Senate okays state sales tax for schools, Kettering votes 'no'

Thursday, April 24, 2008

The Senate approved a plan Tuesday to replace a local-option sales tax with a statewide 1-cent tax that would create a new formula for funding school repairs and ease property taxes.

Local lawmaker Steve Kettering was one of 13 Republican senators who voted against the school funding measure.

It now heads to Gov. Chet Culver, who is expected to sign it into law.

"It's about putting an equal amount of money behind each of our schoolchildren," said Sen. Michael Connolly, D-Dubuque, the measure's main supporter.

The local 1-cent sales tax had already been approved in all 99 counties to fund school projects, but supporters of the bill said the system was not generating enough funds for rural school districts. The new plan offers an equal amount per pupil in all districts.

The Senate passed the measure 34-15, despite critics' warnings that the sales-tax money would eventually be shifted away from schools.

"This is a tax increase to my way of thinking," said Sen. Larry McKibben, R-Marshalltown. "If you want to close up rural Iowa, give them more relief like this."

The bill had been declared dead less than a week ago, but top leaders gave it new life when a group of minority Republicans agreed to support the effort.

Nearly 10 years ago, the Legislature gave local officials the option of imposing a 1-cent sales tax increase with the money going for schools, if local voters agreed. Voters in all Iowa's counties approved that tax, though many are up for renewal within the next couple years.

Supporters of the bill said only urban districts benefit from that funding formula, noting that big cities such as Des Moines and Cedar Rapids have more retail centers and, therefore, attract more sales.

Supporters sought to impose the tax statewide to help rural schools draw more funding. Parts of the money could also go for replacing property taxes.

If signed into law, the bill would implement the statewide tax until 2029. It gives local school officials the ability to plan for long-term improvements, including issuing bonds to pay for big repair projects.

Local State Representative Gary Worthan is one of the critics leery of the plan. He said the bill was pushed because Des Moines had its local-option tax coming up for renewal, and feared that partons who disagreed with spending on a sports arena would defeat it. He also said there is no constitutional protection against future legislatures grabbing the tax income to balance their own generalk fund budget.

"We fear that some of the biggest counties are going to get out and we want to lock them in," said Sen. Jeff Angelo, R-Creston.

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