Clark Kauffman is deputy editor at Iowa Capital Dispatch, where this article first appeared.

A potential class-action lawsuit claims Governor Kim Reynolds’ refusal to pay pandemic-related jobless assistance to 30,000 Iowans was unlawful and deprived those individuals of “life-sustaining benefits.”

Lawyers for Karla Smith of Pleasantville and Holly Bladel of Clinton have filed a lawsuit in U.S. District Court for the Southern District of Iowa claiming the two women and thousands of other Iowans were illegally denied unemployment benefits in 2021 due to the actions of Reynolds and Iowa Workforce Development Director Beth Townsend.

The lawsuit alleges Reynolds and Townsend violated Iowa’s Employment Security law, which requires the state to “cooperate with the United States Department of Labor to the fullest extent” and make available to Iowans “all advantages available under the provisions of the Social Security Act that relate to unemployment compensation.”

“We want to get Iowans back to work!” Governor Kim Reynolds tweeted on October 20, touting a new business grant program financed through the American Rescue Plan, which she used to denounce as a “blue state bailout.”

But there was more: “We also announced a new reemployment case management system to refocus Iowa’s unemployment system and ensure Iowans can get back to work as quickly as possible.”

That’s a creative way of saying Reynolds plans to push more Iowans into available jobs by making it harder for them to collect unemployment benefits. However, the policy changes the governor announced at her latest news conference won’t address several important reasons many Iowans remain out of the workforce.

Iowa Workforce Development Director Beth Townsend acknowledged on April 30 that Iowans who refuse to go back to their jobs because of unsafe working conditions will not automatically be excluded from receiving unemployment payments.

However, she warned that “it takes more than a mere assertion by the employee” to qualify for benefits under those circumstances.

The scale of the economic collapse caused by the novel coronavirus (COVID-19) pandemic is beginning to come into view. The national economy may contract by 40 percent in the second quarter, with unemployment reaching 20 percent. One nationwide survey published this week indicated that 33 percent of voters–including 52 percent of respondents under age 45–have either lost their job, had work hours reduced, or been furloughed.

Iowa’s latest unemployment figures show yet another record number of new claims.

The novel coronavirus (COVID-19) outbreak is causing massive economic disruption as many workplaces close and consumers scale back their normal activities. Economists are predicting a “sharp increase in the unemployment rate nationally.”

The state agency that handles Iowa’s unemployment payments has been receiving as many new claims in a day as they would normally receive “in a busy month.”

Governor Kim Reynolds appointed former Iowa House Speaker Kraig Paulsen as director of the Iowa Department of Revenue on February 22, only six weeks after she had named Adam Humes to lead the agency. A late Friday afternoon news release did not explain the reason for the change, saying only that Humes “has decided to pursue other opportunities.”* Paulsen will start work this coming Monday. Leadership transitions at state agencies typically are weeks or months in the making.

Humes’ predecessor, Courtney Kay-Decker, also left under odd circumstances. Appointed by Governor Terry Branstad in 2011, she sounded excited to continue to lead the department after the 2018 election. But in early December, Kay-Decker announced her resignation, effective at the start of the new year.

Iowa Workforce Development Director Beth Townsend instructed all her agency’s employees today “to be mindful of state and federal guidelines regarding prohibitions of participation in political activities while on state time or using state assets.”

The action followed Bleeding Heartland’s inquiry about a September 29 e-mail from an operations manager to more than 60 Iowa Workforce Development colleagues, recruiting volunteers for the Kim Reynolds/Adam Gregg campaign under the subject heading, “A Message from Governor Reynolds’ Office.”

State law prohibits using “public moneys for political purposes.” Administrative rules written to implement that portion of the Iowa Code forbid public employees from using public resources “to expressly advocate the nomination, election, or defeat of a candidate,” or “to solicit votes, engage in campaign work.”

“Phony number” graphic created by Dave Swenson

I was encouraged when Beth Townsend became Iowa Workforce Development director early this year. The previous director, Teresa Wahlert, was one of Governor Terry Branstad’s worst appointees; I suspect her record for legal entanglements involving an agency director for the State of Iowa will never be surpassed. In contrast, I’d heard consistently good feedback about Townsend’s work as executive director of the Iowa Civil Rights Commission. The new director has taken several steps to bring Iowa Workforce Development’s operations in line with federal labor laws.

