DES MOINES — The days of Iowa lawmakers using their daily allowances to pad their pensions could come to an end.
Under House Study Bill 645, the "per diem" or expense allowance to lawmakers — which ranges from $100 to $134 per day, and average more than $10,000 a year on top of their salaries — would not be included when calculating their pension benefits under the Iowa Public Employees' Retirement System.
"I think it's the fair and right thing to do," said State Rep. Peter Cownie, R-West Des Moines, the bill's floor manager. "Per diem, it just doesn't really pass the sniff test to go towards IPERS for a legislator."
Iowa is one of 13 states that allow per diem payments to be counted toward pension benefits in some form, according to an analysis by USA Today and the Des Moines Register. Lawmakers collected more than $2.5 million in per diem payments from 2006 to 2010, the Register said.
Cownie, who was elected in November 2008 and is serving his second term, told IowaPolitics.com that he was aware that his per diem is being calculated into his pension benefits. As a Polk County legislator, Cownie collects $100.50 per day in per diem, which amounts to between $10,050 to $11,055 during a 100- to 110-day legislative session.
"We get briefed when you first get elected, in terms of all of those sorts of things," said Cownie, who's president of Junior Achievement of Central Iowa, which educates youths about the value of free enterprise, business and economics.
John Gilliland, senior vice president for government relations for the Iowa Association of Business and Industry praised lawmakers for attempting to apply the same rules to themselves as they do to everyone else.
"As far as calculating IPERS and what retired lawmakers' IPERS benefits would be, I don't think it's right that your per diem expenses are included in that calculation," said Gilliland, whose association is the state's largest business trade group representing 1,400 Iowa businesses that employ more than 300,000 Iowans.
Officials with State Budget Solutions, a national nonprofit advocating for reform of state budgets, also welcomed the legislation.
"Not only does it artificially inflate pensions of lawmakers, but you can bet the farm that actuaries never included per diems in calculations of how much needed to be invested to pay the pensions," said State Budget Solutions editor Frank Keegan. "So, the impact on taxpayers of the real cost of the extra amount legislators get actually is compounded."
Management of IPERS affects Iowa taxpayers, who pay the employers' share of the pension fund for public employees.
Lawmakers' per diems and pensions are among several issues addressed in the government efficiency bill, which also would:
» Aim to restrict the use of food assistance benefits, formerly known as food stamps, for items of low nutritional value.
» Study whether a private entity should handle human resources services for state employees, rather than the State Department of Administrative Services
» Require the State Department of Natural Resources to sell $20 million of real property in fiscal 2012-13, which would be deposited into the Iowa Resources Enhancement and Protection Fund, which goes toward enhancing and protecting the state's natural and cultural resources
» Repeal the state's film tax credit program
» Require state agencies to use email and websites, instead of mail, when issuing notices and information
» Move the date of school elections to the same date as city elections.
Lawmakers do not yet have an estimate on how much money the bill would save.
Cownie said lawmakers want to save more than $20 million, but the main goal is to find ways for the state government to be more efficient. He said it "remains to be seen" whether any savings will be worked into the fiscal 2013 budget.
The U.S. Department of Agriculture has so far denied all requests by states to restrict the use of food assistance benefits. Grocers and advocates for low-income families are among those opposing Iowa's proposal.
"We're very concerned about becoming food police and dictating consumer choice," said Craig Schoenfeld, a lobbyist for Hy-Vee Food Stores.
"This will add significant complexity and cost," said Scott Sundstrom, a lobbyist for the Iowa Grocery Industry Association, which represents chain and independent supermarkets, convenience stores, mass merchandisers, wholesalers, brokers, manufacturers and distributors.
Lana Ross, executive director of the Iowa Community Action Association, which provides services to 300,000 low-income families, said her association wants to do everything it can to help families eat healthy, "but when it comes down to dollars and cents, it's going to cost more for them to purchase healthier foods."
A second subcommittee meeting will be held Wednesday. House Study Bill 645 is expected to be debated by the House State Government Committee on Thursday, which would clear the deadline for bills to be approved by at least one committee to be considered alive for the remainder of the session.
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