Senate Majority Leader Mike Gronstal:
“We did some things on job creation in this state on making sure that the resources are there to provide for education and training of employees in this state to match the skills to the jobs that are out there and get thousands of Iowans back to work. So I’m pretty excited about some of the things we did for higher education and in particular community colleges. There are disappointments, there are disappointments in every session. I would have really loved to have gotten something done on commercial property taxes in this state. In the end we felt the plan that the Governor was advancing was one that would shift taxes to homeowners and we couldn’t go along with that.”

Video, audio and a transcript can be found at IPTV.

HF 2472—Ethanol Blended Gasoline Tax Rate

FLOOR ACTION:

SF 2342 provides tax credits for the construction and installation of solar energy systems and geothermal heat pumps. It provides a credit for geothermal systems equal to 25 percent of the federal credit. It is not refundable but can be carried forward for 10 years. The solar energy system tax credit is also 50 percent of the federal credit, is not refundable, and can be carried forward for 10 years. The bill also modifies sales and use tax provisions related to property purchased for auto body repair for resale, and creates a sales tax exemption for certain items purchased for use in providing vehicle wash and wax services. [4/26: 45-1 (Beall “no”; Houser, Johnson, Kapucian, Sorenson excused)]

HF 2472 (companion to SF 2340) extends the paired rate system for motor fuel for an additional year, until July 1, 2013. Currently, an excise tax is imposed on each gallon of motor fuel sold in the state. The general tax rate is 20 cents per gallon, but subject to adjustment each 12-month period, based on a formula that produces a paired rate system for ethanol-blended gasoline and other motor fuel. When the paired rate system expires, the tax rate will be uniformly imposed at 20 cents for each gallon. [4/26: 46-0 (Houser, Johnson, Kapucian, Sorenson excused)]

FLOOR ACTION:

SF 2293 is based on recommendations by the Iowa Insurance Division (IID) to update and modify regulations in a variety of areas under their jurisdiction, including insurance and securities. The original proposal was amended by the Senate to provide that procedures for external review of health care coverage decisions also apply to external review of coverage for dental coverage, and to address irregularities in a federal program in Iowa, HIPIOWA-FED, which is a high-risk pool program for individuals who have pre-existing conditions and have not been able to find private health insurance. It requires HIPIOWA-FED to accept third-party payment of premiums for individuals enrolled in that program, allows HIPIOWA-FED to assess health insurance carriers in Iowa if the program incurs losses and additional federal funding is not provided to offset the losses, enhances Board membership and accountability, and strikes the third-party payer prohibition (514E.7). The House amended the bill by striking the HIPIOWA-Fed provisions, modifying dental review requirements, and adding navigator language applicable to the federal Affordable Care Act. The Senate further amended the House version by reinstating the HIPIOWA-FED provisions and adding language establishing a health insurance and cost containment bureau. [5/1: 26-23 party-line]

FLOOR ACTION:

HF 2465 is the FY13 Standings bill, which makes adjustments to standing appropriations that are in law, addresses several miscellaneous policy issues and makes a number of corrective Code editor fixes required by legislative action this session. The Senate version appropriates $2.84 billion in FY13. The FY12 appropriation was $2.819 billion. The Senate version appropriates an additional $18.87 million in FY12 for a total of $2.838 billion in FY12. The House version represents $70.5 million in reductions to the standing appropriations with the majority of the savings coming from health insurance premiums ($46.7 million), Area Education Agencies ($10 million) and REAP ($8 million). In addition, the House eliminates (does not extend the sunset of) the Class Size Reduction program. This eliminates $30 million from the K-12 school aid formula. Here are the highlights of the strike after amendment that the Senate adopted:

DIVISION I – STANDING APPROPRIATIONS AND RELATED MATTERS

Fully funds the Homestead Property Tax Credit and the Ag Land Tax Credit. $48,811 613 of the Homestead appropriation and $6,704,869 of the Ag Land appropriation are made from the Taxpayers Trust Fund. The Taxpayer Trust Fund is estimated to have a $60 million balance. This is approximately a $55.5 million increase and funds property tax credits at the same level as the House. Total appropriations for property tax credits would be $201.5 million in FY13.

Limitations on Standings FY13 – Last year, several of the standing appropriations were modified to fund the FY13 at 50 percent of their statutory level. The bill makes these adjustments:

County Endowment Community Cultural Grants – The bill increases funding from $208,351 to $416,702 (Governor’s level). The House is at $374,615 for FY13, which is a reduction of $42,087 from FY12 level.

Regional Tourism Marketing – The bill increases funding from $405,153 to $810,306 (Governor’s level). The House is at 728,465 for FY13, which is a reduction of $81,841 from the FY12 level. 

Central Registry for Congenital and Inherited Disorders – The bill increases funding from $85,560 to $232,500.  This is a $61,379 above the FY12 level. This is the same level as the House.

Child Abuse Prevention – The bill increases funding for primary and secondary child abuse prevention programs from $108,886 to $232,500 for FY13, which is $14,728 more than the FY12 level. This is the same level as the House. 

Child Development Programs for At-Risk Children – The bill increase funding from $5.4 million to $10,728,891 (same as Governor). The House is at $9.6 million for FY13, which is $1.1 million less than the FY12 appropriation.

Nonpublic School Transportation – The funding is $7.06 million for FY13, which is the same as the FY12 level.   

Tobacco Stamps – The bill increases funding from $9,208 to $18,416 to the Department of Revenue for tobacco reporting requirements in FY13. The House is at $16,556, which is $1,860 less than the FY12 level.

Standing Appropriation Adjustments Carried Forward – There are several adjustments to standing appropriations that were approved last session and are not being changed this session: 

Instruction Support Program – There is no funding for the instructional support program in FY13, which is the same as FY12. The standing appropriation is $14.8 million.

Legislature – The Legislature’s budget is a standing unlimited appropriation. For budgeting purposes, the FY13 proposed budget is $35.9 million. The House bill reduces funding to the Legislature by $2.15 million or 6 percent for FY13.  

