Text: S03400 Text: S03402 Text: S03400 - S03499 Text: S Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Amend the amendment, S-3391, to House File 692, as 1 2 amended, passed, and reprinted by the House, as 1 3 follows: 1 4 #1. By striking page 1, line 5, through page 189, 1 5 line 19, and inserting the following: 1 6 ""DIVISION I 1 7 PROPERTY TAXATION 1 8 Section 1. Section 441.19, subsections 1 and 2, 1 9 Code 2003, are amended to read as follows: 1 10 1. Supplemental and optional to the procedure for 1 11 the assessment of property by the assessor as provided 1 12 in this chapter, the assessor may require from all 1 13 persons required to list their property for taxation 1 14 as provided by sections 428.1 and 428.2, a 1 15 supplemental return to be prescribed by the director 1 16 of revenue and finance upon which the person shall 1 17 list the person's property and any additions or 1 18 modifications completed in the prior year to a 1 19 structure located on the property. The supplemental 1 20 return shall be in substantially the same form as now 1 21 prescribed by law for the assessment rolls used in the 1 22 listing of property by the assessors. Every person 1 23 required to list property for taxation shall make a 1 24 complete listing of the property upon supplemental 1 25 forms and return the listing to the assessoras1 26promptly as possiblewithin thirty days of receiving 1 27 the assessment notice in section 441.23. The return 1 28 shall be verified over the signature of the person 1 29 making the return and section 441.25 applies to any 1 30 person making such a return. The assessor shall make 1 31 supplemental return forms available as soon as 1 32 practicable after the first day of January of each 1 33 year. The assessor shall make supplemental return 1 34 forms available to the taxpayer by mail, or at a 1 35 designated place within the taxing district. 1 36 2. Upon receipt of such supplemental return from 1 37 any person the assessor shall prepare a roll assessing 1 38 such person as hereinafter provided. In the 1 39 preparation of such assessment roll the assessor shall 1 40 be guided not only by the information contained in 1 41 such supplemental roll, but by any other information 1 42 the assessor may have or which may be obtained by the 1 43 assessor as prescribed by the law relating to the 1 44 assessment of property. The assessor shall not be 1 45 bound by any values or square footage determinations 1 46 or purchase prices as listed in such supplemental 1 47 return, and may include in the assessment roll any 1 48 property omitted from the supplemental return which in 1 49 the knowledge and belief of the assessor should be 1 50 listed as required by law by the person making the 2 1 supplemental return. Upon completion of such roll the 2 2 assessor shall deliver to the person submitting such 2 3 supplemental return a copy of the assessment roll, 2 4 either personally or by mail. 2 5 Sec. 2. NEW SECTION. 441.20 LEGISLATIVE INTENT. 2 6 It is the intent of the general assembly that there 2 7 be transparency in the property tax system. It is 2 8 further the intent of the general assembly that 2 9 property assessments for purposes of property taxation 2 10 be equal and uniform within classes of property. It 2 11 is further the intent of the general assembly to 2 12 minimize the impact that maintenance and upkeep by the 2 13 owner of property has on the assessment of that 2 14 property and that there be predictability in increases 2 15 of property assessments and that such predictability 2 16 be based primarily on the actions of the property 2 17 owner. It is further the intent of the general 2 18 assembly to minimize the impact that increases in 2 19 assessed value of property will have on property taxes 2 20 paid and that any increases will be primarily the 2 21 result of direct action taken by the local taxing 2 22 authority in setting budget amounts rather than by 2 23 increases in market value of property. 2 24 Sec. 3. Section 441.21, Code 2003, is amended by 2 25 striking the section and inserting in lieu thereof the 2 26 following: 2 27 441.21 ASSESSMENT OF STRUCTURES. 2 28 1. All real property, except land, subject to 2 29 taxation shall be assessed on a value per square foot 2 30 basis according to the provisions of this section. 2 31 2. a. Subject to paragraph "b", for valuations 2 32 established as of January 1, 2006, and for subsequent 2 33 assessment years, the assessed value per square foot 2 34 of a residential structure shall be an amount equal to 2 35 the valuation of the structure as determined for the 2 36 assessment year beginning January 1, 2005, prior to 2 37 application of the assessment limitation for that 2 38 year, divided by the total number of square feet of 2 39 the structure as of January 1, 2005. 2 40 b. (1) The assessed value per square foot of an 2 41 existing residential structure purchased after January 2 42 1, 2005, shall be the purchase price of the structure 2 43 divided by the cumulative inflation factor established 2 44 for the assessment year following the year of 2 45 purchase, divided by the total number of square feet 2 46 of the structure as of January 1 of the assessment 2 47 year. The assessed value per square foot of a 2 48 residential structure newly constructed after January 2 49 1, 2005, shall be the market value of the structure, 2 50 as determined by the assessor, divided by the 3 1 cumulative inflation factor established for the 3 2 assessment year following the year construction was 3 3 completed, divided by the total number of square feet 3 4 of the structure as of January 1 of the assessment 3 5 year. However, when valuing an addition that 3 6 substantially increases the square footage of a 3 7 structure, only that portion of the structure 3 8 comprising the addition shall be valued by the 3 9 assessor under this subparagraph. 3 10 (2) If additions or modifications to an existing 3 11 structure do not constitute a newly constructed 3 12 structure, the valuation of the structure shall only 3 13 increase if the square footage of the structure 3 14 increases. The increased valuation, if any, equals 3 15 the amount of increased square feet times the value 3 16 per square foot of the structure prior to the 3 17 additions or modifications. 3 18 3. a. Subject to paragraph "b" for valuations 3 19 established as of January 1, 2006, and for subsequent 3 20 assessment years, the assessed value per square foot 3 21 of a commercial or industrial structure shall be an 3 22 amount equal to the valuation of the structure as 3 23 determined for the assessment year beginning January 3 24 1, 2005, prior to application of the assessment 3 25 limitation for that year, divided by the total number 3 26 of square feet of the structure as of January 1, 2005. 3 27 b. (1) The assessed value per square foot of an 3 28 existing commercial or industrial structure purchased 3 29 after January 1, 2005, shall be the purchase price of 3 30 the structure divided by the cumulative inflation 3 31 factor established for the assessment year following 3 32 the year of purchase, divided by the total number of 3 33 square feet of the structure as of January 1 of the 3 34 assessment year. The assessed value per square foot 3 35 of a commercial or industrial structure newly 3 36 constructed after January 1, 2005, shall be the market 3 37 value of the structure, as determined by the assessor, 3 38 divided by the cumulative inflation factor established 3 39 for the assessment year following the year 3 40 construction was completed, divided by the total 3 41 number of square feet of the structure as of January 1 3 42 of the assessment year. However, when valuing an 3 43 addition that substantially increases the square 3 44 footage of a structure, only that portion of the 3 45 structure comprising the addition shall be valued by 3 46 the assessor under this subparagraph. 3 47 (2) If additions or modifications to an existing 3 48 structure do not constitute a newly constructed 3 49 structure, the valuation of the structure shall only 3 50 increase if the square footage of the structure 4 1 increases. The increased valuation, if any, equals 4 2 the amount of increased square feet times the value 4 3 per square foot of the structure prior to the 4 4 additions or modifications. 4 5 4. a. Subject to paragraph "b" for valuations 4 6 established as of January 1, 2006, and for subsequent 4 7 assessment years, the assessed value per square foot 4 8 of an agricultural structure that is not an 4 9 agricultural dwelling shall be an amount equal to the 4 10 valuation of the structure as determined for the 4 11 assessment year beginning January 1, 2005, prior to 4 12 application of the assessment limitation for that 4 13 year, divided by the total number of square feet of 4 14 the structure as of January 1, 2005. 4 15 b. (1) The assessed value per square foot of an 4 16 existing agricultural structure purchased after 4 17 January 1, 2005, shall be the productivity value of 4 18 the structure divided by the cumulative inflation 4 19 factor established for the assessment year following 4 20 the year of purchase, divided by the total number of 4 21 square feet of the structure as of January 1 of the 4 22 assessment year. The assessed value per square foot 4 23 of an agricultural structure newly constructed after 4 24 January 1, 2005, shall be the productivity value of 4 25 the structure for the assessment year following the 4 26 year construction was completed, as determined by the 4 27 assessor, divided by the cumulative inflation factor 4 28 established for the assessment year following the year 4 29 construction was completed, divided by the total 4 30 number of square feet of the structure as of January 1 4 31 of the assessment year. However, when valuing an 4 32 addition that substantially increases the square 4 33 footage of a structure, only that portion of the 4 34 structure comprising the addition shall be valued by 4 35 the assessor under this subparagraph. 4 36 (2) If additions or modifications to an existing 4 37 structure do not constitute a newly constructed 4 38 structure, the valuation of the structure shall only 4 39 increase if the square footage of the structure 4 40 increases. The increased valuation, if any, equals 4 41 the amount of increased square feet times the value 4 42 per square foot of the structure prior to the 4 43 additions or modifications. 4 44 5. a. In determining the market value of newly 4 45 constructed property, except agricultural structures, 4 46 the assessor may determine the value of the property 4 47 using uniform and recognized appraisal methods 4 48 including its productive and earning capacity, if any, 4 49 industrial conditions, its cost, physical and 4 50 functional depreciation and obsolescence and 5 1 replacement cost, and all other factors which would 5 2 assist in determining the fair and reasonable market 5 3 value of the property but the actual value shall not 5 4 be determined by use of only one such factor. The 5 5 following shall not be taken into consideration: 5 6 special value or use value of the property to its 5 7 present owner, and the goodwill or value of a business 5 8 that uses the property as distinguished from the value 5 9 of the property as property. However, in assessing 5 10 property that is rented or leased to low-income 5 11 individuals and families as authorized by section 42 5 12 of the Internal Revenue Code, as amended, and which 5 13 section limits the amount that the individual or 5 14 family pays for the rental or lease of units in the 5 15 property, the assessor shall use the productive and 5 16 earning capacity from the actual rents received as a 5 17 method of appraisal and shall take into account the 5 18 extent to which that use and limitation reduces the 5 19 market value of the property. The assessor shall not 5 20 consider any tax credit equity or other subsidized 5 21 financing as income provided to the property in 5 22 determining the market value. Upon adoption of 5 23 uniform rules by the department of revenue and finance 5 24 or covering assessments and valuations of such 5 25 properties, the valuation on such properties shall be 5 26 determined in accordance with such values for 5 27 assessment purposes to assure uniformity, but such 5 28 rules shall not be inconsistent with or change the 5 29 foregoing means of determining the market value. 5 30 b. The actual value of special purpose tooling, 5 31 which is subject to assessment and taxation as real 5 32 property under section 427A.1, subsection 1, paragraph 5 33 "e", but which can be used only to manufacture 5 34 property which is protected by one or more United 5 35 States or foreign patents, shall not exceed the fair 5 36 and reasonable exchange value between a willing buyer 5 37 and a willing seller, assuming that the willing buyer 5 38 is purchasing only the special purpose tooling and not 5 39 the patent covering the property which the special 5 40 purpose tooling is designed to manufacture nor the 5 41 rights to manufacture the patented property. For 5 42 purposes of this paragraph, special purpose tooling 5 43 includes dies, jigs, fixtures, molds, patterns, and 5 44 similar property. The assessor shall not take into 5 45 consideration the special value or use value to the 5 46 present owner of the special purpose tooling which is 5 47 designed and intended solely for the manufacture of 5 48 property protected by a patent in arriving at the 5 49 actual value of the special purpose tooling. 5 50 c. In determining the purchase price of a 6 1 structure, the assessor shall consider whether the 6 2 sale was a fair and reasonable exchange in the year in 6 3 which the property was listed and valued between a 6 4 willing buyer and a willing seller, neither being 6 5 under any compulsion to buy or sell and each being 6 6 familiar with all the facts relating to the particular 6 7 property. Sale prices of the property or comparable 6 8 property in normal transactions reflecting market 6 9 value, and the probable availability or unavailability 6 10 of persons interested in purchasing the property, 6 11 shall be taken into consideration in determining 6 12 purchase price. In determining purchase price, sale 6 13 prices of property in abnormal transactions not 6 14 reflecting market value shall not be taken into 6 15 account, or shall be adjusted to eliminate the effect 6 16 of factors which distort market value, including but 6 17 not limited to sales to immediate family of the 6 18 seller, foreclosure or other forced sales, contract 6 19 sales, or discounted purchase transactions. 6 20 d. If a county enters into a contract before May 6 21 1, 2003, for a comprehensive revaluation by a private 6 22 appraiser and such revaluation is for the assessment 6 23 year beginning January 1, 2006, the valuations 6 24 determined under the comprehensive revaluation for 6 25 that assessment year shall be divided by the 6 26 cumulative inflation factor for the assessment year 6 27 beginning January 1, 2006, and that quotient shall be 6 28 considered the valuation of the property for the 6 29 assessment year beginning January 1, 2005. 6 30 6. Notwithstanding any other provision of this 6 31 section, the assessed value per square foot of a 6 32 structure times the total number of square feet of the 6 33 structure shall not exceed its fair and reasonable 6 34 market value for the assessment year, except for 6 35 agricultural structures which shall be valued 6 36 exclusively as provided in subsection 4. 6 37 7. For purposes of this section: 6 38 a. "Annual inflation factor" means an index, 6 39 expressed as a percentage, determined by the 6 40 department by January 15 of the assessment year for 6 41 which the factor is determined, which reflects the 6 42 purchasing power of the dollar as a result of 6 43 inflation during the twelve-month period ending 6 44 September 30 of the calendar year preceding the 6 45 assessment year for which the factor is determined. 6 46 In determining the annual inflation factor, the 6 47 department shall use the annual percent change, but 6 48 not less than zero percent, in the gross domestic 6 49 product price deflator computed for the calendar year 6 50 by the bureau of economic analysis of the United 7 1 States department of commerce and shall add all of 7 2 that percent change to one hundred percent. The 7 3 annual inflation factor and the cumulative inflation 7 4 factor shall each be expressed as a percentage rounded 7 5 to the nearest one-tenth of one percent. The annual 7 6 inflation factor shall not be less than one hundred 7 7 percent. The annual inflation factor for the 2005 7 8 calendar year is one hundred percent. 7 9 b. "Cumulative inflation factor" means the product 7 10 of the annual inflation factor for the 2005 calendar 7 11 year and all annual inflation factors for subsequent 7 12 calendar years as determined pursuant to this 7 13 subsection. The cumulative inflation factor applies 7 14 to the assessment year beginning on January 1 of the 7 15 calendar year for which the latest annual inflation 7 16 factor has been determined. 7 17 c. "Newly constructed" includes, but is not 7 18 limited to, structural replacement, additions that 7 19 substantially increase the square footage, conversion 7 20 into another class of property, and conversion from 7 21 exempt property under section 427.1 to taxable 7 22 property. For commercial and industrial property, 7 23 "newly constructed" also includes an addition or 7 24 removal to a structure of personal property taxed as 7 25 real estate under chapter 427A. 7 26 d. "Structure" means any part of that which is 7 27 built or constructed, an edifice or building of any 7 28 kind, or any piece of work artificially built up or 7 29 composed of parts joined together in some definite 7 30 manner. For residential structures, structure 7 31 includes only those parts of the structure, including 7 32 basements and attics, that are or could be used as 7 33 living space. "Structure" does not include the land 7 34 beneath, or horizontal improvements relating to the 7 35 structure, such as sidewalks, sewers, or retaining 7 36 walls. 7 37 8. For the purpose of computing the debt 7 38 limitations for municipalities, political 7 39 subdivisions, and school districts, the term "actual 7 40 value" means the "actual value" as determined under 7 41 this section without application of any percentage 7 42 reduction and entered opposite each item, and as 7 43 listed on the tax list as provided in section 443.2, 7 44 as "actual value". 7 45 Whenever any board of review or other tribunal 7 46 changes the assessed value of property, all applicable 7 47 records of assessment shall be adjusted to reflect 7 48 such change in both assessed value and actual value of 7 49 such property. 7 50 9. The provisions of this chapter and chapters 8 1 443, 443A, and 444 shall be subject to legislative 8 2 review at least once every five years. The review 8 3 shall be based upon a property tax status report 8 4 containing the recommendations of a property tax 8 5 implementation committee appointed to conduct a review 8 6 of the land tax, square footage tax, the baseline 8 7 assessment for the square footage tax, and other 8 8 related provisions, to be prepared with the assistance 8 9 of the departments of management and revenue and 8 10 finance. The report shall include recommendations for 8 11 changes or revisions based upon demographic changes 8 12 and property tax valuation fluctuations observed 8 13 during the preceding five-year interval, and a summary 8 14 of issues that have arisen since the previous review 8 15 and potential approaches for their resolution. The 8 16 first such report shall be submitted to the general 8 17 assembly no later than January 1, 2010, with 8 18 subsequent reports developed and submitted by January 8 19 1 at least every fifth year thereafter. 8 20 Sec. 4. NEW SECTION. 441.21A PROPERTY 8 21 CLASSIFICATIONS. 8 22 1. a. Agricultural land shall be valued at its 8 23 productivity value. The productivity value of 8 24 agricultural land shall be determined on the basis of 8 25 productivity and net earning capacity of the land 8 26 determined on the basis of its use for agricultural 8 27 purposes capitalized at a rate of seven percent and 8 28 applied uniformly among counties and among classes of 8 29 property. Any formula or method employed to determine 8 30 productivity and net earning capacity of land shall be 8 31 adopted in full by rule. 8 32 b. In counties or townships in which field work on 8 33 a modern soil survey has been completed since January 8 34 1, 1949, the assessor shall place emphasis upon the 8 35 results of the survey in spreading the valuation among 8 36 individual parcels of such agricultural land. 8 37 c. "Agricultural land" includes the land of a 8 38 vineyard. 8 39 2. a. "Residential property" includes all lands 8 40 and buildings which are primarily used or intended for 8 41 human habitation, including those buildings located on 8 42 agricultural land. Buildings used primarily or 8 43 intended for human habitation shall include the 8 44 dwelling as well as structures and improvements used 8 45 primarily as a part of, or in conjunction with, the 8 46 dwelling. This includes but is not limited to 8 47 garages, whether attached or detached, tennis courts, 8 48 swimming pools, guest cottages, and storage sheds for 8 49 household goods. Residential property located on 8 50 agricultural land shall include only buildings. 9 1 b. "Residential property" includes all land and 9 2 buildings of multiple housing cooperatives organized 9 3 under chapter 499A and includes land and buildings 9 4 used primarily for human habitation which land and 9 5 buildings are owned and operated by organizations that 9 6 have received tax-exempt status under section 9 7 501(c)(3) of the Internal Revenue Code and rental 9 8 income from the property is not taxed as unrelated 9 9 business income under section 422.33, subsection 1A. 9 10 c. "Residential property" includes an apartment in 9 11 a horizontal property regime referred to in chapter 9 12 499B which is used or intended for use for human 9 13 habitation regardless of who occupies the apartment. 9 14 Existing structures shall not be converted to a 9 15 horizontal property regime unless applicable building 9 16 code requirements have been met. 9 17 d. Buildings for human habitation that are used as 9 18 commercial ventures, including but not limited to 9 19 hotels, motels, rest homes, and structures containing 9 20 three or more separate living quarters shall not be 9 21 considered residential property. 9 22 Sec. 5. Section 441.23, Code 2003, is amended to 9 23 read as follows: 9 24 441.23 NOTICE OF VALUATION. 9 25 If there has been an increase or decrease in the 9 26 valuation of the property, or upon the written request 9 27 of the person assessed, the assessor shall, at the 9 28 time of making the assessment, inform the person 9 29 assessed, in writing, of the valuation put upon the 9 30 taxpayer's property, and notify the person, if the 9 31 person feels aggrieved, to appear before the board of 9 32 review and show why the assessment should be changed. 