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Iowa businesses will see $1.2 billion unemployment tax cut under bill sent to Kim Reynolds

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Iowa businesses will see .2 billion unemployment tax cut under bill sent to Kim Reynolds


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  • Iowa lawmakers have passed Gov. Kim Reynolds’ bill to cut unemployment taxes for businesses, resulting in more than a $1 billion tax cut over five years.
  • The bill would cut in half the amount of wages on which businesses pay unemployment taxes, as well as lower the maximum unemployment tax rate from 7% to 5.4% and reduce the number of tax tables.
  • Republicans said Iowa’s high unemployment trust fund balance shows the state is over-collecting, while Democrats said the bill gives corporations a tax break and fails to help workers.

Iowa businesses will see a nearly $1.2 billion tax cut on the money they pay into the state’s unemployment trust fund under a proposal lawmakers passed and is headed to Gov. Kim Reynolds for her signature.

In a statement, Reynolds said Iowa’s unemployment tax “has needlessly punished Iowa businesses.”

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“Our unemployment trust fund balance is at an all-time high of nearly $2 billion, while the duration of unemployment claims is at a record low of around nine weeks,” she said. “We’re clearly over-collecting.”

Reynolds called for the unemployment tax cut in her Condition of the State address in January. The bill would cut in half the amount of wages on which businesses pay unemployment taxes, as well as lower the maximum unemployment tax rate from 7% to 5.4% and reduce the number of tax tables.

Those taxes flow into Iowa’s unemployment trust fund, which pays unemployment benefits to workers when they are laid off.

“Passing this bill means nearly $1 billion in savings over five years for Iowa businesses of all sizes,” Reynolds said. “Thank you to our legislators and key stakeholders for their support to help attract new business to Iowa and place existing businesses on a level playing field with our neighboring states.”

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The Iowa Senate voted 32-16 along party lines on May 14 to pass the bill, Senate File 607. House lawmakers followed a few hours later with a party-line vote of 60-27.

Democrats said the bill gives businesses a tax break while doing nothing to help workers.

“Fundamentally, my Democratic colleagues and I do not believe that we should be helping our employers on the backs of our workers,” said Senate Minority Leader Janice Weiner, D-Iowa City.

Democrats seek to restore unemployment benefits cut by Republicans in 2022

Democrats argued the tax cuts for employers are possible because of a 2022 law passed by Republicans that cut the maximum number of weeks Iowans can receive benefits from 26 weeks to 16.

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They offered amendments to restore Iowa to 26 weeks of unemployment benefits, or 39 weeks in the case of a plant closure. Republicans voted the proposals down.

Sen. Janet Petersen, D-Des Moines, read a list of Iowa companies that have laid off workers this year.

“These are real Iowans facing real job losses just this year,” she said. “And instead of helping them, you want to pull money out of Iowa’s unemployment insurance system to give another corporate tax break to companies that are laying them off.”

Sen. Adrian Dickey, R-Packwood, said Iowans still get 26 weeks of unemployment benefits if there is a plant closure, although that number is down from 39 weeks before the 2022 law.

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“When a business does close its doors and goes out of business, we have been compassionate about that issue by moving that to six months of unemployment benefits,” he said.

Sen. Molly Donahue, D-Cedar Rapids, urged Republicans to “stand behind workers.”

“Our unemployment system is rigged for the employers, particularly with this bill,” she said. “It is the workers who hold businesses up and we need to do better by those workers, not give even more breaks to the employers who are laying them off.”

Dickey said the 2022 law included changes that has helped Iowa Workforce Development get Iowans back to work sooner after they are laid off, lowering the state’s average unemployment duration to nine weeks.

“The Republican Party has been the party to stand up for Iowa workers,” he said. “We are the party that wants our workers to aspire more than desiring an unemployment check.”

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How much would Iowa employers save in unemployment taxes?

According to an analysis by the nonpartisan Legislative Services Agency, businesses would see a $1.18 billion tax cut over five years if the bill becomes law.

That would amount to roughly $200 to $250 million less that businesses pay into the unemployment trust fund each year, according to the agency’s estimates.

  • 2026: $193.2 million
  • 2027: $229.4 million
  • 2028: $241.2 million
  • 2029: $253.5 million
  • 2030: $266.3 million

The Legislative Services Agency estimates that Iowa’s unemployment trust fund balance will rise to $2.06 billion in 2026, the first year lower tax rates would take effect. In 2030, the agency estimates the trust fund balance will stand at $1.78 billion.

