- Associated Press - Monday, April 11, 2016

Sioux City Journal. April 10, 2016

Biochemical tax credits: A ‘big deal’ for Iowa.

We commend the Iowa Legislature for passage this year of tax credits designed to encourage extraction of chemicals from biomass for use in consumer products such as pharmaceuticals, plastics, textiles and cosmetics.

In 2014, Iowans celebrated the start of a new chapter for the renewable fuels industry in our state as cellulosic ethanol production, which uses corn plant residue left in the field, began. Biochemical production represents another new frontier of promise for the future.

The new tax credits - $10 million each year for 10 years and described by Gov. Terry Branstad as the first of their kind in the nation - will be administered by the Iowa Economic Development Authority within its existing $170 million tax credit cap. Signed into law by Branstad on Wednesday, the tax credits will strengthen Iowa’s position as a player in a competitive $250 billion chemical industry projected to produce 50,000 new jobs by 2020.

“The production of … biochemicals is perhaps the fastest-growing segment of the bioscience industry and represents one of Iowa’s best opportunities for the development of a high-density cluster such as Silicon Valley,” according to an IEDA background statement about renewable chemical production tax credits.

Battelle (a nonprofit, independent research firm located in Columbus, Ohio) was commissioned by Iowa Partnership for Economic Progress - the state’s CEO-level, industry-led advisory board created by Branstad in 2011 - and the Iowa Business Council to provide the state with an economic development strategic plan for the future. The 18-month, $400,000 study, which was released in December 2014, was privately funded.

“One of the findings of the report,” according to the IEDA background statement, “was that while Iowa’s growth over the last decade has been strong, future growth will require taking advantage of new opportunities and sectors that promise to outpace national growth. IEDA believes that chemical production from biomass feedstocks represents such an opportunity.”

Because the state ranks second in the nation for the availability of biomass, “it is uniquely positioned to take advantage of growth in this sector,” the background statement said.

A report introduced in January, prepared by three Iowa State University professors and funded by the Iowa Biotechnology Association and the Cultivation Corridor (a public-private partnership working to expand the state’s biochemical footprint), the tax credits for biochemical production could have the same kind of impact on Iowa as did state tax credits for the ethanol industry.

“A similar opportunity now exists to make Iowa the leader in the development of the bio-based chemicals industry,” the report said.

When he signed the bill on the ISU campus in Ames, Branstad said the tax credits will “get us in the position so we can build new, cutting-edge bioindustries (by) leveraging homegrown, renewable resources to produce the next generation of building-block chemicals.”

It’s a “big deal,” Branstad said.

We couldn’t agree more.___

The Des Moines Register. April 8, 2016

Iowa’s lax oversight of hospice care is a scandal.

Five years ago, The Des Moines Register first reported that the state of Iowa was inspecting hospice-care facilities roughly once every 20 years.

As one patient advocate said in 2011, Iowa’s oversight of hospice didn’t “even pass the laugh test.” Even the National Hospice & Palliative Care Organization, an industry trade organization, acknowledged that 20 years between inspections was “completely unacceptable.”

To make matters worse, hospice licensing was voluntary in Iowa. That’s right: You needed no license to provide end-of-life care to Iowa patients facing a terminal illness. What’s more, hospice facilities were immune from state fines, no matter how many people were injured or killed due to regulatory violations.

So what did our governor and our state lawmakers do to address these problems?

In a word: Nothing.

In 2013, with voluntary licensing and the 20-year inspection cycle still in place, Gov. Terry Branstad said there was no need to hire additional state inspectors or take action that would drive up costs for private, for-profit health care providers. He said he wanted to see Iowans “take ownership of their own health,” adding that when it comes to people who quite literally can’t take care of themselves, the state should “make sure their relatives” are acting responsibly.

“I know hospice is kind of an end-of-life type of care that is provided in a very thoughtful way to patients and to their families,” Branstad said.

Apparently, the governor divined this knowledge through some sort of sorcery because he certainly didn’t acquire it through a review of the relatively few hospice-inspection reports available from the state. Those reports detail a wide range of violations that include failure to provide resuscitation efforts as requested, resulting in a patient’s death; failure to have properly trained, competent staff; serious medication errors; failure to supervise hospice aides; failure to prevent the spread of infections; and failure to conduct timely background checks on workers.