DIVISION II – MISCELLANEOUS PROVISIONS AND APPROPRIATIONS

Federal Consent Decree Expenditures/Reporting – Authorizes the Attorney General to spend money received from the federal mortgage servicing settlement. The Attorney General is required to spend the money as spelled out in the consent decree. An initial report is due to the Legislature on January 15, 2013.

Keep Iowa Beautiful Fund – Beginning in FY13, up to $1 million in growth from lottery revenues is transferred into the Keep Iowa Beautiful fund within the Iowa Department of Transportation (DOT). Lottery revenue base revenue is set at $64.9 million. The transfers would be for three years, FY13 through FY15.

Iowa Youth Suicide Prevention Program – Appropriates $137,000 in FY13 to the Department of Public Health to establish an Iowa Youth Prevention Suicide Hot Line. This includes an anti-bullying Internet site and texting capabilities.

Individual Disaster Aid – Makes Senate File 2289, which has been signed by the Governor, retroactive to April 12, 2012. This action allows the victims of the recent tornados in southwest Iowa to take advantage of the program and allows low-income Iowans to qualify for disaster relief.

Plumbers License Extensions – Directs Plumbing Board to grant a one-time renewal of an expired license if the person if the person passes a municipal or block examination. The Board is required to clearly state future renewals procedures and requirements in any correspondence. This section expires Jan. 1, 2013.

Rebuild Iowa Infrastructure Fund – Extends reversion of Relocation/West Capital Terrace money until June 30, 2013.

IT Projects – Extends reversion of IT appropriated as part of Government Efficiency in FY11 through FY13.

Department of Inspections & Appeals – Is required to have its nursing home trends reporting website online by December 31, 2012.

Iowa Finance Authority language – Removes use of moral obligation from bonds issued by IFA, and cleans up language in 16.27, paragraph 6.

Rules Internet Site – Directs Administrative Rules Coordinator to work with state agencies to develop a uniform, searchable and user-friendly rules Internet-based database.

Five-year Rules Review – Requires executive branch agencies to conduct an ongoing and comprehensive review of their rules. The goal is to identify and eliminate rules that are outdated, redundant, inconsistent or incompatible with statute or its own rules or those of other agencies. The review is to be planned in consultation with major stakeholders and constituent groups. A summary of the results is to be submitted to the Administrative Rules Review Committee.

Administrative Rules Review Committee – The chair is to be chosen each year at the beginning of each session of the Legislature. The chair for the first session is from the House, the chair for the second session is from the Senate. 

Department of Public Safety Retirement Changes – Disability: the amount of net retirement allowance plus the amount earned by the member is changed from 1.5 times the amount of the current earnable compensation of an active member to 2.5 times the amount.

IPERS Retirement Exclusion for Licenses Health Care Professionals – Extends the through July 2014, the ability of retired licensed health care professionals to be exempt from the four-month bona fide retirement before returning to work as a license health care professional for a public hospital without affecting their retirement benefits. This addresses the shortage of health care professionals (Included in House version).

Infusion of Liquor – Allows a liquor control licensee to have mixed drinks or cocktails mixed on the premises that are not for immediate consumption but may be consumed on the licensed premises under certain conditions based on rules adopted by the Alcoholic Beverage Division. The rules are required to state that the mixed drinks or cocktails can be stored for a maximum of 72 hours in a labeled container in a quantity that does not exceed three gallons. The addition of caffeine, hallucinogenic substances or other added stimulants is prohibited. The licensee is required to keep records showing when the contents in the container were mixed and the recipe used for the mixture. This provision is identical to legislation approved by the Senate on a 48-2 vote on March 6.

Preschool Administration Costs – Requires school districts to pass through at least 95 percent of the funding for preschools for programming for eligible students enrolled in the district’s approved program. This would effectively limit administration costs of preschools to 5 percent of the funding (Included in House version).

Area Education Agency – Directs the Department of Management to reduce funding to the Area Education Agencies for FY13 by $15 million. The House reduces them by $20 million, which is the same as the reduction in FY12. The reduction is to be prorated based on the reduction that occurred in FY04.

Waiving Tuitions – Top priority in awarding an Iowa Grant (administered by the Student Aid Commission) to attend a Regents or private college in Iowa will be given to a qualified student who is a child of a peace officer, fire fighter or sheriff who is totally and permanently disabled or killed in the line of duty. This applies to a student who is a resident of Iowa Is under 25, or under 30 in the student is a veteran, is not a convicted felon and meets any of the following criteria:

** Is the child of a DPS peace officer who was killed in the line of duty (PORS)

** Is the child of a peace officer who was killed in the line of duty – statewide fire and police (411)

** Is the child of a sheriff or deputy sheriff who was killed in the line of duty (IPERS)

Snowmobile Fix – Corrects section of snowmobile legislation passed this year: doesn’t require but doesn’t prohibit snowmobiles from purchasing liability insurance. 

Safe Walkways for Railroad Workers – Directs DOT to adopt rules requiring safe walkways for railroad workers.

Change to the TIF bill (HF 2460), if enacted – Amends the Instructional Support Levy section of HF 2460. Allows Instructional Support Levy taxes to be used on existing debt that is refinanced. In addition, there is clarifying language regarding what is “necessary” to pay the existing debt.

Flood Mitigation (SF 2217, signed by Governor) – Expands eligibility to financial assistance programs administered by the U.S. Environmental Protection Agency and the federal Clean Water Act to allow additional cities/counties to participate. 

Historic Preservation Tax Credit – Disproportionate Allocation Code Fix: For projects beginning on or after July 1, 2012, the amount claimed by a partner if the business is a partnership, a shareholder if the business is an S Corporation, or a member if the business is a LLC, is be based on the amounts designated by the eligible partnership, S corporation or LLC. This applies to tax credits reserved on or after July 1, 2012.

Insurance Division – Confidential Documents, Exceptions: Adds the International Association of Insurance Supervisors and the Bank for International Settlement.

Chiropractors – A third-party payment or prepayment of health or medical expenses will not impose a copayment or coinsurance amount for services provided by a doctor of Chiropractic that is greater than the amount imposed on the insured for services provided by an MD or DO, for the same or similar condition. 