Will businesses use the savings to help employees?

The bill says employers should use any savings they receive from the tax cuts to pay for employee salaries or benefits or to use as an alternative to unemployment benefits during periods of seasonal layoffs.

House Democrats tried to amend the bill to make that mandatory.

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Rep. J.D. Scholten, D-Sioux City, said “knowing what you should do and actually doing it are two different things.”

“Coming into session I came with a mindset that I should eat healthy, but that didn’t happen,” Scholten said, getting laughs from his colleagues.

Corporations should take care of workers, he added, “but that’s not reality.”

“Let me be clear: billionaires do not work harder than the working class,” Scholten said. “It’s bills like this that put a thumb on the scale towards billionaires and towards multinational corporations.”

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Rep. David Young, R-Van Meter, said the Democrats’ amendment would create a mandate on businesses and could prevent them from spending money on new equipment or other ways of improving the business.

“While many of us would like to see and encourage employers to use all the savings from the bill on their employees, businesses may need flexibility in difficult economic times,” he said. “And this could actually result in harm to employees instead by tying the hands of employers to strengthen and grow their business.”

Iowa has nearly $2 billion in its unemployment trust fund

Iowa had $1.95 billion in its unemployment trust fund as of May 12.

As of Jan. 1, 2024, Iowa ranked ninth in the country for unemployment trust fund balance, at $1.8 billion, ahead of more populous states.

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Democrats pointed out that Reynolds used $727 million in federal COVID-19 relief funds to shore up the fund during the pandemic.

Sen. Zach Wahls, D-Coralville, said it’s a good thing that Iowa has a high trust fund balance, raising concerns about what could happen if a recession hits.

“When the whole point of the fund is to be ready for a rainy day and you see storm clouds on the horizon, you want that fund to be full,” he said. “Because what you don’t want is to have to raise taxes when you’re headed into a recession to make up for a shortfall.”

Dickey said the unemployment trust fund is structured so that if the fund dips below a certain level, businesses move to a higher tax rate so the fund is replenished.

“I don’t agree that those scenarios are coming from an economic standpoint,” he said. “But if they are, the fund is structured to handle those situations.”

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How does Iowa’s unemployment insurance taxable wage base compare with other states?

Iowa currently taxes businesses on about $39,500 of an employee’s wages.

That ranks Iowa 12th in the country for its taxable wage base for unemployment insurance.

Iowa’s wage base is the second-highest among surrounding states, second to Minnesota ($43,000).

Reynolds’ proposal would cut that number in half, meaning Iowa would tax businesses on about $19,800 of an employee’s wages.

Iowa would still tax more wages than South Dakota ($15,000), Wisconsin ($14,000), Kansas ($14,000), Illinois ($13,916), Missouri ($9,500), Michigan ($9,000) and Nebraska ($9,000).

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The governor’s proposal would also lower the top rate paid by employers from 7% to 5.4%, reducing both the tax itself and the base they pay the taxes on.

(This story was updated because an earlier version included an inaccuracy.)

Stephen Gruber-Miller covers the Iowa Statehouse and politics for the Register. He can be reached by email at sgrubermil@registermedia.com or by phone at 515-284-8169. Follow him on X at @sgrubermiller.





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Iowa

KTIV receives 6 awards from the Iowa Broadcasters Association

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KTIV receives 6 awards from the Iowa Broadcasters Association


SIOUX CITY (KTIV) – Members of KTIV were in Des Moines, Iowa Thursday, June 12, for the Iowa Broadcasters Association’s Award Ceremony.

The association, which promotes over-the-air broadcasting like radio and television, awarded KTIV six awards. Each award was for the Small Market TV category and is listed below.

  • Breaking News Award for Siouxland’s Historic June 2024 Flooding
  • Digital Excellence Award for Siouxland’s Historic June 2024 Flooding
  • Election Coverage Award for the Iowa Caucuses
  • News Special or Documentary Award for KTIV’s special “The Town Too Tough To Die: Pilger Tornado 10 Years Later”
  • Outstanding Public Service Campaign for the Mighty Mo Run
  • Outstanding Station Promotion for KTIV’s Santa Tracker
KTIV was in Des Moines, Iowa on Thursday, June 12, for the IBA Awards.(KTIV)

Want to get the latest news and weather from Siouxland’s News Source? Follow these links to download our KTIV News app and our First Alert Weather app.