9 33 However, if the valuation ofa class ofagricultural 9 34 property is uniformly decreased, the assessor may 9 35 notify the affected property owners by publication in 9 36 the official newspapers of the county. The owners of 9 37 real property shall be notified not later than April 9 38 15 of any adjustment of the real property assessment. 9 39 The notification shall include a supplemental return 9 40 form for the person to list the person's property and 9 41 any additions or modifications completed in the prior 9 42 year to a structure located on the property, as 9 43 required in section 441.19. 9 44 Sec. 6. Section 441.24, Code 2003, is amended to 9 45 read as follows: 9 46 441.24 REFUSAL TO FURNISH STATEMENT. 9 47 1. If a person refuses to furnish the verified 9 48 statements required in connection with the assessment 9 49 of property by the assessor, or to list the 9 50 corporation's or person's property, the director of 10 1 revenue and finance, or assessor, as the case may be, 10 2 shall proceed to list and assess the property 10 3 according to the best information obtainable, and 10 4 shall add to thetaxableagricultural land and square 10 5 footage valuation one hundred percent thereof, which 10 6 valuation and penalty shall be separately shown, and 10 7 shall constitute the assessment; and if the 10 8 agricultural land or square footage valuation of the 10 9 property is changed by a board of review, or on appeal 10 10 from a board of review, a like penalty shall be added 10 11 to the valuation thus fixed. 10 12 2. However, all or part of the penalty imposed 10 13 under this section may be waived by the board of 10 14 review upon application to the board by the assessor 10 15 or the property owner. The waiver or reduction in the 10 16 penalty shall be allowed only on the agricultural land 10 17 or the square footage valuation ofreal propertythe 10 18 structure against which the penalty has been imposed. 10 19 Sec. 7. Section 441.26, unnumbered paragraph 3, 10 20 Code 2003, is amended to read as follows: 10 21 The notice in19812007 and each odd-numbered year 10 22 thereafter shall contain a statement thatthe10 23 agricultural property assessments and property 10 24 assessed pursuant to section 441.21, subsection 2, 10 25 paragraph "b", subparagraph (1), and subsection 3, 10 26 paragraph "b", subparagraph (1), are subject to 10 27 equalization pursuant to an order issued by the 10 28 director of revenue and finance, that the county 10 29 auditor shall give notice on or before October 15 by 10 30 publication in an official newspaper of general 10 31 circulation to anyclass ofagricultural property 10 32 affected by the equalization order, and that the board 10 33 of review shall be in session from October 15 to 10 34 November 15 to hear protests of affected property 10 35 owners or taxpayers whose valuations have been 10 36 adjusted by the equalization order. 10 37 Sec. 8. Section 441.26, unnumbered paragraphs 4 10 38 and 5, Code 2003, are amended to read as follows: 10 39 The assessment rolls shall be used in listing the 10 40 property, the number of structures, and the total 10 41 square footage of the structures by class of property, 10 42 and showing the values affixed to agricultural land 10 43 and the assessed value per square foot affixed tothe10 44propertythe structures by class of property of all 10 45 persons assessed. The rolls shall be made in 10 46 duplicate. The duplicate roll shall be signed by the 10 47 assessor, detached from the original and delivered to 10 48 the person assessed if there has been an increase or 10 49 decrease in the valuation of the property. If there 10 50 has been no change in the evaluation, the information 11 1 on the roll may be printed on computer stock paper and 11 2 preserved as required by this chapter. If the person 11 3 assessed requests in writing a copy of the roll, the 11 4 copy shall be provided to the person. The pages of 11 5 the assessor's assessment book shall contain columns 11 6 ruled and headed for the information required by this 11 7 chapter and that which the director of revenue and 11 8 finance deems essential in the equalization work of 11 9 the director. The assessor shall return all 11 10 assessment rolls and schedules to the county auditor, 11 11 along with the completed assessment book, as provided 11 12 in this chapter, and the county auditor shall 11 13 carefully keep and preserve the rolls, schedules and 11 14 book for a period of five years from the time of its 11 15 filing in the county auditor's office. 11 16 Beginning with valuations for January 1,19772006, 11 17 and each succeeding year, for each parcel of 11 18 agricultural property and for each structure entered 11 19 in the assessment book, the assessor shall list the 11 20 classification of the property. 11 21 Sec. 9. Section 441.35, subsection 1, Code 2003, 11 22 is amended by striking the subsection. 11 23 Sec. 10. Section 441.35, unnumbered paragraph 2, 11 24 Code 2003, is amended by striking the unnumbered 11 25 paragraph. 11 26 Sec. 11. Section 441.36, Code 2003, is amended to 11 27 read as follows: 11 28 441.36 CHANGE OF ASSESSMENT – NOTICE. 11 29 All changes in assessments authorized by the board 11 30 of review, and reasons therefor, shall be entered in 11 31 the minute book kept bysaidthe board and on the 11 32 assessment roll.SaidThe minute book shall be filed 11 33 with the assessor after the adjournment of the board 11 34 of review and shall at all times be open to public 11 35 inspection. In case the value of any specific 11 36 property or structure or the entire assessment of any 11 37 person, partnership, or association is increased, or 11 38 new property or a new structure is added by the board, 11 39 the clerk shall give immediate notice thereof by mail 11 40 to each at the post-office address shown on the 11 41 assessment rolls, and at the conclusion of the action 11 42 of the board therein the clerk shall post an 11 43 alphabetical list of those whose assessments are thus 11 44 raised and added, in a conspicuous place in the office 11 45 or place of meeting of the board, and enter upon the 11 46 records a statement that such posting has been made, 11 47 which entry shall be conclusive evidence of the giving 11 48 of the notice required. The board shall hold an 11 49 adjourned meeting, with at least five days intervening 11 50 after the posting ofsaidthe notices, before final 12 1 action with reference to the raising of assessments or 12 2 the adding of property or structures to the rolls is 12 3 taken, and the posted notices shall state the time and 12 4 place of holding such adjourned meeting, which time 12 5 and place shall also be stated in the proceedings of 12 6 the board. 12 7 Sec. 12. Section 441.37, subsection 1, paragraphs 12 8 a and b, Code 2003, are amended to read as follows: 12 9 a. Thatsaidthe assessment is not equitable as 12 10 compared with assessments of other like property or 12 11 structures in the taxing district. When this ground 12 12 is relied upon as the basis of a protest the legal 12 13 description and assessments of a representative number 12 14 of comparablepropertiesstructures, as described by 12 15 the aggrieved taxpayer shall be listed on the protest, 12 16 otherwisesaidthe protest shall not be considered on 12 17 this ground. 12 18 b. That the property or structure is assessed for 12 19 more than the value authorized by law, stating the 12 20 specific amount which the protesting party believes 12 21 the property or structure to be overassessed, and the 12 22 amount which the party considers to be its actual 12 23 value and the amount the party considers a fair 12 24 assessment. 12 25 Sec. 13. Section 441.39, Code 2003, is amended to 12 26 read as follows: 12 27 441.39 TRIAL ON APPEAL. 12 28 The court shall hear the appeal in equity and 12 29 determine anew all questions arising before the board 12 30 which relate to the liability of the property or 12 31 structure to assessment or the amount thereof. The 12 32 court shall consider all of the evidence and there 12 33 shall be no presumption as to the correctness of the 12 34valuation ofassessment appealed from. Its decision 12 35 shall be certified by the clerk of the court to the 12 36 county auditor, and the assessor, who shall correct 12 37 the assessment books accordingly. 12 38 Sec. 14. Section 441.42, Code 2003, is amended to 12 39 read as follows: 12 40 441.42 APPEAL ON BEHALF OF PUBLIC. 12 41 Any officer of a county, city, township, drainage 12 42 district, levee district, or school district 12 43 interested or a taxpayer thereof may in like manner 12 44 make complaint beforesaidthe board of review in 12 45 respect to the assessment of any property or structure 12 46 in the township, drainage district, levee district or 12 47 city and an appeal from the action of the board of 12 48 review in fixing the amount of assessment on any 12 49 property or structure concerning which such complaint 12 50 is made, may be taken by any of such aforementioned 13 1 officers. 13 2 Such appeal is in addition to the appeal allowed to 13 3 the person whose property or structure is assessed and 13 4 shall be taken in the name of the county, city, 13 5 township, drainage district, levee district, or school 13 6 district interested, and tried in the same manner, 13 7 except that the notice of appeal shall also be served 13 8 upon the owner of the property or structure concerning 13 9 which the complaint is made and affected thereby or 13 10 person required to return said property or structure 13 11 for assessment. 13 12 Sec. 15. Section 441.43, Code 2003, is amended to 13 13 read as follows: 13 14 441.43 POWER OF COURT. 13 15 Upon trial of any appeal from the action of the 13 16 board of review fixing the amount of assessment upon 13 17 any property or structure concerning which complaint 13 18 is made, the court may increase, decrease, or affirm 13 19 the amount of the assessment appealed from. 13 20 Sec. 16. Section 441.45, subsections 1 and 2, Code 13 21 2003, are amended to read as follows: 13 22 1. The number of acres of land and the aggregate 13 23 taxable values of the agricultural land,exclusive of13 24city lots,returned by the assessors, as corrected by 13 25 the board of review. 13 26 2. The aggregate values of structures and the 13 27 taxable square footage values ofreal estate13 28 structures by class in each township and city in the 13 29 county and the aggregate value of agricultural land in 13 30 each township and city in the county, returned as 13 31 corrected by the board of review. 13 32 Sec. 17. Section 441.47, Code 2003, is amended by 13 33 adding the following new unnumbered paragraph: 13 34 NEW UNNUMBERED PARAGRAPH. For the assessment year 13 35 beginning January 1, 2007, and for all subsequent 13 36 assessment years, only property classified as 13 37 agricultural property and property assessed pursuant 13 38 to section 441.21, subsection 2, paragraph "b", 13 39 subparagraph (1), and subsection 3, paragraph "b", 13 40 subparagraph (1), shall be subject to equalization by 13 41 the director of revenue and finance under this section 13 42 and sections 441.48 and 441.49. 13 43 Sec. 18. NEW SECTION. 441.47A EQUALIZATION OF 13 44 INFLATION FACTORS. 13 45 The director of revenue and finance on or about 13 46 August 15, 2007, and every two years thereafter, shall 13 47 order the equalization of the assessed value per 13 48 square foot resulting from the application of the 13 49 cumulative inflation factor in the several assessing 13 50 jurisdictions in each case as may be necessary to 14 1 bring such values as fixed by the assessor in cases of 14 2 purchases of property and newly constructed property 14 3 to the values determined for the assessment year 14 4 beginning January 1, 2005. In equalizing the effects 14 5 of the application of the cumulative inflation factor, 14 6 the department shall make use of reports issued by 14 7 Iowa state university of science and technology which 14 8 reports shall more precisely indicate, on a county-by- 14 9 county basis, annual and cumulative inflation factors 14 10 for each county. If the cumulative inflation factor 14 11 for an assessing jurisdiction as reported by Iowa 14 12 state university of science and technology is five 14 13 percent above or below the cumulative inflation factor 14 14 as defined in section 441.21, subsection 7, the 14 15 director shall notify the assessor by mail of the 14 16 equalization of the effects of the cumulative 14 17 inflation factor for the assessing jurisdiction. The 14 18 assessor shall recompute the assessments made pursuant 14 19 to section 441.21, subsection 2, paragraph "b", 14 20 subparagraph (1), subsection 3, paragraph "b", 14 21 subparagraph (1), and subsection 4, paragraph "b", 14 22 subparagraph (1), by applying the equalized inflation 14 23 factor. The assessor shall send notice of the 14 24 equalized assessments to all affected property owners. 14 25 Sec. 19. Section 441.50, Code 2003, is amended to 14 26 read as follows: 14 27 441.50 APPRAISERS EMPLOYED. 14 28 The conference board shall have power to employ 14 29 appraisers or other technical or expert help to assist 14 30 in thevaluationassessment of property as provided in 14 31 section 441.21, the cost thereof to be paid in the 14 32 same manner as other expenses of the assessor's 14 33 office. The conference board may certify for levy 14 34 annually an amount not to exceed forty and one-half 14 35 cents per thousand dollars of assessed value of 14 36 taxable property for the purpose of establishing a 14 37 special appraiser's fund, to be used only for such 14 38 purposes. From time to time the conference board may 14 39 direct the transfer of any unexpended balance in the 14 40 special appraiser's fund to the assessment expense 14 41 fund. 14 42 Sec. 20. Section 443.1, Code 2003, is amended to 14 43 read as follows: 14 44 443.1 CONSOLIDATED TAX. 14 45 All square footage taxes which are uniform 14 46 throughout any township or school district shall be 14 47 formed into a single tax and entered upon the tax list 14 48 in a single column, to be known as a consolidated tax, 14 49 and each receipt shall show the percentage levied for 14 50 each separate fund. The land tax shall be separately 15 1 stated and each receipt shall show the percentage 15 2 levied for each separate fund. 15 3 Sec. 21. Section 443.2, Code 2003, is amended to 15 4 read as follows: 15 5 443.2 TAX LIST. 15 6 Before the first day of July in each year, the 15 7 county auditor shall transcribe the assessments of the 15 8 townships and cities into a book or record, to be 15 9 known as the tax list, properly ruled and headed, with 15 10 separate columns, in which shall be entered the names 15 11 of the taxpayers, descriptions of lands, number of 15 12 acres and value, numbers of city lots, their size in 15 13 acres, and value, and each description of the square 15 14 footage tax and the land tax, with a column for polls 15 15 and one for payments, and shall complete it by 15 16 entering the amount due on each installment, 15 17 separately, and carrying out the total of both 15 18 installments. The total of all columns of each page 15 19 of each book or other record shall balance with the 15 20 tax totals. After computing the amount of land tax 15 21 and square footage tax due and payable on each 15 22 property, the county auditor shall round the total 15 23 amount oftaxtaxes due and payable on the property to 15 24 the nearest even whole dollar. 15 25 The county auditor shall list the aggregate actual 15 26 value and the aggregate taxable value of all taxable 15 27 property within the county and each political 15 28 subdivision including property subject to the 15 29 statewide property tax imposed under section 437A.18 15 30 on the tax list in order that the actual value of the 15 31 taxable property within the county or a political 15 32 subdivision may be ascertained and shown by the tax 15 33 list for the purpose of computing the debt-incurring 15 34 capacity of the county or political subdivision. As 15 35 used in this section, "actual value" is the value 15 36 determined under section 441.21, subsections 1 to 3, 15 37 Code 2005, prior to the reduction to a percentage of 15 38 actual value as otherwise provided in section 441.21, 15 39 Code 2005. "Actual value" of property subject to 15 40 statewide property tax is the assessed value under 15 41 section 437A.18. 15 42 Sec. 22. Section 443.3, Code 2003, is amended to 15 43 read as follows: 15 44 443.3 CORRECTION – TAX APPORTIONED. 15 45 At the time of transcribingsaidthe assessments 15 46 into the tax list, the county auditor shall correct 15 47 all transfers up to date and place the legal 15 48 descriptions of all real estate in the name of the 15 49 owner atsaidthat date as shown by the transfer book 15 50 in the auditor's office. At the end of the list for 16 1 each township or city the auditor shall make an 16 2 abstract thereof, and apportion the consolidated tax 16 3 among the respective funds to which it belongs, 16 4 according to the amounts levied for each. The auditor 16 5 shall apportion the land tax as prescribed in section 16 6 443A.2. 16 7 Sec. 23. Section 443.6, Code 2003, is amended to 16 8 read as follows: 16 9 443.6 CORRECTIONS BY AUDITOR. 16 10 The auditor may correct any error in the assessment 16 11 or tax list, and the assessor or auditor may list for 16 12 taxation any omitted land and may assess and list for 16 13 taxation any omittedpropertystructure. 16 14 Sec. 24. Section 443.7, Code 2003, is amended to 16 15 read as follows: 16 16 443.7 NOTICE. 16 17 Before listing for taxation any omitted land and 16 18 before assessing and listing for taxation any omitted 16 19propertystructure, the assessor or auditor shall 16 20 notify by mail the person in whose name theproperty16 21 land or structure is taxed, to appear before the 16 22 assessor or auditor at the assessor's or auditor's 16 23 office within ten days from the date of the notice and 16 24 show cause, if any, why the correction or assessment 16 25 should not be made. 16 26 Sec. 25. Section 443.9, Code 2003, is amended to 16 27 read as follows: 16 28 443.9 ADJUSTMENT OF ACCOUNTS. 16 29 If such correction or assessment is made after the 16 30 books or other records approved by thestateauditor 16 31 of state have passed into the hands of the treasurer, 16 32 the treasurer shall be charged or credited therefor as 16 33 the case may be. In the event such listing of omitted 16 34 land or listing and assessment of omittedproperty16 35 structure is made by the assessor after the tax 16 36 records have passed into the hands of the auditor or 16 37 treasurer, such correction or assessment shall be 16 38 entered on the records by the auditor or treasurer. 16 39 Sec. 26. Section 443.12, Code 2003, is amended to 16 40 read as follows: 16 41 443.12 CORRECTIONS BY TREASURER. 16 42 Whenpropertyland or a structure subject to 16 43 taxation is withheld, overlooked, or from any other 16 44 cause is not listed, or is not listed and assessed, 16 45 the county treasurer shall, when apprised thereof, at 16 46 any time within two years from the date at which such 16 47 listing and assessment should have been made, demand 16 48 of the person, firm, corporation, or other party by 16 49 whom the same should have been listed, or to whom it 16 50 should have been listed and assessed, or of the 17 1 administrator thereof, the amount thepropertyland or 17 2 structure should have been taxed in each year the same 17 3 was so withheld or overlooked and not listed or not 17 4 listed and assessed, together with six percent 17 5 interest thereon from the time the taxes would have 17 6 become due and payable had suchpropertyland been 17 7 listed or such structure been listed and assessed. 17 8 Sec. 27. Section 443.13, Code 2003, is amended to 17 9 read as follows: 17 10 443.13 ACTION BY TREASURER – APPORTIONMENT. 17 11 Upon failure to pay such sum within thirty days, 17 12 with all accrued interest, the treasurer shall cause 17 13 an action to be brought in the name of the treasurer 17 14 for the use of the proper county, to be prosecuted by 17 15 the county attorney, or such other person as the board 17 16 of supervisors may appoint, and when suchproperty17 17 land has been fraudulently withheld from listing or 17 18 such structure fraudulently withheld from listing and 17 19 assessment, there shall be added to the sum found to 17 20 be due a penalty of fifty percent upon the amount, 17 21 which shall be included in the judgment. The amount 17 22 thus recovered shall be by the treasurer apportioned 17 23 ratably as the taxes would have been if they had been 17 24 paid according to law. 17 25 Sec. 28. Section 443.14, Code 2003, is amended to 17 26 read as follows: 17 27 443.14 DUTY OF TREASURER. 17 28 The treasurer shall assess anyreal property17 29 structure and shall list the acreage of any land 17 30 subject to taxation which may have been omitted by the 17 31 assessor, board of review, or county auditor, and 17 32 collect taxes thereon, and in such cases shall note, 17 33 opposite the tract or lot assessed, the words "by 17 34 treasurer". 17 35 Sec. 29. Section 443.15, Code 2003, is amended to 17 36 read as follows: 17 37 443.15 TIME LIMIT. 17 38 The assessment shall be made within two years after 17 39 the tax list shall have been delivered to the 17 40 treasurer for collection, and not afterwards, if the 17 41propertyland or structure is then owned by the person 17 42 who should have paid the tax. 17 43 Sec. 30. Section 443.17, Code 2003, is amended to 17 44 read as follows: 17 45 443.17 PRESUMPTION OF TWO-YEAR OWNERSHIP. 17 46 In any action or proceeding, now pending or 17 47 hereafter brought, to recover taxes uponpropertyland 17 48 not listed or agricultural land or a structure not 17 49 listed and assessed for taxation during the lifetime 17 50 of any decedent, it shall be presumed that any 18 1 property, any evidence of ownership of property, and 18 2 any evidence of a promise to pay, owned by a decedent 18 3 at the date of the decedent's death, had been acquired 18 4 and owned by such decedent more than two years before 18 5 the date of the decedent's death; and the burden of 18 6 proving that any such property had been acquired by 18 7 such decedent less than two years before the date of 18 8 the decedent's death shall be upon the heirs, 18 9 legatees, and legal representatives of any such 18 10 decedent. 18 11 Sec. 31. Section 443.18, Code 2003, is amended to 18 12 read as follows: 18 13 443.18 REAL ESTATE – DUTY OF OWNER. 18 14 In all cases wherereal estateland subject to 18 15 taxation has not been listed or agricultural land or a 18 16 structure subject to taxation has not been listed and 18 17 assessed, the owner, or an agent of the owner, shall 18 18 have the same done by the treasurer, and pay the taxes 18 19 thereon; and if the owner fails to do so the treasurer 18 20 shall list or list and assess the same and collect the 18 21 tax assessed as the treasurer does other taxes. 18 22 Sec. 32. Section 443.19, Code 2003, is amended to 18 23 read as follows: 18 24 443.19 IRREGULARITIES, ERRORS AND OMISSIONS – 18 25 EFFECT. 