Rep. Abby Finkenauer introduces “Stop Swaps, Protect Local Jobs Act”

CEDAR RAPIDS, Iowa (KCRG) - Iowa Congresswoman Abby Finkenauer wants to end a practice she says costs Iowa jobs and lets companies get around federal requirements on road construction work.

The proposed Stop Swaps, Protect Local Jobs Act would end the practice of fund-swapping. That’s when the state receives federal grant money for local road construction, but then swaps that funding source for the project. It lets counties and cities avoid federal requirements like requiring set wages for workers and using American made products.

Fund-swapping became legal in Iowa in 2017.

But Rep. Finkenauer says these provisions ensure local communities get the federals dollars they need and create more opportunities.

“When we can protect those provisions...we help stimulate the economy,” Finkenauer said in an interview with KCRG-TV9. “We help protect local jobs, and we also make sure, again, that we’re supporting American made manufacturers who desperately need our support right now.”

She cited a more than $6 million project in Davenport: the reconstruction and widening of 53rd Street. It avoided set wages and buy-American provisions. She said the city saved more than $400,000 compared to a bid that would have met those federal provisions.

But, according to Finkenauer, the cost to the local economy was higher.

“What they ended up losing out on because their fair wage standards were not attached when they decided to use the fund swapping was over $800,000 in local wages that could have been put back onto the community and could have been supporting local jobs,” she said.

The Iowa Department of Transportation says there are efficiencies to the federal aid swaps. The department says it cuts back much of the red tape and streamlines project development.

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