What is needed in a pandemic is for citizens to stay home, and for public policy to assure access to unemployment insurance and health care, and push support to the health system. Economists such as former Labor Secretary Robert Reich are making these points — that limiting the spread of the coronavirus is the top priority to save lives.[1] When even economists are pressing the point about public health, our leaders should pay attention. Now is not the time to talk about being “open for business” prematurely, as President Trump once suggested we do by Easter. That is not to say a public health spotlight precludes steps in the coming weeks and months to set up recovery when that can be the main focus. Now, jobs remain in critical services in hospitals and electric stations, and some in construction. Factories where people stand next to each other on a production line have different social distancing from workers who build things in the open air. We could expand more of the latter jobs right now where the materials are at hand. Good examples: Wind turbines and solar installations and the power lines that connect them to the electric grid. Right now we could be constructing clean energy facilities that can be producing electricity in six months or a year when we all want demand to expand. It is an opportune moment to think ahead and start replacing older coal production plants, which have their own health problems. Public policy has a role here. Just before the Iowa legislators recessed because of the COVID-19 pandemic, they passed — and Governor Kim Reynolds signed — a bill to stabilize the solar industry. It would do this by setting the price for the next seven years for the electricity that MidAmerican and Alliant buy from homeowners and businesses.[2] Another step the Legislature could take is lifting the limit on the tax credit for businesses and homeowners when they install solar. The annual amount that could be taken on the credit was not fully used in the first year, but in all years since 2013 installations exceeded the cap, now at $5 million per year, pushing installations completed later in the year to a waitlist.[3] The tax credit eventually comes but not until at least a year later. While an installation completed today will get a federal tax credit when taxes are filed in April 2021, the Iowa tax credit will not happen until 2022 or later. Why make these Iowa investors wait? Extending the total amount eligible for the credit from $5 million to perhaps $20 million would further stimulate the construction of solar panels just when the economy needs the jobs. There also is a federal role, as the amount of that credit for both solar and wind is phasing out. This would be a good time to stop the phaseout for the next several years. Tax credits of electric cars could also be enhanced. COVID-19 has slammed the economy. We need to think about when we will recover but also how we will recover. Jobs in clean energy have been on a growth curve that can be re-established quickly. And these jobs are creating a new energy system that will help us with the next crisis, climate change. Most agree we should follow science to confront the pandemic. We should also follow the science to prepare for the next crisis — climate change. David Osterberg is an economist and lead environmental researcher at the nonpartisan Iowa Policy Project in Iowa City. Contact: dosterberg@iowapolicyproject.org. A version of this column also ran in the April 1 Quad-City Times.         [1] MSNBC interview, March 17, 2020. https://www.msnbc.com/the-beat-with-ari/watch/-our-economy-is-shutting-down-clinton-wh-veteran-pushes-lives-over-dollars-in-covid-19-crisis-80868933847 [2] O. Kay Henderson. Iowa House and Senate give solar bill unanimous support. Radio Iowa March 4, 2020. https://www.radioiowa.com/2020/03/04/iowa-house-and-senate-give-solar-bill-unanimous-support/ [3] Iowa Department of Revenue. Solar Energy System Tax Credit Annual Report for 2019. https://www.legis.iowa.gov/docs/publications/DF/1126111.pdf

Seniors in particular should be wary of Governor Reynolds’ tax-shift plan because, like most Iowans they would, in general, see little or no benefit and could even be worse off. The list of those harmed by this plan is significant already.

• Poor and moderate-income Iowans will lose income and services.
• Environmental and outdoor recreation advocates who sought a sales-tax increase to fund their priorities will get far less than they expected because the Governor proposes to change the rules.
• Education, law enforcement and other services will suffer with net losses in general fund revenues that the governor is demanding.