18 26NoA failure of the owner to have suchproperty18 27 land listed or agricultural land or structure listed 18 28 and assessed or to have the errors in the listing or 18 29 assessment corrected, andnoan irregularity, error or 18 30 omission in the listing of such land or listing and 18 31 assessment of suchpropertyagricultural land or 18 32 structure, shall not affect in any manner the legality 18 33 of the taxes levied thereon, or affect any right or 18 34 title to suchreal estateproperty which would have 18 35 accrued to any party claiming or holding under and by 18 36 virtue of a deed executed by the treasurer as provided 18 37 by this title, had the listing and assessment of such 18 38 property been in all respects regular and valid. 18 39 Sec. 33. Section 443.21, Code 2003, is amended to 18 40 read as follows: 18 41 443.21 ASSESSMENTS CERTIFIED TO COUNTY AUDITOR. 18 42 All assessors and assessing bodies, including the 18 43 department of revenue and finance having authority 18 44 over the listing of land or listing and assessment of 18 45propertyagricultural land and structures for tax 18 46 purposes shall certify to the county auditor of each 18 47 county the number of acres of land and the assessed 18 48 values of agricultural land and structures for all the 18 49 taxable property in such county as finallyequalized18 50anddetermined, and the same shall be transcribed onto 19 1 the tax lists as required by section 443.2. 19 2 Sec. 34. Section 443.22, Code 2003, is amended to 19 3 read as follows: 19 4 443.22 UNIFORM ASSESSMENTS MANDATORY. 19 5 All assessors and assessing bodies, including the 19 6 department of revenue and finance having authority 19 7 over the listing of land and listing and assessment of 19 8propertyagricultural land and structures for tax 19 9 purposes, shall comply with sections 428.4, 428.29, 19 10 434.15, 438.13, 441.21, and 441.45. The department of 19 11 revenue and finance, having authority over the listing 19 12 and assessments, shall exercise its powers and perform 19 13 its duties under section 421.17 and other applicable 19 14 laws so as to require the uniform and consistent 19 15 application ofsaidthat section. 19 16 Sec. 35. NEW SECTION. 443A.1 LAND TAX. 19 17 Effective for the fiscal year beginning July 1, 19 18 2007, and all subsequent fiscal years, a land tax 19 19 shall be imposed against each acre or portion of an 19 20 acre of land in a county. 19 21 Sec. 36. NEW SECTION. 443A.2 APPORTIONMENT OF 19 22 LAND TAX. 19 23 1. The land tax for each county shall be 19 24 apportioned as follows: 19 25 In the unincorporated area of the county, the land 19 26 tax shall be distributed to the county, the school 19 27 district located in the unincorporated area of the 19 28 county, and other taxing entities located in the 19 29 unincorporated area of the county in the same 19 30 proportion that property taxes levied in the 19 31 unincorporated area of the county for the fiscal year 19 32 beginning July 1, 2006, were allocated to those 19 33 entities. 19 34 In the incorporated areas of the county, the land 19 35 tax shall be distributed to the city, the county, each 19 36 school district located within the city, and other 19 37 taxing entities located within the city in the same 19 38 proportion that property taxes levied in the city for 19 39 the fiscal year beginning July 1, 2006, were allocated 19 40 to those entities. 19 41 2. The city finance committee and the county 19 42 finance committee shall jointly determine the 19 43 adjustments to be made to the allocation of the land 19 44 tax in the case of boundary adjustments made to a 19 45 taxing district on or after January 1, 2006. 19 46 3. After the auditor has computed the amount of 19 47 land tax to be distributed to each taxing district, 19 48 the auditor shall compute the rate of tax to be levied 19 49 upon the square footage valuation of structures 19 50 pursuant to chapter 444. 20 1 Sec. 37. Section 444.1, Code 2003, is amended to 20 2 read as follows: 20 3 444.1 BASIS FOR AMOUNT OF TAX. 20 4 In all taxing districts in the state, including 20 5 townships, school districts, cities and counties, when 20 6 by law then existing the people are authorized to 20 7 determine by vote, or officers are authorized to 20 8 estimate or determine, a rate of taxation required for 20 9 any public purpose, such rate shall in all cases be 20 10 estimated and based upon the amount of land tax 20 11 available to the district and the adjusted taxable 20 12 square footage valuation of such taxing district for 20 13 the preceding calendar year. 20 14 Sec. 38. Section 444.2, Code 2003, is amended to 20 15 read as follows: 20 16 444.2 AMOUNTS CERTIFIED IN DOLLARS. 20 17 When an authorized square footage tax rate within a 20 18 taxing district, including townships, school 20 19 districts, cities and counties, has been thus 20 20 determined as provided by law, the officer or officers 20 21 charged with the duty of certifying the authorized 20 22 rate to the county auditor or board of supervisors 20 23 shall, before certifying the rate, compute upon the 20 24 adjusted taxable square footage valuation of the 20 25 taxing district for the preceding fiscal year, the 20 26 amount of tax the rate will raise, stated in dollars, 20 27 and shall certify the computed amount in dollars and 20 28 not by rate, to the county auditor and board of 20 29 supervisors and shall further certify the percentage 20 30 of such amount to be levied against each class of 20 31 property. 20 32 Sec. 39. Section 444.3, Code 2003, is amended to 20 33 read as follows: 20 34 444.3 COMPUTATION OF SQUARE FOOTAGE RATE. 20 35 When the square footage valuations for the several 20 36 taxing districts shall have been adjusted by the 20 37 several boards for the current year, and the amount of 20 38 land tax to be distributed to each taxing district has 20 39 been deducted from the dollar amounts certified in 20 40 section 444.2 for each taxing district, the county 20 41 auditor shall thereupon apply such a rate, not20 42exceeding the rate authorized by law,or rates as will 20 43 raise the amount required for such taxing district, 20 44 and when combined with the land tax amount will raise 20 45 an amount not exceeding the dollar amount authorized 20 46 by law for the taxing district, andnowill not raise 20 47 a larger amount. For purposes of computing the square 20 48 footage rate under this section, the adjusted taxable 20 49 square footage valuation of the property of a taxing 20 50 district does not include the valuation of property of 21 1 a railway corporation or its trustee which corporation 21 2 has been declared bankrupt or is in bankruptcy 21 3 proceedings. Nothing in the preceding sentence 21 4 exempts the property of such railway corporation or 21 5 its trustee from taxation and the rate computed under 21 6 this section shall be levied on the taxable property 21 7 of such railway corporation or its trustee. 21 8 The square footage tax rate shall be expressed in 21 9 dollars and cents per one hundred dollars of valuation 21 10 per square foot. 21 11 Sec. 40. NEW SECTION. 444.9 COMPUTATION OF TAX. 21 12 The amount of tax imposed on any taxable property 21 13 is the sum of the amounts computed in subsections 1 21 14 and 2. 21 15 1. LAND TAX. The product of the land tax rate 21 16 times the number of acres or portion of an acre of the 21 17 taxable property. 21 18 2. SQUARE FOOTAGE TAX. The product of the square 21 19 footage tax rate times the valuation per square foot 21 20 of the taxable structure times the number of square 21 21 feet of the taxable structure. The square footage tax 21 22 shall be computed separately for each structure 21 23 located on the land. 21 24 Sec. 41. PROPERTY TAX IMPLEMENTATION COMMITTEE. 21 25 1. On or before July 1, 2003, the department of 21 26 revenue and finance, in consultation with the 21 27 department of management, shall initiate and 21 28 coordinate the establishment of a property tax 21 29 implementation committee and provide staffing 21 30 assistance to the committee. The property tax 21 31 implementation committee shall include four members of 21 32 the general assembly, one each appointed by the 21 33 majority leader of the senate, the speaker of the 21 34 house of representatives, the minority leader of the 21 35 senate, and the minority leader of the house of 21 36 representatives. The committee shall also include 21 37 members appointed by the department of revenue and 21 38 finance representing the department of revenue and 21 39 finance, the department of management, counties, 21 40 cities, school districts, local assessors, commercial 21 41 property taxpayers, industrial property taxpayers, 21 42 residential property taxpayers, and agricultural 21 43 property taxpayers, and other appropriate 21 44 stakeholders. The department may consider 21 45 participation on the committee of former state 21 46 officials with expertise in budget and tax policy. 21 47 The chairpersons of the committee shall be those 21 48 members of the general assembly appointed by the 21 49 majority leader of the senate and the speaker of the 21 50 house of representatives. 22 1 2. The committee shall study and make 22 2 recommendations relating to the land tax, square 22 3 footage tax, the baseline assessment for the square 22 4 footage tax, and other related provisions. The 22 5 committee shall also study and make recommendations on 22 6 issues relating to implementation of a land tax and 22 7 square footage tax, including, but not limited to, 22 8 whether or not maximum square footage rates and land 22 9 tax rates should be imposed and, if such rates are 22 10 recommended, the imposition of rates that have a 22 11 revenue neutral impact on classes of property, the 22 12 property tax financing portion of the school funding 22 13 formula, treatment of current property tax credits and 22 14 exemptions under a land tax and square footage tax and 22 15 continued state reimbursement of any credits or 22 16 exemptions, implementation of urban revitalization and 22 17 urban renewal programs under the land tax and square 22 18 footage tax, implementation of a payment in lieu of 22 19 taxes program for local government services, and 22 20 maintenance of equity among classes of taxpayers and 22 21 among taxpayers within the same class. The property 22 22 tax implementation committee shall also study the role 22 23 of property taxes in funding local government services 22 24 and the types of services currently funded by property 22 25 taxes. 22 26 3. The property tax implementation committee shall 22 27 direct three counties and cities within those counties 22 28 to submit data as prescribed by the committee. The 22 29 department of revenue and finance, in consultation 22 30 with the department of management, shall select the 22 31 three counties and the cities within those counties 22 32 that will be required to provide data to the 22 33 committee. The committee shall devise a system for 22 34 testing the data, including the necessary computer 22 35 hardware and software to allow the selected counties 22 36 and cities to prepare projected budgets, to determine 22 37 the rates for the land tax and the square footage tax 22 38 for those projected budgets, and to provide a sampling 22 39 of the effect on the various classes of property in 22 40 those jurisdictions. The committee shall use the data 22 41 and the results of the projections to resolve, and 22 42 make recommendations relating to, the issues described 22 43 in subsection 2, and related issues, in a revenue 22 44 neutral manner that will not result in a shift of 22 45 property tax burden between classes of property. The 22 46 committee shall submit to the general assembly by 22 47 October 31, 2003, October 31, 2004, and October 31, 22 48 2005, a report for each of those years resolving the 22 49 issues in subsection 2 and other related issues for 22 50 implementation of this Act. The reports shall include 23 1 detailed estimates of the cost to the counties and 23 2 cities of providing the data and an estimate of the 23 3 cost of statewide implementation of this Act. 23 4 Sec. 42. EFFECTIVE AND APPLICABILITY DATES. 23 5 1. The section of this division of this Act 23 6 establishing the property tax implementation 23 7 committee, being deemed of immediate importance, takes 23 8 effect upon enactment. 23 9 2. The remainder of this division of this Act 23 10 takes effect July 1, 2005, and applies to assessment 23 11 years beginning on or after January 1, 2006, and 23 12 applies to tax collections for fiscal years beginning 23 13 on or after July 1, 2007. 23 14 Sec. 43. FUTURE REPEAL. This division of this Act 23 15 is repealed effective June 30, 2005. 23 16 DIVISION II 23 17 INDIVIDUAL INCOME TAX 23 18 2004-2006 TAX YEARS 23 19 Sec. 44. Section 422.5, subsection 1, paragraphs a 23 20 through i, Code 2003, are amended to read as follows: 23 21 For tax years beginning 23 22 in the calendar year: 23 23 2004 2005 2006 23 24 a. On all taxable income from 23 25 zero through one thousand dollars,23 26thirty-six hundredths of one23 27percent.: ............................. .35% .34% .33% 23 28 b. On all taxable income exceeding 23 29 one thousand dollars but not 23 30 exceeding two thousand dollars,23 31seventy-two hundredths of one23 32percent.: ............................. .71% .68% .65% 23 33 c. On all taxable income exceeding 23 34 two thousand dollars but not 23 35 exceeding four thousand dollars,23 36two and forty-three hundredths23 37percent.: ............................ 2.39% 2.30% 2.21% 23 38 d. On all taxable income exceeding 23 39 four thousand dollars but not 23 40 exceeding nine thousand dollars,23 41four and one-half percent.: .......... 4.42% 4.25% 4.09% 23 42 e. On all taxable income exceeding 23 43 nine thousand dollars but not 23 44 exceeding fifteen thousand 23 45 dollars, six and twelve hundredths23 46percent.: ............................ 6.01% 5.78% 5.56% 23 47 f. On all taxable income exceeding 23 48 fifteen thousand dollars but not 23 49 exceeding twenty thousand 23 50 dollars, six and forty-eight hundredths24 1percent.: ............................ 6.36% 6.12% 5.88% 24 2 g. On all taxable income exceeding 24 3 twenty thousand dollars but not 24 4 exceeding thirty thousand 24 5 dollars, six and eight-tenths24 6percent.: ............................ 6.68% 6.42% 6.17% 24 7 h. On all taxable income exceeding 24 8 thirty thousand dollars but not 24 9 exceeding forty-five thousand 24 10 dollars, seven and ninety-two hundredths24 11percent.: ............................ 7.78% 7.48% 7.19% 24 12 i. On all taxable income exceeding 24 13 forty-five thousand dollars, eight24 14and ninety-eight hundredths24 15percent.: ............................ 8.82% 8.48% 8.15% 24 16 Sec. 45. EFFECTIVE AND APPLICABILITY DATE 24 17 PROVISIONS. This division of this Act takes effect 24 18 January 1, 2004, for tax years beginning on or after 24 19 January 1, 2004, but before January 1, 2007. 24 20 DIVISION III 24 21 INDIVIDUAL INCOME TAX 24 22 2007 AND SUBSEQUENT TAX YEARS 24 23 Sec. 46. Section 422.5, subsection 1, paragraphs a 24 24 through i, Code 2003, are amended to read as follows: 24 25 For tax years beginning 24 26 in the calendar year: 24 27 2007 and subsequent 24 28 calendar years 24 29 a. On all taxable income from 24 30 zero through one thousand dollars,24 31thirty-six hundredths of one24 32percent.: ............................. .31% 24 33 b. On all taxable income exceeding 24 34 one thousand dollars but not 24 35 exceeding two thousand dollars,24 36seventy-two hundredths of one24 37percent.: ............................. .61% 24 38 c. On all taxable income exceeding 24 39 two thousand dollars but not 24 40 exceeding four thousand dollars,24 41two and forty-three hundredths24 42percent.: ............................ 2.06% 24 43 d. On all taxable income exceeding 24 44 four thousand dollars but not 24 45 exceeding nine thousand dollars,24 46four and one-half percent.: .......... 3.81% 24 47 e. On all taxable income exceeding 24 48 nine thousand dollars but not 24 49 exceeding fifteen thousand 24 50 dollars, six and twelve hundredths25 1percent.: ............................ 5.19% 25 2 f. On all taxable income exceeding 25 3 fifteen thousand dollars but not 25 4 exceeding twenty thousand 25 5 dollars, six and forty-eight hundredths25 6percent.: ............................ 5.49% 25 7 g. On all taxable income exceeding 25 8 twenty thousand dollars but not 25 9 exceeding thirty thousand 25 10 dollars, six and eight-tenths25 11percent.: ............................ 5.76% 25 12 h. On all taxable income exceeding 25 13 thirty thousand dollars but not 25 14 exceeding forty-five thousand 25 15 dollars, seven and ninety-two hundredths25 16percent.: ............................ 6.71% 25 17 i. On all taxable income exceeding 25 18 forty-five thousand dollars, eight25 19and ninety-eight hundredths25 20percent.: ............................ 7.61% 25 21 Sec. 47. EFFECTIVE AND APPLICABILITY DATE 25 22 PROVISIONS. This division of this Act takes effect 25 23 January 1, 2007, for tax years beginning on or after 25 24 January 1, 2007. 25 25 DIVISION IV 25 26 INDIVIDUAL INCOME TAX 25 27 2007 AND SUBSEQUENT TAX YEARS 25 28 Sec. 48. Section 422.4, subsection 1, paragraphs b 25 29 and c, Code 2003, are amended to read as follows: 25 30 b. "Cumulative inflation factor" means the product 25 31 of the annual inflation factor for the19882007 25 32 calendar year and all annual inflation factors for 25 33 subsequent calendar years as determined pursuant to 25 34 this subsection. The cumulative inflation factor 25 35 applies to all tax years beginning on or after January 25 36 1 of the calendar year for which the latest annual 25 37 inflation factor has been determined. 25 38 c. The annual inflation factor for the19882007 25 39 calendar year is one hundred percent. 25 40 Sec. 49. Section 422.4, subsection 16, Code 2003, 25 41 is amended to read as follows: 25 42 16.The words "taxable"Taxable income"meanmeans 25 43 the net income as defined in section 422.7 minus the 25 44 deductions allowed by section 422.9, in the case of 25 45 individuals; in. In the case of estates or trusts, 25 46the words"taxable income"meanmeans the taxable 25 47 income,(without a deduction for personal exemption), 25 48 as computed for federal income tax purposes under the 25 49 Internal Revenue Code, but with the adjustments 25 50 specified in section 422.7plus the Iowa income tax26 1deducted in computing the federal taxable income and26 2minus federal income taxes as provided in section26 3422.9. 26 4 Sec. 50. Section 422.5, subsection 1, Code 2003, 26 5 as amended by 2003 Iowa Acts, Senate File 442, section 26 6 4, is amended by striking the subsection and inserting 26 7 in lieu thereof the following: 26 8 1. a. A tax is imposed upon every resident and 26 9 nonresident of the state which tax shall be levied, 26 10 collected, and paid annually upon and with respect to 26 11 the entire taxable income at rates as follows: 26 12 (1) On all taxable income from zero through eight 26 13 thousand dollars, two and five hundredths percent. 26 14 (2) On all taxable income exceeding eight thousand 26 15 dollars but not exceeding one hundred thousand 26 16 dollars, four and sixty-five hundredths percent. 26 17 (3) On all taxable income exceeding one hundred 26 18 thousand dollars, four and nine-tenths percent. 26 19 b. (1) The tax imposed upon the taxable income of 26 20 a nonresident shall be computed by reducing the amount 26 21 determined pursuant to paragraph "a" by the amounts of 26 22 nonrefundable credits under this division and by 26 23 multiplying this resulting amount by a fraction of 26 24 which the nonresident's net income allocated to Iowa, 26 25 as determined in section 422.8, subsection 2, 26 26 paragraph "a", is the numerator and the nonresident's 26 27 total net income computed under section 422.7 is the 26 28 denominator. This provision also applies to 26 29 individuals who are residents of Iowa for less than 26 30 the entire tax year. 26 31 (2) The tax imposed upon the taxable income of a 26 32 resident shareholder in an S corporation which has in 26 33 effect for the tax year an election under subchapter S 26 34 of the Internal Revenue Code and carries on business 26 35 within and without the state may be computed by 26 36 reducing the amount determined pursuant to paragraph 26 37 "a" by the amounts of nonrefundable credits under this 26 38 division and by multiplying this resulting amount by a 26 39 fraction of which the resident's net income allocated 26 40 to Iowa, as determined in section 422.8, subsection 2, 26 41 paragraph "b", is the numerator and the resident's 26 42 total net income computed under section 422.7 is the 26 43 denominator. If a resident shareholder has elected to 26 44 take advantage of this subparagraph, and for the next 26 45 tax year elects not to take advantage of this 26 46 subparagraph, the resident shareholder shall not 26 47 reelect to take advantage of this subparagraph for the 26 48 three tax years immediately following the first tax 26 49 year for which the shareholder elected not to take 26 50 advantage of this subparagraph, unless the director 27 1 consents to the reelection. This subparagraph also 27 2 applies to individuals who are residents of Iowa for 27 3 less than the entire tax year. 27 4 Sec. 51. Section 422.5, subsection 2, Code 2003, 27 5 is amended by striking the subsection and inserting in 27 6 lieu thereof the following: 27 7 2. a. However, if the married persons' filing 27 8 jointly or separately on a combined return, unmarried 27 9 head of household's, or surviving spouse's net income 27 10 exceeds thirteen thousand five hundred dollars or nine 27 11 thousand dollars in the case of all other persons, the 27 12 regular tax imposed under this division shall be the 27 13 lesser of the product of eight percent times the 27 14 portion of the net income in excess of thirteen 27 15 thousand five hundred dollars or nine thousand 27 16 dollars, as applicable, or the regular tax liability 27 17 computed without regard to this paragraph. 27 18 b. Paragraph "a" does not apply to estates and 27 19 trusts. Married taxpayers electing to file separately 27 20 shall compute the alternate tax described in paragraph 27 21 "a" using the total net income of the husband and 27 22 wife. The alternate tax described in paragraph "a" 27 23 does not apply if one spouse elects to carry back or 27 24 carry forward the loss as provided in section 422.9, 27 25 subsection 3. A person who is claimed as a dependent 27 26 by another person as defined in section 422.12 shall 27 27 not receive the benefit of paragraph "a" if the person 27 28 claiming the dependent has net income exceeding 27 29 thirteen thousand five hundred dollars or nine 27 30 thousand dollars as applicable or the person claiming 27 31 the dependent and the person's spouse have combined 27 32 net income exceeding thirteen thousand five hundred 27 33 dollars or nine thousand dollars as applicable. 27 34 Sec. 52. Section 422.5, subsection 5, Code 2003, 27 35 is amended to read as follows: 27 36 5. Upon determination of the latest cumulative 27 37 inflation factor, the director shall multiply each 27 38 dollar amount set forth in subsection 1,paragraphs27 39"a" through "i" of this sectionparagraph "a", by this 27 40 cumulative inflation factor, shall round off the 27 41 resulting product to the nearest one dollar, and shall 27 42 incorporate the result into the income tax forms and 27 43 instructions for each tax year. 27 44 Sec. 53. Section 422.5, subsection 7, Code 2003, 27 45 is amended by striking the subsection. 