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Reynolds vetoes Iowa bill aimed at limiting eminent domain for carbon pipelines

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Reynolds vetoes Iowa bill aimed at limiting eminent domain for carbon pipelines


Iowa Gov. Kim Reynolds vetoed a bill Wednesday that would have made it more difficult for companies to use eminent domain to build carbon capture pipelines and other energy infrastructure.

In her veto message, Reynolds said the bill is not just about eminent domain.

“It goes much further — and in doing so, sets a troubling precedent that threatens Iowa’s energy reliability, economy and reputation as a place where businesses can invest with confidence,” she said.

Reynolds said the bill’s insurance mandates and 25-year permit limit would even block pipeline projects that use only voluntary agreements with landowners.

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“I understand this was not the intent,” she said. “Those who crafted the bill said they don’t want to stop CO2 pipelines that rely entirely on voluntary agreements. But that is exactly what the bill does. For that reason alone, I cannot sign it.”

Reynolds also raised concerns about the bill’s changes to permitting rules for other types of pipelines, including those that transport oil, gas and fertilizer. She also said the bill would put Iowa at a competitive disadvantage for biofuels production as other Midwestern states move forward with carbon capture projects.

She said she is “committed to working with the Legislature to strengthen landowner protections, modernize permitting, and respect private property.” In the meantime, Reynolds said she is asking Iowa Utilities Commission members to be present for live testimony and informational meetings, which would have been required by the bill she vetoed.

“Those who crafted the bill said they don’t want to stop CO2 pipelines that rely entirely on voluntary agreements. But that is exactly what the bill does. For that reason alone, I cannot sign it.”

Gov. Kim Reynolds

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House Speaker Pat Grassley, R-New Hartford, said he has asked House members to sign a petition to hold a special session to override the governor’s veto.

“This veto is a major setback for Iowa,” Grassley said in a statement. “It is a setback not only for landowners who have been fighting across Iowa, but for the work the House of Representatives has put in for four years to get legislation like HF639 passed. We will not stop fighting and stand firm on our commitment until landowners in Iowa are protected against eminent domain for private gain.”

Lawmakers can override a veto if two-thirds of the members of each chamber vote to pass the bill again.

Senate Majority Leader Jack Whitver, R-Grimes, said he supports Reynolds’ decision.

“Based on the votes on that bill in the Iowa Senate, a significant majority of our caucus supports a better policy to protect landowner rights,” he said. “I expect that majority of our caucus would not be interested in any attempt to override her veto.”

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Katarina Sostaric

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Iowa Public Radio

Eminent domain bill supporters in red shirts and opponents in blue shirts watched as the Iowa Senate debated a bill to limit eminent domain for carbon pipelines May 12, 2025.

Iowans who oppose the use of eminent domain for the Summit Carbon Solutions carbon capture pipeline have fought for years to get a bill passed that would prevent the company from acquiring land from unwilling landowners in its path. State utility regulators gave Summit Carbon Solutions conditional approval last year to use eminent domain for the project.

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This year, 12 Republican senators defied their leaders and forced a vote on a bill aimed at further restricting eminent domain and pipeline projects. After a contentious, late night debate in which GOP senators publicly argued with each other about the potential impact of the bill, 13 Republicans joined with 14 Democrats to pass it.

Senate Democratic Leader Janice Weiner of Iowa City said she was disappointed by the veto but not surprised.

“There is simply no amount of political posturing or legislative stonewalling that can deny the fact that Iowans’ right to private property should never be infringed upon for private gain,” she said.

House Minority Leader Brian Meyer, D-Des Moines, said Reynolds sided with her political donors rather than Iowa landowners.

“Iowa House Democrats and Republicans worked together to protect property rights,” he said. “At the end of the day, there is only one group to blame for the failure of the eminent domain bill: Iowa Republican lawmakers.”

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Summit Carbon Solutions thanked the governor for her “thoughtful and thorough review of the bill.”

“We look forward to continued discussions with state leaders as we advance this important project,” Summit’s statement reads. “At a time when farmers are facing increasing pressures, this project opens the door to new markets and helps strengthen America’s energy dominance for the long term.”