Add seniors to the list. It is clear seniors are among the losers in this legislation unless they are (1) rich or (2) not concerned about the public services that will be lost. Iowans at low and moderate incomes already can count on paying a greater share of their income in state and local tax under the plan. That’s because it trades a sales tax increase, which disproportionately affects those at lower incomes, for cuts in the income tax and property tax, which helps wealthier filers. To get her way at the expense of low-income Iowans no matter their age, the Governor wants to change the law that set up the constitutional amendment approved by voters in 2010. The amendment directed the next three-eighths-cent sales tax to a Natural Resources and Outdoor Recreation Trust Fund. That law, set up to implement the fund, said trust fund moneys would “supplement and not replace” appropriations for the purposes named for the fund. That is important on two counts. Besides throwing aside the expectation of all of the designated sales tax increase providing new money for those purposes, her plan shortchanges the specified purposes, cutting trails, REAP, and much of the funding for the Department of Natural Resources. Beyond the formula change that should concern anyone who voted for the amendment in 2010, seniors in particular should be wary because the Governor is embracing the voters’ consent to a tax increase only if she can cut other taxes by a greater amount. Her proposed income tax cuts are guaranteed to hinder Iowa’s long-term commitments to other services, from education funding for grandchildren’s schools, to corrections to safety-net supports — and make the overall tax system less fair to the poor and middle-income Iowans and especially seniors. A bad deal for seniors The Governor’s plan would raise the sales tax by a full penny, not just three-eighths of a cent for the trust fund, and use the majority of the increased revenue to cut income taxes. That would be a bad deal for most seniors. The Iowa Department of Revenue has estimated that an additional penny sales tax would cost the average lower income household in Iowa without children about $40 on average (with a range of $30 to $50). That includes all households making less than $30,000. Those in the $30,000 to $50,000 gross income range would pay $68 to $90 more.  Data from the Institute on Taxation and Economic Policy indicate that 40 percent of Iowa households earn under $50,000.[1] But estimates from the Iowa Department of Revenue show that the income tax cuts would not provide any measurable benefit for the lowest-income 40 percent of seniors – an average tax savings of just one dollar, for those with taxable income under $10,000. Because of favorable tax treatment for seniors, many currently pay no income tax and thus would get no benefit. Those earning $50,000 to $75,000 total income represent the middle 20 percent of Iowa households. They would pay $100 to $120 more a year in sales tax under the Reynolds plan, but save only about $33 in income taxes. At least 60 percent of seniors, in other words, pay more under this proposal – and they are paying more largely to finance bigger tax cuts for the wealthiest Iowans. Seniors count on many public services that are funded by state and local government. So while seniors largely will not benefit on the revenue side, they will also lose on the expenditure side, in lost services. These services cannot avoid cuts if the Governor gets her way. Under her proposal, there will be about $175 million less revenue in the general fund each year, which means less funding for education, health care, and other services. A key reason most seniors do not benefit It also is helpful to remember that many seniors have several built-in exceptions to income tax. These exceptions make new income-tax cuts meaningless or minimal to them, unless they are quite well off already:

• All Social Security benefits already are exempt from state tax in Iowa.
• The first $6,000 in pension benefits per person ($12,000 per married couple) is exempt from tax.
• Those age 65 or older receive an additional $20 personal credit.
• While non-elderly taxpayers are exempt from tax on the first $9,000 of income, for those age 65 or older, the exemption rises to $24,000. For married couples, the threshold is $13,500 for the non-elderly, but $32,000 for seniors.

In short, under current Iowa tax law, seniors get very substantial income tax breaks. For seniors especially, new tax-cut promises are hollow — just like, if the Governor gets her way, the promises that came with the 2010 campaign for a constitutional amendment for a sales tax increase to fund water quality and recreation.   [1]   Those with taxable income under $10,000 account for 41 percent of senior tax filers for Tax Year 2022, according to Table 5 in the Iowa Department of Revenue memo to Jeff Robinson on the impact of SSB3116 on seniors, Feb. 14, 2020. Those with $10,000 to $20,000 taxable income account for another 17 percent of senior taxpayers. Peter Fisher is research director of the nonpartisan Iowa Policy Project.   David Osterberg is IPP’s environmental researcher and co-founded the organization in 2001.

It is worth noting that as the Iowa Senate passed an exceedingly meager 2.1 percent growth in per-pupil spending for Iowa’s K-12 public schools, Governor Reynolds’ tax bill offers a net reduction in revenue.

But even the governor has proposed more for FY2021 — 2.5 percent — than the Senate approved Monday. As shown below, the governor’s plan keeps Iowa on a long-term downward trendline (in red) for school funding growth. The Senate plan goes lower.