Custody of Children – Directs a judge to take into consideration, when making custody decisions, whether the person has let the child have unsupervised access to a person who is on the sex offender registry. 

Deposit of Public Funds Correction – Repeals section 5 of SF 2168 (deposit of public funds in banks), which was recommended by the State Treasurer after consulting with bankers because it may have unintended consequences (Included in House version).

Housing Enterprise Zone Tax Credit Issue – a section of SF 2308: Addresses and fixes a problem with Housing Enterprise Zone Project in which a city failed to file the appropriate paperwork. This would extend the time for the project. Mechanics Lien Bill (HF 2465) – Changes mechanics lien registry to “state construction lien registry.”

DIVISION III – CORRECTIVE PROVISIONS

These are corrective provisions to bills that have been approved by the Legislature or conforming changes to the Code. These corrections are non-substantive Code Editor changes recommended by the Legislative Services Agency. These bills or Code sections are amended:

SF 2265 – Notarial Acts

HF 2285 – Plumber Licensing

SF 2247 – Mental Retardation Code References

HF 2458 – Rural Iowa Primary Care Loan Repayment Program

HF 2165 – Physician Orders for Scope of Treatment

SF 2248 – Respiratory Care Licensed Professionals

SF 2203 – Code Editors Bill

HF 2403 – CDLs for Military Service

HF 2228 – Requiring Motor Vehicle Operator to have Control of Vehicle

HF 2428 – Vehicles on Economic Export Corridors

HF 2467 – Snowmobiles

SF 2249 –Motor Vehicle Dealers at Events

HF 2145 – Surplus Insurance Lines

SF 2285 – Statutory Corrections

HF 2370 – Real Estate & Mortgage Foreclosure Civil Actions

SF 2265 – Notarial Acts

DIVISION IV – Carry Forward (FY12) Appropriations

Vicksburg – Iowa State Memorial: $320,000 FY12 (ending balance) appropriation.

Labor Management Councils – Appropriates $38,000 from FY12 for Labor Management Council grants.

Legislative Interim Study of Price Lab School at UNI – Includes a $3 million (FY12) appropriation to UNI to keep Price Lab School open. The Regents are required to keep Price Lab School open until July 1, 2013.

Economic Emergency Fund – Performance of duty: $2.9 million (FY12) appropriation for Missouri River damage

411 Retirement System – FY12 (ending balance) $5 million appropriation

Watershed Improvement Fund – $5 million FY12 (ending balance) appropriation

Iowa State University for their Bioscience Initiative – $5 million FY12 (ending balance) appropriation 

Public Safety Training Task Force – Appropriates $50,000 from the FY12 ending balance to the Department of Public Safety to be used from July 1, 2012, through December 31, 2015, for administrative support for the Public Safety task force. The Department of Public Safety will provide administrative support for the task force, which consists of the following:

** One member appointed by the Iowa Peace Officers Association

** One member appointed by the Iowa State Sheriff’s and Deputies Association

** One member appointed by the Iowa Police Chiefs Association

** One member who is a fire chief appointed by the Iowa Fire Chiefs Association

** One member who is a fire chief appointed by the Iowa Professional Fire Chiefs Association

** One member who is the chief of the Iowa Fire Service Training Bureau

** Two members who represent the fire service appointed by the Iowa Firefighters Association

** Director of the Iowa Law Enforcement Academy

** Commissioner of the Department of Public Safety (DPS)

** Two members appointed by the Iowa Professional Firefighters

** State Fire Marshal

** Director of the Department of Corrections (DOC)

** One member appointed by the Chief of the Bureau of Emergency Medical Services–Public Health

** One member appointed by the Iowa Emergency Medical Services Association

** One member appointed by the Iowa State Police Association

** One member appointed by the State Police Officers Council – representing DPS peace officers

** One member appointed by the State Police Officers Council – representing (DNR)

** Chief of Law Enforcement Bureau of DNR

** One member appointed by Governor – public member in general

** One member appointed by DOC’s collective bargaining unit.

** One member appointed by jailers and dispatchers collective bargaining unit.

** One member appointed by Community College Presidents

** Dir. Of Homeland Security/Designee

** Adjutant General of the Iowa National Guard/Designee. 

** Representative of DOT motor vehicle enforcement

The task force will be gender balanced. The task force is required to consider and develop strategies relating to public training facility governance, with the goal of all public safety disciplines being represented. Part of the recommendations of the Task Force is to include the distribution of money from the Public Safety Training and Equipment Trust Fund. Each public safety discipline will advise the task force by developing individual training policies and standards as determined by the discipline’s governing bodies. The task force will also develop a proposal for a joint public safety training facility, a budget for construction and future operation of the facility, and potential centrally located locations. Interim reports are due to the Legislature by December 31 of each year. The final report is due December 31, 2015. The final report will include, but is not limited to:

** Consolidation of public safety governance within a single board and the membership of the board.

** Development of a consolidated fire and police public safety training facility, including possible locations, building recommendations and financing options.

** Any other recommendations relating to public safety standards, training and facilities requirements.

Division V – Department of Revenue:

“Non-con” cleanups from the Department of Revenue Omnibus bill SSB 3117

Division VI – Credit for Time Served While on Probation

SF 2209/HF 2316 responds to a recent Iowa Supreme Court case, referred to as the Anderson case, in which it was determined  that current Iowa law specifically provides that all persons who are placed on supervised probation who have that probation revoked will get credit for time served while on probation. The law, as written, had unintended consequences. For example, someone on supervised probation who had freedom of movement (e.g., living at home) would get credit for that probation and time taken off of their prison sentence for the time spent on probation. The bill, as amended, specifies that if a defendant is placed on probation, they will only get credit for time served if their probation is revoked for the time served in a community based corrections residential facility or an alternative jail facility as part of their probation.

Division VII – County Treasurers

SF 2240 is a County Treasurer clean-up bill. Sections 161A.35, 311.17, 311.19, 331.384, 357.20, 358.16, 364.13, 384.60, 384.65, 468.57 all pertain to an increase in the amount that can be waivered on properties with city special assessments and drainage districts from $100 to $500. Currently a property owner has the right to pay their city special assessments or drainage assessments in ten installments over ten years if the assessment is more than $100. Sections 435.24, 445.36A, 445.57 all pertain to how partial payments can be apportioned, either immediately each month or semi-annually. Section 446.32 amends when taxes for a subsequent year may be paid by the tax sale certificate holder beginning an additional month to the current 14 days following the date from which an installment becomes delinquent.