Thankfully, the federal government has recognized that some states aren’t doing an adequate job with hospice inspections. In April 2014, the Centers of Medicaid and Medicare Services required all 50 states to inspect their hospice-care providers at least once every three years, if they weren’t already doing so.

As a result, Iowa’s state inspectors have ramped up their inspections, uncovering not just isolated instances of inadequate care, but systemic problems that affect many patients and should have been addressed years ago.

For example, a Waterloo hospice was cited for routinely failing to evaluate a patient’s bed sores - some of which were extraordinarily large and resulted in exposed bone - despite the patient’s complaints of “excruciating and unbearable” pain. The staff there allegedly defended the practice, arguing that assessing the wounds of terminally ill patients was inconsistent with their overall operating philosophy.

But although the federal government ordered increased inspections two years ago, Iowa is still getting up to speed. It will be another year before all of the state’s 82 hospice-care providers have been inspected at least once in the preceding three years.

As things stand now, there are 23 Iowa hospice-care providers for which the state either has no inspection data at all or the most recent inspection report is at least 11 years old.

And then there’s the still-unresolved issues of voluntary licensing and the the inability of state inspectors to impose fines and financial penalties. Seventy-four of Iowa’s 82 hospice providers are not state licensed, and not one of the 82 has ever been subjected to a state fine, even after being cited for dozens of violations.

Our state lawmakers have known of these problems for at least five years, and they’ve done nothing to fix them. Instead, they’ve focused their attention on expanding the rights of gun owners and making fireworks more accessible.

There’s a term for this sort of legislating. It’s called “dereliction of duty.”___

Quad-City TimesĀ . April 10, 2016

Who needs Panama: Iowa, Illinois cater to shell companies.

The release of the “Panama Papers” exposed, like never before, the corrupt off-shore dealings that permit the world’s rich and powerful to dodge taxes and funnel cash. But the names of Americans - citizens of the largest economy on the globe - were, so far, few and far between within the massive trove of information.

The dearth of American-owned offshore shell companies shouldn’t be a shock, federal regulators and transparency advocates say. Iowa and Illinois are among the states that, through non-existent disclosure requirements, make the U.S. a tax-dodger’s paradise.

It’s the ultimate outcome of lax, secretive state laws in Nevada, Wyoming and Delaware that require little to no information of someone forming a limited liability corporation. An entire legal industry thrives in those states to file and manage LLC shell companies for anonymous stockholders. Iowa’s LLC formation laws are nearly identical to those in the three poster-children - Nevada, Wyoming and Delaware - for sketchy, intentionally opaque LLC formation.

The problem, advocates and government officials often say, is that states such as Iowa and Illinois don’t even require the names of the would-be corporation’s stockholders.

“As far as what’s reported to this office - well, not much,” said Deb Russell, director of Limited Partnerships within the Illinois Secretary of State’s office.

Iowa asks just four questions - none of which are about who owns or runs the business - on its LLC formation form. Illinois is only slightly more rigid, requiring the name of the “manager,” who typically doesn’t actually own the business.

“There are those that would like to have more info,” Russell said, “but that’s what we require at this point.”

In both states, legislative action would likely be required for any meaningful change. Yet, lawmakers in Illinois and Iowa dawdle.

A decade ago, the U.S. Treasury Department began questioning the lack of ownership disclosure in more than a dozen states. Fourteen states, including Iowa, require neither the identities of an LLC “manager” nor ownership, Treasury concluded in its 2006 report “The Role of Domestic Shell Companies in Financial Crime and Money Laundering.” These states do not “impose effective accountability safeguards” against crime and tax evasion, the agency said. Under the guise of national security, the U.S. Senate has repeatedly tried to force the states to better track the identities of corporate owners. But even the fear of funding terrorism hasn’t been enough to overcome the cries of business advocacy groups and corporate-friendly governors, which kill the bills in the U.S. House.

Some now call the U.S. the “offshore’s offshore.” The U.S. ranks third in global financial secrecy, behind Kenya and Switzerland, says the Tax Justice Network.

