Among the large projects taken up this session is the Chapter 20, public employee relations (collective bargaining) reform passed and signed last week. This reform may be the most needed and bold action of the 2017 session.
Our reforms will have the effect of balancing the experience between the private sector, who provides the vast majority of tax revenue for public services, and the public sector employees who provide the services Iowans expect.
When Chapter 20 was written and debated in 1974, the end result was a bill that addressed the issues of the day. The Legislature 42 years ago listed 17 mandatory topics that must be bargained if either side wanted to negotiate on them. If the topic is opened and the two sides do not come to an agreement, the outcome is potentially settled by a third party arbitrator who does not represent the taxpayers. This has become a fatal flaw over the last four decades.
Compare that to the private sector, where employers have the final say on what they can afford, which benefits can be provided, and decide how issues such as hours, in-service training, or procedures for staff reduction will be handled. It is my belief if a private sector business tried to operate under the same restraints as our public sector employers that business would eventually go broke. The old Chapter 20 places too much power in the hands of those negotiating for higher wages and a customized work environment at the expense of the taxpayer and the officials charged with providing a service for Iowans.
The reason the old Chapter 20 looked like it was working is that governments really can’t go broke and close. They can’t be sold to a larger entity like a private business can. Instead, as the cost of services goes up, the tax burden goes up. Property taxes, income taxes, and sales taxes are all collecting more than they ever have. Yet we find ourselves in difficult budget situations annually.
So, for 42 years the agricultural, manufacturing, and service sectors of Iowa’s economy have been growing and expanding, while Iowa’s cost of government grew right along with it. Even if tax rates did not increase, natural growth in economic activity sent in more of your tax dollars. If we could hold the cost of government steady, this would translate into lower tax rates and more growth. This Chapter 20 revision is working to address this problem.
Iowa’s public sector employees are valued and provide important services in every community of the state. I understand the concern of public employees. After 42 years under the old law, our current public employees have worked their entire career under this framework. This change for them seems difficult, but I will say again, this law does not remove health insurance, it requires it. The new law has nothing to do with IPERS. The new law does not cut wages.
But I do not think it is right that Iowa law provides an advantage in negotiating over the majority of taxpayers who foot the bill. It is also important that the elected official at each level have the final say in how a public entity is managed. This is the Chapter 20 that should have been enacted in 1975 and will serve us well for years to come.
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