As legislatures begin their sessions, this podcast takes the opportunity to talk with the CEO of NCSL for some perspective on the coming year. Since this podcast started in 2016, we’ve featured interviews first with Bill Pound and now with Tim Storey, who has been at the helm of NCSL since mid-2019. Storey talked about how the ongoing pandemic will affect both how legislatures meet and the topics they tackle. Those include education, taxes and oversight of the unprecedented federal money flowing to the states. He also talked about this decade’s redistricting cycle and the 2022 election, and why there may not be as much change at the state level as some expect.
RESOURCES
State of State Legislatures 2022 | Jan. 9, 2022 | OAS Episode 149
Ed: Hello and welcome to “Our American States,” a podcast from the National Conference of State Legislatures. This podcast is all about legislatures: the people in them, the policies, process and politics that shape them. I’m your host, Ed Smith.
“States are in the strongest fiscal condition they have been in, in decades.”
That was Tim Storey, the executive director of NCSL and my guest on the podcast. Since this podcast started in 2016, the first episode of the year is always an interview with NCSL’s executive director. First that was with Bill Pound, and now with Tim Storey, who has been at the helm of NCSL since mid-2019.
We talked about how the ongoing pandemic will affect both how legislatures meet and the topics they tackle. Those include education, taxes, and oversight of the unprecedented federal money flowing to the states.
We also talked about this decade’s redistricting cycle and the 2022 election, and why there may not be as much change at the state level as some expect. Here’s our discussion.
Tim Storey, welcome back to the podcast.
Tim: Oh, Ed, I’m really happy to be here and talking about what’s going on in legislatures next year. It’s a little meta because I do the other podcast and this is “Our American States,” but I’ve been thinking a lot about what’s going to happen, so I’m looking forward to the conversation.
Time Marker (TM): 01:39
Ed: Well, this is a tradition on this podcast to talk with the executive director, Bill Pound before you and now you in the top-dog post here, and this is the third time. So, you’re starting to get some years in on this job. I’m really glad that you could make the time to do this.
Let’s start with that big picture, that 10,000-foot view. What are state legislatures doing in 2022? How are things looking for them?
Tim: I will say that this is a question that sort of strikes terror in my heart because there are 7,383 legislators… I say it all the time… who this year have introduced over 107,000 pieces of legislation in 2021 so far. There are still 14 states in session; they could still squeeze a few more bills in… of which about 17,000 were passed into law.
So, legislatures are very active on hundreds of fronts. To try to sum up what are legislators going to do, three things, it’s nearly impossible. I won’t completely cop out, but I will say I want to think in terms of three big themes that I think are going to be the meta forces driving legislatures, the huge currents in the river, not the little subcurrents and eddies, but the big meta, mega currents that will drive the conversation and drive bills that get passed and bills that move in legislatures.
Having said that, I think there are three big things that are going to be driving the conversation: #1) state budgets – states are in the strongest fiscal condition they have been in, in decades, since really before the Great Recession of 2008 and maybe even before. These kinds of anecdotal reports tend to leave the actual collection to confirm some of this, so we don’t really have the hard, empirical data to do it.
But we do know from many discussions with legislative fiscal officers and legislative leaders and legislators, and I’ve been fortunate to be talking to a lot of legislators recently in a number of meetings, that state budgets are really strong and stable heading into the 2022 sessions, record budget surpluses in a number of states including California, the big kahuna. They’ve got a 47- billion-dollar budget surplus and that could even go higher. I just saw yesterday that Minnesota reported a 7.7-billion-dollar budget surplus.
And that’s because of a trifecta of positive things that affected state budgets. One, revenues are far stronger than anyone anticipated, so legislatures have to predict budgets and they have to estimate what will come in from the sales tax, what will come in from the income taxes that states have and other sources of revenue that states have. And all of those categories are trending heavily to the upside. So, states are deep into the black ink on the positive budget side of the ledger.
The other… I said there was sort of a trifecta of positive impacts on budgets – they had really slashed spending in COVID and held spending down for the last two budget cycles. So, they were putting less money out into state programs from state resources. At the same time, this is the third in this trifecta – there’s been this huge influx of money from the federal government to the state governments, particularly legislatures, to address the issues of COVID and the pandemic and the economic fallout of that.
