A multifaceted spending bill will likely move to a negotiating committee after the Iowa Senate declined to agree to a number of contentious policy proposals.
Lawmakers in the Democratic-controlled Senate rejected the version of the so-called standings bill on Tuesday that previously passed the Republican-majority House.
The House version had added new policies, including a proposal that would change collective bargaining rules.
The so-called standings legislation is traditionally viewed as the last opportunity to move legislation before the session ends. Senate Republicans failed to add a controversial policy requiring photo ID be presented at the polls.
The bill now moves back to the House, but given the differences between the sides, it is expected to soon move to a negotiating committee where lawmakers from both chambers will seek a compromise.