Division VIII — Boards and Commissions

SF 461 relates to certain boards and commissions with legislative appointments. Code chapter 28B, relating to the commission on interstate cooperation, is amended to provide for appointment of a  commission in accordance with a resolution adopted for this purpose by the legislative council and to conform the per diem payment provision with that applied to other legislative appointments. Current law provides for the commission to be appointed on an ongoing basis. Code section 216A.132, relating to appointment of the criminal and juvenile justice planning advisory council in the Department of Human Rights, is amended. The judicial and legislative branch appointments are specified to be ex-officio and nonvoting positions. In addition, the terms of the legislative appointments from the House of Representatives are conformed to other legislative appointments to begin and end with the term of the Legislature’s biennium. Code section 249A.36, establishing the medical assistance quality improvement council, is repealed. The Code provision establishing the council, consisting of non-legislator members, was enacted in 2008 but council members have never been appointed.  

Division IX – Allowable Growth 

Sets Allowable growth for the school aid formula (including categorical funding) in FY14 at 4 percent. 

Division X – City Franchise Fees

Beginning July 1, 2012, a city that is subject of a judgment or court-approved settlement, which includes a payment, must set a franchise fee of not more than 7 percent. The amount collected in excess of 5 percent will be used to pay the restitution/settlement. A city may assess and collect a franchise fee in excess of 5 percent for a period not to exceed seven consecutive fiscal years. This division is repealed as of July 1, 2030. 

Division XI – External Review of Health Care Coverage Decisions

The Dental External Review (Insurance Omnibus, SF 2293) provides that procedures for external review of health care coverage decisions also apply to external review of coverage for dental.

Division XII – Early Intervention Block Grant Program

Repeals the sunset date. Effective upon enactment.  SF 2219 strikes the sunset date for class-size reduction/early intervention program. This program was funded from July 1, 1999, to June 30, 2012. There is a sunset date in Code. SF 2219 strikes that sunset date since this funding in now in the school finance formula. The Iowa Early Intervention Block Grant Program set a goal of no more than 17 students per teacher in kindergarten through third-grade classrooms. School districts may use funds from this program in a number of ways to increase the basic skills of students, including hiring additional licensed instructional staff, before and after school programs, tutoring, implementing all-day kindergarten and more (Iowa Code 256D.2). In 2008, the Legislature provided a new categorical allowable growth formula for three long-standing education line-item appropriations: (1) Teacher Quality and Phase II, (2) Professional Development, (3) Early Intervention (also known as Class Size Reduction money). In FY13, Early Intervention Funds are estimated to total $30.3 million within the school aid formula.

Division XIII – Juvenile Offenders

SF 365, with a strike-after amendment proposed by the Senate, relates to the placement of a juvenile on youthful offender status in district court and other laws regarding juveniles who are charged with criminal offenses. Under current Iowa law, a juvenile court may waive its jurisdiction over a child alleged to have committed certain delinquent acts to the district court for prosecution as a youthful offender.  Upon a plea or verdict of guilt in the district court, the child is returned to the jurisdiction of the juvenile court, which enters an order of disposition and supervises the child until age 18. When the child reaches age 18, a hearing is held in district court where the court has discretion to discharge the sentence or continue supervision of the youthful offender in district court. The youthful offender law is meant to present a hybrid proceeding between juvenile proceedings and full waiver for prosecution as an adult. The amendment to SF 365 makes some changes to Iowa’s current youthful offender law and other laws relating to juveniles. 

The bill with the amendment allows a child who is waived to district court for prosecution as a youthful offender to receive a deferred judgment. Under current law, the child can only receive a deferred sentence. Children who are waived to district court to be prosecuted as adults are eligible to receive a deferred judgment, so this change creates parity between a child prosecuted as an adult and a child who is prosecuted as a youthful offender.

In addition, the amendment establishes a minimum age at which a child can be prosecuted as a youthful offender. Current law has no minimum age and the bill clarifies that only children ages 12 to15 can be prosecuted as youthful offenders and the Code identifies the crimes for which a child can be prosecuted as a youthful offender. However, children who are 10, 11 or older who are charged with a class “A” felony can also be placed on youthful offender status.

The amendment mandates that once a young person age 16 or older is waived to district court to be prosecuted as an adult and convicted or pleads guilty in district court, any subsequent criminal charges against that person are automatically waived to district court. The amendment also specifies that the court may waive a mandatory minimum sentence relating to a juvenile who is waived to district court for prosecution as an adult for a crime which requires a mandatory minimum sentence for an adult who pleads guilty or is convicted of the crime.

Division XIV – Regents

Iowa Communications Network written Report of savings by state agencies – This section does not apply to Regents.

Minority And Women Educators’ Enhancement Program – By January 31 of each year, the regents are to submit a progress report to the Legislature regarding this program. 

Purchasing – U of I Hospitals and Clinics, Competitive purchases: Deletes reference to the $10,000 threshold. Purchases will be in compliance with the purchasing policies of the Regents.

Premium tax exemptions – Hawk I program, state employees: Premiums received for benefits acquired on behalf of state employees are exempt from premium tax. This also applies to employees of the Board of Regents. 