It has become a familiar story: Tax breaks and tax expenditures growing at a pace that spending on traditional state priorities cannot match. This growth continues on autopilot, year after year, with little scrutiny and often with weak justification.

The cost of business tax credits under the income tax grew from $214 million in Fiscal Year 2015 to $244 million in FY19, and is projected to be $287 million for FY20.[1] The commercial and industrial property tax cuts enacted in 2013 have added significantly more to that estimate. The business property tax credit enacted in that legislation, which will remain at $125 million every year, will bring the overall state cost of business tax credits to more than $400 million by FY20. In other words, business tax credits in total will have about doubled in six years. (See graph.)

Related business breaks would drive total spending on subsidies to business much higher.

• • • Iowa in recent years has spent $152 million annually to backfill local public revenues lost when commercial and industrial property assessments were rolled back to 90 percent of actual value, a tax break to business.[2]
    • Revenue losses from the state’s failure to enact combined reporting to plug loopholes in the corporate income tax amount to an estimated $200 million.[3]
    • The state also spends nearly $60 million annually backfilling the loss of tax base to school districts as a result of city and county use of tax increment financing, much of which reduces the costs of business development.[4]

The total cost of business subsidies, in other words, approaches $800 million, even without other so-called tax expenditures, such as the state’s use of single-factor apportionment.

Tax credits have the same impact on the state’s bottom line as any other spending. Such spending comes outside the normal budget process where agencies, advocates and constituents make proposals that lawmakers vote up or down, on the record. Tax credits, with few exceptions, cause spending outside that competition.

State spending on business subsidies necessarily comes at the expense of other budgetary priorities, including education, health, and public safety. Investments in education and infrastructure, the building blocks of a strong economy, suffer when the annual budget debates start out with a billion dollars already committed to business incentives.

Real reform is needed now more than ever.

See our Roadmap for Opportunity two-pager on this topic.

[1] The following tax credits listed in the Iowa Department of Revenue Contingent Liabilities Reports are included in our analysis as business tax credits: Enterprise Zone Programs, High Quality Jobs Program, Historic Preservation, Industrial New Job Training Program (260E), Research Activities, Targeted Jobs, Venture Capital, Accelerated Career Education, Redevelopment, Renewable Chemical Production, Renewable Energy, Wind Energy Production, Biodiesel Blended Fuel, E15 Gasoline Promotion, E85 Gasoline Promotion, Ethanol Blended Gasoline, Ethanol Promotion. With the exception of Historic Preservation, this list is in line with credits classified as “business incentives” by the Iowa Department of Revenue in their most recent tax expenditure study. https://tax.iowa.gov/reports/2010-iowa-general-fund-tax-expenditures-excel.

[2] Legislative Services Agency, Summary of the Governor’s Budget Recommendations FY2021. Jan. 16, 2020, page 212.

[3] Iowa Department of Revenue, 2017.

[4] Legislative Services Agency, FY 2018 Annual Urban Renewal Report, February 15, 2019, p. 24. About 15 percent of TIF erxpenditure in FY18 went directly for business projects; it is not known how much of the 63 percent that went to property acquisition, roads, bridges, utilities, and water or wastewater treatment plants was associated with business development.

Peter Fisher is research director of the nonpartisan Iowa Policy Project.

pfisher@iowapolicyproject.org

See IPP’s Roadmap for Opportunity piece on tax reform

Iowa is an average-tax state. Even before expensive tax cuts passed in 2018 to benefit the wealthiest, Iowans paid about 2.5 percent of their income toward income taxes, 2.4 percent for sales taxes, which earns us a rank of 20^th and 21^st, respectively, among the 50 states.[1] Business taxes in Iowa are actually below average according to recent studies by two accounting firms: one placed Iowa 31^st, the other 36^th.[2]

But our tax system already failed the fairness test before those new tax cuts. The highest income Iowans pay a smaller share of their income to state and local taxes than lower and middle-income Iowans — our tax system is regressive. Those in the bottom fifth of Iowa households by income pay 12.4 percent of their income in state and local taxes, while those with incomes in the top 1 percent pay just 7.7 percent.[3] And hundreds of millions in tax revenue are lost every year to corporate loopholes and business tax credits that produce little or no public benefit. At the same time, the state struggles every year to adequately fund education, public safety, health care and other priorities.

