While Iowa GOP lawmakers are against legalizing cannabis this session, a former state official expects they'll soon "need a new sin tax" to make up for lost revenue from tax cuts, reports Iowa Capital Dispatch.

Why it matters: State forecasters project Iowa's revenue to decline by around $1 billion over two years because of major tax cuts signed into law by Gov. Kim Reynolds, who also says she wants to eliminate the state income tax by 2027.

• While Republicans say they expected revenues to go down and still have a nearly $2 billion surplus to work with, Democrats are warning that this year's expansion of a private school "voucher" program will compound the losses, IPR reported in December.

Driving the news: State estimates show a 5.3% drop in revenue for fiscal year 2025 and a 6.3% drop in fiscal year 2026.

• Mike Tramontina, the former director of the Iowa Department of Management, predicts Republicans will avoid raising income or sales taxes during a financial shortfall, due to political pushback. Instead, they'll turn to cannabis legalization.
• He estimates the state will need $40 million to $50 million in new revenue and the current medical marijuana program won't cover that. Cigarette and alcohol sales taxes are already "quite high," he tells ICD.

Zoom out: Neighboring states — including Illinois, Minnesota and Missouri — are reaping fiscal benefits from Iowans crossing state lines to purchase recreational cannabis.

• Missouri, which legalized recreational cannabis in February 2023, garnered $65 million in tax revenues from its first year of sales. Illinois estimated it generated about $3.6 million in tax revenue from Wisconsin residents alone in 2022, about 7.8% of all its cannabis revenues.
• A cannabis dispensary in Eagleville, Missouri, regularly advertises in Iowa and has customers who travel across state lines for products.

What they're saying: Rep. Ann Meyer (R-Fort Dodge) chairs the Health and Human Services Committee and is a key lawmaker for passing recreational cannabis legislation.

• While Meyer tells ICD she opposes legalizing recreational use, she supports the state's medical program and is open to "revising" it if any changes are needed.

The big picture: The Trump administration appears to favor policies legalizing cannabis in the U.S., including rescheduling it at the federal level, NPR reported in November.

• Trump legalized hemp in 2018.

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Iowans paid an average of $2,416 last year for home insurance — an increase from $2,120 in 2023, according to Insurify, an insurance shopping and comparison website.

Why it matters: While Iowa lacks wildfires and hurricanes, other extreme weather like hail and tornadoes has resulted in some companies dropping out or raising their prices for Iowans.

• A 2024 New York Times analysis showed Iowa was unprofitable for insurance companies from 2020 to 2023.
• The state had the third-highest year-to-date increase in home insurance premiums in 2024, according to Insurify.

Zoom in: Iowa has been facing rising premiums ever since a derecho tore across the state in 2020.

• Following last year's devastating tornadoes and storms, insurance challenges are unlikely to subside anytime soon.

Go deeper: Wildfires and hurricanes could make parts of U.S. uninsurable

🗳️ Arizona politician Kari Lake is returning to Iowa for a West Des Moines event on Jan. 30. There's speculation she could primary against U.S. Sen. Joni Ernst, who is up for re-election. (Des Moines Register)

💵 Local smoke shop owners say a new law adding a 40% tax to pipes and bongs could result in them closing or laying off staff. A $30 pipe could now rise to $44. (Des Moines Register)

🏀 The Cyclones men's basketball team reached its highest-ever AP ranking — No. 2 in the nation. (WHO-13)

A Texas man was arrested after allegedly stalking Caitlin Clark and sending threatening messages. (KCCI)

We're almost halfway through Dry January, but if you're participating in the trend, it doesn't mean your nights out for the rest of the month have to be dull.

Why it matters: Studies show that temporarily abstaining from alcohol comes with health perks like better sleep, less stress and weight loss.

Zoom in: The New Northwestern in the East Village has dedicated its entire seasonal menu this month to mocktails, including a "mocktini" and "NA Espresso" ($9).

• Linh enjoys the "Hop to It" at Bartender's Handshake: hop water, mint, lime and honey ($7).

Pro tips for a successful Dry January, from Axios Finish Line:

💬 Tell people. It holds you accountable and makes it easier to navigate social situations.

✂️ Cut back. Instead of quitting altogether, perhaps try a Damp January first. Use the month to reset the way you think about alcohol and mindfully drink less.

🙂 Replace, don't erase. If you're used to a nightly glass of wine, don't stop that ritual — find a substitute.

• Plus: Don't skip social occasions, or you'll burn out quickly. Instead, find and order nonalcoholic options you love.

Go deeper for mocktail recipes