Supporters and opponents of the bill have disagreed about its impact

The Summit Carbon Solutions pipeline would transport carbon dioxide emissions from ethanol plants in Iowa, Nebraska, South Dakota and Minnesota to be sequestered underground in North Dakota. Biofuels producers have said the project is needed to create new markets for low-carbon fuels, which they said would increase demand for corn and boost Iowa’s economy.

Monte Shaw, executive director of the Iowa Renewable Fuels Association (IRFA), thanked Reynolds for vetoing the bill.

“Any thoughtful review of this bill would determine that it would lead to higher energy prices for Iowans, hamper future economic development, hold back job creation and stifle new markets for Iowa farmers,” he said. “IRFA thanks Gov. Reynolds for listening to Iowans, studying the actual legislation and ignoring the rhetoric that was as inaccurate as it was loud.”

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Shaw said the bill would not have enhanced property owner rights, and that it simply sought to kill carbon capture pipelines.

Iowans living in or near the path of proposed carbon pipelines rallied at the Statehouse in support of a bill that would restrict the use of eminent domain for such projects.

Madeleine Charis King

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Iowa Public Radio

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Iowans living in or near the path of proposed carbon pipelines rallied at the Statehouse in support of a bill that would have restricted the use of eminent domain for such projects.

Landowners facing the use of eminent domain have said the bill wouldn’t stop any pipelines — but it would have leveled the playing field for affected landowners and their neighbors.

Mary Powell, an affected landowner from Shelby County, said last month the bill was a reasonable, common sense measure to help protect Iowans’ rights to have control over their land.

“The issue at hand is not a partisan issue,” she said. “It’s not about Democrats or Republicans or who has the most money to push through their private agenda for private gain. It’s about taking a stand and protecting the rights of Iowans. It’s about holding the pipeline companies and those in public office accountable.”

Rep. Charley Thomson, R-Charles City, said he wrote the bill. He recently wrote on Facebook that the bill is “a relatively tepid first step toward fixing Iowa’s broken pipeline permitting system.”

“The entire CO2 pipeline project is based on lies, so I’m not the least surprised that the CO2 pipeline crowd launched a blizzard of lies in their attacks on HF639,” he wrote.

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What would the bill have done?    

The bill says a hazardous liquid pipeline can only use eminent domain if it is a common carrier, which is defined as transporting a commodity for entities not affiliated with the pipeline company.

A company seeking to use eminent domain would have to establish “by clear and convincing evidence that the proposed use meets the definition of a public use, public purpose, or public improvement.”

The bill would have established insurance requirements for hazardous liquid pipelines that would’ve included coverage for landowners who couldn’t get insurance or whose premiums rose as a result of the pipeline.

Pipelines transporting carbon dioxide would have also been prohibited from operating for longer than 25 years, and the Iowa Utilities Commission (IUC) would’ve not be allowed to renew a permit granted to a carbon pipeline.

The bill would have put in place requirements for IUC members to attend hearings and informational meetings regarding the proposed use of eminent domain — something Reynolds said she is asking ICU members to do. It would’ve specified who could intervene in IUC proceedings, and limited the situations in which the IUC could impose sanctions on interveners.

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Iowa high school co-ed state golf: Cedar Falls, Grundy Center take home titles

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Iowa high school co-ed state golf: Cedar Falls, Grundy Center take home titles


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The 2025 Iowa high school golf season is in the books following the conclusion of the state co-ed golf tournament on June 10.

In Class 2A, the duo of Molly Ratchford and Anthony Galvin from Cedar Falls took home the state title at the Cedar Pointe Golf Course in Boone. The pair shot a combined 68, claiming the crown by two strokes over the team from Cedar Rapids Washington, Jane Petersen and Preston Haefner.

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The third-place team in 2A was Natalie Henson and Ty Faltys from Marshalltown, who shot a 74.

In Class 1A, the duo of Leah Larson and Judd Jirovsky from Grundy Center won the state co-ed crown with a score of 75 at the American Legion Golf Course in Marshalltown. Another Grundy Center duo, Avery Knutsen and Preston Martens, claimed second place. They finished just two strokes behind Larson and Jirovsky with a 77.

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Finishing in third place was Woodward-Granger’s team of Mallory Polito and Max Behrens, who also shot a 77.



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