Division XV 

Sales Tax E-Fairness (SF 2330) relates to the collection of sales and use taxes by retailers maintaining a place of business in this state, agreements relating to the collection of sales and use taxes and sales of tangible personal property and services of state agencies. The bill provides a definition for maintaining a place of business in Iowa. An amendment was adopted in committee to remove controversial language regarding affiliates. [4/3: 48-0]

“Safe Harbor” bill (SF 2301) will provide for a special fund at the Iowa Department of Agriculture reserved for local authorities to tap into to pay for the care of non-agriculture animals in the event they need to be rescued. The Safe Harbor fund will be financed by the license fees already being paid by those who are licensed by the state as commercial establishments, breeders, shelters, kennels, pet shops, pounds, public auctions or research facilities. No new fees or fee increases will be needed. Currently, at least four USDA-licensed commercial breeders are under review by the USDA’s Investigation and Enforcement Services. If those licenses are cancelled, the disposition of more than 400 adult dogs and an unknown number of puppies will be in question. Law enforcement officials in Sac, Greene and Clinton counties noted the high cost to taxpayers and non-profit groups in recent months when rescues were necessary due to severe neglect and abandonment. The rescue fund will help local authorities recoup their costs for food, water and medical care in these instances. SF 2301 is patterned after SF 478, which set up a funding mechanism to provide for livestock deemed to be neglected and in need of immediate sustenance, which was signed into law in 2011. A corrective amendment regarding the definition of “vertebrate animal” was made to this legislation. [5/1: 26-22 (party-line, Houser, McKinley absent)]

SF 2339—Brownfields and Grayfields Tax Credits

SF 2340—Ethanol Blended Gasoline Tax Rate

SSB 3204—Sales Tax Exemptions and Energy Tax Credits

HF 2459—Sheep and Wool Production

HF 2460—Tax Increment Financing

HF 2464—IDPH Technical Bill

FLOOR ACTION:

SF 2332 makes several changes relating to enhanced 911 emergency telephone systems. Most of the changes are updating Code sections to reflect current terminology. The amount of notification needed before an alternative surcharge referendum is brought before the voters is reduced from 100 days to 60 days. The 21-percent allocation of the wireless surcharge fee to wireless carriers to recover their costs to deliver E911 phase 1 services is struck. Phase 1 has been completed. The amount allocated to the local Public Safety Answering Points (PSAPs) is increased from 25 percent to 46 percent of the wireless surcharge. This will increase funding to PSAPs by about $3.7 million annually (this is the amount deleted from the wireless carriers). The requirements that up to $500,000 annually be applied to specified outstanding wireless E911 Phase 1 obligations and that as much as $159,000 per quarter be allocated equally to joint E911 service boards are deleted since they are no longer needed. Hardware and software for an Internet protocol-enabled next generation network is added as permissible uses of carryover operating surplus moneys.  There is a temporary moratorium on an additional new surcharge until 150 days after submission of the E911 Task Force’s report.

An E911 Task Force is created and will submit a report to the Legislature by December 1, 2012. The bill requires Homeland Security & Emergency Management to convene a task force of stakeholders to consider and offer recommendations regarding needed upgrades and enhancements to the state’s E911 programs. This is to include public safety and emergency management representatives, local public safety answering point personnel, telecommunications service providers and state agencies that are directly involved in administering and providing E911 services. This includes but is not limited to:

** Enhanced technology needs to local E911 public safety answering points to ensure timely, quality emergency response services.

** Identifying new wireless technologies used in E911 service delivery.

** Funding needs to meet state and federal emergency communications technology mandates.

** Potential wireless and wire-line surcharge adjustments to meet E911 service delivery demands, including specific recommendations on surcharge equalization and on the distribution formula of surcharge revenues.

** Local and state E911 administration and governance. [4/23: 49-0 (McKinley excused)]

SF 2339 increases the amount of tax credits that the Economic Development Authority (EDA) may annually allocate under its aggregate tax credit limit in Code section 15.119 to the Redevelopment Tax Credit Program for Brownfields and Grayfields from $5 million to no more than $10 million. This does not increase overall spending on tax credits just allows the EDA Board to make changes to the allocations under the cap. [4/23: 49-0 (McKinley excused)]

HF 2459 is the Sheep Production Check‐off Increase, which authorizes the Sheep Promotion Board to call for a special referendum to ask their members if they want to increase their per-head check‐off from 10¢ to 25¢. If a majority of voters authorize the increase, a second question would be asked: “Would you also authorize the board, by resolution, to raise any additional increases in the future, as long as the board waits three years from the previous increase, provides notice to producers, and the increase can only be 5¢ every three years up to a maximum of 50¢?” This bill came from the Sheep Promotion Board. [4/19: 31-16 (Anderson, Bertrand, Chelgren, Courtney, Dearden, Dix, Dotzler, Dvorsky, Feenstra, Hamerlinck, McCoy, Smith, Sodders, Sorenson, Whitver, Zaun “no”)]

HF 2460 relates to Iowa’s urban renewal law and incremental taxes. The Senate amendment strikes everything in HF 2460 and does the following:

** The amendment requires certain reporting of the counties, cities and rural improvement trustees regarding urban renewal projects, plans and tax increment financing (TIF). Each municipality must file the electronic report with the Department of Management by December 1, 2012.

** Legislative Services Agency is required to do an annual report on the information contained in the reports and this annual report will be sent to the Governor and the Legislature. When a municipality amends or modifies an adopted renewal plan to include an additional urban renewal project, it must hold a public hearing.

** TIF cannot be used for the relocation of a commercial or industrial enterprise not presently located within the municipality unless: (1) The local governing body of the municipality where the business is currently located has a entered into a written agreement with the local governing body of the municipality where the business is proposing to relocate concerning the relocation or has a written agreement concerning the general use of economic incentives to attract commercial or industrial development within those municipalities or (2) The local governing body of the municipality where the commercial or industrial enterprise is proposing to relocate find that the use of TIF is in the public interest (requires written verification).  “Relocation” means the closure or substantial reduction of an enterprise’s existing operations in one area of the state and the initiation of substantially the same operation in the same county or contiguous county in the state.

** A city must get the approval of the county board of supervisors when the city adopts a resolution approving the Local Option Sales Tax (LOST) TIF.