But more robust filing probably isn’t a magic bullet, others contend. Robert Miller, a professor of corporate law at University of Iowa, said anyone can easily end-run bolstered identification mandates.

“If you don’t want to be listed as a ‘member,’ have someone else sign it and then sell you their shares,” Miller said.

For Miller, the Panama Papers are less about Old World elites dodging comparatively robust transparency requirements and high taxes through shady off-shore businesses. The leak is about the political class trying keep secret how much money can be made by those in office.

The fact that the American gentry apparently sees little need to stash cash off-shore is of obvious public concern. It’s particularly troubling in an era of soaring income inequality and decaying infrastructure.

State lawmakers can no longer ignore their complicity in the land of corporations with no accountability. Pro-business governors must accept that their policies are assisting tax evasion, laundering and dark money.

Iowa and Illinois are part of the problem. And, in the wake of the Panama Papers, steps must be taken to assure corporate transparency once and for all.___

Waterloo-Cedar Falls Courier. April 6, 2016

Iowa Supreme Court decision will affect students.

Justices for the Supreme Court of the Territory of Iowa heard their first case in 1839, beginning an ongoing process to explain and define just what the law says and means for residents.

The next attempt for clarity will begin at 7 p.m. April 14 at Clinton High School. The court will hold one of its “road shows” in the auditorium, part of an effort to make the judicial system more accessible to Iowa residents.

For the mobile sessions, justices select cases with fundamental and easily understood principles at stake, Chief Justice Mark Cady told The Courier in April 2015. On that occasion, the justices were visiting Decorah High School.

The court also looks for legal disputes that might have regional or tailored appeal. The case at hand, State of Iowa v. Mar’yo D. Lindsey Jr., should be of interest to high school students and, in particular, young athletes.

After Lindsey in August 2013 was injured in a football game and taken to a hospital, school officials carried his equipment bag back to Dunkerton High School. There, after hearing “a very discernible loud clunk,” they opened the bag and discovered a handgun loaded with one bullet, a small bag of marijuana and rolling papers.

It’s important to note the school provides the equipment bags to its players, and coaches and staff routinely handle the items. Coaches and staff also were aware of Lindsey’s criminal record.

Judge David Staudt convicted Lindsey of possession of a firearm as a felon, carrying weapons on school grounds, carrying weapons, and possession of a controlled substance. He ordered Lindsey to serve up to five years.

Lindsey got out March 6, which raises the question, why go on with the appeal to the Iowa Supreme Court?

“If successful, it would wipe out the four convictions - in addition, I believe he is still under supervision,” said Mark Smith, Lindsey’s attorney. “He was released, but not necessarily discharged.”

Smith in the appeal raises several basic questions. What constitutes reasonable grounds for suspecting a student is violating either the law or school policy? Is that sufficient to justify a targeted search of a specific student’s personal belongings?

The Iowa Supreme Court also has never addressed “the quantum of suspicion” school officials need before conducting a search targeting an individual student, according to Smith.

The state, represented by Tyler Buller, an assistant Iowa attorney general, in its argument focuses on the specifics of Lindsey’s case. Buller maintains ensuring the bag got back to Dunkerton was neither a “seizure” or a “search” in the legal sense.

“Somewhat like adults who choose to participate in a ‘closely regulated industry,’ students who voluntarily participate in school athletics have reason to expect intrusions upon normal rights and privileges, including privacy,” Buller quotes from other court rulings.

A doctrine, known as in loco parentis, also comes into play, according to Buller. The concept grants officials caring for other people’s children some of the parents’ rights and duties. Keeping kids safe is one of those responsibilities.

Smith and Buller both endorse the court’s travels.

“Sometimes, it might seem like judges and lawyers have a monopoly on the Constitution, because we talk about constitutional issues with three-part tests, Latin words and case names,” Buller said.

“But the reality is that the Constitution belongs to the people, and all three branches of government interact with the Constitution in the criminal justice system: the governor and General Assembly enacts laws defining crime; county attorneys or the attorney general prosecute offenders; and the judicial branch hears cases and holds offenders accountable,” he added.

“Holding these arguments in public gives citizens a front-row seat to what government officials are doing about crime and public safety.”

Iowans should take advantage of the opportunity.___

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