Week 14 Legislative Update

It was a relatively quiet week at the capitol, as leadership in the two chambers continue to negotiate on multiple fronts to develop a path toward adjournment. Both chambers had limited floor debate and limited committee work, as committee chairs met to discuss remaining policy bills they view as must-pass measures before adjournment. The follow are among the issues that must still be resolved before adjournment:

Tax Reform

As we reported a few weeks ago, the House and the Senate continue to be far apart on their proposals for tax reform, with the House initially supporting the governor’s proposal to enact a reform package that would reduce state revenue by $1.7 billion over the next six years and the Senate supporting a reform package that would reduce state tax revenue by nearly $1.2 billion annually. On Wednesday, House leadership released their own tax package that phases in reforms, resulting in a $140 million funding cut in FY19 and $300 million in FY20. The two chambers are now moving forward with their own tax plans. It remains to be seen when the differences between the two will be resolved, but leadership has made it clear that they will not adjourn without enactment of some form of a tax package.

 

State Budget

Efforts to successfully negotiate budget targets are reliant upon an agreement on the issue of tax reform, as these reform packages will significantly reduce the tax revenues available to fund state programs, including Medicaid. With the revised FY18 budget totaling approximately $7.249 billion, tax reforms to the degree originally proposed by the Senate would reduce the state revenue by approximately one-sixth. Such a significant reduction in state revenue would likely necessitate cuts to nearly every aspect of state government. It is expected that as the two chambers negotiate, the ultimate reform package will result in a smaller reduction to state spending than originally proposed by the Senate proposal, but will still result in sizable reductions in state spending. It is expected that leadership will factor in the anticipated influx of revenue growth resulting federal tax reform to help mitigate the revenue reductions from the state-level tax package.

 

Opioid Abuse

For the last several weeks, we have been telling you about behind the scenes efforts to address issues with HF 2377, the opioid omnibus bill that continues to await floor debate in the Senate. Having previously passed the House unanimously, two issues have been holding up Senate passage of the bill. The first is proposal to expand pharmacist PMP reporting to include schedule V controlled substances, which the House does not support, and the second is the IMS-crafted amendment to repeal the Board of Medicine’s chronic pain management CME mandate and scale back the CDC prescribing guidelines CME mandate currently in the bill to only apply to those prescribers who actually prescribe opioids, which the House supports.

Recently, a third sticking point has been added to the mix as the bill’s floor manager has attempted to tie passage of the opioid bill with efforts to expand Iowa’s Medical Cannabidiol Act. Under an amendment filed this week, 12 additional medical conditions would be added to the list of qualifying conditions and the current 3% THC cap medical cannabis would be eliminated entirely. House leadership has indicated that it has little interest in pursuing changes to the current medical cannabidiol program, which has not yet been fully implemented. It remains to be seen how Senate leadership will address this latest complication to final passage of the opioid legislation, but it appears likely HF 2377 will not be taken up until the end of session.

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