27 46 Sec. 54. Section 422.7, Code 2003, as amended by 27 47 2003 Iowa Acts, Senate File 442, section 5, and House 27 48 File 674, sections 5 and 6, is amended by striking the 27 49 section and inserting in lieu thereof the following: 27 50 422.7 "NET INCOME" – HOW COMPUTED. 28 1 The term "net income" means the adjusted gross 28 2 income before the net operating loss deduction as 28 3 properly computed for federal income tax purposes 28 4 under the Internal Revenue Code, with the following 28 5 adjustments: 28 6 1. The adjusted gross income is adjusted by adding 28 7 the sum of the following: 28 8 a. Add the amount of federal income tax refunds 28 9 received in a tax year beginning on or after January 28 10 1, 2007, but before January 1, 2010, to the extent 28 11 that the federal income tax was deducted on an Iowa 28 12 individual income tax return for a tax year beginning 28 13 prior to January 1, 2007. 28 14 b. Add interest and dividends from foreign 28 15 securities and from securities of state and other 28 16 political subdivisions exempt from federal income tax 28 17 under the Internal Revenue Code. 28 18 c. Add interest and dividends from regulated 28 19 investment companies exempt from federal income tax 28 20 under the Internal Revenue Code. 28 21 d. Add, to the extent not already included, income 28 22 from the sale of obligations of the state and its 28 23 political subdivisions. Income from the sale of these 28 24 obligations is exempt from the taxes imposed by this 28 25 division only if the law authorizing these obligations 28 26 specifically exempts the income from the sale from the 28 27 state individual income tax. 28 28 e. Add the amount resulting from the cancellation 28 29 of a participation agreement refunded to the taxpayer 28 30 as a participant in the Iowa educational savings plan 28 31 trust under chapter 12D to the extent previously 28 32 deducted as a contribution to the trust. 28 33 2. The adjusted gross income is adjusted by 28 34 subtracting the sum of the following: 28 35 a. Subtract the amount of federal income taxes 28 36 paid or accrued, as the case may be, in a tax year 28 37 beginning on or after January 1, 2007, but before 28 38 January 1, 2010, to the extent the federal tax payment 28 39 is for a tax year beginning prior to January 1, 2007. 28 40 b. Subtract interest and dividends from federal 28 41 securities. 28 42 c. Subtract the loss on the sale or exchange of a 28 43 share of a regulated investment company held for six 28 44 months or less to the extent the loss was disallowed 28 45 under section 852(b)(4)(B) of the Internal Revenue 28 46 Code. 28 47 d. (1) Subtract, to the extent included, the 28 48 amount of additional social security benefits taxable 28 49 under the Internal Revenue Code for tax years 28 50 beginning on or after January 1, 1994. The amount of 29 1 social security benefits taxable as provided in 29 2 section 86 of the Internal Revenue Code, as amended up 29 3 to and including January 1, 1993, continues to apply 29 4 for state income tax purposes for tax years beginning 29 5 on or after January 1, 1994. 29 6 (2) Married taxpayers, who file a joint federal 29 7 income tax return and who elect to file separate 29 8 returns or who elect separate filing on a combined 29 9 return for state income tax purposes, shall allocate 29 10 between the spouses the amount of benefits subtracted 29 11 under subparagraph (1) from net income in the ratio of 29 12 the social security benefits received by each spouse 29 13 to the total of these benefits received by both 29 14 spouses. 29 15 e. (1) For a person who is disabled, or is fifty- 29 16 five years of age or older, or is the surviving spouse 29 17 of an individual or a survivor having an insurable 29 18 interest in an individual who would have qualified for 29 19 the exemption under this paragraph for the tax year, 29 20 subtract, to the extent included, the total amount of 29 21 a governmental or other pension or retirement pay, 29 22 including, but not limited to, defined benefit or 29 23 defined contribution plans, annuities, individual 29 24 retirement accounts, plans maintained or contributed 29 25 to by an employer, or maintained or contributed to by 29 26 a self-employed person as an employer, and deferred 29 27 compensation plans or any earnings attributable to the 29 28 deferred compensation plans, up to a maximum of six 29 29 thousand dollars for a person, other than a husband or 29 30 wife, who files a separate state income tax return and 29 31 up to a maximum of twelve thousand dollars for a 29 32 husband and wife who file a joint state income tax 29 33 return. 29 34 (2) However, a surviving spouse who is not 29 35 disabled or fifty-five years of age or older can only 29 36 exclude the amount of pension or retirement pay 29 37 received as a result of the death of the other spouse. 29 38 A husband and wife filing separate state income tax 29 39 returns or separately on a combined return are allowed 29 40 a combined maximum exclusion under this paragraph "e" 29 41 of up to the amount allowed for a husband and wife who 29 42 file a joint state income tax return. The exclusion 29 43 shall be allocated to the husband or wife in the 29 44 proportion that each spouse's respective pension and 29 45 retirement pay received bears to total combined 29 46 pension and retirement pay received. 29 47 f. Notwithstanding the method for computing income 29 48 from an installment sale under section 453 of the 29 49 Internal Revenue Code, as defined in section 422.3, 29 50 the method to be used in computing income from an 30 1 installment sale shall be the method under section 453 30 2 of the Internal Revenue Code, as amended up to and 30 3 including January 1, 2000. A taxpayer affected by 30 4 this paragraph shall make adjustments in the adjusted 30 5 gross income pursuant to rules adopted by the 30 6 director. 30 7 The adjustment to net income provided in this 30 8 paragraph "f" is repealed for tax years beginning on 30 9 or after January 1, 2002. However, to the extent that 30 10 a taxpayer using the accrual method of accounting 30 11 reported the entire capital gain from the sale or 30 12 exchange of property on the Iowa return for the tax 30 13 year beginning in the 2001 calendar year and the 30 14 capital gain was reported on the installment method on 30 15 the federal income tax return, any additional 30 16 installment from the capital gain reported for federal 30 17 income tax purposes is not to be included in net 30 18 income in tax years beginning on or after January 1, 30 19 2002. 30 20 g. Subtract, if the taxpayer is the owner of an 30 21 individual development account certified under chapter 30 22 541A at any time during the tax year, all of the 30 23 following: 30 24 (1) Contributions made to the account by persons 30 25 and entities, other than the taxpayer, as authorized 30 26 in chapter 541A. 30 27 (2) The amount of any savings refund authorized 30 28 under section 541A.3, subsection 1. 30 29 (3) Earnings from the account. 30 30 h. (1) Subtract the maximum contribution that may 30 31 be deducted for income tax purposes as a participant 30 32 in the Iowa educational savings plan trust pursuant to 30 33 section 12D.3, subsection 1, paragraph "a". 30 34 (2) Subtract, to the extent included, income from 30 35 interest and earnings received from the Iowa 30 36 educational savings plan trust created in chapter 12D. 30 37 (3) Subtract, to the extent not deducted for 30 38 federal income tax purposes, the amount of any gift, 30 39 grant, or donation made to the Iowa educational 30 40 savings plan trust for deposit in the endowment fund 30 41 of that trust. 30 42 i. Subtract, to the extent included, active duty 30 43 pay received by a person in the national guard or 30 44 armed forces military reserve for services performed 30 45 on or after August 2, 1990, pursuant to military 30 46 orders related to the Persian Gulf Conflict. 30 47 j. Subtract, to the extent included, active duty 30 48 pay received by a person in the national guard or 30 49 armed forces military reserve for service performed on 30 50 or after November 21, 1995, pursuant to military 31 1 orders related to peacekeeping in Bosnia-Herzegovina. 31 2 k. Subtract, to the extent included, the 31 3 following: 31 4 (1) Payments made to the taxpayer because of the 31 5 taxpayer's status as a victim of persecution for 31 6 racial, ethnic, or religious reasons by Nazi Germany 31 7 or any other Axis regime or as an heir of such victim. 31 8 (2) Items of income attributable to, derived from, 31 9 or in any way related to assets stolen from, hidden 31 10 from, or otherwise lost to a victim of persecution for 31 11 racial, ethnic, or religious reasons by Nazi Germany 31 12 or any other Axis regime immediately prior to, during, 31 13 and immediately after World War II, including, but not 31 14 limited to, interest on the proceeds receivable as 31 15 insurance under policies issued to a victim of 31 16 persecution for racial, ethnic, or religious reasons 31 17 by Nazi Germany or any other Axis regime by European 31 18 insurance companies immediately prior to and during 31 19 World War II. However, income from assets acquired 31 20 with such assets or with the proceeds from the sale of 31 21 such assets shall not be subtracted. This 31 22 subparagraph shall only apply to a taxpayer who was 31 23 the first recipient of such assets after recovery of 31 24 the assets and who is a victim of persecution for 31 25 racial, ethnic, or religious reasons by Nazi Germany 31 26 or any other Axis regime or is an heir of such victim. 31 27 l. Subtract, to the extent included, active duty 31 28 pay received by a person in the national guard or 31 29 armed forces military reserve for service performed on 31 30 or after January 1, 2003, pursuant to military orders 31 31 related to Operation Iraqi Freedom, Operation Noble 31 32 Eagle, and Operation Enduring Freedom. 31 33 m. Subtract, not to exceed one thousand five 31 34 hundred dollars, the overnight transportation, meals, 31 35 and lodging expenses, to the extent not reimbursed, 31 36 incurred by the taxpayer for travel away from home of 31 37 more than one hundred miles for the performance of 31 38 services by the taxpayer as a member of the national 31 39 guard or armed forces military reserve. 31 40 n. Subtract, to the extent included, military 31 41 student loan repayments received by the taxpayer 31 42 serving on active duty in the national guard or armed 31 43 forces military reserve or on active duty status in 31 44 the armed forces. 31 45 o. Subtract, to the extent not otherwise excluded, 31 46 the amount of the death gratuity payable under 10 31 47 U.S.C. } 1475-1491 for deaths occurring after 31 48 September 10, 2001. 31 49 3. a. In determining the amount of federal income 31 50 tax refunds or taxes paid or accrued under subsection 32 1 1 or 2, for tax years beginning in the 2001 calendar 32 2 year, the amount shall not be adjusted by the amount 32 3 received during the tax year of the advanced refund of 32 4 the rate reduction tax credit provided pursuant to the 32 5 federal Economic Growth and Tax Relief Reconciliation 32 6 Act of 2001, Pub. L. No. 107-16, and the advanced 32 7 refund of such credit shall not be subject to taxation 32 8 under this division. 32 9 b. In determining the amount of federal income tax 32 10 refunds or taxes paid or accrued under subsection 1 or 32 11 2, for tax years beginning in the 2002 calendar year, 32 12 the amount shall not be adjusted by the amount of the 32 13 rate reduction credit received during the tax year to 32 14 the extent that the credit is attributable to the rate 32 15 reduction credit provided pursuant to the federal 32 16 Economic Growth and Tax Relief Reconciliation Act of 32 17 2001, Pub. L. No. 107-16, and the amount of such 32 18 credit shall not be taxable under this division. 32 19 4. The additional first-year depreciation 32 20 allowance authorized in section 168(k) of the Internal 32 21 Revenue Code, as enacted by Pub. L. No. 107-147, 32 22 section 101, does not apply in computing net income 32 23 for state tax purposes. If the taxpayer has taken 32 24 such deduction in computing federal adjusted gross 32 25 income, the following adjustments shall be made: 32 26 a. Add the total amount of depreciation taken on 32 27 all property for which the election under section 32 28 168(k) of the Internal Revenue Code was made for the 32 29 tax year. 32 30 b. Subtract an amount equal to depreciation taken 32 31 on such property for the tax year using the modified 32 32 accelerated cost recovery system depreciation method 32 33 applicable under section 168 of the Internal Revenue 32 34 Code without regard to section 168(k). 32 35 c. Any other adjustments to gains or losses to 32 36 reflect the adjustments made in paragraphs "a" and "b" 32 37 pursuant to rules adopted by the director. 32 38 Sec. 55. Section 422.8, subsection 2, paragraph a, 32 39 Code 2003, is amended to read as follows: 32 40 a. Nonresident's net income allocated to Iowa is 32 41 the net income, or portion of net income, which is 32 42 derived from a business, trade, profession, or 32 43 occupation carried on within this state or income from 32 44 any property, trust, estate, or other source within 32 45 Iowa. However, income derived from a business, trade, 32 46 profession, or occupation carried on within this state 32 47 and income from any property, trust, estate, or other 32 48 source within Iowa shall not include distributions 32 49 from pensions, including defined benefit or defined 32 50 contribution plans, annuities, individual retirement 33 1 accounts, and deferred compensation plans or any 33 2 earnings attributable thereto so long as the 33 3 distribution is directly related to an individual's 33 4 documented retirement and received while the 33 5 individual is a nonresident of this state. If a 33 6 business, trade, profession, or occupation is carried 33 7 on partly within and partly without the state, only 33 8 the portion of the net income which is fairly and 33 9 equitably attributable to that part of the business, 33 10 trade, profession, or occupation carried on within the 33 11 state is allocated to Iowa for purposes of section 33 12 422.5, subsection 1, paragraph"j""b", and section 33 13 422.13 and income from any property, trust, estate, or 33 14 other source partly within and partly without the 33 15 state is allocated to Iowa in the same manner, except 33 16 that annuities, interest on bank deposits and 33 17 interest-bearing obligations, and dividends are 33 18 allocated to Iowa only to the extent to which they are 33 19 derived from a business, trade, profession, or 33 20 occupation carried on within the state. 33 21 Sec. 56. Section 422.8, subsection 4, Code 2003, 33 22 is amended by striking the subsection. 33 23 Sec. 57. Section 422.9, subsection 1, Code 2003, 33 24 is amended to read as follows: 33 25 1. An optional standard deduction, after deduction33 26of federal income tax,equal to one thousand two 33 27 hundred thirty dollars for a married person who files 33 28 separately or a single person or equal to three 33 29 thousand thirty dollars for a husband and wife who 33 30 file a joint return, a surviving spouse, or an 33 31 unmarried head of household.The optional standard33 32deduction shall not exceed the amount remaining after33 33deduction of the federal income tax.33 34 Sec. 58. Section 422.9, subsection 2, paragraph b, 33 35 Code 2003, is amended by striking the paragraph. 33 36 Sec. 59. Section 422.9, subsections 6 and 7, Code 33 37 2003, are amended by striking the subsections. 33 38 Sec. 60. Section 422.11B, subsection 1, Code 2003, 33 39 is amended to read as follows: 33 40 1. There is allowed as a credit against the tax 33 41 determined in section 422.5, subsection 1, paragraphs 33 42 "a" through "j" for a tax year an amount equal to the 33 43 minimum tax credit for that tax year. 33 44 The minimum tax credit for a tax year is the 33 45 excess, if any, of the adjusted net minimum tax 33 46 imposed for all prior tax years beginning on or after 33 47 January 1, 1987, but before January 1, 2007, over the 33 48 amount allowable as a credit under this section for 33 49 those prior tax years. 33 50 If a minimum tax credit is available to a tax 34 1 period beginning on or after January 1, 2007, the 34 2 credit can be carried over to tax years beginning on 34 3 or after January 1, 2007, but before January 1, 2010. 34 4 The minimum tax credit is limited to the tax 34 5 determined in section 422.5, subsection 1, paragraphs 34 6 "a" and "b". 34 7 Sec. 61. Section 422.13, subsection 1, paragraph 34 8 c, and subsection 1A, Code 2003, are amended to read 34 9 as follows: 34 10 c. However, if that part of the net income of a 34 11 nonresident which is allocated to Iowa pursuant to 34 12 section 422.8, subsection 2, is less than one thousand 34 13 dollars the nonresident is not required to make and 34 14 sign a returnexcept when the nonresident is subject34 15to the state alternative minimum tax imposed pursuant34 16to section 422.5, subsection 1, paragraph "k". 34 17 1A. Notwithstanding any other provision in this 34 18 section, a resident of this state is not required to 34 19 make and file a return if the person's net income is 34 20 equal to or less than the appropriate dollar amount 34 21 listed in section 422.5, subsection 2, upon which tax 34 22 is not imposed. A nonresident of this state is not 34 23 required to make and file a return if the person's 34 24 total net income in section 422.5, subsection 1, 34 25 paragraph"j","b", is equal to or less than the 34 26 appropriate dollar amount provided in section 422.5, 34 27 subsection 2, upon which tax is not imposed. For 34 28 purposes of this subsection, the amount of a lump sum 34 29 distribution subject to separate federal tax shall be 34 30 included in net income for purposes of determining if 34 31 a resident is required to file a return and the 34 32 portion of the lump sum distribution that is allocable 34 33 to Iowa is included in total net income for purposes 34 34 of determining if a nonresident is required to make 34 35 and file a return. 34 36 Sec. 62. Section 422.21, unnumbered paragraph 5, 34 37 Code 2003, is amended to read as follows: 34 38 The director shall determine for the19892008 and 34 39 each subsequent calendar year the annual and 34 40 cumulative inflation factors for each calendar year to 34 41 be applied to tax years beginning on or after January 34 42 1 of that calendar year. The director shall compute 34 43 the new dollar amounts as specified to be adjusted in 34 44 section 422.5 by the latest cumulative inflation 34 45 factor and round off the result to the nearest one 34 46 dollar. The annual and cumulative inflation factors 34 47 determined by the director are not rules as defined in 34 48 section 17A.2, subsection 11. The director shall 34 49 determine for the 1990 calendar year and each 34 50 subsequent calendar year the annual and cumulative 35 1 standard deduction factors to be applied to tax years 35 2 beginning on or after January 1 of that calendar year. 35 3 The director shall compute the new dollar amounts of 35 4 the standard deductions specified in section 422.9, 35 5 subsection 1, by the latest cumulative standard 35 6 deduction factor and round off the result to the 35 7 nearest ten dollars. The annual and cumulative 35 8 standard deduction factors determined by the director 35 9 are not rules as defined in section 17A.2, subsection 35 10 11. 35 11 Sec. 63. Section 422.11B, Code 2003, is repealed. 35 12 COORDINATING AMENDMENTS 35 13 Sec. 64. Section 12D.9, subsection 2, Code 2003, 35 14 is amended to read as follows: 35 15 2. State income tax treatment of the Iowa 35 16 educational savings plan trust shall be as provided in 35 17 section 422.7,subsections 32, 33, and 34subsection 35 18 1, paragraph "e", and subsection 2, paragraph "h", and 35 19 section 422.35, subsection 14. 35 20 Sec. 65. Section 217.39, Code 2003, is amended to 35 21 read as follows: 35 22 217.39 PERSECUTED VICTIMS OF WORLD WAR II – 35 23 REPARATIONS – HEIRS. 35 24 Notwithstanding any other law of this state, 35 25 payments paid to and income from lost property of a 35 26 victim of persecution for racial, ethnic, or religious 35 27 reasons by Nazi Germany or any other Axis regime or as 35 28 an heir of such victim which is exempt from state 35 29 income tax as provided in section 422.7, subsection3535 30 2, paragraph "k", shall not be considered as income or 35 31 an asset for determining the eligibility for state or 35 32 local government benefit or entitlement programs. The 35 33 proceeds are not subject to recoupment for the receipt 35 34 of governmental benefits or entitlements, and liens, 35 35 except liens for child support, are not enforceable 35 36 against these sums for any reason. 35 37 Sec. 66. Section 422.120, subsection 1, paragraph 35 38 b, subparagraph (3), Code 2003, is amended to read as 35 39 follows: 35 40 (3) The annual index factor for the 1997 calendar 35 41 year is one hundred percent. Foreach subsequentthe 35 42 1998 through 2006 calendaryearyears, the annual 35 43 index factor equals the annual inflation factor for 35 44 that calendar year as computed in section 422.4 for 35 45 purposes of the individual income tax. For the 2007 35 46 calendar year and each subsequent calendar year the 35 47 annual index factor shall be determined by the 35 48 department by October 15 of the calendar year 35 49 preceding the calendar year for which the factor is 35 50 determined, which reflects the purchasing power of the 36 1 dollar as a result of inflation during the fiscal year 36 2 ending in the calendar year preceding the calendar 36 3 year for which the factor is determined. In 36 4 determining the annual index factor, the department 36 5 shall use the annual percent change, but not less than 36 6 zero percent, in the gross domestic product price 36 7 deflator computed for the second quarter of the 36 8 calendar year by the bureau of economic analysis of 36 9 the United States department of commerce and shall add 36 10 all of that percent change to one hundred percent. 36 11 The annual index factor and the cumulative index 36 12 factor shall each be expressed as a percentage rounded 36 13 to the nearest one-tenth of one percent. The annual 36 14 index factor shall not be less than one hundred 36 15 percent. 36 16 Sec. 67. Section 425.23, subsection 4, paragraph 36 17 b, Code 2003, is amended to read as follows: 36 18 b. The annual adjustment factor for the 1998 base 36 19 year is one hundred percent. Foreach subsequentthe 36 20 1999 through 2006 baseyearyears, the annual 36 21 adjustment factor equals the annual inflation factor 36 22 for the calendar year, in which the base year begins, 36 23 as computed in section 422.4 for purposes of the 36 24 individual income tax. For the 2007 base year and 36 25 each subsequent base year, the annual adjustment 36 26 factor equals the annual index factor, in which the 36 27 base year begins, as computed in section 422.120, 36 28 subsection 1, for purposes of the livestock production 36 29 tax credit. 