Real tax reform, then, would mean three things: (1) ensuring adequate revenue, (2) reducing the regressivity of our tax system, and (3) reining in corporate tax credits and loopholes.

Iowa’s 2018 tax law fails the test, cutting back on both fairness and revenues

The legislation signed into law in 2018 does none of these things. It cuts revenue, makes the tax system more regressive by concentrating tax cuts on the rich, and fails to reform credits or loopholes.[4] The package had one true benefit: modernizing the sales tax to include online purchases and level the playing field for local and state-based businesses.

Under this legislation, however, the income tax savings to a middle-class family by 2021 amount to just $5 to $10 a week and much of that will be taken back by the sales-tax increase. Millionaires, on the other hand, will see on average a $24,636 cut for the year. Almost half of the tax cuts will go to the richest 2.5 percent of Iowa taxpayers, those making $250,000 or more.

The 2018 tax bill also piles $40 million in corporate tax cuts on top of commercial property tax cuts enacted several years ago that have cost local governments millions of dollars. A new special tax break for business owners who receive “pass-through” income will cost in excess of $65 million a year, with 60 percent of the benefit going to the top 2 percent of taxpayers.

Overall, the bill will take $300 to $400 million a year out of the budget that could have gone to adequately fund education or public safety or mental health care. Those revenue cuts will happen regardless of the state of the Iowa economy or the budget; no safeguards will prevent it, despite the bill’s much touted “triggers.”[5]

To add insult to injury, the tax bill is far more likely to hurt the Iowa economy than to help it. The tax cutting experiment in Kansas was a failure, harming the state economy rather than helping it.[6] And Iowa’s own experience with massive tax cutting, in the late 1990s, not only failed to stimulate growth, but likely contributed to the subsequent slowing of the state’s economy.[7] 

Policy Alternatives: The elements of real reform 

• Ensure adequate funding for our schools, which have been underfunded for years, revenue failing to keep pace with costs. End cuts to state funding of Iowa’s public universities and community colleges, forcing higher tuition, and leaving students and families with rising debt.
• Plug corporate tax loopholes that cost Iowa an estimated $200 million a year,[8] and rein in business tax credits that grew from $200 million to $423 million in six years.[9]
• Make our tax system fairer, and better based on ability to pay. This should be done by providing enhanced recognition of the cost of raising a family by expanding the child tax credit and the child and dependent care credit, as well as the Earned Income Tax Credit. Less reliance on the sales tax, which has doubled since 1983 and is poised for another potential increase, or offsets to these increases can enhance opportunities for low- and moderate-income families now put at a disadvantage.

Rebalancing the tax code would reduce its current regressive nature, which imposes higher taxes as a share of income on lower- and middle-income Iowans than on the wealthy.

[1] Taxes as a percent of state personal income for the most recent five years available, 2013-2017, from the U.S. Census, Census of Government Finances.

[2] Iowa ranks 31^st in business taxes as a percent of GSP according to Ernst & Young LLP, Total state and local business taxes, October 2019. Table 4, page 12. https://www.cost.org/globalassets/cost/stri/studies-and-reports/FY16-State-And-Local-Business-Tax-Burden-Study.pdf.pdf; Iowa ranks 36^th (with #1 being the highest tax rate) in business taxes as a share of business pre-tax operating surplus by Anderson Economic Group LLC, June 2018. 2018 State Business Tax Burden Rankings, Exhibit I, page 17. https://www.andersoneconomicgroup.com/wp-content/uploads/AEGBusinessTaxBurdenStudy_2018_FINAL.pdf

[3] Institute on Taxation and Economic Policy. Who Pays? Sixth Edition. https://itep.org/whopays-map/

[4] See Charles Bruner and Peter Fisher, “Tax plan facts vs. spin.” Iowa Fiscal Partnership, May 5, 2018. http://www.iowafiscal.org/tax-plan-facts-vs-spin/

[5] All the triggers would do is save us from an even larger budget disaster in 2023 and beyond. The triggers are revenue targets; if the targets are not achieved, the last round of cuts will not take place as scheduled for tax year 2023.