So, the federal government, in the four major pieces of legislation that they passed in the last year, little over a year, injected over 6.1 trillion dollars into the U.S. economy, a really staggering amount of stimulus to the U.S. economy, I think far greater than most, if not all other countries around the world. And so, that goes into the economy and a lot of that is, by the way, direct transfers to states to address COVID.
A lot of that money comes into the economy. Americans are not going to restaurants and not traveling, but they’re spending on a lot of goods and services that bring in sales tax revenue. So, the economy is filled with cash. That shows up in state revenues, and state budgets are getting direct transfers under the Cares Act, the federal stimulus bill that came after that, the American Rescue Plan that came after that, and now the Infrastructure and Investment Jobs Act that came after that. They’ve got a tremendous amount of federal funding to distribute.
The budget will be the big conversation and how to spend money, including that you’re going to have a number of states including not just Republican states, but also Democratic states, talking about tax relief and how do you adjust taxes at a time. Are there ways you may want to cut some taxes and look at your income, your revenue side of the equation?
Also, demands are high. There are many issues that have landed on the legislative doorstep, and it goes on and on. Expanding broadband continues to be a major issue for underserved people. I’m going to just randomly pick a couple. Homelessness and housing is a major issue in many states. So, that’s kind of meta issue number one.
Meta issue number two is COVID and healthcare generally. It continues to be a major… it looms in the background of all the conversations, whether you’re talking about workforce issues, which are huge, or education issues. Roughly half of state budgets go to education. Well, the impact of COVID on the education system is tremendous in myriad ways. Whether you’re in the education committee or the transportation committee or the health committee for sure, you’re going to be talking about the continued addressing of COVID.
And then there’s the direct COVID stuff, some of the debates that are going to happen about vaccine mandates on private employers; that’s going in both directions frankly – some states are going one direction and strengthening private employers’ ability to mandate vaccines, and other states are working to limit the ability of private employers to mandate vaccines and provide more exceptions, require that state employment doesn’t have a strict vaccine mandate – that’s happening in some states.
So, COVID is still going to be a major impact on what legislatures talk about, the bills they consider, and the bills they move.
And then, finally, it’s an election year. It’s not technically an issue, but it is in the background and heavily in the background. And it’s not just an election year; it’s the election after redistricting and, by the way, a bunch of states still have to go through a line drawing and the clock is ticking. Primaries start in March, although the North Carolina court just delayed their early primary. They had a March primary; it’s been delayed into May or June if memory serves. Texas has a March primary, which may or may not hold because of court intervention.
So, you’ve got the fact that every member is either vacating, as in the election after redistricting, the turnover in legislatures always spikes up, so we’ll probably see overall turnover of legislators go back up around 25%. It tends to be 18/19/20% in a regular election cycle. It’s going to jump up. So, you’ll see a lot of new faces in the 2023 legislative sessions. We’ll be talking about that next year.
And not just redistricting, but this is the big election in terms of there are more seats up because of the redistricting cycle, so you’ve got 84% of the 7,300 seats up, so 6,166 legislative seats on the ballot this year.
Some very competitive primaries in both parties, but I think the Republicans are probably going to have more internal primary battles this time around. That’s a speculative thing based on talking to legislators and what I’m reading.
So, those are the three themes, or those are the three gorillas that are lurking around the halls of the capitol.
TM: 10:20
Ed: Well, Tim, you’ve answered all my questions, so thank you very much.
Tim: That’s the top level. That’s definitely the 10,000…
Ed: Well, we’ll dig in a little more. Let me ask you just a very practical question. This is something we discussed last year. With COVID, do you expect all legislatures will be meeting in person?
Tim: We know that they will not. I mean, we already know of a handful of legislatures that are going to continue to meet remotely. There’s another issue that’s happening where a handful of legislative chambers are requiring that their members show proof of vaccines, and that’s leading to some court challenges. So, who knows where that leads?
These are really interesting questions about if someone gets elected, and then the chambers have the authority to seat the members from the election. That’s an interesting thing that not everyone tracks on. Legislative chambers have a great deal of authority on who they get to seat to be in the legislature regardless of how the election plays out. They can set some rules.