36 30 Sec. 68. Section 450.4, subsection 8, Code 2003, 36 31 is amended to read as follows: 36 32 8. On the value of that portion of any lump sum or 36 33 installment payments which are received by a 36 34 beneficiary under an annuity which was purchased under 36 35 an employee's pension or retirement plan which was 36 36 excluded from net incomeas set forth inunder section 36 37 422.7, subsection 31. 36 38 Sec. 69. Section 541A.2, subsection 7, unnumbered 36 39 paragraph 1, Code 2003, is amended to read as follows: 36 40 An individual development account closed in 36 41 accordance with this subsection is not subject to the 36 42 limitations and benefits provided by this chapter but 36 43 is subject to state tax in accordance with the 36 44 provisions of section 422.7, subsection282, 36 45 paragraph "g", and section 450.4, subsection 6. An 36 46 individual development account may be closed for any 36 47 of the following reasons: 36 48 Sec. 70. Section 541A.3, subsection 2, Code 2003, 36 49 is amended to read as follows: 36 50 2. Income earned by an individual development 37 1 account is not subject to state tax, in accordance 37 2 with the provisions of section 422.7, subsection282, 37 3 paragraph "g". 37 4 Sec. 71. Division III of this Act is repealed. 37 5 CONTINGENT EFFECTIVE AND APPLICABILITY DATE PROVISION 37 6 Sec. 72. 37 7 1. This division of this Act takes effect upon 37 8 ratification prior to January 1, 2007, of an amendment 37 9 to the Constitution of the State of Iowa requiring a 37 10 three-fifths majority vote of each house of the 37 11 general assembly in order to pass a bill that amends 37 12 the state individual income tax by raising the rate or 37 13 rates of the individual income tax or of an amendment 37 14 to the Constitution of the State of Iowa requiring a 37 15 statewide referendum in order to approve a bill that 37 16 amends the state individual income tax by raising the 37 17 rate or rates of the individual income tax. 37 18 2. If this division of this Act takes effect as 37 19 provided in subsection 1, this division of this Act, 37 20 except as provided in subsection 3, applies to tax 37 21 years beginning on or after January 1, 2007. 37 22 3. The section of this division of this Act 37 23 repealing section 422.11B applies to tax years 37 24 beginning on or after January 1, 2010. 37 25 DIVISION V 37 26 SALES AND USE TAX STUDIES 37 27 Sec. 73. INDUSTRIAL PROCESSING EXEMPTION STUDY 37 28 COMMITTEE. On or before July 1, 2003, the department 37 29 of revenue and finance shall initiate and coordinate 37 30 the establishment of an industrial processing 37 31 exemption study committee and provide staffing 37 32 assistance to the committee. It is the intent of the 37 33 general assembly that the committee shall include 37 34 representatives of the department of revenue and 37 35 finance, department of management, industrial 37 36 producers including manufacturers, fabricators, 37 37 printers and publishers, and an association that 37 38 specifically represents business tax issues, and other 37 39 stakeholders. 37 40 The industrial processing exemption under the sales 37 41 and use tax is a significant exemption for business. 37 42 The committee shall study and make legislative and 37 43 administrative recommendations relating to Iowa's 37 44 processing exemption to ensure maximum utilization by 37 45 Iowa's industries. 37 46 The committee shall study and make recommendations 37 47 regarding all of the following: 37 48 1. The current sales and use tax industrial 37 49 processing exemption. 37 50 2. The corresponding administrative rules, 38 1 including a review and recommendation of an 38 2 administrative rules process relating to the 38 3 industrial processing exemption prior to filing with 38 4 the administrative rules review committee. 38 5 3. Other states' industrial processing exemptions. 38 6 4. Recommendations for change for issues including 38 7 effectiveness and competitiveness. 38 8 5. Development of additional publications to 38 9 improve compliance. 38 10 The committee shall annually report to the general 38 11 assembly by January 1 of each year through January 1, 38 12 2013. 38 13 Sec. 74. IOWA SALES, SERVICES, AND USE TAX STUDY 38 14 COMMITTEE. On or before July 1, 2003, the department 38 15 of revenue and finance shall initiate and coordinate 38 16 the establishment of a state sales, services, and use 38 17 tax study committee and provide staffing assistance to 38 18 the committee. It is the intent of the general 38 19 assembly that the committee shall include 38 20 representatives of the department of revenue and 38 21 finance, department of management, an association of 38 22 Iowa farmers and other agricultural interests, retail 38 23 associations, contractors, taxpayers, an association 38 24 that specifically represents business tax issues, and 38 25 other stakeholders, two members of the general 38 26 assembly, and a representative of the governor's 38 27 office. 38 28 The committee shall study the current sales, 38 29 services, and use tax law. Programs funded through 38 30 special features of the tax code often escape regular 38 31 review. It is intended that the study committee shall 38 32 review the current sales, services, and use tax 38 33 exemptions to improve government accountability. 38 34 The committee shall study and make recommendations 38 35 regarding all of the following: 38 36 1. Retaining or eliminating current sales, 38 37 services, and use tax exemptions or providing new 38 38 exemptions. Such decisions shall be based at least 38 39 partially on the issues of effectiveness and 38 40 competitiveness and their impact on economic behavior. 38 41 2. Tax simplification and consistency issues in 38 42 applying the tax, including recordkeeping burdens on 38 43 retailers and application by the department of revenue 38 44 and finance. 38 45 3. Streamlining sales tax implementation in Iowa. 38 46 4. The tax rate. 38 47 5. Comparison of Iowa sales, services, and use tax 38 48 structure with other states. 38 49 The committee shall report to the general assembly 38 50 by January 1, 2004. The report shall provide 39 1 rationale for each decision made by the study 39 2 committee. 39 3 Sec. 75. EFFECTIVE DATE. This division of this 39 4 Act, being deemed of immediate importance, takes 39 5 effect July 1, 2003. 39 6 DIVISION VI 39 7 GROW IOWA BOARD AND FUND 39 8 Sec. 76. Section 15.108, subsection 9, Code 2003, 39 9 is amended by adding the following new paragraph: 39 10 NEW PARAGRAPH. g. Administer the marketing 39 11 strategy selected pursuant to section 15G.108. 39 12 Sec. 77. NEW SECTION. 15G.101 DEFINITIONS. 39 13 As used in this chapter, unless the context 39 14 otherwise requires: 39 15 1. "Board" means the grow Iowa board established 39 16 in section 15G.102. 39 17 2. "Department" means the Iowa department of 39 18 economic development created in section 15.105. 39 19 3. "Director" means the director of the department 39 20 of economic development. 39 21 4. "Fund" means the grow Iowa fund created in 39 22 section 15G.107. 39 23 5. "Grow Iowa geographic regions" means the 39 24 geographic regions defined in section 15G.105. 39 25 Sec. 78. NEW SECTION. 15G.102 GROW IOWA BOARD. 39 26 1. The grow Iowa board is established consisting 39 27 of nine voting members. The grow Iowa board shall be 39 28 located for administrative purposes within the 39 29 department and the director shall provide office 39 30 space, staff assistance, and necessary supplies and 39 31 equipment for the board. The director shall budget 39 32 moneys to pay the compensation and expenses of the 39 33 board. In performing its functions, the board is 39 34 performing a public function on behalf of the state 39 35 and is a public instrumentality of the state. 39 36 2. a. The members of the board shall be appointed 39 37 as follows: 39 38 (1) Five individuals appointed by the governor, 39 39 subject to confirmation by the senate. 39 40 (2) Four individuals appointed by the legislative 39 41 council. 39 42 b. All appointments shall comply with sections 39 43 69.16 and 69.16A. 39 44 c. At least one member of the board shall be from 39 45 each grow Iowa geographic region. 39 46 d. Each of the following areas of expertise shall 39 47 be represented by at least one member of the board who 39 48 has professional experience in that area of expertise: 39 49 (1) Accounting and finance. 39 50 (2) Business development for employers with less 40 1 than two hundred employees and sales of less than ten 40 2 million dollars per year. 40 3 (3) Insurance. 40 4 (4) Economics. 40 5 (5) Personnel. 40 6 e. All members of the board shall be actively 40 7 employed in the private, for-profit sector of the 40 8 economy. 40 9 f. The board membership shall be balanced between 40 10 representation by employers with less than two hundred 40 11 employees and employers with two hundred or more 40 12 employees. 40 13 3. The chairperson and vice chairperson shall be 40 14 elected by the members of the board from the 40 15 membership of the board. In the case of the absence 40 16 or disability of the chairperson and vice chairperson, 40 17 the members of the board shall elect a temporary 40 18 chairperson by a majority vote of those members who 40 19 are present and voting, provided a quorum is present. 40 20 4. The members of the board shall be appointed to 40 21 three-year staggered terms and the terms shall 40 22 commence and end as provided in section 69.19. If a 40 23 vacancy occurs, a successor shall be appointed in the 40 24 same manner and subject to the same qualifications as 40 25 the original appointment to serve the unexpired term. 40 26 5. A majority of the board constitutes a quorum. 40 27 6. A member of the board shall abstain from voting 40 28 on the provision of financial assistance to a project 40 29 which is located in the county in which the member of 40 30 the board resides. 40 31 7. The members of the board are entitled to 40 32 receive reimbursement for actual expenses incurred 40 33 while engaged in the performance of official duties. 40 34 A board member may also be eligible to receive 40 35 compensation as provided in section 7E.6. 40 36 Sec. 79. NEW SECTION. 15G.103 BOARD DUTIES. 40 37 The board shall do all of the following: 40 38 1. Organize. 40 39 2. Receive advice and recommendations from the 40 40 grow Iowa investment board, the economic development 40 41 marketing board, and the grow Iowa review commission. 40 42 3. Provide advice and recommendations to the 40 43 department and the Iowa economic development board for 40 44 making appropriations from and administering the grow 40 45 Iowa fund. A recommendation made by the grow Iowa 40 46 board to the department or the Iowa economic 40 47 development board shall be either approved or denied 40 48 by the department or the Iowa economic development 40 49 board. 40 50 4. Assist the department in implementing programs 41 1 and activities in a manner designed to achieve the 41 2 goals set out in section 15G.106. 41 3 5. By December 15 of each year, submit a written 41 4 report to the general assembly reviewing the 41 5 activities of the board during the calendar year. The 41 6 report shall include information necessary for the 41 7 review of the goals and performance measures set out 41 8 in section 15G.106. State agencies and other entities 41 9 receiving moneys from the fund shall cooperate with 41 10 and assist the board in compilation of the report. 41 11 6. Adopt administrative rules pursuant to chapter 41 12 17A necessary to administer this chapter. This 41 13 delegation shall be construed narrowly. 41 14 Sec. 80. NEW SECTION. 15G.104 GROW IOWA 41 15 INVESTMENT BOARD. 41 16 1. A grow Iowa investment board is established 41 17 consisting of three members and is located for 41 18 administrative purposes within the department. The 41 19 director of the department shall provide office space, 41 20 staff assistance, and necessary supplies and equipment 41 21 for the board. The director shall budget moneys to 41 22 pay the compensation and expenses of the board. In 41 23 performing its functions, the board is performing a 41 24 public function on behalf of the state and is a public 41 25 instrumentality of the state. 41 26 2. a. Membership of the grow Iowa investment 41 27 board shall include all of the following: 41 28 (1) One member appointed by the governor from a 41 29 list of three banking representatives provided by the 41 30 superintendent of banking. This member shall serve a 41 31 three-year term. 41 32 (2) One member appointed by the governor from a 41 33 list of entrepreneurs provided jointly by the Iowa 41 34 association of business and industry and the national 41 35 federation of independent business. This member shall 41 36 serve a three-year term. 41 37 (3) The entrepreneur of the year as selected by 41 38 the Iowa small business development centers shall be 41 39 offered a one-year membership on the investment board. 41 40 If the entrepreneur of the year declines to serve on 41 41 the investment board, a member shall be appointed by 41 42 the governor from the list provided pursuant to 41 43 subparagraph (2) for the one-year term. 41 44 b. The chairperson and vice chairperson of the 41 45 grow Iowa investment board shall be elected by and 41 46 from the investment board members. The terms of the 41 47 members shall commence and end as provided by section 41 48 69.19. If a vacancy occurs, a successor shall be 41 49 appointed in the same manner and subject to the same 41 50 qualifications as the original appointment to serve 42 1 the unexpired term. A majority of the investment 42 2 board constitutes a quorum. 42 3 3. The grow Iowa investment board, after a 42 4 thorough review, shall determine whether a proposed 42 5 project using moneys from the grow Iowa fund is 42 6 practical and shall provide recommendations to the 42 7 grow Iowa board regarding any moneys proposed to be 42 8 expended from the grow Iowa fund, with the exception 42 9 of moneys appropriated for purposes of the loan and 42 10 credit guarantee program and regarding whether a 42 11 proposed project is practical. The recommendations 42 12 shall be based on whether the expenditure would make 42 13 the achievement of the goals in accordance with the 42 14 performance measures set out in section 15G.106 more 42 15 likely. The recommendations may include conditions or 42 16 that proposed expenditure be rejected. The grow Iowa 42 17 board shall consider the recommendations of the grow 42 18 Iowa investment board and shall make an independent 42 19 recommendation to the department and the Iowa economic 42 20 development board regarding the expenditure. The 42 21 recommendations of the grow Iowa board shall include 42 22 the recommendations made by the grow Iowa investment 42 23 board. 42 24 4. The members of the board are entitled to 42 25 receive reimbursement for actual expenses incurred 42 26 while engaged in the performance of official duties. 42 27 A board member may also be eligible to receive 42 28 compensation as provided in section 7E.6. 42 29 Sec. 81. NEW SECTION. 15G.104A GROW IOWA REVIEW 42 30 COMMISSION. 42 31 1. A grow Iowa review commission is established 42 32 consisting of three members and is located for 42 33 administrative purposes within the department. The 42 34 director of the department shall provide office space, 42 35 staff assistance, and necessary supplies and equipment 42 36 for the review commission. The director shall budget 42 37 moneys to pay the compensation and expenses of the 42 38 commission, including the actual expenses of the 42 39 auditor of state incurred while engaged in the 42 40 performance of official commission duties. In 42 41 performing its functions, the review commission is 42 42 performing a public function on behalf of the state 42 43 and is a public instrumentality of the state. 42 44 2. Membership of the review commission shall 42 45 include the auditor of state, an economist for the 42 46 Iowa state university cooperative extension service in 42 47 agriculture and home economics appointed by the 42 48 president of the senate after consultation with the 42 49 minority leader of the senate, and a private sector 42 50 economist with broad experience reviewing and 43 1 analyzing the Iowa economy and the economy of the 43 2 upper midwest appointed by the speaker of the house of 43 3 representatives after consultation with the minority 43 4 leader of the house of representatives. The 43 5 appointments shall comply with sections 69.16 and 43 6 69.16A. The chairperson of the review commission 43 7 shall be the auditor of state. The members shall be 43 8 appointed to three-year staggered terms and the terms 43 9 shall commence and end as provided by section 69.19. 43 10 If a vacancy occurs, a successor shall be appointed in 43 11 the same manner and subject to the same qualifications 43 12 as the original appointment to serve the unexpired 43 13 term. A majority of the review commission constitutes 43 14 a quorum. For purposes of this subsection, "upper 43 15 midwest" includes the states of Iowa, Kansas, 43 16 Minnesota, Missouri, Nebraska, North Dakota, and South 43 17 Dakota. 43 18 3. The review commission shall analyze all annual 43 19 reports of the grow Iowa board for purposes of 43 20 determining if the goals and performance measures set 43 21 out in section 15G.106 have been met. By January 1, 43 22 2007, the review commission shall submit a report to 43 23 the grow Iowa board, the department, and the general 43 24 assembly. The report shall include findings, itemized 43 25 by grow Iowa geographic regions, regarding whether the 43 26 goals and performance measures were met. The report 43 27 shall also include recommendations regarding the 43 28 continuation, elimination, or modification of any 43 29 programs receiving moneys from the grow Iowa fund and 43 30 whether moneys should continue to be appropriated to 43 31 and from the grow Iowa fund. The recommendations 43 32 shall be based on whether the goals in accordance with 43 33 the performance measures are being achieved. 43 34 4. The members of the commission, including the 43 35 auditor of state, are entitled to receive 43 36 reimbursement for actual expenses incurred while 43 37 engaged in the performance of official duties. A 43 38 commission member may also be eligible to receive 43 39 compensation as provided in section 7E.6. 43 40 Sec. 82. NEW SECTION. 15G.105 GROW IOWA 43 41 GEOGRAPHIC REGIONS. 43 42 For purposes of applying the goals and performance 43 43 measurements, the state shall be divided into five 43 44 grow Iowa geographic regions. The regions shall be 43 45 the following: 43 46 1. The northwest region shall include the counties 43 47 of Lyon, Osceola, Dickinson, Emmet, Kossuth, 43 48 Winnebago, Sioux, O'Brien, Clay, Palo Alto, Hancock, 43 49 Plymouth, Cherokee, Buena Vista, Pocahontas, Humboldt, 43 50 Wright, Woodbury, Ida, Sac, Calhoun, Webster, and 44 1 Hamilton. 44 2 2. The northeast region shall include the counties 44 3 of Worth, Mitchell, Howard, Winneshiek, Allamakee, 44 4 Cerro Gordo, Floyd, Chickasaw, Fayette, Clayton, 44 5 Franklin, Butler, Bremer, Hardin, Grundy, Black Hawk, 44 6 Buchanan, Delaware, Dubuque, Tama, Benton, Linn, 44 7 Jones, and Jackson. 44 8 3. The southeast region shall include the counties 44 9 of Poweshiek, Iowa, Johnson, Cedar, Clinton, Scott, 44 10 Muscatine, Mahaska, Keokuk, Washington, Louisa, 44 11 Monroe, Wapello, Jefferson, Henry, Des Moines, 44 12 Appanoose, Davis, Van Buren, and Lee. 44 13 4. The southwest region shall include the counties 44 14 of Monona, Crawford, Carroll, Greene, Harrison, 44 15 Shelby, Audubon, Guthrie, Pottawattamie, Cass, Adair, 44 16 Mills, Montgomery, Adams, Union, Clarke, Lucas, 44 17 Fremont, Page, Taylor, Ringgold, Decatur, and Wayne. 44 18 5. The central region shall include the counties 44 19 of Boone, Story, Marshall, Dallas, Polk, Jasper, 44 20 Madison, Warren, and Marion. 44 21 Sec. 83. NEW SECTION. 15G.106 GOALS – 44 22 PERFORMANCE MEASURES. 44 23 1. In performing the duties provided in this 44 24 chapter, chapter 15, and chapter 15E, the grow Iowa 44 25 board, the grow Iowa investment board, the economic 44 26 development marketing board, the grow Iowa review 44 27 commission, and the department shall achieve the goals 44 28 of expanding and stimulating the state economy, 44 29 increasing the wealth of Iowans, and increasing the 44 30 population of the state. For purposes of this 44 31 section, "upper midwest region" includes the states of 44 32 Iowa, Kansas, Minnesota, Missouri, Nebraska, North 44 33 Dakota, and South Dakota. 44 34 2. Goal achievement shall be examined on a 44 35 regional basis using the grow Iowa geographic regions 44 36 and not on a statewide basis. The performance of the 44 37 grow Iowa geographic regions shall be compared to the 44 38 performance of the state, the upper midwest region, 44 39 and the United States. The baseline year shall be the 44 40 calendar year 2000. In each grow Iowa geographic 44 41 region, the goal shall be to increase the baseline 44 42 performance measures listed in subsections 3, 4, and 44 43 5, by thirty percent. 44 44 3. a. In determining whether the goal of 44 45 expanding and stimulating the state economy has been 44 46 met, the following performance measures shall be 44 47 considered: 44 48 (1) An increase in Iowa's gross domestic product. 44 49 (2) A net increase in business start-ups. 44 50 (3) A net increase in business expansion. 45 1 (4) A net increase in business modernization. 45 2 (5) A net increase in attracting new businesses to 45 3 the state. 45 4 (6) A net increase in business retention. 45 5 (7) A net increase in job creation and retention. 45 6 (8) A decrease in Iowa of the ratio of the 45 7 government wage earnings as a percentage share of the 45 8 earnings of private industry in Iowa at a rate at 45 9 least equal to the ratio of the upper midwest region. 45 10 b. By December 15 of each year, the department 45 11 shall submit a report to the grow Iowa review 45 12 commission and the grow Iowa board that identifies 45 13 information pertinent to the performance measures in 45 14 paragraph "a", subparagraphs (3), (4), and (6), that 45 15 the department gains through interviews with 45 16 businesses in the state that close all or a portion of 45 17 operations in the state. By December 15 of each year, 45 18 based on the same interviews, the department shall 45 19 submit a report to the general assembly providing 45 20 suggested amendments to the Code of Iowa and the Iowa 45 21 administrative code designed to stimulate and expand 45 22 the state's economy. 45 23 c. By December 15 of each year the department 45 24 shall submit a report to the grow Iowa review 45 25 commission and the grow Iowa board that identifies 45 26 lost sale reports information pertinent to the 45 27 performance measures in paragraph "a", subparagraphs 45 28 (2) and (5), which indicate that the state has not 45 29 been successful in the performance measures in 45 30 paragraph "a", subparagraphs (2) and (5). 