutenant Governor Kim Reynolds is traveling around Iowa right now campaigning. You haven't yet named a running mate, which is probably a little bit behind because no one knows who your lieutenant governor might be. When are you going to announce your choice?
Hatch: We have been really fortunate to have a wide range of people who are interested and a wide range of people who would make good lieutenant governors. And it's a process and we're interviewing them now. We're narrowing it down. We should have an announcement early next week.
Obradovich: What kind of criteria are you looking for? And are you looking for a woman as lieutenant governor?
Hatch: We -- the criteria is we want somebody who will be able to be governor if anything should happen to me. Also a person who could be a partner with me that could act independently of me, that could go on appearances on their own and can really sell and reach out to the people of the state. And we will be looking at somebody most likely from eastern Iowa and women are a significant, are on the significant list of our choice.
Obradovich: Okay. Well, Governor Branstad will be traveling around the state, not only with Lieutenant Governor Kim Reynolds but also with Joni Ernst as the republican nominee for U.S. Senate. How do you -- as you look at your campaign -- how do you bring in women as voters? And how do you appeal to women in your campaign?
Hatch: Well, we're going to have a great appeal to women. I think we are more in step with women voters than Governor Branstad. We really have a more forceful presentation in our government. I have announced that half of the women in my cabinet will be women --
Obradovich: Half of the women --
Henderson: Half of the directors --
Hatch: Half of the directors of state agencies, excuse me, in the government will be women. And I think, I'm very fortunate to have a wife that is my business partner and she is engaged and she'll be a wonderful First Lady and she is going to be on the campaign trail as well. And with the large number of local government candidates around the state we're going to attract a lot of women.
Henderson: Governor Branstad has already labeled you a Des Moines liberal millionaire, a typical tax and spend democrat. How do you, I guess, respond to that when the tax plan that you released last fall did raise taxes on some people and you have supported an increase in the gas tax?
Hatch: You have to remember, what he has conveniently forgotten is that I was one of the main sponsors and floor manager of the budget, balancing budget act of 1992 when I was in the House. I led the effort in the House, Congressman Boswell led it in the Senate to have a budget that is balanced, that has reserves that were created and that, for the very first time, took this governor off of automatic pilot and the games he was playing to balance the budget, we took those games away from him. Since then it has been good for the state, we have followed that procedure. My tax proposal affects a tax cut for 90% of Iowans. The middle class in this country and in this state really has been taking the burden, disproportionately taking the burden of funding all public services. I want to lighten that burden. We have in this state, for example, only a $50 credit for children. I upped that to $500 for children. If we value children as everybody says we do, let's reward that in our tax policy. Also, we have dual income families, we're the 9th highest state with two people working in the family. Let's reward that productivity and give them a credit. That's what that tax proposal was for. And the very rich, which in one case my family would fall into, would have to pay higher taxes. I think that's a tradeoff that I would take any time to make sure that middle class Iowans got a fair shake.
Obradovich: Balancing the budget still allows for substantial growth in the size of state government just as long as the economy is growing. Will you grow the size of state government as governor?
Hatch: Well, I think we have a challenge ahead of us because this governor is decimating public service in this state. He's closing down juvenile homes, he's closing down Workforce Development agencies, he's not providing, he's not filling the positions. The case work agencies, case work management has gone up in all of our agencies. We're not repairing roads. We have to reorganize state government. It's one of the first things I will do. I will make sure that our services are protected, that people are being served at all levels. We are not going to have an explosion of state assistance. We're going to be very careful and very thoughtful on how we get this state back in order. He has, as I said, has produced the most scandal-ridden administration in the history of this state. And there's too many investigations, too many unknowns, people are insecure about what this government can provide them. We're going to have to take a real hard look at how we provide these services with an administration that is fair.
Obradovich: Can you do that without significantly increasing spending? I mean, state government is spending close to $7 billion now. Are you saying that's not enough to run those state services?
Hatch: No, I'm saying that we have to reorganize government and really kind of fix the problems he has created.
Obradovich: So, you'll hold the line on spending?
Hatch: Taxpayers don't want to pay more than they need to and I want to promise taxpayers of this state that I'm not going to ask them to spend more than they need to.
Henderson: As a senator, you were an advocate for expanding the number of Iowans who qualified for Medicaid coverage, government paid health care expenses. There are some Iowans who are adamantly opposed to that. What do you say to Iowans who say the government is giving too much to too many?