** Restricts the municipality from using Instructional Support Levy for tax increment financing unless the school board by resolution approves the use of the levy. This is effective on April 24, 2012. [4/24: 26-22 party-line (Hamerlinck, McKinley excused)]

HF 2464 makes technical changes and updates to various programs within the Iowa Department of Public Health, including Board of Nursing Home Administrators, inspections of radiation machines, HIV confidentiality, pharmacy pilot programs and the reporting of federal grants with a state match. [4/23: 49-0 (McKinley excused)]

COMMITTEE ACTION:

SF 2340 extends the paired rate system for motor fuel for an additional year, until July 1, 2013. Currently, an excise tax is imposed on each gallon of motor fuel sold in the state. The general tax rate is 20 cents per gallon, but subject to adjustment each 12-month period, based on a formula that produces a paired rate system for ethanol-blended gasoline and other motor fuel. When the paired rate system expires, the tax rate will be uniformly imposed at 20 cents for each gallon. [4/25: short form (Chelgren, McCoy excused)]

SSB 3204 provides tax credits for the construction and installation of solar energy systems and geothermal heat pumps. It provides a credit for geothermal systems equal to 25 percent of the federal credit. It is not refundable but can be carried forward for 10 years. The solar energy system tax credit is also 25 percent of the federal credit, is not refundable, and can be carried forward for 10 years. The bill also modifies sales and use tax provisions related to property purchased for auto body repair for resale, and creates a sales tax exemption for certain items purchased for use in providing vehicle wash and wax services. [4/25: short form (Chelgren, McCoy excused)]

FLOOR ACTION:

SF 430 creates the Iowa Public Information Board to advise on provisions of Iowa’s Open Records (Chapter 22) and Public Meetings (Chapter 21) laws. Highlights include:

Iowa Public Information Board. The purpose of the bill is to provide an alternative means to secure compliance with and enforcement of the requirements of chapters 21 (open meetings) and 22 (public records) and provide an efficient, informal and cost-effective process for resolving disputes. The 9-member board is appointed by the Governor and subject to Senate confirmation. No more than three members can be representatives from the media and no more than three can be representatives of cities, counties and other political subdivisions. Appointments need to be politically balanced and gender balanced. The board will be an independent agency.  Members will serve staggered four-year terms; a quorum is five members; the board will select one person to act as the chairperson and must employ an attorney to serve as the executive director; the board is to meet at least quarterly, at the call of the chair; will be paid per diem as prescribed under 7E.6 ($50 per day); and will be reimbursed actual and necessary expenses for board business.

Draft Documents – Confidential Records. Adds to the list of confidential records tentative, preliminary, draft, speculative or research material, prior to its completion of the purpose for which it is intended and in a form prior to the form in which it is submitted for use or used in the actual formulation, recommendation, adoption or execution of any official policy or action by a government body or public official authorized to make such decisions for the governmental body. This does not apply to public records that are actually submitted for use or are used in the formulation, recommendation, adoption or execution of any official policy or action of a governmental body or a public official authorized to adopt or execute official policy for the governmental body.

Election of Remedies. An aggrieved party, the attorney general or any county attorney may seek compliance with open meetings and public records laws by filing an action with a court or filing a timely complaint to the Public Information Board. If a party seeks enforcement by filing an action, and another party seeks enforcement for the same violation by filing a complaint with the board, the court in which the action was filed will stay the action pending resolution of the complaint with the board, authorizing the complainant to file a complaint with respect to the same incident with the board. If a party is seeking to enjoin the inspection of a public record, either party may seek to remove the proceeding to the board by filing with the board within 30 days of the commencement of the judicial proceeding.

Board Powers and Duties.

** Employ an executive director to execute its authority and prosecute respondents in proceedings before the board and to represent the board in proceedings before a court.

** Adopt rules to implement, enforce and interpret this new board and its requirements.

** Issue declaratory orders with the force of law or informal advice on the applicability of chapters 21 (open meetings) and 22 (public records).

** Receive complaints and seek resolution through informal assistance or through mediation and settlement, investigation, determine probable cause and prosecute violations before the board in contested cases.

** Request and receive from governmental bodies information necessary to perform its duties.

** May examine confidential records subject to the complaints  as they maintain their confidential status.

** Issue subpoenas to investigate and prosecute complaints.

** Issue orders after a proceeding with the force of law, determining whether there have been open meetings or public records violations, and impose civil penalties and other appropriate remedies.

** Represent itself in judicial proceedings through their own attorney, through the Attorney General’s office or through other attorneys retained by the board at its option.

** Make training opportunities available for lawful custodians, governmental bodies and others. The board may require, in its discretion, appropriate persons to have periodic training and approval by the board.

** Disseminate information (website) to inform the public about their rights to access government information including information relating to the obligations of governmental bodies under open meetings and public records laws.

** Prepare reports for the Governor and Legislature at least annually, describing complaints, proceedings, investigations, hearings, decisions rendered and other work done.

** Make recommendations to the Governor and Legislature proposing legislation for public access to government information deemed desirable.

Filing a Complaint with the Board. The board must adopt rules providing for timing, form, content and means by which any aggrieved person, any Iowa citizen, the attorney general or any county attorney may file a complaint with the board. There is a 60-day limitation to timing from when due diligence would reveal the violation. All complaints are public records.

Initial Processing of Complaint. Upon receipt of a complaint, the board must either determine that, on its face the complaint appears legally sufficient, is within the board’s jurisdiction and could have merit. In such a case, the complaint must be accepted and parties notified in writing. If the complaint is outside its jurisdiction, legally insufficient, frivolous, without merit, involves harmless error or relates to a specific incident that has previously been finally disposed of on its merits by the board or a court, the board must decline to accept the complaint. If the complaint is refused, the board must provide the complainant a written order explaining the reasons for the action.

Informal Assistance – Mediation and Settlement. After accepting a complaint, the board must attempt to find an informal resolution. If that is insufficient, the board may offer mediation and settlement. Mediation and settlement will offer a neutral mediation employed by the board, either through its own staff or an outside source. Mediation must be informal and non-adversarial. It must be calculated to reach a mutually acceptable resolution.

Enforcement – Formal Investigation – Contested Cases.

** If any party declines mediation or settlement, or if mediation fails, the board must initiate a formal investigation. The board, after an appropriate investigation, will determine whether the complaint is within the board’s jurisdiction and if there is probable cause. If there is no probable cause, or if the complaint falls outside the jurisdiction of the board, the board will issue a written order to both parties explaining why it is dismissing the complaint. If probable cause and jurisdiction are found, the board must issue an order to that effect and commence a contested case. If there are no material facts in dispute, the board may order that the contested case procedures relating to the presentation of evidence will not apply. An attorney selected by the executive director will prosecute the respondent. At the end of the proceeding, the board must, by majority vote, render a decision. If the board finds merit, the board may issue an appropriate order to ensure enforcement of open meetings and public records laws, including specific performance.