So, for example, many states have a rule that says if you’re under indictment, you have to resign from the legislature, even though the voters elected you and put you in there. This is a much different scenario, but I just say that legislative bodies have a lot of say in who gets to sit in the legislative body. Obviously, the election is the main way that you get into a legislature. So, there is a big discussion of vaccine mandates for legislators happening in a handful of states.
So, yeah, I think we won’t see nearly as many states meeting remotely as we did a year ago, primarily because of increase in people who are vaccinated. It is COVID’s world. We continue to coexist in COVID’s world and even though everyone is tired of it, everyone is talking about it, everybody is tired of dealing with it, it is the crisis of our time and it’s not just a short-term crisis. It’s a long-term issue.
I just thought about some of the fallouts of COVID that legislatures are going to be dealing with, talking about how that’s one of the meta issues, like mental health – there is a mental health epidemic/crisis that’s hitting the country and it’s been well-documented, and legislators are hearing about it. I think that’s going to be a big area of focus.
So, that was a bit of a non sequitur, but yeah, I think most legislatures are going to try to get back to something closer to normal, but there will definitely be some, and it may depend on: do they have testing or an outbreak and you have to take short-terms adjournments like what happened in Idaho a few months ago – they had to take a break. They had a few positive cases and they paused for a little bit and then came back after they thought everybody had quarantined long enough.
TM: 13:06
Ed: Well, it has been two of the strangest years I think in all of our lives. Every time we think that we’ve rounded the corner, it seems as though we’re not quite at the end of the race yet.
But do you think that even given COVID’s ongoing presence in our lives, states will be doing a lot of other policy work that may not be related to COVID? I know that for the first portion of this pandemic, states really… they had to; this was the emergency, and a lot of action was taken at the executive side, a lot of work on budgets to try to make sure that there was money for what needed to be done.
Is that going to morph a little bit now? Is that going to evolve into a little bit more of a hybrid model?
Tim: That’s a great question because I think you allude to the fact that we’ll move in the direction of normal I guess in terms of there will be issues. I think of like online gaming, right – that’s an issue where about half the states have enacted legislation to enable online sports betting, I should say. And so, I think the other half of the states that don’t have it will be looking at it hard and you’ll see it continue to expand in some of the states that have not already allowed for online sports betting.
Some states will close the door and say that it’s not the right thing for our state, not the right time. That’s not really related to COVID. Maybe it is. You’re stuck at home, and you want to bet on the game on your phone. So, I think that’s one of those issues that when I made my list of all the issues that states will be dealing with, I put that on there because it’s something that’s kind of been naturally evolving.
You have those issues, like how states deal with marijuana and retail and recreational marijuana. Have we reached a plateau of states moving towards greater legalization of marijuana? Maybe a pause because it’s sort of expanded in a very natural way to many states. But I suspect you’ll continue seeing states looking at that. It’s not in a top-issue slot this time around. And it hasn’t much to do with COVID directly.
Privacy, tech issues, cybersecurity – I think that’s going to be a top issue for states, particularly California got out with a pretty substantial regulatory bill around user data and privacy. A couple of other states have adopted the California-style legislation on that, and I know that the tech industry would like Congress to do something about it, because you’re going to have a number of states continue to push on data privacy for their constituents.
Not a COVID issue – cybersecurity and state systems as hacks and intrusions and hijackings and ransoms continue to affect major IT systems, including just the other day the legislative IT system for the State of Virginia. The Virginia legislature was hacked. So, they’ll go after legislative systems too. That will ripple through. Legislatures will look hard at what happened in Virginia and then that will be more evidence to them about the high stakes with cybersecurity.
So, yeah, it’s a great question. I think we’re going to move back in the direction of talking about some things that aren’t necessarily just dealing with the pandemic.
TM: 16:32
Ed: Well, I tell you, I can hardly turn on the television without seeing a sports bidding ad, so…
Tim: You’re in Colorado, right?
Ed: Exactly. Where it’s legal. It’s been pushed out very, very aggressively.
Tim: Very state specific. And there are places where you’ve got a lot of people who are driving across the border. Sometimes they drive over to buy fireworks. In some cases, they go to get legal marijuana. I’m not sure if it’s legal if you take it to another state. I don’t know those laws. But yeah, you’ve got people who are driving across the border to put a bet on the Nuggets game or whatever.