Hatch: You know, there's a really fine balance between our quality of life. And when you have 250,000 to 300,000 Iowans without health insurance the cost of keeping them healthy or even alive is so much higher if they don't have insurance, if they don't go to the doctors. So, it was very clear to us and it is showing in the numbers, we have over 100,000 new Iowans covered because of our efforts and the premiums of health coverage is going down. And so we have an opportunity here to realign those health care costs that would help people stay active, stay healthy, live longer and that is really what, you know, part of our responsibility is.
Obradovich: You were part of the crafting of the Affordable Care Act through a presidential task force of local people from the states. Do you feel like Obamacare is where it should be now? Or, if you were governor, would you be looking for the federal government to make changes that would make more sense for Iowa?
Hatch: I think one of the best parts of the Affordable Care Act is the ability of states to be part of the construction and the implementation of that federal law. It is the most flexible law provided to states in regards to health and human services --
Borg: But Kathie's question is, would you advocate changing?
Hatch: Well, and saying that, I would absolutely know that we have the flexibility to change, our obligations to change and make it work for Iowans. That is why I was so involved in trying to get the Iowa Insurance Exchange created in this state because that should be created for Iowans. If we had that I think we'd be better managed, we would have better control of our spending and more people would have insurance.
Henderson: A few moments ago you mentioned the disrepair of Iowa roads. Would you support a gas tax increase of a dime? Or what sort of increase would you support?
Hatch: This is one of the disappointing elements I think of Branstad's lack of leadership. He ran four years ago implying to people that he was going to increase the gas tax, that he was going to repair the roads, he was going to repair the bridges, we were going to have commerce that was going to be created more in our rural areas. He is a person that supposedly represents rural Iowa. This is one good example --
Borg: What about you?
Hatch: This is one good example of people not representing rural Iowa who say they do. I'm from urban Iowa. I'm a democrat liberal. I would increase the gas tax over five years, two cents a year, to go toward repairing the roads in rural Iowa, to make the farm-to-market roads better, to make the manufacturing-to-retail roads better, that would be in commerce, that would be roads, that would be highways, that would be waterways and rail. We have an obligation to make sure that the hard working businesses get their products to market.
Henderson: There are some areas of the state which consider casinos to be economic development. Cedar Rapids among them, very disappointed they didn't get a license from the Racing and Gaming Commission. As governor, would you sign a bill from the legislature that changes the criteria by which the commission makes that decision?
Hatch: Well, if the legislature got that involved and passed a law that would allow and recognize that certain areas of the state have better needs that were not considered under the existing law, yes, I would indeed sign that. I would also ask my Racing and Gaming commissioners to look at different criteria. Like in Cedar Rapids, they were just inundated with the largest natural disaster in the state's history, they're bouncing back, you've got some creative business people there and local elected officials that have brought that city back to a new American city. And we have an opportunity to listen to those voters to say, listen, we want to do something to continue this momentum. And it might have taken a little bit of a market share away from another gambling casino but we're not in the business of guaranteeing profits for any of these casinos. We want to make sure if it's economic development that these communities, through their thoughtful process and vote of the people, decided that they wanted a casino. We should have been more open to the unique situation of Cedar Rapids.
Borg: You're sounding like you want to go back, as Ron Corbett, the Mayor of Cedar Rapids says, the commission should ask for us to reapply and reconsider our application.
Hatch: Well, you should absolutely reapply but the criteria should be different, otherwise it's going to be the same. And having a smoke free casino is probably not going to be enough. I mean, the Governor doesn't agree with that anyway. It was just another way of deflecting the fact that he showed lack of leadership in this.
Obradovich: Speaking of raising money, your campaign has raised less than a million dollars, you had said you needed to raise at least a million by the end of 2013 to have a viable campaign. Why should voters bet on you when the Governor is breaking records for fundraising? And also, will you be in any position to help democrats keep the Senate majority given that that's probably where the Governor's extra money is going to go?
Borg: We're running short on time so --
Hatch: Really quickly, if this campaign is going to be about who can raise the most money then I'm not your candidate. But we just heard and we just saw in the election this week, Eric Cantor lost. He had a lot more money than his opponent. It's a matter of whether or not we have vision and ideas, whether or not we can articulate our positions and make Iowans feel that there's a better choice, a fresh start, someone who can come together, bring people together, who has a history of bringing people together instead of defending the most scandal-ridden administration of the history of the state.
Borg: Senator Hatch, thanks for being our guest today.
Hatch: Thank you very much, Dean.
Borg: And we'll be back next week with another edition of Iowa Press, the usual times, 7:30 Friday night and noon on Sunday. I'm Dean Borg. Thanks for joining us today.