45 31 d. For purposes of the performance measure in 45 32 paragraph "a", subparagraph (7), the department of 45 33 economic development, in consultation with the 45 34 department of workforce development and the auditor of 45 35 state, shall determine an average annual job creation 45 36 and retention rate based on the ten years prior to 45 37 2003. During the fiscal years beginning July 1, 2003, 45 38 July 1, 2004, and July 1, 2005, the department of 45 39 economic development shall report the job creation and 45 40 retention rate of those businesses that receive moneys 45 41 originating from the grow Iowa fund and the job 45 42 creation and retention rate of those businesses that 45 43 do not receive moneys originating from the grow Iowa 45 44 fund. The ten-year average annual job creation and 45 45 retention rate shall be compared to the job creation 45 46 and retention rates determined under this paragraph 45 47 for the fiscal years beginning July 1, 2003, July 1, 45 48 2004, and July 1, 2005. The department of economic 45 49 development shall assist the department of workforce 45 50 development in maintaining detailed employment 46 1 statistics on businesses that receive moneys 46 2 originating from the grow Iowa fund, on businesses 46 3 that do not receive moneys originating from the grow 46 4 Iowa fund, and on industries in Iowa that those 46 5 businesses represent. The auditor of state shall 46 6 audit the reliability and validity of the statistics 46 7 compiled pursuant to this paragraph. 46 8 4. In determining whether the goal of increasing 46 9 the wealth of Iowans has been met, the following 46 10 performance measures shall be considered: 46 11 a. The per capita personal income in Iowa shall 46 12 equal or exceed the average per capita personal income 46 13 for the upper midwest region. 46 14 b. The average earnings per job in Iowa shall 46 15 equal or exceed the average earnings per job in the 46 16 upper midwest region. 46 17 c. The average manufacturing earnings per employee 46 18 in Iowa shall equal or exceed the average 46 19 manufacturing earnings per employee in the upper 46 20 midwest region. 46 21 d. The average service earnings per employee in 46 22 Iowa shall equal or exceed the average service 46 23 earnings per employee in the upper midwest region. 46 24 e. The average earnings per employee in the 46 25 financial, insurance, and real estate industries in 46 26 Iowa shall equal or exceed the average earnings per 46 27 employee in the financial, insurance, and real estate 46 28 industries in the upper midwest region. 46 29 5. In determining whether the goal of increasing 46 30 the population of the state has been met, the 46 31 following performance measures shall be considered: 46 32 a. The net increase in new residents in the state 46 33 gained through attracting new businesses to the state. 46 34 b. The increase in the retention of high school 46 35 graduates and college graduates from private and 46 36 public colleges and universities in the state after 46 37 graduation. 46 38 c. The ability to retain fifty percent of all 46 39 undergraduate graduates of universities under the 46 40 control of the state board of regents in the state 46 41 after graduation. 46 42 d. The net population growth of Iowa equals or 46 43 exceeds the population growth in the upper midwest 46 44 region. 46 45 Sec. 84. NEW SECTION. 15G.107 GROW IOWA FUND. 46 46 A grow Iowa fund is created in the state treasury 46 47 under the control of the grow Iowa board consisting of 46 48 moneys appropriated to the grow Iowa board. Moneys in 46 49 the fund are not subject to section 8.33. 46 50 Notwithstanding section 12C.7, interest or earnings on 47 1 moneys in the fund shall be credited to the fund. The 47 2 fund shall be administered by the grow Iowa board, 47 3 which shall make expenditures from the fund consistent 47 4 with this chapter and pertinent Acts of the general 47 5 assembly. 47 6 Sec. 85. NEW SECTION. 15G.108 ECONOMIC 47 7 DEVELOPMENT MARKETING BOARD – MARKETING STRATEGIES. 47 8 1. a. An economic development marketing board is 47 9 established consisting of seven members and is located 47 10 for administrative purposes within the department. 47 11 The director of the department shall provide office 47 12 space, staff assistance, and necessary supplies and 47 13 equipment for the board. The director shall budget 47 14 moneys to pay the compensation and expenses of the 47 15 board. In performing its functions, the board is 47 16 performing a public function on behalf of the state 47 17 and is a public instrumentality of the state. 47 18 b. The membership of the board shall be as 47 19 follows: 47 20 (1) Three members with significant demonstrated 47 21 experience in marketing or advertising appointed by 47 22 the governor. 47 23 (2) Four members with significant demonstrated 47 24 experience in marketing or advertising appointed by 47 25 the legislative council. 47 26 c. The appointments made by the governor shall 47 27 comply with sections 69.16 and 69.16A and shall be 47 28 subject to confirmation by the senate. 47 29 d. The chairperson and vice chairperson of the 47 30 board shall be elected by and from the board members 47 31 listed in paragraph "b". In case of the absence or 47 32 disability of the chairperson and vice chairperson, 47 33 the members of the board shall elect a temporary 47 34 chairperson by a majority vote of those members who 47 35 are present and voting. 47 36 e. The members shall be appointed to three-year 47 37 staggered terms and the terms shall commence and end 47 38 as provided by section 69.19. If a vacancy occurs, a 47 39 successor shall be appointed to serve the unexpired 47 40 term. A successor shall be appointed in the same 47 41 manner and subject to the same qualifications as the 47 42 original appointment to serve the unexpired term. 47 43 f. A majority of the board constitutes a quorum. 47 44 2. The board shall administer and implement the 47 45 approval process for marketing strategies provided in 47 46 subsection 3. 47 47 3. The economic development marketing board shall 47 48 accept proposals for marketing strategies for purposes 47 49 of selecting a strategy for the department to 47 50 administer. The marketing strategies shall be 48 1 designed to market Iowa as a lifestyle, increase the 48 2 population of the state, increase the wealth of 48 3 Iowans, and expand and stimulate the state economy. 48 4 The economic development marketing board shall submit 48 5 a recommendation regarding the proposal to the grow 48 6 Iowa board. In selecting a marketing strategy for 48 7 recommendation, the economic development marketing 48 8 board shall base the selection on the goals and 48 9 performance measures provided in section 15G.106. The 48 10 grow Iowa board shall either approve or deny the 48 11 recommendation. 48 12 4. The department shall implement and administer 48 13 the marketing strategy approved by the grow Iowa board 48 14 as provided in subsection 3. The department shall 48 15 provide the economic development marketing board with 48 16 assistance in implementing administrative functions of 48 17 the board and provide technical assistance to the 48 18 board. 48 19 5. The members of the board are entitled to 48 20 receive reimbursement for actual expenses incurred 48 21 while engaged in the performance of official duties. 48 22 A board member may also be eligible to receive 48 23 compensation as provided in section 7E.6. 48 24 Sec. 86. NEW SECTION. 15G.109 FUTURE 48 25 CONSIDERATION. 48 26 Not later than February 1, 2007, the legislative 48 27 services agency shall prepare and deliver to the 48 28 secretary of the senate and the chief clerk of the 48 29 house of representatives identical bills that repeal 48 30 the provisions of this chapter. It is the intent of 48 31 this section that the general assembly shall bring the 48 32 bill to a vote in either the senate or the house of 48 33 representatives expeditiously. It is further the 48 34 intent of this chapter that if the bill is approved by 48 35 the first house in which it is considered, it shall 48 36 expeditiously be brought to a vote in the second 48 37 house. 48 38 DIVISION VII 48 39 VALUE-ADDED AGRICULTURAL PRODUCTS AND PROCESSES 48 40 FINANCIAL ASSISTANCE PROGRAM 48 41 Sec. 87. Section 15E.111, subsection 1, Code 2003, 48 42 is amended to read as follows: 48 43 1. a. The department shall establish a value- 48 44 added agricultural products and processes financial 48 45 assistance program. The department shall consult with 48 46the Iowa corn growers association and the Iowa soybean48 47associationIowa commodity groups. The purpose of the 48 48 program is to encourage the increased utilization of 48 49 agricultural commodities produced in this state. The 48 50 program shall assist in efforts to revitalize rural 49 1 regions of this state, by committing resources to 49 2 provide financial assistance to new or existing value- 49 3 added production facilities. The department of 49 4 economic development may consult with other state 49 5 agencies regarding any possible future environmental, 49 6 health, or safety issues linked to technology related 49 7 to the biotechnology industry. In awarding financial 49 8 assistance, the department shall prefer producer- 49 9 owned, value-added businesses and public and private 49 10 joint ventures involving an institution of higher 49 11 learning under the control of the state board of 49 12 regents or a private college or university acquiring 49 13 assets, research facilities, and leveraging moneys in 49 14 a manner that meets the goals of the grow Iowa fund 49 15 and shall commit resources to assist the following: 49 16a.(1) Facilities which are involved in the 49 17 development of new innovative products and processes 49 18 related to agriculture. The facility must do either 49 19 of the following: produce a good derived from an 49 20 agricultural commodity, if the good is not commonly 49 21 produced from an agricultural commodity; or use a 49 22 process to produce a good derived from an agricultural 49 23 process, if the process is not commonly used to 49 24 produce the good. 49 25b.(2) Renewable fuel production facilities. As 49 26 used in this section, "renewable fuel" means an energy 49 27 source which is derived from an organic compound 49 28 capable of powering machinery, including an engine or 49 29 power plant. 49 30 (3) Agricultural business facilities in the 49 31 agricultural biotechnology industry, agricultural 49 32 biomass industry, and alternative energy industry. 49 33 For purposes of this subsection: 49 34 (a) "Agricultural biomass industry" means 49 35 businesses that utilize agricultural commodity crops, 49 36 agricultural by-products, or animal feedstock in the 49 37 production of chemicals, protein products, or other 49 38 high-value products. 49 39 (b) "Agricultural biotechnology industry" means 49 40 businesses that utilize scientifically enhanced plants 49 41 or animals that can be raised by producers and used in 49 42 the production of high-value products. 49 43 (c) "Alternative energy industry" includes 49 44 businesses involved in the production of ethanol, 49 45 including gasoline with a mixture of seventy percent 49 46 or more ethanol, biodiesel, biomass, hydrogen, or in 49 47 the production of wind energy. 49 48 (4) Facilities that add value to Iowa agricultural 49 49 commodities through further processing and development 49 50 of organic products and emerging markets. 50 1 (5) Producer-owned, value-added businesses, 50 2 education of producers and management boards in value- 50 3 added businesses, and other activities that would 50 4 support the infrastructure in the development of 50 5 value-added agriculture. Public and private joint 50 6 ventures involving an institution of higher learning 50 7 under the control of the state board of regents or a 50 8 private college or university to acquire assets, 50 9 research facilities, and leverage moneys in a manner 50 10 that meets the goals of the grow Iowa fund. For 50 11 purposes of this subsection, "producer-owned, valued- 50 12 added business" means a person who holds an equity 50 13 interest in the agricultural business and is 50 14 personally involved in the production of crops or 50 15 livestock on a regular, continuous, and substantial 50 16 basis. 50 17 b. Financial assistance awarded under this section 50 18 may be in the form of a loan, loan guarantee, grant, 50 19 production incentive payment, or a combination of 50 20 financial assistance. The department shall not award 50 21 more than twenty-five percent of the amount allocated 50 22 to the value-added agricultural products and processes 50 23 financial assistance fund during any fiscal year to 50 24 support a single person. The department may finance 50 25 any size of facility. However, the departmentshall50 26 may reserve up to fifty percent of the total amount 50 27 allocated to the fund, for purposes of assisting 50 28 persons requiringonefive hundred thousand dollars or 50 29 less in financial assistance. The amount shall be 50 30 reserved until the end of the third quarter of the 50 31 fiscal year. The department shall not provide 50 32 financial assistance to support a value-added 50 33 production facility if the facility or a person owning 50 34 a controlling interest in the facility has 50 35 demonstrated a continuous and flagrant disregard for 50 36 the health and safety of its employees or the quality 50 37 of the environment. Evidence of such disregard shall 50 38 include a history of serious or uncorrected violations 50 39 of state or federal law protecting occupational health 50 40 and safety or the environment, including but not 50 41 limited to serious or uncorrected violations of 50 42 occupational safety and health standards enforced by 50 43 the division of labor services of the department of 50 44 workforce development pursuant to chapter 84A, or 50 45 rules enforced by the department of natural resources 50 46 pursuant to chapter 455B or 459, subchapters II and 50 47 III. 50 48 DIVISION VIII 50 49 ENDOW IOWA GRANTS 50 50 Sec. 88. NEW SECTION. 15E.301 SHORT TITLE. 51 1 This division shall be known as and may be cited as 51 2 the "Endow Iowa Program Act". 51 3 Sec. 89. NEW SECTION. 15E.302 PURPOSE. 51 4 The purpose of this division is to enhance the 51 5 quality of life for citizens of this state through 51 6 increased philanthropic activity by providing capital 51 7 to new and existing citizen groups of this state 51 8 organized to establish endowment funds that will 51 9 address community needs. The purpose of this division 51 10 is also to encourage individuals, businesses, and 51 11 organizations to invest in community foundations. 51 12 Sec. 90. NEW SECTION. 15E.303 DEFINITIONS. 51 13 As used in this division, unless the context 51 14 otherwise requires: 51 15 1. "Board" means the governing board of the lead 51 16 philanthropic entity identified by the department 51 17 pursuant to section 15E.304. 51 18 2. "Business" means a business operating within 51 19 the state and includes individuals operating a sole 51 20 proprietorship or having rental, royalty, or farm 51 21 income in this state and includes a consortium of 51 22 businesses. 51 23 3. "Community affiliate organization" means a 51 24 group of five or more community leaders or advocates 51 25 organized for the purpose of increasing philanthropic 51 26 activity in an identified community or geographic area 51 27 in this state with the intention of establishing a 51 28 community affiliate endowment fund. 51 29 4. "Endowment gift" means an irrevocable 51 30 contribution to a permanent endowment held by a 51 31 qualified community foundation. 51 32 5. "Lead philanthropic entity" means the entity 51 33 identified by the department pursuant to section 51 34 15E.304. 51 35 6. "Qualified community foundation" means a 51 36 community foundation organized or operating in this 51 37 state that meets or exceeds the national standards 51 38 established by the national council on foundations. 51 39 Sec. 91. NEW SECTION. 15E.304 ENDOW IOWA GRANTS. 51 40 1. The department shall identify a lead 51 41 philanthropic entity for purposes of encouraging the 51 42 development of qualified community foundations in this 51 43 state. A lead philanthropic entity shall meet all of 51 44 the following qualifications: 51 45 a. The entity shall be a nonprofit entity which is 51 46 exempt from federal income taxation pursuant to 51 47 section 501(c)(3) of the Internal Revenue Code. 51 48 b. The entity shall be a statewide organization 51 49 with membership consisting of organizations, such as 51 50 community, corporate, and private foundations, whose 52 1 principal function is the making of grants within the 52 2 state of Iowa. 52 3 c. The entity shall have a minimum of forty 52 4 members and that membership shall include qualified 52 5 community foundations. 52 6 2. A lead philanthropic entity may receive a grant 52 7 from the department. The board shall use the grant 52 8 moneys to award endow Iowa grants to new and existing 52 9 qualified community foundations and to community 52 10 affiliate organizations that do all of the following: 52 11 a. Provide the board with all information required 52 12 by the board. 52 13 b. Demonstrate a dollar-for-dollar funding match 52 14 in a form approved by the board. 52 15 c. Identify a qualified community foundation to 52 16 hold all funds. A qualified community foundation 52 17 shall not be required to meet this requirement. 52 18 d. Provide a plan to the board demonstrating the 52 19 method for distributing grant moneys received from the 52 20 board to organizations within the community or 52 21 geographic area as defined by the qualified community 52 22 foundation or the community affiliate organization. 52 23 3. Endow Iowa grants awarded to new and existing 52 24 qualified community foundations and to community 52 25 affiliate organizations shall not exceed twenty-five 52 26 thousand dollars per foundation or organization unless 52 27 a foundation or organization demonstrates a multiple 52 28 county or regional approach. Endow Iowa grants may be 52 29 awarded on an annual basis with not more than three 52 30 grants going to one county in a fiscal year. 52 31 4. In ranking applications for grants, the board 52 32 shall consider a variety of factors including the 52 33 following: 52 34 a. The demonstrated need for financial assistance. 52 35 b. The potential for future philanthropic activity 52 36 in the area represented by or being considered for 52 37 assistance. 52 38 c. The proportion of the funding match being 52 39 provided. 52 40 d. For community affiliate organizations, the 52 41 demonstrated need for the creation of a community 52 42 affiliate endowment fund in the applicant's geographic 52 43 area. 52 44 e. The identification of community needs and the 52 45 manner in which additional funding will address those 52 46 needs. 52 47 f. The geographic diversity of awards. 52 48 5. Of any moneys received by a lead philanthropic 52 49 entity from the state, not more than five percent of 52 50 such moneys shall be used by the entity for 53 1 administrative purposes. 53 2 Sec. 92. NEW SECTION. 15E.306 REPORTS – AUDITS. 53 3 By January 31 of each year, the lead philanthropic 53 4 entity, in cooperation with the department, shall 53 5 publish an annual report of the activities conducted 53 6 pursuant to this division during the previous calendar 53 7 year and shall submit the report to the governor and 53 8 the general assembly. The annual report shall include 53 9 a listing of endowment funds and the amount of tax 53 10 credits authorized by the department. 53 11 Sec. 93. EFFECTIVE AND RETROACTIVE APPLICABILITY 53 12 DATES. This division of this Act, being deemed of 53 13 immediate importance, takes effect upon enactment and 53 14 is retroactively applicable to January 1, 2003, for 53 15 tax years beginning on or after that date. 53 16 DIVISION IX 53 17 TECHNOLOGY TRANSFER ADVISORS 53 18 Sec. 94. NEW SECTION. 7.23 TECHNOLOGY TRANSFER 53 19 ADVISOR. 53 20 Two technology transfer advisors shall be appointed 53 21 by the governor, serve at the pleasure of the 53 22 governor, and be located at offices at the university 53 23 of Iowa and Iowa state university of science and 53 24 technology. A technology transfer advisor is not a 53 25 state agency and is not subject to chapter 17A. A 53 26 technology transfer advisor shall do all of the 53 27 following: 53 28 1. Facilitate the transfer of technology developed 53 29 at the university of Iowa, the university of northern 53 30 Iowa, Iowa state university of science and technology, 53 31 community colleges, and private colleges and 53 32 universities. 53 33 2. Coordinate the technology transfer activities 53 34 at each of the public and private universities to 53 35 encourage the implementation of best practices in 53 36 technology transfer, establish measures of 53 37 performance, and design programs of continuous quality 53 38 improvement for each technology transfer office. 53 39 3. Establish technology transfer goals for the 53 40 state. 53 41 4. Provide technical assistance to Iowa-based 53 42 entrepreneurs associated with or unrelated to the 53 43 universities under the control of the state board of 53 44 regents regarding technology transfer-related issues. 53 45 The technical assistance shall include assistance in 53 46 the areas of patents and licensing, business 53 47 development and management, finance, production, 53 48 sales, and marketing. 53 49 5. Receive the technology transfer-related report 53 50 submitted by the state board of regents pursuant to 54 1 section 262.9, subsection 31. 54 2 6. To ensure economic growth, serve as a 54 3 coordinator between Iowa-based businesses and 54 4 businesses intending to locate in Iowa. 54 5 Sec. 95. Section 15.108, Code 2003, is amended by 54 6 adding the following new subsection: 54 7 NEW SUBSECTION. 12. TECHNOLOGY TRANSFER ADVISORS. 54 8 The department shall cooperate with and provide 54 9 staffing support to the technology transfer advisors 54 10 appointed pursuant to section 7.23. 54 11 Sec. 96. Section 262.9, Code 2003, is amended by 54 12 adding the following new subsections: 54 13 NEW SUBSECTION. 29. Actively encourage and 54 14 promote the transfer of technology and research at 54 15 universities under the control of the board to 54 16 commercial application, including the start-up of 54 17 business entities. 54 18 NEW SUBSECTION. 30. Give preference and technical 54 19 support to those faculty members and staff members 54 20 desiring to obtain licenses for intellectual property 54 21 rights created in whole or in part by the faculty 54 22 member or staff member. However, such preference 54 23 shall not be construed to be a right accruing to that 54 24 faculty member or staff member. 54 25 NEW SUBSECTION. 