Come November 2, voters will see a referendum on a constitutional amendment that its sponsor says would have “completely changed the face of Iowa” had it been the law of the land 20 years ago. And, at a time when the red and blue partisans in the legislature can’t seem to agree on anything, this measure eased through two different legislative sessions with 90 percent support from Republicans and Democrats.
If voters approve the referendum, the next sales tax increase would generate millions of dollars for cleaning Iowa’s filthy waters, to help stop farm soil from washing into its streams and rivers and to develop new parks and trails.
Known as Iowa’s Water and Land Legacy Amendment, the measure would designate three-eighths of one percent of a sales tax increase to a trust fund dedicated to conserving the state’s natural resources. That fraction would generate about $150 million a year.
“If we would have passed this 20 years ago, we would have already spent $3 billion on conservation,” said Sen. Dick Dearden, D-Des Moines, who sponsored the bill.
It would be only the third amendment to the state constitution in the past 16 years, Dearden said.
The vote, in the words of Iowa Nature Conservancy Director Sean McMahon, “is nothing short of a referendum on conservation.”
“It’s now or never,” he said, calling it one of the most important conservation measures to pass through the legislature in a generation. “If we were to lose, legislators would not have the stomach to bring it up again for a while.”
Even if legislators raised the issue in the next session, they would be “back to square one,” said Jim Gillespie, bureau chief of field services for the Iowa Division of Soil Conservation.
“They would be forced to go through two legislatures,” he said, referring to the legal requirement that all amendments to the state constitution pass through two consecutive legislative sessions. “It would be at least three years to get it back to the people.”
About the Amendment
The amendment is based on work by the Sustainable Funding Advisory Committee, which was created in 2006. The commission decided on $150 million as the figure needed to fund conservation projects. The amount is in addition to the current budget for conservation.
After approving the two referendum resolutions, the legislature also passed a companion bill during the 2010 session. The bill explains how money raised by the tax increase would be allotted if the amendment passes.
The two largest portions of the fund will go to the Iowa Department of Natural Resources, which would receive 23 percent, and the Iowa Department of Agriculture, which would receive 20 percent.
Within the Department of Agriculture, the trust fund would add an additional $30 million to the annual budget. It would more than double the resources currently available to the department’s Division of Soil Conservation, Gillespie said.
That division is responsible for programs such as the Iowa Financial Incentives Cost-Share, which helps farmers pay for the installation of wetlands and other infrastructure that prevent runoff of fertilizer and sediment into Iowa rivers.
Last year, the division had roughly $7 million to divide among applicants for the program. This fell about $15 million short of the amount requested, Gillespie said.
Programs such as Cost-Share help improve water quality and soil conservation. These are increasingly important in Iowa, where sediment and runoff pollution such as nitrates cause many pollution problems. Sediment clogs streams and rivers, choking off aquatic life. Nitrate travels through Iowa, down the Mississippi River and into the Gulf of Mexico, where it is responsible for the large, growing hypoxic phenomenon known as the Dead Zone.
Money provided by the trust fund can only be used for voluntary projects, such as Cost- Share, not for regulatory measures.
Funding is Key
The restriction of the funds to voluntary programs is an attempt to work within the existing structure, which is largely non-regulatory, McMahon said. With the investment of new funding, McMahon said he believed voluntary programs would be more efficient and successful than regulation.
“Funding is key,” Susan Heathcote, water program director for the Iowa Environmental Council said. The ability to provide incentives for farmers to take economic risks to protect the environment is essential to the success of voluntary measures.
“Producers will say: ‘That’s all fine and nice. Birds are great. I’d like to put prairie in, too, but it is not going to make me any money.’” Heathcote said. “One hundred and fifty million dollars per year could help with that.”
However, neither this code nor the amendment would actually put money into the trust fund.
The amendment before the public only creates the fund. The code describes how money would hypothetically be divvied up. Actual capital will be generated only after sales taxes are raised.
Legislators who supported the bill would not be bound by that decision to approve future tax increases, Dearden said, but denied anyone might have used their vote as “brochure politics.”
“Once you start messing around with the state constitution, you get pretty sincere,” he said.
However, because of the way the resolution is written, it is difficult to provide any timeline for the funding.
“They could be raised next year,” Dearden said. “It could happen right away or way down the line.”
Tax Hike Move Unlikely Next Year
Dearden said that he would consider passing tax increases based upon the margin of support for the amendment, but added that, because of the state of the economy, he would probably not support an increase in the coming session.
Although the connection to a future tax increase may seem circuitous, the original committee studying the policy examined over forty other funding methods before settling on this one, McMahon said.
The idea of a tax increase could frighten off some voters.
There are always some people who think “there’s a boogeyman hiding behind every tax increase,” Dearden said.
However, McMahon likened voting for the amendment as a form of insurance, not a vote for a tax increase.
“If the legislature increases sales taxes in the future, Iowa’s Water and Land Legacy is a guarantee that at least a portion of that increase will go…to programs that will benefit all Iowans,” he said.
There are also potential economic benefits to funding the conservation of natural resources. The state of Iowa takes in roughly $2.6 billion in revenue from recreational use of lakes, parks and trails, according to the Iowa State University Center for Agriculture and Rural Development report. A study by U.S. Fish and Wildlife found an additional $1 billion is earned through recreational hunting, fishing and wildlife watching.
“The economy and the environment are inextricably linked,” McMahon said. “[These measures] will grow Iowa’s economy, but we need to invest now. We’re falling behind in Iowa.”
Distribution of Funding
A companion act passed during the 2010 legislative session set up the potential distribution of money from the fund.
- Department of Natural Resources………………………………….. ..23 percent
- Department of Agriculture and Land Stewardship…………..………14 percent
- Watershed protection account………………………………………….13 percent
Comprised of the DNR and the Department of Agriculture
- Resources Enhancement and Protection Fund……………….. … ..13 percent
- Local conservation partnerships………………………………………10 percent
Comprised of the DNR and the Department of Transportation
- Lake restoration…………………………………………………………..7 percent
DNR – Purpose: Improve recreational uses and the general health of the lake by improving water quality