[6] Michael Mazerov. “Kansas Provides Compelling Evidence of Failure of ‘Supply-Side’ Tax Cuts.” Center on Budget and Policy Priorities, January 22, 2018. https://www.cbpp.org/research/state-budget-and-tax/kansas-provides-compelling-evidence-of-failure-of-supply-side-tax-cuts

[7] Peter Fisher. “Tax cuts: Already tried, failed.” Iowa Policy Points, April 23, 2018. https://iowapolicypoints.org/2018/04/23/tax-cuts-already-tried-failed/

[8] Iowa Policy Project analysis of Iowa Department of Revenue estimates.

[9] “Growing cost, lax oversight of Iowa business tax credits.” Iowa Fiscal Partnership, March 16, 2018. http://www.iowafiscal.org/wp/wp-content/uploads/2018/03/180319-IFP-taxcredit-bgd.pdf

We would be remiss at the end of 2019 not to note the positive lessons of the last 10 years.

— We have plenty of room to raise the minimum wage, now 12 years old at $7.25 an hour. Had the minimum simply kept up with inflation, it would be 22 percent higher, at $8.83 — but of course still short of a living wage. IPP research shows a single parent needs about $20 to $22 an hour working full time just to make a bare-bones household budget.

— We can require polluters to stop ruining Iowa’s water, by putting some teeth in the so-called Nutrient Reduction Strategy, which is rendered meaningless by requiring nothing of polluters. Even the good actors in the ag community should be able to see their efforts are eroded like unprotected soil when neighbors’ farm practices contribute to nutrient pollution.

— Without raising tax rates, we can raise significant revenue for education and other shortchanged services, by curtailing or ending research tax-credit checks for corporations that pay no income tax ($40 million), and by closing tax loopholes ($100 million). Instead, we have seen an average increase of less than 2 percent in permitted per-pupil K-12 spending in Iowa over 10 years. We see rising college tuition because of poor state support.

— We can make our tax system more fair by shifting our increased reliance on sales taxes to revenue sources such as income tax. Our four-decade trend toward sales tax (and against income tax) may continue in 2020 with the push for environmental quality and recreation as directed by voters in 2010, but it can be paired with moves to make the overall system more fair. Note: That approach demands no new tax cuts for the wealthy.

That list is hardly exhaustive. Queue up child care assistance, wage theft enforcement, restoring and protecting collective bargaining rights, making pensions more commonplace instead of attacking workers who have them. We could even step up efforts to protect vulnerable communities in advance of the next flooding disaster,

The common theme: Since we’ve done nothing or virtually nothing meaningfully positive in 10 years in these areas, even small steps will look good in comparison. And, because of the pent-up frustration of those who would have been satisfied five years ago with small steps, visionary and dramatic steps might be possible.

But this is not a “woulda, coulda, shoulda” refrain like you would hear after a near-miss in a ballgame. For all their theme of decline, retrenchment and a “can’t-do” mindset, the failures of the 2010s really spotlight what we can do through public policy to work together for a stronger, more equitable, more inclusive, more sustainable Iowa in the 2020s.

This is a moment to start a rebound.

At the Iowa Policy Project, we have used solid information and years of perspective to spotlight challenges and ways to make life in Iowa better, next year, five years, even 10 years from now.

So, bring on 2020!

Mike Owen is executive director of the nonpartisan Iowa Policy Project. mikeowen@iowapolicyproject.org

The Iowa Policy Project is a 501c3 nonprofit organization funded by individual donations, organizations and foundation grants. Tax-deductible contributions may be made online at this link.

I recently watched part of the Hancher Auditorium parking lot ripped up and repaved at the University of Iowa. With the university community well aware of the impacts of flooding, I was surprised by the missed opportunity to rebuild the parking lot with more water retention features like bioswales or permeable pavers. We know that heavy rainfall impacts in Iowa will only grow as climate change accelerates.[1]

At the same time, I realized these types of interventions are expensive and perhaps outside the routine maintenance budget. So I turned my attention to other ideas for the campus: solar power opportunities and the university’s pledge to combat climate change through renewable power generation. Surely such an ambitious proposal would have resources enough to invest in solar power generation.

