Governor’s agency reorganization bill passes Iowa Senate with minimal changes

By: - March 7, 2023 8:49 pm

The Iowa Senate advanced legislation Tuesday that would consolidate 37 state executive agencies into 16. (Photo illustration by Iowa Capital Dispatch with background via Canva)

Gov. Kim Reynolds’ state government restructuring bill moved forward Tuesday, despite criticisms from Democrats that the proposed changes would stymie government oversight and accountability.

The Iowa Senate approved Senate File 514 on a 34-15 vote. The 1,500-plus-page bill would consolidate Iowa’s current 37 executive cabinet agencies to 16.

It advanced after senators adopted one of 11 proposed amendments. Sen. Jason Schultz, R-Schleswig, the bill manager, offered the amendment, which scrapped a provision lowering the Senate approval threshold for gubernatorial appointees. Current law requires 33 votes; the original bill would have required  30 votes to confirming the governor’s appointees.

Democrats called the bill a “power grab” by the governor, arguing on the Senate floor the bill will reduce government oversight and hurt the quality of government services for some Iowans.

“I really just have concerns about this bill, how big it is, how much power it gives to our governor,” Sen. Janet Petersen, D-Des Moines said. “I’m a believer in checks and balances and the three branches of government.”

But Schultz said that as the head of Iowa’s executive branch, Reynolds already is in charge of the agencies impacted.

“This is not a power grab,” Schultz said. “It’s her branch. It is the next governor’s branch. They’re going to have the ability to control, to answer for, and to report to the people of Iowa, what they’re doing in a more consistent, even-handed, accountable manner.”

Democratic senators said House Republicans may consider more changes to the bill. The House State Government Committee advanced House Study Bill 126 early Friday after Democrats introduced 39 amendments, all of which failed. That approval came after hours of subcommittee meetings going through the various sections of the bill.

The governor has said the extensive changes will reduce government costs by $215 million in the four years after implementation, and would not eliminate any current employees. Reynolds and staff worked with a Virginia-based consultant, Guidehouse, on developing the plan. The office paid the consulting firm $994,000 for developing a government realignment plan and implementation strategy.

Sen. Sarah Trone Garriott, D-West Des Moines, criticized the Legislature for moving forward with a largely unchanged piece of legislation after hearing from Iowans in subcommittee meetings about the issues they saw in the bill.

“It’s not our job to roll over so the governor can impress out-of-state bullies and rich out-of-state venture capitalists, and consolidate her power,” Trone Garriott said. “If this chamber passes legislation straight from the governor’s out-of-state consultants — with barely any effort to listen, almost no effort to shape the legislation based on what Iowans are telling us they need — we are not doing our job.”

Iowa Child Advocacy Board asks to remain independent

Trone Garriott introduced an amendment, which failed 17-32, to reverse the provision moving the Iowa Child Advocacy Board (ICAB) from the Iowa Department of Inspections and Appeals to the Department of Health and Human Services.

Molly Severn, the governor’s legislative liaison, said the move makes sense — ICAB and its Court Appointed Special Advocate (CASA) volunteers work with children in Iowa’s child welfare systems, which are run through HHS staff.

Judge William Owens, in his capacity as chair of the Iowa Child Advocacy Board, said the change could cause issues for advocates who see an Iowa family’s situation differently than the official caseworker.

CASA volunteers are responsible for advocating on behalf of the child. Sometimes, that means making different recommendations in court than what the child’s case worker, an employee of the Department of Health and Human Services, recommends. By putting ICAB under the new department, it could prevent volunteers from feeling open to disagree and critique the department’s approaches, and would hurt the trust built with children who feel department staff do not treat them fairly, multiple CASA volunteers told lawmakers during subcommittee meetings.

“Its not unusual at all to see recommendations that come from foster care review boards or from CASA volunteers that are contrary from what the HHS case manager in that court case is recommending,” Owens said. “… It may not be a direct conflict of interest for all of this to happen, but certainly there is an appearance of that and families would view it as an appearance of that.”

The Child Advocacy Board held a special meeting in January to discuss the bill, which members unanimously opposed. After the bill was introduced and members spoke up against the governor’s proposal, one member of the board, Alison Guernsey, was not reappointed to her position. Nicole Nicholson, who Trone Garriott said is the spouse of a member of Reynolds’ staff, was appointed to fill the vacancy.

