Iowa House Democrats roll out affordability plan, take aim at Reynolds’ priorities

DES MOINES — As rising costs for health care, housing and utilities strain household budgets, Iowa House Democrats are pitching a broad legislative agenda they say would lower everyday expenses and improve financial security for working families.

Democrats on Wednesday unveiled a package of proposals aimed at lowering living costs, boosting wages and protecting affordable health insurance — while sharply criticizing Republican leaders and Gov. Kim Reynolds for what they described as a lack of focus on affordability.

The plan, announced at a Statehouse news conference a day after Reynolds' Condition of the State address, includes raising Iowa's minimum wage, requiring paid family leave, freezing residential utility rates, expanding homebuyer assistance and redirecting funding from Iowa's taxpayer-funded non-public school Education Savings Accounts program to preserve expiring federal health insurance subsidies.

"We made it our goal to focus on three main things — making Iowa number one in education, lowering the cost of living and affordability, and making Iowa the best place to live and raise a family," said House Minority Leader Brian Meyer, D-Des Moines. "What we are presenting today is our plan to make life more affordable for the working person in the state of Iowa."

Criticism of governor's agenda

Democrats repeatedly contrasted their proposals with Reynolds' speech Tuesday night, arguing it did little to address the rising cost of housing, health care, groceries and utilities.

In her address, Reynolds unveiled a property tax proposal, an issue Republicans have labeled their top priority for the session. Her plan would cap revenue growth for cities and counties at 2% — excluding new construction and allowing exceptions for school funding and debt service — and freeze property taxes for Iowans age 65 and older whose homes are valued at $350,000 or less.

Reynolds' office has said the proposal would cut property taxes by $3 billion over six years. She also proposed creating tax-deductible savings accounts for first-time homebuyers, another idea Democrats criticized as out of touch with Iowans struggling to save for down payments.

State Rep. Larry McBurney, D-Urbandale, said the governor's speech offered little direct relief for families facing rising costs.

"First-time homebuyers are going to be offered a tax-free savings account, but most first-time homebuyers are struggling paycheck to paycheck, and saving for a down payment has become a pipe dream for most Iowans," McBurney said.

He also noted the governor highlighted $50 million to establish cancer care hubs in rural areas, Centers of Excellence for cancer care, cancer screenings for the uninsured or underinsured and funding radon mitigation tests without addressing how facilities would be staffed, and promoted initiatives such as removing artificial dyes from school lunches while failing to ensure every child in school receives a lunch.

What the plan includes

Democrats said most of the proposals are "cost neutral" to the state and would be introduced as bills or amendments during the 2026 legislative session.

Key elements include:

Housing: Increasing Iowa's first-time homebuyer closing-cost assistance grant from $2,500 to $10,000, which McBurney said is needed to keep pace with inflation.Paid leave: Requiring employers of all sizes to provide paid family and medical leave, with up to 12 weeks for family leave and 12 weeks for medical leave for both full- and part-time workers. Democratic leaders said employers — not the state — would cover the cost. Thirteen states and Washington, D.C. have laws requiring paid family and medical leave programs. Most are funded through employee-paid payroll taxes, and some are also partially funded by employer-paid payroll taxes.Utilities: Freezing residential electric and natural gas rates through Dec. 31, 2030, to give households predictability in monthly bills.Health care: Repealing Iowa's Education Savings Account program and redirecting funding to replace enhanced premium federal health care tax credits that expired late last year. Iowa's Education Savings Account participation surged, with 41,000 students using ESAs for the 2025-26 school year, a significant jump from nearly 28,000 in 2024-25 and nearly 17,000 in 2023-24. This was the first year all Iowa families with school-aged children could apply for an Education Savings Account. The resulting cost was about $327.9 million. Democrats say their estimates show replacing expiring federal ACA tax credits would cost between $90 million and $130 million annually.Wages: Raising Iowa's minimum wage to $15 an hour by July 1, 2028, with increases to $10 in 2026 and $12.50 in 2027, followed by automatic annual adjustments tied to inflation.Retirement: Creating a state-run, portable retirement savings option for workers whose employers do not offer retirement plans.

State Rep. Dan Gosa, D-Davenport, said the agenda is focused on workers who have seen wages lag behind rising costs.

"Our plan is built on a simple belief: If you work hard in Iowa, you should be able to afford a good life," Gosa said. "For far too long, wages have fallen behind, workers' rights have been weakened, and families have been forced to choose between their health, their jobs and their financial security."

Democrats plan to force GOP votes

Asked how Democrats expect the proposals to advance in a Republican-controlled legislature, Meyer said Democrats are open to negotiations, but plan to offer them as bills and amendments — forcing House Republicans to take votes on the record during an election year where affordability is on the minds of many voters.

"We're open to having conversations about these," Meyer said. "This is our proposal. We will be offering them as bills and also as amendments, and we look forward to working with them."

He suggested paid family and medical leave could be the most likely area of bipartisan agreement, noting Republicans enacted a limited paid leave policy last year. Under legislation passed last year, new mothers or adoptive parents working for the state receive four weeks of paid leave, while non-birthing parents receive one week. Democrats' plan would require paid family leave across all employers, including state government.

Republican leaders and the governor's office did not immediately respond to requests for comment Wednesday.