In 2017, UI President Bruce Harreld announced a goal to increase the university’s use of renewable resources for power and steam production and reduce coal firing for steam and energy production, and entirely phasing out coal by 2025.[2] This laudable goal addresses climate change, makes the university’s operations more sustainable, and improves air quality in Iowa City. Why not enhance this goal with solar panels?

The President’s message noted that the university would rely on a combination of biomass firing for renewable resources to hit a target of 40 percent of energy production by 2020. The university has pursued various options of biomass to be fired alongside coal for the time being (and presumably to be fired by itself once coal is eliminated). These options are:

• • • Oat hulls, the byproduct of industrial processes, currently sourced from Quaker Oats in nearby Cedar Rapids. This fuel source is readily available, and by reusing formerly discarded ingredients the UI can prevent methane emissions from decomposition while burning a carbon-neutral fuel.
    • Miscanthus grass,[3] a non-native, but non-invasive grass, is often used for biomass around the world due to its high energy content and quick growing nature. The university has planted a few collection areas and buys harvest from local producers.
    • Energy pellets, another industrial byproduct that can be fired alongside coal. Like oat hulls, adding another use to an already ongoing industrial process is more sustainable than burning a non-renewable fuel source.

On its face, this strategy seems like an innovative use of natural ingredients that are carbon neutral and close by, obtainable from regional industry and agriculture.

But it’s still only 40 percent of the plan. Where does the remaining 60 percent come from? Natural gas,[4] which is “cleaner” than coal firing for particulate matter and CO₂ , is readily available, and adds a power predictability that is hard to get from some renewable resources. But should natural gas be 60 percent of the university’s energy portfolio, when renewables could play a bigger role?

The university’s Office of Sustainability mentions, but dismisses, greater use of wind power and solar power. Both are mentioned as being implemented in a limited fashion on campus as demonstration projects for research purposes, but said to be too resource intensive (land and money) to fully replace other energy production methods for campus uses.

The message is a concern. If a complete replacement strategy were a qualifying criteria, why would it not apply to biomass firing sources as well. If not, why would the UI not consider solar and wind as a smaller scale, partial contribution to the university’s energy portfolio?

Other universities, including Maryland and Michigan State[5] have both solved cost concerns with public-private partnerships and power purchasing agreements. Indeed, UI researchers already note that the kilowatt cost of solar is below that of more traditional production requirements in some states, with the implication that similar cost comparisons will become more attainable through the country.[6]

Given the similarities between the UI and Michigan State (MSU) — both large public universities in the Midwest with similar climates and both governed by a quasi-public Board or Regents — the MSU example with solar power may prove fruitful. MSU followed the lead of several U.S. universities (including UC San Diego[7]) in deploying solar panels above parking lots on campus.

Solar could bring several benefits if installed at the Hancher lot, beyond power generation. Besides vehicle protection, it could offer research opportunities on solar generation, grid distribution methods, and power storage mechanisms for engineering faculty and students.[8]

Indeed, the University of Iowa already has experience in similar solar deployments. Its Facilities Management department already operates a solar power charging station for university vehicles, just on a much smaller scale.[9] The university has many surface parking lots that could reduce ongoing university expenses by harnessing the air rights just 10 feet above existing lots.

If this isn’t incentive enough, the university is ranked eighth in the Big Ten Conference for green power generation by the U.S. Environmental Protection Agency.[10] Surely Hawkeye pride can carry us to be No. 1. Forget Hancher. Perhaps the lots around Kinnick Stadium could be ground zero for a Hawkeye solar project — with a slogan ready to go: America Needs Solar.

[1] https://www.iowapolicyproject.org/2019Research/190905-Floods-Climate.html
[2] https://now.uiowa.edu/2017/02/ui-announces-it-will-be-coal-free-2025
[3] https://www.facilities.uiowa.edu/sites/www.facilities.uiowa.edu/files/wysiwyg_uploads/hawkeyecampusmiscanthus.pdf
[4] https://www.facilities.uiowa.edu/energy-environment/renewable-energy
[5] https://msutoday.msu.edu/news/2019/msu-helps-big-ten-achieve-largest-collective-green-energy-use/
[6] https://dailyiowan.com/2018/03/19/solar-energy-lights-up-on-campus/
[7] https://www.borregosolar.com/commercial-solar-systems/university-of-california-san-diego
[8] https://msutoday.msu.edu/news/2017/construction-begins-on-msu-solar-array-project/
[9] https://www.facilities.uiowa.edu/sustainable-energy-discovery-district
[10] https://www.epa.gov/greenpower/college-and-university-challenge

Joseph Wilensky is a Master’s Degree candidate in the University of Iowa School of Urban and Regional Planning. He was an intern at the Iowa Policy Project during the fall semester 2019.

