S.F. 2055 Section 1. Section 468.100, Code 2014, is amended to read 1 as follows: 2 468.100 Monthly estimate —— payment. 3 1. The supervising engineer shall, on or before the tenth 4 day of each calendar month, furnish the contractor and file 5 with the auditor estimates for work done during the preceding 6 calendar month under the contract on each section, and the 7 auditor shall at once draw warrants in favor of such contractor 8 on the drainage funds of the district or give the contractor 9 an order directing the county treasurer to deliver to the 10 contractor or contractors improvement certificates, or drainage 11 bonds as the case may be, for ninety percent of the estimate 12 on work done. Such monthly estimates shall remain on file in 13 the office of the auditor as a part of the permanent records of 14 the district to which they relate. Drainage warrants, bonds , 15 or improvement certificates when so issued shall be in such 16 amounts as the auditor determines, not however, in amounts in 17 excess of one five thousand dollars. 18 2. All of the provisions of this section shall, when 19 applicable, apply to repair work and improvement work in the 20 same force and effect as to original construction. 21 Sec. 2. Section 468.291, Code 2014, is amended to read as 22 follows: 23 468.291 Monthly estimate —— payment. 24 The engineer in charge of the work shall furnish the 25 contractor a monthly statement estimating the amount of work 26 done on each section and in each county. A duplicate copy of 27 the statement shall be filed with the auditor of each county 28 where the work is done. When the auditor files the statement, 29 the auditor shall draw a warrant for the contractor or give the 30 contractor an order directing the treasurer to deliver to the 31 contractor improvement certificates or drainage bonds, as the 32 case may be, in favor of the contractor for ninety percent of 33 the amount due from the auditor’s county. Drainage warrants, 34 bonds, or improvement certificates when so issued shall be in 35 -1- LSB 5421XS (4) 85 da/sc 1/ 3

S.F. 2055 such amounts as the auditor determines, but shall not be in 1 amounts in excess of one five thousand dollars. 2 EXPLANATION 3 The inclusion of this explanation does not constitute agreement with 4 the explanation’s substance by the members of the general assembly. 5 BILL’S PROVISIONS —— INCREASE IN CEILING AMOUNT FOR PAYMENT 6 OF CONSTRUCTION WORK. This bill increases the ceiling amount 7 for drainage warrants, bonds, or improvement certificates 8 issued for purposes of paying contractors for work performed 9 within a drainage or levee district (district), as approved by 10 a supervising engineer appointed by the district’s governing 11 board. The amount of the ceiling is increased from $1,000 to 12 $5,000. 13 BACKGROUND —— GOVERNANCE. Under Code chapter 468, drainage 14 or levee districts are established and managed by different 15 forms of governing boards. An intracounty district is 16 established and managed by a county board of supervisors in 17 the county where the district is located (Subchapter I, Part 18 1 —— Code sections 468.1 through 468.200). An intercounty 19 district may be established in two or more counties and managed 20 by a joint board of supervisors (Subchapter II, Part 1 —— Code 21 sections 468.270 through 468.304), and two or more intracounty 22 districts located in more than one county may be converted into 23 an intercounty district and again managed by a joint board of 24 supervisors (Subchapter II, Part 2 —— Code sections 468.305 25 through 468.314). A drainage district may also be placed under 26 the management of a board of trustees (Subchapter III, Parts 1 27 through 3 —— Code sections 468.500 through 468.539). 28 BACKGROUND —— CONTRACTING FOR WORK. The governing board 29 is required to appoint an engineer to supervise work projects 30 in the district, sometimes referred to as a “supervising 31 engineer” (Code sections 468.33 and 468.287). When a district 32 is established the governing board must award a contract or 33 contracts to contractors bidding on the project according to 34 specific procedures (Code section 468.35). After the district 35 -2- LSB 5421XS (4) 85 da/sc 2/ 3

S.F. 2055 is established, the governing board may order repairs to the 1 district or order an improvement to be made to the district 2 in a manner that expands, enlarges or otherwise increases its 3 capacity (Code section 468.126). The governing board must 4 award a contract or contracts to contractors bidding on the 5 project according to specific procedures (Code section 468.35). 6 BACKGROUND —— PAYMENT. A district contracting for 7 construction work may pay a contractor for construction costs 8 by drawing a warrant or issuing a bond or drainage certificate 9 (Code sections 468.74, 468.145, and 468.285). The warrants may 10 be, and the bonds or certificates are, payable at a future date 11 with accrued interest. During construction the supervising 12 engineer must provide the county auditor with a monthly 13 estimate of work completed and payments due to the contractor. 14 The supervising engineer’s estimate is used as the basis for 15 interim payments to the contractor for up to 90 percent of the 16 work completed. Upon the work’s completion, the supervising 17 engineer files a report with the governing board which holds a 18 public hearing of affected landowners to determine if there are 19 objections prior to final settlement of amounts due under the 20 construction contract (Code sections 468.101 through 468.103, 21 and 468.292). 22 -3- LSB 5421XS (4) 85 da/sc 3/ 3