Commerce Committee Report – week 10, 2018

HF 2171 – Electronic “stop payment” option;
HF 2234 – Foreclosure timeline;
HF 2236 – Insurance Division “service of process” clean-up;
HF 2305 – Telemedicine health insurance coverage;
HF 2307 – Process for certain utility sales. 



HF 2171 (SF 2170) is a technical change to allow a person to electronically stop payment on a check. In Iowa, a customer’s “stop payment” order is effective for six months, but lapses if the original order is verbal and not confirmed in writing within 14 days. The stop payment can also be renewed for another six months if the bank receives written notice that the order is effective. Email is included in “written notification.” The bill is supported by the Iowa Bankers Association, Iowa Credit Union League and Community Bankers of Iowa.
[3/13: 49-0]


HF 2234 (SF 2168) shortens the timeframe for residential foreclosures. The federal Dodd-Frank Act added a 120-day waiting period before a financial institution can start a foreclosure proceeding. Taking that into account, this proposal shortens Iowa’s foreclosure waiting periods (12 months to 6 months, and 6 months to 3 months.) The 3-month waiting period applies to foreclosures where the financial institution agrees to forgive the debt, which is the situation in most Iowa foreclosures. The 6-month waiting period applies to the few foreclosure cases where the financial institution has not agreed to waive the debt. Both the 3-month and 6-month wait times do not begin until the 120-day Dodd-Frank waiting period has expired. Even with this legislation, Iowa will continue to have one of the longer foreclosure timeframes in the country The original bill inadvertently shortened redemption periods for agricultural mortgages as well as residential. The Senate unanimously adopted an amendment to restore redemption periods for agricultural mortgages to current law, which is a 12-month/6-month timeframe depending on whether the lender wants to waive rights to a deficiency judgment.
[3/13: 47-2 (No: Boulton, Jochum)]


HF 2236 (SF 2248) is an Iowa Insurance Division departmental bill to provide greater clarity and consistency in the “service of process” provisions applicable to individuals and entities under the Division’s regulatory authority. The recommendations were made following the Division’s five-year review of its administrative rules. Supporters include the Iowa State Bar Association, the Federation of Iowa Insurers and the Independent Insurance Agents of Iowa.
[3/13: 49-0]


HF 2307 (SF 2328) establishes a process for the sale of a city utility to another party, and requires the Iowa Utilities Board (IUB) to approve the acquisition of a water utility by an investor-owned utility already regulated by the IUB. Iowa American Water Company is the only investor-owned, rate-regulated water utility currently in the state, and provides water in most of Scott County, including Davenport and Bettendorf, as well as the city of Clinton.

The bill requires the Utilities Board to approve any acquisition in the interest of existing and new ratepayers. It states that a community can receive fair market value for those acquisitions. Currently, the Utilities Board only reimburses for book value (depreciated value of the assets), which is often much less than current debt. A sale of a municipal utility requires voter approval, and the legislation sets up a process to ensure transparency so that the community has the information necessary for a thorough review prior to any action.

Key stakeholders, including the Iowa Association of Municipal Utilities, Iowa Rural Water Association the IUB and the Iowa American Water Company worked together to help craft the proposal. In addition, the Office of Consumer Advocate (Utilities) has reviewed the legislation as it pertains to the best interest of current and future ratepayers and has no issues. The bill passed the House 98-0.
[3/14: 48-0 (Absent: Bertrand)]



HF 2305 relates to insurance coverage for health care services delivered by telehealth. “Telehealth” as defined is the delivery of health care services through the use of interactive audio and video and does not include health care services delivered through an audio-only telephone, e-mail or fax. The bill requires a health insurer to provide the same coverage for covered health care services, including services for mental health conditions, illnesses, injuries or diseases, whether the health care services are provided in person or delivered by telehealth. It prohibits insurance coverage disparity between services provided in person or via telehealth. The Insurance Commissioner may adopt rules to administer the Code section. The bill is applicable to third-party payment provider policies, contracts or plans delivered, issued for delivery, continued or renewed in Iowa on or after January 1, 2019. The bill passed the House 98-0.
[3/13: short form]