31. By January 15 of each year, 54 26 submit a report to the governor, through the 54 27 technology transfer advisors, and the general assembly 54 28 containing information from the previous calendar year 54 29 regarding all of the following: 54 30 a. Patents secured or applied for by each 54 31 university under the control of the board delineated 54 32 by university and by faculty member and staff member 54 33 responsible for the research or activity that resulted 54 34 in the patent. In the initial report filed by January 54 35 15, 2004, the board shall include an inventory of 54 36 patent portfolios with details concerning which 54 37 patents are creating financial benefit and the amount 54 38 of financial benefit and which patents are not 54 39 creating financial benefit and the amount invested in 54 40 those patents. 54 41 b. Research grants secured by each university 54 42 under the control of the board from both public and 54 43 private sources delineated by university and by 54 44 faculty member and staff member. The board shall also 54 45 include the same information for grant applications 54 46 that are denied. 54 47 c. The number of faculty members and staff members 54 48 at each university under the control of the board 54 49 involved in a start-up company. 54 50 d. The number of grant applications for research 55 1 received by each university under the control of the 55 2 board for start-up companies, the number of 55 3 applications approved, and the number of applications 55 4 denied. 55 5 e. The number of agreements entered into by 55 6 faculty members and staff members at each university 55 7 under the control of the board with foundations 55 8 affiliated with the universities relating to business 55 9 start-ups. 55 10 f. An accounting of the financial gain received by 55 11 each university under the control of the board 55 12 relating to patents sold, royalties received, 55 13 licensing fees, and any other remuneration received by 55 14 the university related to technology transfer. 55 15 g. The number of professional employees at each 55 16 university under the control of the board who assist 55 17 in the transfer of technology and research to 55 18 commercial application. 55 19 DIVISION X 55 20 IOWA ECONOMIC DEVELOPMENT 55 21 LOAN AND CREDIT GUARANTEE FUND 55 22 Sec. 97. NEW SECTION. 15E.221 SHORT TITLE. 55 23 This division shall be known and may be cited as 55 24 the "Iowa Economic Development Loan and Credit 55 25 Guarantee Fund Act". 55 26 Sec. 98. NEW SECTION. 15E.222 LEGISLATIVE 55 27 FINDING – PURPOSES. 55 28 1. The general assembly finds all of the 55 29 following: 55 30 a. That small and medium-sized businesses, in 55 31 general, and certain targeted industry businesses and 55 32 other qualified businesses, in particular, may not 55 33 qualify for conventional financing. 55 34 b. That the limited availability of credit for 55 35 export transactions limits the ability of small and 55 36 medium-sized businesses in this state to compete in 55 37 international markets. 55 38 c. That, to enhance competitiveness and foster 55 39 economic development, this state must focus on growth 55 40 in certain specific targeted industry businesses and 55 41 other qualified businesses, especially during a time 55 42 of war. 55 43 d. That the challenge for the public economic 55 44 sector is to create an atmosphere conducive to 55 45 economic growth, in conjunction with financial 55 46 institutions in the private sector, which fill the 55 47 gaps in credit availability and export finance, and 55 48 that allow the private sector to identify the lending 55 49 opportunities and foster decision making at the local 55 50 level. 56 1 2. The general assembly declares the purposes of 56 2 this division to be all of the following: 56 3 a. To create incentives and assistance to increase 56 4 the flow of private capital to targeted industry 56 5 businesses and other qualified businesses. 56 6 b. To promote industrial modernization and 56 7 technology adoption. 56 8 c. To encourage the retention and creation of 56 9 jobs. 56 10 d. To encourage the export of goods and services 56 11 sold by Iowa businesses in national and international 56 12 markets. 56 13 Sec. 99. NEW SECTION. 15E.223 DEFINITIONS. 56 14 As used in this division, unless the context 56 15 otherwise requires: 56 16 1. "Financial institution" means an institution 56 17 listed in section 422.61, subsection 1, or such other 56 18 financial institution as defined by the department for 56 19 purposes of this division. 56 20 2. "Program" means the loan and credit guarantee 56 21 program established in this division. 56 22 3. "Qualified business" means an existing or 56 23 proposed business entity with an annual average number 56 24 of employees not exceeding two hundred employees. 56 25 "Qualified business" does not include businesses 56 26 engaged primarily in retail sales, real estate, or the 56 27 provision of health care or other professional 56 28 services. "Qualified business" includes professional 56 29 services businesses that provide services to targeted 56 30 industry businesses or other entities within and 56 31 outside of this state. 56 32 4. "Targeted industry business" means an existing 56 33 or proposed business entity, including an emerging 56 34 small business or qualified business which is operated 56 35 for profit and which has a primary business purpose of 56 36 doing business in at least one of the targeted 56 37 industries designated by the department which include 56 38 life sciences, software and information technology, 56 39 advanced manufacturing, value-added agriculture, and 56 40 any other industry designated as a targeted industry 56 41 by the loan and credit guarantee advisory board. 56 42 Sec. 100. NEW SECTION. 15E.224 LOAN AND CREDIT 56 43 GUARANTEE PROGRAM. 56 44 1. The department shall, with the advice of the 56 45 loan and credit guarantee advisory board, establish 56 46 and administer a loan and credit guarantee program. 56 47 The department, pursuant to agreements with financial 56 48 institutions, shall provide loan and credit 56 49 guarantees, or other forms of credit guarantees for 56 50 qualified businesses and targeted industry businesses 57 1 for eligible project costs. A loan or credit 57 2 guarantee provided under the program may stand alone 57 3 or may be used in conjunction with or to enhance other 57 4 loans or credit guarantees, offered by private, state, 57 5 or federal entities. However, the department shall 57 6 not in any manner directly or indirectly pledge the 57 7 credit of the state. Eligible project costs include 57 8 expenditures for productive equipment and machinery, 57 9 working capital for operations and export 57 10 transactions, research and development, marketing, and 57 11 such other costs as the department may so designate. 57 12 2. A loan or credit guarantee or other form of 57 13 credit guarantee provided under the program to a 57 14 participating financial institution for a single 57 15 qualified business or targeted industry business shall 57 16 not exceed one million dollars in value. Loan or 57 17 credit guarantees or other forms of credit guarantees 57 18 provided under the program to more than one 57 19 participating financial institution for a single 57 20 qualified business or targeted industry business shall 57 21 not exceed ten million dollars in value. 57 22 3. In administering the program, the department 57 23 shall consult and cooperate with financial 57 24 institutions in this state and with the loan and 57 25 credit guarantee advisory board. Administrative 57 26 procedures and application procedures, as practicable, 57 27 shall be responsive to the needs of qualified 57 28 businesses, targeted industry businesses, and 57 29 financial institutions, and shall be consistent with 57 30 prudent investment and lending practices and criteria. 57 31 4. Each participating financial institution shall 57 32 identify and underwrite potential lending 57 33 opportunities with qualified businesses and targeted 57 34 industry businesses. Upon a determination by a 57 35 participating financial institution that a qualified 57 36 business or targeted industry business meets the 57 37 underwriting standards of the financial institution, 57 38 subject to the approval of a loan or credit guarantee, 57 39 the financial institution shall submit the 57 40 underwriting information and a loan or credit 57 41 guarantee application to the department. 57 42 5. The department, with the advice of the loan and 57 43 credit guarantee advisory board, shall adopt a loan or 57 44 credit guarantee application procedure for a financial 57 45 institution on behalf of a qualified business or 57 46 targeted industry business. 57 47 6. Upon approval of a loan or credit guarantee, 57 48 the department shall enter into a loan or credit 57 49 guarantee agreement with the participating financial 57 50 institution. The agreement shall specify all of the 58 1 following: 58 2 a. The fee to be charged to the financial 58 3 institution. 58 4 b. The evidence of debt assurance of, and security 58 5 for, the loan or credit guarantee. 58 6 c. A loan or credit guarantee that does not exceed 58 7 fifteen years. 58 8 d. Any other terms and conditions considered 58 9 necessary or desirable by the department. 58 10 7. The department, with the advice of the loan and 58 11 credit guarantee advisory board, may adopt loan and 58 12 credit guarantee application procedures that allow a 58 13 qualified business or targeted industry business to 58 14 apply directly to the department for a preliminary 58 15 guarantee commitment. A preliminary guarantee 58 16 commitment may be issued by the department subject to 58 17 the qualified business or targeted industry business 58 18 securing a commitment for financing from a financial 58 19 institution. The application procedures shall specify 58 20 the process by which a financial institution may 58 21 obtain a final loan and credit guarantee. 58 22 Sec. 101. NEW SECTION. 15E.225 TERMS – FEES. 58 23 1. When entering into a loan or credit guarantee 58 24 agreement, the department, with the advice of the loan 58 25 and credit guarantee advisory board, shall establish 58 26 fees and other terms for participation in the program 58 27 by qualified businesses and targeted industry 58 28 businesses. 58 29 2. The department, with due regard for the 58 30 possibility of losses and administrative costs and 58 31 with the advice of the loan and credit guarantee 58 32 advisory board, shall set fees and other terms at 58 33 levels sufficient to assure that the program is self- 58 34 financing. 58 35 3. For a preliminary guarantee commitment, the 58 36 department may charge a qualified business or targeted 58 37 industry business a preliminary guarantee commitment 58 38 fee. The application fee shall be in addition to any 58 39 other fees charged by the department under this 58 40 section and shall not exceed one thousand dollars for 58 41 an application. 58 42 Sec. 102. NEW SECTION. 15E.226 LOAN AND CREDIT 58 43 GUARANTEE ADVISORY BOARD. 58 44 The department, in consultation with the 58 45 superintendent of banking, shall establish a loan and 58 46 credit guarantee advisory board. The advisory board 58 47 shall provide the department with technical advice 58 48 regarding the administration of the program, including 58 49 the adoption of administrative rules pursuant to 58 50 chapter 17A. The advisory board shall review and 59 1 provide recommendations regarding all applications 59 2 under the program. Members of the advisory board are 59 3 entitled to receive reimbursement for actual expenses 59 4 incurred while engaged in the performance of official 59 5 duties. Advisory board members may also be eligible 59 6 to receive compensation as provided in section 7E.6. 59 7 The director of the department shall budget moneys to 59 8 pay the compensation and expenses of the advisory 59 9 board. The provisions of this section relating to the 59 10 adoption of administrative rules shall be construed 59 11 narrowly. 59 12 DIVISION XI 59 13 ECONOMIC DEVELOPMENT ASSISTANCE AND DATA COLLECTION 59 14 Sec. 103. NEW SECTION. 15E.118 BUSINESS START-UP 59 15 INFORMATION – INTERNET WEB SITE. 59 16 The department shall provide information through an 59 17 internet web site and a toll-free telephone service to 59 18 assist persons interested in establishing a commercial 59 19 facility or engaging in a commercial activity. The 59 20 information shall include all of the following: 59 21 1. Assistance, information, and guidance for 59 22 start-up businesses. 59 23 2. Information gathered by the department pursuant 59 24 to section 15E.17, subsection 2. 59 25 3. Personal and corporate income tax information. 59 26 4. Information regarding financial assistance and 59 27 incentives available to businesses. 59 28 5. Workforce availability in the state presented 59 29 in a regional format. 59 30 Sec. 104. NEW SECTION. 15E.119 ECONOMIC 59 31 DEVELOPMENT-RELATED DATA COLLECTION. 59 32 1. The department shall interview any business 59 33 that considered locating in Iowa but decided to locate 59 34 elsewhere. The department shall attempt to determine 59 35 factors that affected the location decision of the 59 36 business. 59 37 2. The department shall interview any business 59 38 that closes major operations in the state or dissolves 59 39 the business's corporate status in an effort to 59 40 identify factors that led to the closure or 59 41 dissolution. 59 42 3. By January 15 of each year, the department 59 43 shall submit a written report to the general assembly 59 44 that summarizes the information collected pursuant to 59 45 this section and provides suggested amendments to the 59 46 Code of Iowa and the Iowa administrative code designed 59 47 to stimulate and expand the state's economy. 59 48 Sec. 105. INTERNET WEB SITE DEVELOPMENT. In 59 49 developing the internet web site required in section 59 50 15E.118, the department of economic development shall 60 1 examine similar efforts in other states and 60 2 incorporate the best practices. 60 3 DIVISION XII 60 4 CULTURAL AND ENTERTAINMENT DISTRICTS 60 5 Sec. 106. NEW SECTION. 303.3B CULTURAL AND 60 6 ENTERTAINMENT DISTRICTS. 60 7 1. The department of cultural affairs shall 60 8 establish and administer a cultural and entertainment 60 9 district certification program. The program shall 60 10 encourage the growth of communities through the 60 11 development of areas within a city or county for 60 12 public and private uses related to cultural and 60 13 entertainment purposes. 60 14 2. A city or county may create and designate a 60 15 cultural and entertainment district subject to 60 16 certification by the department of cultural affairs, 60 17 in consultation with the department of economic 60 18 development. A cultural and entertainment district 60 19 shall consist of a geographic area not exceeding one 60 20 square mile in size. A cultural and entertainment 60 21 district certification shall remain in effect for ten 60 22 years following the date of certification. Two or 60 23 more cities or counties may apply jointly for 60 24 certification of a district that extends across a 60 25 common boundary. Through the adoption of 60 26 administrative rules, the department of cultural 60 27 affairs shall develop a certification application for 60 28 use in the certification process. The provisions of 60 29 this subsection relating to the adoption of 60 30 administrative rules shall be construed narrowly. 60 31 3. The department of cultural affairs shall 60 32 encourage development projects and activities located 60 33 in certified cultural and entertainment districts 60 34 through incentives under cultural grant programs 60 35 pursuant to section 303.3, chapter 303A, and any other 60 36 grant programs. 60 37 DIVISION XIII 60 38 WORKFORCE ISSUES 60 39 Sec. 107. NEW SECTION. 15A.10 JOB RETENTION – 60 40 INCENTIVES. 60 41 1. In order to assure the retention of existing 60 42 jobs that would otherwise be lost, the director of the 60 43 department of economic development may authorize 60 44 incentives and assistance provided to a business under 60 45 this section for a period not to exceed ten years upon 60 46 finding the following: 60 47 a. The business currently employing, at one place 60 48 of business, at least one thousand employees is likely 60 49 to close or substantially reduce employment. 60 50 b. The business agrees to remain in the state for 61 1 at least ten years and invest at least fifteen million 61 2 dollars to retool or upgrade facilities. 61 3 2. Incentives and assistance that may be 61 4 authorized by the director include any of the 61 5 following: 61 6 a. New jobs credit from withholding, as provided 61 7 in section 15.331. 61 8 b. Sales, services, and use tax refund, as 61 9 provided in section 15.331A. 61 10 c. Investment tax credit, as provided in section 61 11 15.333. 61 12 d. Research activities tax credit, as provided in 61 13 section 15.335. 61 14 3. A business shall enter into an agreement with 61 15 the department and the city or county specifying the 61 16 terms and conditions that must be met in exchange for 61 17 the incentives and assistance authorized in this 61 18 section. The agreement shall specify how the 61 19 incentives will be repaid in the event the business 61 20 fails to meet or maintain the terms and conditions of 61 21 the agreement. 61 22 DIVISION XIV 61 23 UNIVERSITY-BASED RESEARCH UTILIZATION PROGRAM 61 24 Sec. 108. NEW SECTION. 262B.11 UNIVERSITY-BASED 61 25 RESEARCH UTILIZATION PROGRAM. 61 26 1. The department of economic development shall 61 27 establish and administer a university-based research 61 28 utilization program for purposes of encouraging the 61 29 utilization of university-based research, primarily in 61 30 the area of high technology, in new or existing 61 31 businesses. The program shall include the three 61 32 universities under the control of the state board of 61 33 regents and all accredited private universities 61 34 located in the state. 61 35 2. A new or existing business that utilizes a 61 36 technology developed by an employee at a university 61 37 under the control of the state board of regents may 61 38 apply to the department of economic development for 61 39 approval to participate in the university-based 61 40 research utilization program. The department shall 61 41 approve an applicant if the applicant meets all of the 61 42 following criteria: 61 43 a. The applicant utilizes a technology developed 61 44 by an employee at a university under the control of 61 45 the state board of regents, provided that the 61 46 technology has received a patent after the effective 61 47 date of this Act. If the applicant has been in 61 48 existence more than one year prior to applying, the 61 49 applicant shall organize a separate company to utilize 61 50 the technology. For purposes of this section, the 62 1 separate company shall be considered the applicant 62 2 and, if approved, the approved business. 62 3 b. The applicant develops a five-year business 62 4 plan approved by the department. The plan shall 62 5 include information concerning the applicant's Iowa 62 6 employment goals and projected impact on the Iowa 62 7 economy. The department shall only approve plans 62 8 showing sufficient potential impact on Iowa employment 62 9 and economic development. 62 10 c. The applicant meets a minimum-size business 62 11 standard determined by the department. 62 12 d. The applicant provides annual reports to the 62 13 department that include employment statistics for the 62 14 applicant and the total taxable wages paid to Iowa 62 15 employees and reported to the department of revenue 62 16 and finance pursuant to section 422.16. 62 17 3. A business approved under the program and the 62 18 university employee responsible for the development of 62 19 the technology utilized by the approved business shall 62 20 be eligible for a tax credit. The credit shall be 62 21 allowed against the taxes imposed in chapter 422, 62 22 divisions II and III. An individual may claim a tax 62 23 credit under this section of a partnership, limited 62 24 liability company, S corporation, estate, or trust 62 25 electing to have income taxed directly to the 62 26 individual. The amount claimed by the individual 62 27 shall be based upon the pro rata share of the 62 28 individual's earnings from the partnership, limited 62 29 liability company, S corporation, estate, or trust. A 62 30 tax credit shall not be claimed under this subsection 62 31 unless a tax credit certificate issued by the 62 32 department of economic development is attached to the 62 33 taxpayer's tax return for the tax year for which the 62 34 tax credit is claimed. The amount of a tax credit 62 35 allowed under this subsection shall equal the amount 62 36 listed on a tax credit certificate issued by the 62 37 department of economic development pursuant to 62 38 subsection 4. A tax credit certificate shall not be 62 39 transferable. Any tax credit in excess of the 62 40 taxpayer's liability for the tax year may be credited 62 41 to the taxpayer's tax liability for the following five 62 42 years or until depleted, whichever occurs first. A 62 43 tax credit shall not be carried back to a tax year 62 44 prior to the tax year in which the taxpayer redeems 62 45 the tax credit. 62 46 4. For the five tax years following the tax year 62 47 in which a business is approved under the program, the 62 48 department of revenue and finance shall provide the 62 49 department of economic development with information 62 50 required by the department of economic development 63 1 from each tax return filed by the approved business. 63 2 Upon receiving the tax return-related information, the 63 3 department of economic development shall do all of the 63 4 following: 63 5 a. Review the information provided by the 63 6 department of revenue and finance pursuant to this 63 7 subsection and the annual report submitted by the 63 8 applicant pursuant to subsection 2, paragraph "d". If 63 9 the department determines that the business activities 63 10 of the applicant are not providing the benefits to 63 11 Iowa employment and economic development projected in 63 12 the applicant's approved five-year business plan, the 63 13 department shall not issue tax credit certificates for 63 14 that year to the applicant or university employee and 63 15 shall determine any related university share to be 63 16 equal to zero for that year. 63 17 b. Effective for the fiscal year beginning July 1, 63 18 2004, and for subsequent fiscal years, issue a tax 63 19 credit certificate to the approved business and the 63 20 university employee responsible for the development of 63 21 the technology utilized by the approved business in an 63 22 amount determined pursuant to subsection 5. A tax 63 23 credit certificate shall contain the taxpayer's name, 63 24 address, tax identification number, the amount of the 63 25 tax credit, and other information required by the 63 26 department of revenue and finance. 63 27 c. (1) Determine the university share which is 63 28 equal to the value of thirty percent of the tax 63 29 liability of the approved business for purposes of 63 30 making an appropriation pursuant to section 262B.12, 63 31 if enacted by 2003 Iowa Acts, House File 683 or 63 32 another Act, to the university where the technology 63 33 utilized by the approved business was developed. A 63 34 university share shall not exceed two hundred twenty- 63 35 five thousand dollars per year per technology 63 36 utilized. For each technology utilized, the aggregate 63 37 university share over a five-year period shall not 63 38 exceed six hundred thousand dollars. 