Ed: Right. More and more people who never knew what the word geofencing meant now understand it because that’s how they manage to keep you only betting in the state.
Tim: It’s fascinating, mindboggling that they do that, but yeah, you’re right.
TM: 17:17
Ed: Education – you brought that up before and boy, has that ever been a hot issue at every level from school boards to gubernatorial races and that kind of thing. How involved will legislatures be with that issue this year? What kinds of actions do you see legislatures getting involved in?
Tim: This is heavily influenced by the pandemic, sort of what’s going on in mostly K-12, less so in higher ed. There’s a lot of concern about what’s happened to student learning over the past two years with so much virtual learning over a year ago, and even coming back now and having this kind of pause when you’ve got a COVID outbreak and the disruption. And, by the way, that gets into issues of childcare and working parents who are trying to navigate what they do when their school closes down for a week, or they send the kids home for five days. Legislators are hearing a lot about that.
I think legislatures are going to focus on some of those learning gap issues and what you can do to address that. In the background of that, which I think is one of the biggest issues legislatures are going to be tackling, which is workforce issues, and that’s across the board. That’s state agencies and it’s everything from finding enough highway patrol candidates to teachers and healthcare workers that the states employ.
You’ve got looming, if not real, immediate shortages in all of these areas because the entire economy is struggling to get workers into some of these roles. So, it’s hitting states just as hard if not harder. I think teacher workforce issues and just getting enough teachers, many of whom have been burned out by the pandemic and the struggles in that time, the same with healthcare workers.
Getting tests into schools – I think that’s something that I seem to have heard a lot of legislatures are doing is starting to fund COVID tests, not SAT or ACT tests, but getting COVID tests. Maybe you’ll take a quiz and a COVID test every day. You’ve got to study for your COVID test. That’s something legislatures are going to be doing to try to figure out how to get schools into some kind of flow and normalcy, so you can get focused on what it’s all about, which is student learning, and not constantly dealing with masks and not masks and outbreaks and closing schools and quarantines. Those are going to be the big education issues.
Ed: Tim, thanks. We’re going to take a quick break and come back with the rest of our conversation.
MUSIC and Gene VO:
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TM: 20:24
Ed: There’s a whole lot of money, as you said, that the federal government has pumped out into the economy and a lot of it into the states. There was quite a bit of money that went into education. It wasn’t necessarily under the oversight of legislatures, but there’s the ARPA money and there’s the infrastructure money.
I’m just wondering: Do you think legislatures are taking the right steps to make sure that they’re going to have oversight and make sure that money is being spent appropriately?
Tim: Yeah, I do. There’s a very robust conversation going on both within legislatures and then also among legislators across state lines about how they’re allocating the funds from really, again, the four big stimulus packages that Congress enacted, including the last one which is specifically around infrastructure, but also has some COVID-related stuff like broadband. There are billions and billions of dollars to expand broadband, particularly to underserved and rural areas.
I think they’re waiting to see continued guidance from the federal government. The Department of Treasury has talked about flexibility, flexibility, flexibility, flexibility. So, I think legislatures are hearing that and are also going to see it as a way to innovate, in particular expenditures that might not last forever and require eternal maintenance of funding, but are like hey, we’ve got to replace this unemployment insurance IT system because it was a disaster when trying to get out unemployment.
One of the U.S. inspector generals came here and one of the ITs said last week or the week before that there was over 85 billion dollars in unemployment claims paid out. That was related to a number of things including the speed with which states are trying to get the money out, but the difficulty of having systems that could verify identity and also including gig workers, which is harder to verify exactly who they are and where they are. A lot of this was hyper organized crime fraud, stealing millions of dollars from states and the U.S. government.
The reason I raise that is I think they’ll be thinking about okay, can we spend this money for a big, one-time investment on an IT system for unemployment insurance that will be more robust and hold up and help us prevent some of this fraud. So, that conversation will go on for all kinds of IT systems as well as other state systems. It’s like hey, we’ve got money now; we don’t know if we’re going to live like this forever.
And the same with tax relief. You can get into all kinds of things here. But yeah, I think legislatures are being really thoughtful. The thing I hear over and over and over again is that we can’t pretend this money will always be here. The outlook for the U.S. economy remains fairly strong. A number of economic reports I saw in the last couple of days are still showing strong indications. We’re recording this on the day that the Fed announced it was going to probably do three rate hikes next year and wind down, taper the stimulus that they’re doing. And despite that, markets are up, things look good, and people still have a lot of cautious optimism about the economy.