** The board may also, upon finding a violation, seek civil damages, which range between $100 to$2,500 depending upon severity and intent, void any action taken in open meetings violations if a court could do so in similar circumstances or require the respondent to take any remedial action deemed appropriate by the board.

** The board does not have authority to remove someone from public office because of a violation. However, the board may file an action under chapters 21 (open meetings) and 22 (public records) to remove persons from office for violations that would subject a person to removal under those chapters.

** A final order by the board is enforceable in court and is subject to judicial review.

Defenses in a Contested Case. Harmless error and injunction prohibiting disclosure (pursuant to chapter 22.8 -injunctions to restrain examinations of public records) are a defense but must be proved by clear and convincing evidence.

Jurisdiction. The board does not have jurisdiction over the judicial or legislative branches of state government, or any officer or employee of those branches of government, or over the Governor or the office of the Governor.

Iowa Public Information Board – Transitional Provisions.

** Initial members of the board are to be appointed by September 1, 2012.

** The executive director cannot be hired prior to July 1, 2013.

** Prior to July 1, 2013, the board must meet as necessary to organize and prepare a report to be submitted to the Governor and Legislature. The report must include: a job description for the executive director; goals for board operations; procedures for handling of confidential information by the executive director and members of the board; conflict of interest policies for board members; and performance measures to measure achievement of the board’s goals.

Effective Date. Except for the transitional provisions (which are effective July 1, 2012), the bill takes effect on July 1, 2013. [4/23: 49-0 (McKinley absent)]

FLOOR ACTION:

HF 563 creates the Transparency in Private Attorney Contracts Act, which addresses the procedure to be followed when the state retains a private attorney to do work on its behalf. The bill relates to contingency fee contracts that private attorneys enter into with the state and limits contingency fees based on the amount of the recovery. The Attorney General must make a written determination that the contingency fee representation will be cost-effective and in the public interest. In addition, the Attorney General must follow the procurement process used by the Department of Administrative Services in seeking private attorneys unless there is a written determination that such a request is not feasible under the circumstances. In addition, all information related to a contingency fee contract is to be posted on the Attorney General’s website. [4/23: 49-0 (McKinley excused)]

FLOOR & COMMITTEE ACTION:

HJR 2008 nullifies the amendment to the Department of Human Services (DHS) rule providing for Medicaid reimbursement paid to physicians for services rendered in a facility setting. The amendment to the rule provides for adjustment of the reimbursement by a percentage differential that is equal to the percentage difference between the Medicare nonfacility and facility fee schedule amounts for Iowa. By nullifying the amendment to the rule, the reimbursement will remain based on an adjustment factor as determined by DHS. [4/25: 43-0 (Anderson, Chelgren, Hamerlinck, Kapucian, McKinley Rielly, Sorenson excused)] [4/24: short form]

HF 2458—Primary Care Loan Repayment

FLOOR ACTION:

SF 2338 makes numerous changes to promote efficiency in state government, including:

** Government Information Technology Services – (1) Duplex Printing encourages all state agencies (excluding board of regents institutions) to use duplex printing and a print-on-demand strategy to reduce printing costs; (2) IT Device Inventory requires the Department of Administrative Services (DAS) to complete an inventory of IT devices and submit a report to the Legislature by January 1, 2013; (3) IT Coordination & Management requires DAS to develop an IT schedule of services for all agencies to comply with requirements by December 31, 2013 (DAS is to submit a copy of the schedule to the Legislature by July 31, 2012, and periodic updates are required); and (4) Procuring IT through leasing should be explored.

** Medication Therapy Management – Codifies the MTM pilot program, which has been implemented through DAS for state employees.

** State Physical Resources – By September 30, 2012, DAS must conduct a high-level needs analysis of state employee work stations and office standards, focusing on adequate square footage needs and creating healthy, productive and efficient work environments. Overall objectives of the analysis must include improving employee density, properly allocating space for individual and group work, improving worker health and safety, improving technology integration, and improving energy efficiency and sustainability in state offices.  The department must submit findings and recommendations to the Capitol Planning Commission and to the Legislature’s Fiscal Committee by October 30, 2012.

** Eliminate Audit Fees – Eliminates audit fees for Mental Health Centers/Substance Abuse Community Action Agencies (HF 2362) and for commodity organizations (corn, turkey, egg, sheep and wool).

** Public Defense and Homeland Security & Emergency Management – Creates separate departments.

** Electronic Communications – promotes communication through electronic mail.

** State Records – Eliminates the state records commission and transfers their authority to the director of the Department of Cultural Affairs. The Department can establish rates to be charged to an agency for storage and retention of records. The Department may charge agencies for storage and deposit payment in an internal service fund. The receipts are to be used for the operations of the Department in records storage and retention. Annual accounting reports are due to the Department of Management and the Legislature. The Department of Transportation (DOT) and Regents are exempt from these requirements.

** DOT Modernization – Allows for online driver’s license and nonoperator identification card renewal under certain circumstances. The bill also eliminates the reduced fee for electric automobiles.

** Department of Revenue State Debt Report – The Department of Revenue will develop and recommend legislative proposals necessary for the continued efficiency of the office of the state debt coordinator. A report is to be filed with the Governor and Legislature no later than January 14, 2013.

** Department of Natural Resources Auditor Clean-up Bill – Updates Iowa’s waste management policy (455B).

** Ongoing Program Review – Adds to the duties of the Legislature’s State Government Efficiency Review Committee, to comprehensively review on a regular basis, programs and projects to determine whether they are effectively and efficiently meeting needs, and whether the needs remain applicable. The review will consider whether modifications to programs or projects could better meet the needs identified in a more effective manner.

** Deletes IJOBS Board

** Maintains the E911 Board, which will advise the Interoperability Board, rather than the Homeland Security Administration.

