Iowa Senate Republican lawmakers advanced a bill Wednesday allowing state agencies to hire private auditors to complete statutorily required audits to combat a shortage of Certified Public Accountants, or CPAs, in the state. 

The bill, Senate File 2311, would allow state agencies to bypass the auditors’ office and contract with private CPAs, using money that would have paid for the Auditor of State office’s fees.

Under current Iowa law, cities and states are allowed to contract with private CPAs to perform audits that are subject to review by the Auditor’s office. Under the proposed legislation no mechanism for review, or re-audits, is put in place. 

Democrats say the bill is an effort to handicap the Auditor of State’s office, the only state office held by a Democrat. 

The bill comes after Senate File 478, which allowed state agencies to withhold documents from the auditor’s office, passed along party lines — minus five Republicans who joined Democrats in opposition — last April and was signed into law by Iowa Gov. Kim Reynolds in June. 

RELATED: Iowa House sends “most pro-corruption bill in Iowa History” to Governor’s desk

Lawmakers quickly advanced the bill out of a subcommittee hearing on Wednesday morning and later passed the bill, 11-7, out of the Iowa Senate State Government committee. With only Republicans supporting the bill, and Iowa Sen. Charlie McClintock, R-Alburnett, joining all Democrats on the committee in opposing the bill. The bill is now eligible for floor debate and has met a key legislative deadline to keep the bill alive. 

John McCormally, a legislative liaison with the Auditor of State’s office, told the panel of lawmakers that the bill is “a recipe for corruption.” 

“It’s really easy to get away with things when you have the ref on retainer,” McCormally said. “The best way to audit a giant entity like the state of Iowa is with someone who is accountable to taxpayers and voters, not the same insiders they are auditing.” 

McCormally also said that the bill would not be budget neutral because CPA rates are more expensive than the auditor’s office. 

Iowa Sen. Tony Bisignano, D-Des Moines, said the bill is politically motivated — targeting the only Democrat in statewide office — at the cost of transparency. 

“We have one Democrat elected statewide — one — and he’s the auditor, unfortunately for you, because he’s the guy that could look in to see what the rest of you are doing,” Bisignano said. “That seems to be a problem here now.” 

Iowa Sen. Mike Bousselot, R-Ankeny, said the bill is “good governance” and allows flexibility for state agencies attempting to meet statutory requirements. 

“Only in politics, could hiring nonpartisan auditors be considered partisan,” Bousselot said. “It’s not partisan. It’s good government, the same good government that we give and allow our cities and our schools to think the government that works in many other states.”

Iowa House Lawmakers unveil new AEA bill, scrap Reynolds plan 

Iowa House Republicans introduced a new bill that would retain Iowa’s Area Education Agencies as the sole provider of Education Services for Students with Disabilities, scrapping Iowa Gov. Kim Reynolds’s key legislative priority ahead of a legislative deadline. 

The proposal, House Study Bill 713, would do away with several key parts of Reynolds’ plan instead: 

• Continuing to send all federal special education funding to AEAs rather than the school districts it is earmarked for. 
• Send state aid and property tax dollars earmarked for special education directly to Iowa’s public school districts.
• Require districts to use AEA’s for special education services, but schools could contract out for general education and media services that are currently provided by AEAs. 
• Would not take effect until the 2025-26 school year. 

The bill would also create a task force to make recommendations on AEA oversight, services, and staffing by the end of 2024. 

The bill is scheduled to be heard in front of an Iowa House Education subcommittee on Thursday at 12:00 p.m. in the old Iowa Supreme Court chamber at the Iowa Capitol. 

Senate Republicans pass governor’s AEA bill, with amendments

Iowa Senate Republicans passed the governor’s bill to reform Iowa’s Area Education Agencies out of the Iowa Senate Education Committee Wednesday, on party lines, with an amendment that would make major changes to the governor’s proposal.

The amended bill would direct AEAs and their directors to submit reports to the Department of Education and the legislature detailing their plans to reduce administrative costs by 30 percent and inventory held by AEAs. 

The amended bill would also consolidate some AEA services.

The bill would still move oversight of AEAs to the Iowa Department of Education and move AEAs to a “fee-for-service” model where they contract most services with AEAs, giving them the option to use private services instead. 

The bill would also give all special education funding to AEAs through the Department of Management and split funding for general education and media service funds. 

A public copy of the amendment is not yet available.