So, legislatures are doing all of this in that context, the bigger world, and are wary of inflation pressures and supply chain pressures that pressure the entire U.S. economy.
TM: 24:00
Ed: I want to go to redistricting, which you brought up earlier. As we know, states had to wait quite a while to get the final numbers that they needed to begin drawing their maps. And you’re saying that some states are still trying to get those lines figured out and finished. What’s the state of that? Can you give us kind of an assessment of that?
Tim: Last I checked, which was just a week or so ago, so this is still neighborhood pretty accurate, about a third of the states had drawn their legislative and congressional lines. We’ve got seven states that don’t have congressional districts; they just have one U.S. House member. So, set those aside.
This means that the majority of states still have to go to finalized maps, which is always a contentious issue, often winds up being challenged in courts, although some of the avenues of court challenges have been closed at the federal level, so I think you’ll see more state challenges to legislative maps inside of the state court system going to state supreme courts. I think that’s a trend that’s going to happen on redistricting.
But yeah, again, it’s just this specter in the back of the minds of legislators because you’re thinking: Am I going to run? Am I even going to be in my new district? How much upheaval? If there are big population shifts, boy, all bets are off because a big population shift in one end of the state could have a major effect on the other end of a state in terms of a district getting smaller or a district getting bigger. Am I even going to be in my new district?
I’ve already heard of legislators who have announced they’re moving because they got drawn out of their current district and they’re going to literally pick up and find a new house in a new district. It’s not unheard of.
It really puts a wrinkle into the ’22 sessions because even if the lines are drawn and now it’s the devil you know versus the one you don’t, because if the lines aren’t drawn, you’re sort of guessing what your district might look like. And you’re thinking: Do I want to campaign? How do I campaign? I’ve got a whole new community where I really don’t know the community leaders. I’ve got to really get out there.
And the primaries start happening fast, like I said. May and June are the bulk of the primary season and a lot of the races, particularly on the Republican side, I think you’re going to see a spike in legislative primaries, not huge, not big numbers per se, but it will be a little increase because of some of the tensions within the GOP, and the Democrats as well. You’ve definitely got factions within the Democrats as well.
So yeah, that whole what’s going on with my district, that is always in the back of their minds.
TM: 26:34
Ed: Let me stick with the ’22 election for a minute. There’s certainly lots of speculation that the GOP has a pretty good chance of retaking the House, and the Senate seems like kind of a tossup. At the state legislative level, the GOP has been in a pretty dominant position in terms of the chambers they hold really since the 2010 election. I wonder is there really much room to move in the state legislative elections, or are we going to be looking at kind of a stasis situation?
Tim: Well, as you know, but maybe not all of the people who are listening to this do, the party in the White House has a distinct historic trend working against them in midterm election cycles. So, the Democrats in this case with Joe Biden in the White House, they know… I assume they know that in 28 of the past 30 midterm elections going back to 1902, so over a century, well over a century…
Ed: This is a statistic, by the way, that I love to trot out and tell people about because it’s such a mind-blowing piece of data.
Tim: It is. The party in the White House is at such a disadvantage when it comes to these midterm elections and it’s just one of the most consistent things in all of American political data and history.
So, the Democrats have their work cut out for them. They’re against the wind, fighting uphill, one hand tied behind their backs. And then all the opposite metaphors apply to the Republicans. They have the wind at their backs and they’re swimming with the flow, with the stream, and this is a year that Democrats would expect to not be optimistic about, a year that Republicans have high expectations for.
But you make an interesting point. In the 2020 election, Biden wins the White House, Democrats do okay, but do not have a great year in legislative elections. And, in fact, two chambers flipped to the Republicans in New Hampshire, and no chambers switched to the Democrats in the 2020 election. So, now Republicans continue to have a fairly strong advantage in state legislatures, roughly two to one, two-thirds of legislative chambers being Republican controlled and only a third controlled by the Democrats.
And then you start to look at the landscape and then you look at who is drawing the lines, and it would point to not a lot of change and upheaval, not a lot of battleground chambers at this point. I kind of reserve the right to say look at this differently in six months, especially after the lines get drawn.