** Strikes Farm to School Council. The Departments of Agriculture and Education assume its duties.

** Obsolete Provisions – Repeals Farmworks matching funds (15.112); ls 15C – World Trade Center; 15D – Midwest Nuclear Compact. [4/19: 47-0 (Houser, McKinley, Ward excused)]

HF 2458 establishes a Rural Iowa Primary Care Loan Repayment Program to be administered by the College Student Aid Commission. The program provides loan repayments for medical students who agree to practice as physicians in service commitment areas for five years and meet certain requirements. The amount of loan repayment for an eligible student will be not more than $50,000 annually for an eligible loan. A service commitment area is defined as a city in Iowa with a population of less than 26,000 that is located more than 20 miles from a city with a population of 50,000 or more and provides a $20,000 contribution for deposit in the fund for each physician in the community who is participating in the program. [4/19: 47-0 (Houser, McKinley, Ward excused)]

HF 2467—Snowmobiles, ATVs

HF 2460—Tax Increment Financing

HF 2464—IDPH Technical Bill

SSB 3202—Brownfields and Grayfields Tax Credits

FLOOR ACTION:

HF 675 makes significant changes to Code Chapter 572, the Mechanic’s Lien chapter. Currently, Chapter 572 is archaic, cumbersome and difficult to interpret, sometimes resulting in subcontractors failing to get paid for work and filing unenforceable liens. In addition, homeowners sometimes pay double for the work done on their homes because they have no notice of liens that were filed, close on their home and pay the general contractor who sometimes fails to pay a subcontractor. Currently, mechanic’s lien filings are done at the county level. This bill creates a State Construction Registry (SCR), which is Internet-based and administered by the Secretary of State. The SCR will serve as a state-wide central repository where pre-lien notices and mechanics’ liens will be filed and housed. The requirements relating to the SCR apply to residential construction, defined in the bill as “construction on single-family or two-family dwellings occupied or used, or intended to be occupied or used, primarily for residential purposes, and includes horizontal condominiums.” Under the bill:

** General contractors and owner-builders who contract with subcontractors to provide labor and furnish materials on a project will post a “notice of Commencement of Work” to the State Construction Registry website within 10 days of commencement of work on the property. The bill outlines the information required to be included in the notice. The Secretary of State then assigns an SCR number to the project.

** If a general contractor fails to post the notice of commencement of work, a subcontractor may post the notice.

** In order to preserve lien rights, subcontractors will post a “preliminary notice” to the SCR website relating to a residential project for which they are providing labor, services, materials, etc.

** To perfect a lien after filing a preliminary notice, a subcontractor must post the lien to the website that homeowners, bankers, abstracters and others will be able to search for postings related to a property. [4/16: 46-2 (Bartz, Kettering “no”; Horn, Ward excused)]

HF 2467 makes various updates to Department of Natural Resources (DNR) regulations regarding snowmobiles, all-terrain vehicles (ATVs) and personal watercraft. The bill clarifies that the instruction courses that are offered to the operators of snowmobiles, ATVs and personal watercraft are education courses, rather than simply safety courses. This conforms to national standards for these courses. The bill also extends the length of registration for snowmobiles and ATVs from one year to three years, which conforms to existing boat registrations. The fees are adjusted to correspond to this change in registration, so the one-year, $15 registration fee for snowmobiles and ATVs will be replaced with a three-year, $45 fee. The fee paid to county recorders will increase from $2 to $5, which is a net savings of $1 to the owner. The bill expands the definition of public land to include public ice, and makes technical changes to the required equipment for ATVs and snowmobiles. The bill also bans the practice of “water-skipping,” where a rider of a snowmobile will attempt to drive the vehicle across the surface of a waterway (not including an ice-covered waterway). [4/12: 29-18 (Anderson, Bacon, Behn, Bertrand, Chelgren, Dix, Feenstra, Hamerlinck, Hatch, Kettering, McKinley, Seymour, Smith, Sodders, Sorenson, Ward, Whitver, Zaun “no”)]

COMMITTEE ACTION:

HF 2460 relates to Iowa’s urban renewal law and incremental taxes. A Senate Ways and Means amendment strikes everything in HF 2460. The amendment:

** Requires certain reporting of the counties, cities and rural improvement trustees regarding urban renewal projects, plans and tax increment financing (TIF). Each municipality must file the electronic report with the Department of Management by December 1, 2012.

** Requires the Legislative Services Agency to do an annual report on the information contained in the reports, and this annual report will be sent to the Governor and the Legislature. When a municipality amends or modifies an adopted renewal plan to include an additional urban renewal project, they must hold a public hearing.

** TIF cannot be used for the relocation of a commercial or industrial enterprise not presently located within the municipality unless: 1) The local governing body of the municipality where the business is currently located has a entered into a written agreement with the local governing body of the municipality where the business is proposing to relocate or has a written agreement concerning the general use of economic incentives to attract commercial or industrial development within those municipalities; or 2) The local governing body of the municipality where the commercial or industrial enterprise is proposing to relocate and the use of TIF is in the public interest (requires some written verification). “Relocation” means the closure or substantial reduction of an enterprise’s existing operations in one area of the state and the initiation of substantially the same operation in the same county or contiguous county in the state.

** The TIF revenue on wind energy urban renewal areas can only be used for the construction and improvement of roads, bridges and culverts. Wind energy TIFs are limited to 10 years.

** A city must get the approval of the county board of supervisors when the city adopts a resolution approving the Local Option Sales Tax (LOST) TIF. [4/18: 11-3 (Anderson, Bartz, Smith “no”; Quirmbach “pass”)]

HF 2464 makes technical changes and updates to various programs within the Iowa Department of Public Health, including Board of Nursing Home Administrators, inspections of radiation machines, HIV confidentiality and the reporting of federal grants with a state match. [4/18: short form]

SSB 3202 increases the amount of tax credits that the Economic Development Authority may annually allocate under its aggregate tax credit limit in Code section 15.119 to the Redevelopment Tax Credit Program for Brownfields and Grayfields from $5 million to $10 million. This does not increase overall spending on tax credits just allows changes to the allocations under the cap. [4/18: short form]