“They know that there is a cost to defying a governor who values loyalty to her over all things … but despite that, these leaders are clear on their responsibility and they have the conviction to stand up and speak out on behalf of the Iowans,” Trone Garriott said. “They serve the people, and this chamber would do well to follow their example.”

Schultz said he was “becoming swayed” by the arguments brought forward during the subcommittee meetings from CASA volunteers, but he is now satisfied that HHS will be able to allow the board and volunteers to retain independence, like it does for the Children’s Behavioral Health System state board.

“As I’ve gotten into long conversations about this, the efforts that the administration is willing to take to make sure that there is independence yet while still offering training … This will benefit the children as the volunteers are advocating on their behalf,” Schultz said.

Reorganization gives state attorney general more power

Another amendment, brought forward by Sen. Liz Bennett, D-Cedar Rapids, would have cut the provisions making the currently independent Office of the Consumer Advocate a division under the Attorney General’s office. The measure failed 16-33. The consumer advocate represents ratepayers in utility cases.

Bennett also sought to remove provisions allowing the attorney general to hire attorneys and staff for the Office of the Consumer Advocate and those ending a requirement that the consumer advocate be a “competent attorney.” The bill would also allow the attorney general to remove the lead consumer advocate for any reason, while currently that can only happen for “just cause.”

Some advocates said they were concerned about these provisions, because it may mean higher utility costs for Iowans. Steve Falck with the Environmental Law & Policy Center said removing the independence of the Office of the Consumer Advocate could mean utilities have the ability to go to the attorney general, who would have the ability to punish or remove OCA staff, and demand action following a report that “caused some heartburn.”

Paige Yontz, state advocacy manager with AARP Iowa shared similar concerns. Iowans, especially those over age 50, could lose protections currently provided by the OCA on issues like utilities raising rates.

“It’s critical that we maintain adequate protection for those we appoint to serve in the best interest of the consumers, giving them the reassurance that their honest, unfiltered analysis of various utilities’ issues are met without retaliation,” Yontz said. “… It’s that honest, unfiltered analysis that this ultimately puts in jeopardy.”

It’s not the only part of the bill that gives more power to the attorney general. Other provisions include allowing the office to prosecute any criminal proceeding on behalf of the state, regardless of whether the local county attorney asks for assistance. It also gives the attorney general’s office exclusive jurisdiction over election-related crimes.

These changes come shortly after Republican Attorney General Brenna Bird took office, defeating longtime Attorney General Tom Miller, a Democrat, in the 2022 midterms. Reynolds called for her supporters to help put Bird in office and said she wanted “my own attorney general” in office.

Democrats said the attorney general-related changes are political moves, not changes that make government more efficient.

More power to fire workers, set salaries 

Democratic leaders also criticized other changes, including those making it easier for the governor to fire workers who currently hold four-year terms, and allowing her to remove agency directors from salary limits in current law.

These changes and more, such as giving the governor the power to appoint the director of the Department of the Blind, shows the bill does not have Iowans’ best interests at heart, Democrats said.

Sen. Pam Jochum, D-Dubuque, asked Republicans if they would support this bill if it was proposed by a Democratic governor.

“Even if a Democratic governor had proposed this bill, I would not be supporting it,” she said. “… In my humble opinion, what we are putting at risk is oversight and accountability. What I believe is happening is a government that will be less responsive to everyday Iowans.”

Schultz disagreed with Democrats’ characterization of the bill, and said it was time Iowa’s government went through a modernization process. The bill makes puts Iowa’s state governance system in the governor’s “chain of command,” he said, and “simply aligns with people who are already doing the work causing efficiencies.”

“Simple change is not a reason to to oppose change,” Schultz said. “Somebody has a bigger picture, somebody has a greater mission. And you have to trust sometimes the leadership.”

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Robin Opsahl
Robin Opsahl

Robin Opsahl is an Iowa Capital Dispatch reporter covering the state Legislature and politics. They have experience covering government, elections and more at media organizations including Roll Call, the Sacramento Bee and the Wausau Daily Herald.