Public policy to deal with flooding involves a lot of big-ticket items that carry big implications for the future of communities that, by choice or by economic necessity stand in harm’s way.

This issue all comes down to one of equity and equality.

Equality would ensure every community is provided the same resources and consideration regardless of their characteristics. But, as we have discussed, providing the same resources to a community that has less opportunity and ability to recover as one that is well positioned to do so results in the outcomes we have seen: Wealthy communities become wealthier while poorer communities fall further and further behind.

Equity calls for alleviating these disparities to create the opportunity for equal recovery rates and outcomes among disparate communities.

How do you do that? The following suggestions are a few items that will work toward leveling the playing field.

• • • “Rebalance” mitigation efforts with an emphasis on community impact and vulnerability rather than up-front economic loss, the latter putting higher-value properties ahead of those less able to cope on their own.
    • Put more flexibility in FEMA guidelines to ease community burdens and allow for a creative use of funds.
    • Better direct Community Block Development Grant funds to the best place for mitigation efforts — not necessarily within the damage area, but outside if needed. Flood mitigation is best placed upstream.
    • Keep state funds flowing pending the arrival federal aid, which might be delayed after a federal disaster is declared and Iowa stops processing and paying disaster claims.

While these suggestions won’t fix everything, they offer a start to a discussion that needs to start now. Policy makers and recovery agents must take into account social vulnerability and community impacts to a greater extent than they already do if we are to break the downward spiral poor communities find themselves in following disasters.

Previous:
Part 1: Flooding hits different families differently
Part 2: Flood mitigation protects different families differently

Joseph Wilensky is a Master’s Degree candidate in the University of Iowa School of Urban and Regional Planning. Visit the Iowa Policy Project website for his December 2019 report, Flooding and Inequity: Policy Responses on the Front Line.

 

* Graphic credit: Matt Kinshella; culturalorganizing.org blog, “The problem with that equity-vs.equality graphic you’re using.” Copyright Paul Kuttner

Part 1: Flooding hits different families differently

I’ve just wrapped up a paper on the different outcomes people experience following a disastrous flood destroying their world. Not only is a family’s experience different from the world they lived in prior to the flood, but depending on who they are, a lower income family’s experience can be profoundly different from that of a family of greater means.

It’s not shocking to hear that the poor in America live in a different world than anyone else, but Americans living in poverty are more likely to die in a disaster event and less likely to recover after one. Additionally, when Americans living in poverty recover, they usually recover worse off them they were before disaster struck. This is not the case for the well off. The well off tend to increase their net worth following a disaster.

Why is that? First, and most obvious, if people can afford to live in areas not prone to disaster, they usually choose to do so. Beach-view mansions in Malibu notwithstanding, people don’t usually build their home in known flood plains if they can afford to live elsewhere.

So if you’re located in a dangerous area, you usually can’t afford not to be there. Disaster strikes, the flood waters have started to recede and in preparing to rebuild you look to disaster recovery assistance to help you out. But there’s a problem. Disaster recovery assistance doesn’t come quickly, especially assistance from the federal government. This delay presents a real problem for those unable to absorb the cost of replacement shelter, replacement clothes, increased commutes to work (assuming the job is still there following a disaster).

The delay leaves people desperate for help , willing to jump on any assistance money that appears (even if doing so bars them from participating in larger programs later) or willing to sell their home or property to opportunistic investors who do have the ability to wait out assistance program delays. Having sold, or having grabbed available funds, you are worse off than you were before. Some with more resources can to weather the paper storm that follows an actual one, and come out better than they were before.

Next, Part 2: Flood mitigation protects different families differently

Joseph Wilensky is a Master’s Degree candidate in the University of Iowa School of Urban and Regional Planning. Visit the Iowa Policy Project website for his December 2019 report, Flooding and Inequity: Policy Responses on the Front Line.