So, you’ve got a handful of states with rank-choice voting in California and Maine and Alaska, so there’s some upheaval; it makes those a little bit harder to predict. It might look different in June. And then you’ve got redistricting process changes in Michigan, where the map may look a lot different because of the fact that it’s a less partisan-influenced map in the new Michigan legislative lines because of the commission that they adopted for this round of redistricting.
You take all that into account and, as we said today, it does not look like there are a ton of battleground chambers. You could have a relatively strong status quo and that is in contrast to the normal 12 chambers which switch hands every two years at the legislative level. But what we will have, as I think I mentioned earlier, is that maybe 25% of the people will turn over, or higher, because it’s the post-redistricting election, so you can have a lot of change in the individuals serving in legislatures, but not so much change in the party control of legislatures.
TM: 30:18
Ed: Yeah, I was a little mystified following the 2020 election talking to some of my Democratic friends who were so enthusiastic and thought such a huge victory had been scored and I said well, yeah, if you don’t look at state legislatures and you don’t consider redistricting and virtually everything else that makes up how our government and political system work. But yeah, it was a great year other than that.
Let me ask you about the new federal administration. Last year we talked a little bit about how states would fare with the new Biden administration. I wonder how would you assess that relationship? How would you rank how states have fared thus far in the last almost a year?
Tim: It’s mostly defined by the infrastructure bill that was passed. That’s the biggest impact, piece of legislation by far that the Congress and the President have passed, and that included I think over 350 billion dollars for state and local governments specifically on infrastructure. I think I’ve got that number right. It’s a huge amount that just literally is going to be channeled through the states and local governments.
That really frames everything. It’s such a major investment by the federal government that really allows the states a great deal of flexibility to decide how they prioritize projects, whether it’s water and sewer or airports or ports. All things considered, all the kind of hyper-polarization that is out there and exists, strong disagreements between Republicans on how the President’s mandate for private businesses on COVID, which many Republican legislators have pushed back on pretty strongly.
But I think that overall, this administration is working well with the states. The direct evidence I see is they’re listening to them, including legislators, and they reached out to us on a number of occasions and really want to bring in Republicans as well as Democrats. So, I think it would be a fairly positive report.
TM: 32:37
Ed: Well, let me do a little self-promotion, which is we’re going to do a number of podcasts about infrastructure and how states are going to grapple with that working with folks at NCSL who are tracking that closely. So, listeners, look for those. And on the subject of promotion, I want to ask you one more thing before we go.
A few months ago, you started your own podcast, “Legislatures: The Inside Story.” You’ve had some interesting interviews. And I just wonder how that experience has worked for you so far, what your thoughts are on that.
Tim: Oh, I love it. I love it because I learn so much and as someone who really is just curious by nature, I love fascinating and interesting people, it gives me an excuse to and forces me to carve out time to talk to interesting people. I suspect that’s part of the reason you like doing these as well for “Our American States.”
Of course, it’s a very different take. This podcast gets into a lot of really substantive kinds of issues and details in a narrower way on some really vital and important issues, and of course, I’ve been talking mostly to leaders and individuals about ideas and thoughts without really homing in on autonomous vehicles or upgrading the electric grid or something like that, all of which are incredibly important things. I know we cover some of those things with “Our American States.”
So, I really love it and I hope that people, if they get a chance, they’ll click on a few of those and listen to the conversations. I always try to pull them back to how legislatures work and what legislators and legislative staff can learn from whoever the guest is, be it a former legislative leader or one of the world’s leading neuroscientists, John Medina.
We’ve had a pretty interesting group and more interesting guests are coming up, so I love it.
Ed: Well, I think there are few better gigs in life than talking to people who are really smart and passionate about what they do. So, you’re right, that’s exactly why I like to do it and I can understand where that comes from for you as well.
Well, Tim, I always enjoy hearing what your take is on the new year, and I’ll keep my scorecard and we’ll talk again next year. Take care.
MUSIC
Ed: And that concludes this episode of our podcast. We encourage you to review and rate NCSL podcasts on Apple podcasts, Google Play, Pocket Casts, Stitcher, or Spotify. We also encourage you to check out our other podcasts: Legislatures: The Inside Story, and the special series Building Democracy. Thanks for listening.