Which makes it even more disappointing to see Townsend sell one of the biggest lies of Branstad’s long, long stint as governor, first in her agency’s annual budget presentation, and now in the editorial pages of Iowa’s largest newspapers.

For years, Governor Terry Branstad and his appointees have cited fake job creation statistics to create the illusion that Iowa was on track to fulfill one of Branstad’s key promises from the 2010 campaign. This week, the deception culminated in an official slideshow “indicating that 206,200 gross jobs have been created in Iowa since 2011, based upon current employment statistics.”

It’s a shame the governor can’t celebrate Iowa’s low unemployment rate without exaggerating job growth during his administration.

It’s even more unfortunate when major news media downplay the dishonesty underlying Branstad’s claims.

Not for the first time and probably not for the last time, Governor Terry Branstad dropped a lot of line-item vetoes late in the afternoon before a holiday weekend. Early news reports are understandably focusing on the vetoes of one-time funding for K-12 education and state universities, as well as language that would have kept mental health institutions in Clarinda and Mount Pleasant open. Bleeding Heartland has a post in progress about the fallout from those actions and others, including Branstad’s decision to strike language that would have expanded child care assistance.

Democratic State Representative Sharon Steckman called attention to several other line-item vetoes that flew below the radar yesterday. One of them seems particularly important, as it could put the State of Iowa at odds with U.S. Department of Labor demands to “strengthen Iowa’s compliance with Federal law” and keep administrative law judges “free from actual or perceived intimidation.”

JULY 6 UPDATE: The vetoed language pertained to administrative law judges working for the Public Employment Relations Board, not Iowa Workforce Development; see further details below.

Iowa Workforce Development Director Beth Townsend is implementing key recommendations from the U.S. Department of Labor to resolve concerns about the previous agency director’s actions. Townsend’s actions provide a refreshing contrast to Teresa Wahlert’s management of Iowa Workforce Development, which sparked recurring controversy and not one, not two, but three lawsuits.

The U.S. Department of Labor’s Employment and Training Administration has given Iowa Workforce Development Director Beth Townsend a list of tasks to “strengthen Iowa’s compliance with Federal law” and address various concerns about the actions of Teresa Wahlert, Townsend’s predecessor.

It’s another sign that while Wahlert may not be Governor Terry Branstad’s worst appointee during his current administration, she’s a solid contender.

Sidestepping what looked like an unwinnable battle with Iowa Senate Democrats, Governor Terry Branstad announced in a press release today that Teresa Wahlert will retire as head of Iowa Workforce Development. Apparently Wahlert informed Branstad on January 9 that she would step down, effective today. Iowa Civil Rights Commission Executive Director Beth Townsend will take over as acting director of Iowa Workforce Development. After the jump I’ve posted background on Townsend as well as today’s press release about Wahlert’s retirement.

Wahlert’s tenure was rocky from the start, as she only barely was confirmed to lead the agency in 2011. Iowa Senate Democrats objected to the planned closure of staffed Iowa Workforce Development offices all over the state, a policy that Wahlert later carried out despite lawmakers’ efforts to keep the offices open. (The Iowa Supreme Court eventually ruled unanimously that Branstad acted improperly when he struck language about the field offices without vetoing the money allocated to fund them, but the offices were never reopened.)

Wahlert’s conduct is also mixed up in two lawsuits filed by former senior state employees. As if that weren’t enough, an arbitrator ruled in November that Wahlert “overstepped her bounds when she promoted a judge who had been demoted after complaints that she created a hostile work environment.” For those reasons, she certainly would not have received the 34 yes votes she needed in the Iowa Senate, had Branstad re-appointed her to her current job. Today’s official press release does not acknowledge any of the controversies surrounding Wahlert’s work. Instead, the governor and Lieutenant Governor Kim Reynolds praised her leadership on worker training and job creation.

Final note: words attributed to Reynolds today greatly exaggerate the number of jobs created during Wahlert’s years in state government. No matter how many times real economists dismantle this zombie lie, the Branstad administration is hell-bent on counting only gross jobs created (a “fake” number), not net jobs created (which accounts for job losses as well). Townsend could do all Iowans a service by getting her new subordinates out of the fuzzy math business. As Mike Owen of the Iowa Policy Project argued here, the “political tainting” of Iowa Workforce Development is unacceptable: “IWD should be trying to determine and illustrate the actual job picture facing our state, so policy makers can make decisions in that light.”