63 39 (2) The department shall maintain records for each 63 40 university during each fiscal year regarding the 63 41 university share each university is entitled to 63 42 receive through the appropriation in section 262B.12, 63 43 if enacted by 2003 Iowa Acts, House File 683 or 63 44 another Act. A university shall be entitled to 63 45 receive the total university share for that particular 63 46 university during the previous fiscal year. 63 47 d. For the fiscal year beginning July 1, 2004, not 63 48 more than two million dollars worth of certificates 63 49 shall be issued pursuant to paragraph "b". For the 63 50 fiscal year beginning July 1, 2005, and every fiscal 64 1 year thereafter, not more than ten million dollars 64 2 worth of certificates shall be issued pursuant to 64 3 paragraph "b". 64 4 5. The tax credit certificates issued by the 64 5 department for each of the five years following the 64 6 tax year in which the business is approved under the 64 7 program shall be for the following amounts: 64 8 a. For the approved business, the value of the tax 64 9 credit certificate shall equal thirty percent of the 64 10 tax liability of the approved business. The value of 64 11 a certificate issued to an approved business shall not 64 12 exceed two hundred twenty-five thousand dollars. The 64 13 total aggregate value of certificates issued over a 64 14 five-year period to an approved business shall not 64 15 exceed six hundred thousand dollars. 64 16 b. For the university employee responsible for the 64 17 development of the technology utilized by the approved 64 18 business, the value of the tax credit certificate 64 19 shall equal ten percent of the tax liability of the 64 20 approved business. If more than one employee is 64 21 responsible for the development of the technology, the 64 22 value equal to ten percent of the tax liability of the 64 23 approved business shall be divided equally and 64 24 individual tax credit certificates shall be issued to 64 25 each employee responsible for the development of the 64 26 technology. Each year, the total value of a 64 27 certificate or certificates issued for a utilized 64 28 technology shall not exceed seventy-five thousand 64 29 dollars. For each technology utilized, the total 64 30 aggregate value of certificates issued over a five- 64 31 year period to the university employee responsible for 64 32 the development of the technology shall not exceed two 64 33 hundred thousand dollars. 64 34 6. The department of economic development shall 64 35 notify the department of revenue and finance when a 64 36 tax credit certificate is issued pursuant to 64 37 subsection 4. The notification shall include the name 64 38 and tax identification number appearing on any tax 64 39 credit certificate. 64 40 Sec. 109. NEW SECTION. 422.11H UNIVERSITY-BASED 64 41 RESEARCH UTILIZATION PROGRAM TAX CREDIT. 64 42 The taxes imposed under this division, less the 64 43 credits allowed under sections 422.12 and 422.12B, 64 44 shall be reduced by a university-based research 64 45 utilization program tax credit authorized pursuant to 64 46 section 262B.11. 64 47 Sec. 110. Section 422.33, Code 2003, is amended by 64 48 adding the following new subsection: 64 49 NEW SUBSECTION. 14. The taxes imposed under this 64 50 division shall be reduced by a university-based 65 1 research utilization program tax credit authorized 65 2 pursuant to section 262B.11. 65 3 DIVISION XV 65 4 FUTURE REPEAL 65 5 Sec. 111. The divisions of this Act designated the 65 6 grow Iowa board and fund, the value-added agricultural 65 7 products and processes financial assistance program, 65 8 the endow Iowa grants, the technology transfer 65 9 advisors, the Iowa economic development loan and 65 10 credit guarantee fund, the economic development 65 11 assistance and data collection, the cultural and 65 12 entertainment districts, the workforce issues, and the 65 13 university-based research utilization program, are 65 14 repealed effective June 30, 2010. 65 15 DIVISION XVI 65 16 LIABILITY REFORM 65 17 Sec. 112. Section 668.12, Code 2003, is amended to 65 18 read as follows: 65 19 668.12 LIABILITY FOR PRODUCTS –STATE OF THE ART65 20DEFENSEDEFENSES. 65 21 1. In any action brought pursuant to this chapter 65 22 against an assembler, designer, supplier of 65 23 specifications, distributor, manufacturer, or seller 65 24 for damages arising from an alleged defect in the 65 25 design, testing, manufacturing, formulation, 65 26 packaging, warning, or labeling of a product, a 65 27 percentage of fault shall not be assigned to such 65 28 persons if they plead and prove that the product 65 29 conformed to the state of the art in existence at the 65 30 time the product was designed, tested, manufactured, 65 31 formulated, packaged, provided with a warning, or 65 32 labeled. 65 33 2. Nothing contained inthis sectionsubsection 1 65 34 shall diminish the duty of an assembler, designer, 65 35 supplier of specifications, distributor, manufacturer 65 36 or seller to warn concerning subsequently acquired 65 37 knowledge of a defect or dangerous condition that 65 38 would render the product unreasonably dangerous for 65 39 its foreseeable use or diminish the liability for 65 40 failure to so warn. 65 41 3. An assembler, designer, supplier of 65 42 specifications, distributor, manufacturer, or seller 65 43 shall not be subject to liability under a theory of 65 44 civil conspiracy unless the person knowingly and 65 45 voluntarily entered into an agreement, express or 65 46 implied, to participate in a common plan with the 65 47 intent to commit a tortious act upon another. Mere 65 48 membership in a trade or industrial association or 65 49 group is not, in and of itself, evidence of such an 65 50 agreement. 66 1 Sec. 113. Section 668A.1, subsection 1, Code 2003, 66 2 is amended to read as follows: 66 3 1. In a trial of a claim involving the request for 66 4 punitive or exemplary damages, the court shall 66 5 instruct the jury to answer special interrogatories 66 6 or, if there is no jury, shall make findings, 66 7 indicating all of the following: 66 8 a.Whether, by a preponderance of clear,66 9convincing, and satisfactory evidence, the conduct of66 10the defendant from which the claim arose constituted66 11willful and wanton disregard for the rights or safety66 12of another.66 13b.Whether the conduct of the defendant was 66 14 directed specifically at the claimant, or at the 66 15 person from which the claimant's claim is derived. 66 16 b. Whether, by a preponderance of clear and 66 17 convincing evidence, the conduct of the defendant from 66 18 which the claim arose constituted actual malice. 66 19 Sec. 114. NEW SECTION. 668A.2 DEFINITIONS. 66 20 As used in this chapter, the following terms shall 66 21 have the following meanings: 66 22 1. "Clear and convincing evidence" means evidence 66 23 which leaves no serious or substantial doubt about the 66 24 correctness of the conclusions drawn from the 66 25 evidence. It is more than a preponderance of 66 26 evidence, but less than beyond a reasonable doubt. 66 27 2. "Malice" means either conduct which is 66 28 specifically intended by the defendant to cause 66 29 tangible or intangible serious injury to the plaintiff 66 30 or conduct that is carried out by the defendant both 66 31 with a flagrant indifference to the rights of the 66 32 plaintiff and with a subjective awareness that such 66 33 conduct will result in tangible serious injury. 66 34 Sec. 115. NEW SECTION. 668A.3 AWARD OF PUNITIVE 66 35 OR EXEMPLARY DAMAGES – PROOF – STANDARD. 66 36 Punitive or exemplary damages shall only be awarded 66 37 where the plaintiff proves by clear and convincing 66 38 evidence that the plaintiff's harm was the result of 66 39 actual malice. This burden of proof shall not be 66 40 satisfied by proof of any degree of negligence, 66 41 including gross negligence. 66 42 Sec. 116. APPLICABILITY. This division of this 66 43 Act, relating to liability reform, applies to cases 66 44 filed on or after July 1, 2003. 66 45 DIVISION XVII 66 46 WORKERS' COMPENSATION 66 47 Sec. 117. Section 85.34, subsection 2, unnumbered 66 48 paragraph 1, Code 2003, is amended to read as follows: 66 49 Compensation for permanent partial disability shall 66 50 begin at the termination of the healing period 67 1 provided in subsection 1. The compensation shall be 67 2 in addition to the benefits provided by sections 85.27 67 3 and 85.28. The compensation shall be based only upon 67 4 the extent of the disability related to the injury 67 5 received and upon the basis of eighty percent per week 67 6 of the employee's average spendable weekly earnings, 67 7 but not more than a weekly benefit amount, rounded to 67 8 the nearest dollar, equal to one hundred eighty-four 67 9 percent of the statewide average weekly wage paid 67 10 employees as determined by the department of workforce 67 11 development under section 96.19, subsection 36, and in 67 12 effect at the time of the injury. The minimum weekly 67 13 benefit amount shall be equal to the weekly benefit 67 14 amount of a person whose gross weekly earnings are 67 15 thirty-five percent of the statewide average weekly 67 16 wage. For all cases of permanent partial disability 67 17 compensation shall be paid as follows: 67 18 Sec. 118. Section 85.34, subsection 2, paragraph 67 19 u, Code 2003, is amended by adding the following new 67 20 unnumbered paragraph after unnumbered paragraph 2 as 67 21 follows: 67 22 NEW UNNUMBERED PARAGRAPH. When an employee makes a 67 23 claim for benefits under this subsection, the employer 67 24 is not liable for that portion of the employee's 67 25 present disability caused by a prior work-related 67 26 injury or illness that was sustained by the employee 67 27 while the employee was employed by a different 67 28 employer. When an employee's present disability 67 29 includes disability caused by a prior work-related 67 30 injury or illness that was sustained by the employee 67 31 while in the employ of the same employer, the employer 67 32 is liable for compensating all of the employee's work- 67 33 related disability sustained by the employee while in 67 34 the employ of the employer, except that any portion of 67 35 the disability that was previously compensated by the 67 36 employer shall be deducted from the employer's 67 37 obligation to pay benefits for the employee's present 67 38 disability. If an employee's present disability is 67 39 reduced by a portion of disability sustained from 67 40 prior work-related injuries or illnesses for which the 67 41 employee has already been compensated by the same 67 42 employer, then the employee shall receive compensation 67 43 for the remaining disability caused by the present 67 44 work-related injury or illness plus an additional ten 67 45 percent of the amount of the increase in disability. 67 46 Sec. 119. APPLICABILITY. This division of this 67 47 Act, relating to workers' compensation, applies to an 67 48 injury occurring on or after July 1, 2003. 67 49 DIVISION XVIII 67 50 FINANCIAL SERVICES 68 1 Sec. 120. Section 537.2502, subsections 3 and 6, 68 2 Code 2003, are amended to read as follows: 68 3 3. A delinquency charge shall not be collected 68 4 under subsection 1, paragraph "a", on an installment 68 5whichthat is paid in full within ten days after its 68 6 scheduled or deferred installment due date even though 68 7 an earlier maturing installment or a delinquency or 68 8 deferral charge on an earlier installment may not have 68 9 been paid in full. For purposes of this subsection, 68 10 payments associated with a precomputed transaction are 68 11 applied first to current installments and then to 68 12 delinquent installments. 68 13 6. A delinquency charge shall not be collected 68 14 under subsection 4 on a paymentwhichassociated with 68 15 a precomputed transaction that is paid in full on or 68 16 before its scheduled or deferred due date even though 68 17 an earlier maturing payment or a delinquency or 68 18 deferred charge on an earlier payment has not been 68 19 paid in full. For purposes of this subsection, 68 20 payments are applied first to amounts due for the 68 21 current billing cycle and then to delinquent payments. 68 22 Sec. 121. Section 537.2601, subsection 1, Code 68 23 2003, is amended to read as follows: 68 24 1.Except as provided in subsection 2, withWith 68 25 respect to a credit transaction other than a consumer 68 26 credit transaction, the parties may contract for the 68 27 payment by the debtor of any finance or other charge 68 28 as permitted by law.Except with respect to debt68 29obligations issued by a government, governmental68 30agency or instrumentality, in calculating any finance68 31charge contracted for, any month may be counted as68 32one-twelfth of a year, but a day is to be counted as68 33one three-hundred sixty-fifth of a year.68 34 DIVISION XIX 68 35 UNEMPLOYMENT COMPENSATION SURCHARGE 68 36 Sec. 122. Section 96.7, subsection 12, paragraph 68 37 a, Code 2003, is amended to read as follows: 68 38 a. An employer other than a governmental entity or 68 39 a nonprofit organization, subject to this chapter, 68 40 shall pay an administrative contribution surcharge 68 41 equal in amount to one-tenth of one percent of federal 68 42 taxable wages, as defined in section 96.19, subsection 68 43 37, paragraph "b", subject to the surcharge formula to 68 44 be developed by the department under this paragraph. 68 45 The department shall develop a surcharge formula that 68 46 provides a target revenue level of no greater than six 68 47 million five hundred twenty-five thousand dollars 68 48annuallyfor calendar years 2003, 2004, and 2005 and a 68 49 target revenue level of no greater than three million 68 50 two hundred sixty-two thousand five hundred dollars 69 1 for calendar year 2006 and each subsequent calendar 69 2 year. The department shall reduce the administrative 69 3 contribution surcharge established for any calendar 69 4 year proportionate to any federal government funding 69 5 that provides an increased allocation of moneys for 69 6 workforce development offices, under the federal 69 7 employment services financing reform legislation. Any 69 8 administrative contribution surcharge revenue that is 69 9 collected in calendar year20022003, 2004, or 2005 in 69 10 excess of six million five hundred twenty-five 69 11 thousand dollars or in calendar year 2006 or a 69 12 subsequent calendar year in excess of three million 69 13 two hundred sixty-two thousand five hundred dollars 69 14 shall be deducted from the amount to be collected in 69 15 the subsequent calendar year 2003 before the 69 16 department establishes the administrative contribution 69 17 surcharge. The department shall recompute the amount 69 18 as a percentage of taxable wages, as defined in 69 19 section 96.19, subsection 37, and shall add the 69 20 percentage surcharge to the employer's contribution 69 21 rate determined under this section. The percentage 69 22 surcharge shall be capped at a maximum of seven 69 23 dollars per employee. The department shall adopt 69 24 rules prescribing the manner in which the surcharge 69 25 will be collected. Interest shall accrue on all 69 26 unpaid surcharges under this subsection at the same 69 27 rate as on regular contributions and shall be 69 28 collectible in the same manner. Interest accrued and 69 29 collected under this paragraph and interest earned and 69 30 credited to the fund under paragraph "b" shall be used 69 31 by the department only for the purposes set forth in 69 32 paragraph "c". 69 33 Sec. 123. Section 96.7, subsection 12, paragraph 69 34 d, Code 2003, is amended to read as follows: 69 35 d. This subsection is repealed July 1,20032006, 69 36 and the repeal is applicable to contribution rates for 69 37 calendar year20042007 and subsequent calendar years. 69 38 Sec. 124. EFFECTIVE DATE. This division of this 69 39 Act, concerning the unemployment compensation 69 40 surcharge, being deemed of immediate importance, takes 69 41 effect upon enactment. 69 42 DIVISION XX 69 43 ECONOMIC DEVELOPMENT 69 44 Sec. 125. NEW SECTION. 15E.18 CITIES, COUNTIES, 69 45 AND REGIONS – SITE PREPARATION FOR TARGETED ECONOMIC 69 46 DEVELOPMENT. 69 47 1. For purposes of this section, "region" means a 69 48 group of two or more contiguous counties that 69 49 establishes a single, focused economic development 69 50 effort. 70 1 2. A city, county, or region, subject to the 70 2 approval of the property owner, may designate an area 70 3 within the boundaries of the city, county, or region 70 4 for a specific type of targeted economic development. 70 5 The specific type of targeted economic development 70 6 shall be one of the following: 70 7 a. Manufacturing. 70 8 b. Light industrial. 70 9 c. Warehouse and distribution. 70 10 d. Office parks. 70 11 e. Business and commerce parks. 70 12 f. Research and development. 70 13 3. A city, county, or region that designates an 70 14 area for a specific type of targeted economic 70 15 development may apply to the department for purposes 70 16 of certifying the area as a preapproved development 70 17 site. The department shall develop criteria for the 70 18 certification process. 70 19 4. Prior to a specific project being developed, a 70 20 city, county, or region designating the area for 70 21 targeted economic development pursuant to this section 70 22 may apply for and obtain appropriate licenses, 70 23 permits, and approvals for the type of targeted 70 24 economic development project desired for the area. 70 25 Sec. 126. NEW SECTION. 15E.19 REGULATORY 70 26 ASSISTANCE. 70 27 1. The department of economic development shall 70 28 coordinate all regulatory assistance for the state of 70 29 Iowa. Each state agency with regulatory programs for 70 30 business shall maintain a coordinator within the 70 31 office of the director or the administrative division 70 32 of the state agency. Each coordinator shall do all of 70 33 the following: 70 34 a. Serve as the department of economic 70 35 development's primary contact for regulatory affairs. 70 36 b. Provide regulatory requirements to businesses 70 37 and represent the agency in the private sector. 70 38 c. Monitor permit applications and provide timely 70 39 permit status information to the department of 70 40 economic development. 70 41 d. Have the ability to require regulatory staff 70 42 participation in negotiations and discussions with 70 43 businesses. 70 44 e. Notify the department of economic development 70 45 regarding proposed rulemaking activities that impact a 70 46 regulatory program and any subsequent changes to a 70 47 regulatory program. 70 48 2. The department of economic development shall, 70 49 in consultation with the coordinators described in 70 50 this section, examine, and to the extent permissible, 71 1 assist in the implementation of methods, including the 71 2 possible establishment of an electronic database, to 71 3 streamline the process for issuing permits to 71 4 business. 71 5 3. By January 15 of each year, the department of 71 6 economic development shall submit a written report to 71 7 the general assembly regarding the provision of 71 8 regulatory assistance by state agencies, including the 71 9 department's efforts, and its recommendations and 71 10 proposed solutions, to streamline the process of 71 11 issuing permits to business. 71 12 Sec. 127. NEW SECTION. 15E.20 PERMIT APPROVAL 71 13 REQUIREMENTS. 71 14 A state agency which requires a permit, license, or 71 15 other regulatory approval shall issue or deny the 71 16 permit, license, or other regulatory approval within 71 17 ninety days of the receipt by the state agency of an 71 18 application. Unless such a state agency communicates 71 19 any concerns to or requests additional information 71 20 from an applicant within ten days of the receipt of 71 21 the application, the application shall be considered 71 22 complete. A permit, license, or other regulatory 71 23 approval not issued or denied within the ninety days 71 24 shall be deemed to be issued and valid. 71 25 DIVISION XXI 71 26 UTILITY SALES TAX EXEMPTION 71 27 Sec. 128. Section 422.45, subsection 61, paragraph 71 28 b, subparagraphs (2), (3), (4), and (5), Code 2003, 71 29 are amended to read as follows: 71 30 (2) If the date of the utility billing or meter 71 31 reading cycle of the residential customer for the 71 32 sale, furnishing, or service of metered gas and 71 33 electricity is on or after January 1, 2003, through 71 34December 31, 2003June 30, 2008, or if the sale, 71 35 furnishing, or service of fuel for purposes of 71 36 residential energy and the delivery of the fuel occurs 71 37 on or after January 1, 2003, throughDecember 31, 200371 38 June 30, 2008, the rate of tax is three percent of the 71 39 gross receipts. 71 40 (3) If the date of the utility billing or meter 71 41 reading cycle of the residential customer for the 71 42 sale, furnishing, or service of metered gas and 71 43 electricity is on or afterJanuary 1, 2004July 1, 71 44 2008, throughDecember 31, 2004June 30, 2009, or if 71 45 the sale, furnishing, or service of fuel for purposes 71 46 of residential energy and the delivery of the fuel 71 47 occurs on or afterJanuary 1, 2004July 1, 2008, 71 48 throughDecember 31, 2004June 30, 2009, the rate of 71 49 tax is two percent of the gross receipts. 71 50 (4) If the date of the utility billing or meter 72 1 reading cycle of the residential customer for the 72 2 sale, furnishing, or service of metered gas and 72 3 electricity is on or afterJanuary 1, 2005July 1, 72 4 2009, throughDecember 31, 2005June 30, 2010, or if 72 5 the sale, furnishing, or service of fuel for purposes 72 6 of residential energy and the delivery of the fuel 72 7 occurs on or afterJanuary 1, 2005July 1, 2009, 72 8 throughDecember 31, 2005June 30, 2010, the rate of 72 9 tax is one percent of the gross receipts. 72 10 (5) If the date of the utility billing or meter 72 11 reading cycle of the residential customer for the 72 12 sale, furnishing, or service of metered gas and 72 13 electricity is on or afterJanuary 1, 2006July 1, 72 14 2010, or if the sale, furnishing, or service of fuel 72 15 for purposes of residential energy and the delivery of 72 16 the fuel occurs on or afterJanuary 1, 2006July 1, 72 17 2010, the rate of tax is zero percent of the gross 72 18 receipts. 72 19 DIVISION XXII 72 20 STATE ASSISTANCE FOR EDUCATIONAL INFRASTRUCTURE 72 21 Sec. 129. NEW SECTION. 292A.1 DEFINITIONS. 72 22 As used in this chapter, unless the context 72 23 otherwise requires: 72 24 1. "Capacity per pupil" means the sum of a school 72 25 district's property tax infrastructure capacity per 72 26 pupil and the sales tax capacity per pupil. 72 27 2. "Committee" means the school budget review 72 28 committee established in section 257.30. 72 29 3. "Department" means the department of education 72 30 established in section 256.1. 72 31 4. "Fund" means the state assistance for 72 32 educational infrastructure fund created in section 72 33 292A.3. 72 34 5. "Local match percentage" means a percentage 72 35 equivalent to either of the following, whichever is 72 36 less: 72 37 a. Fifty percent. 72 38 b. The quotient of a school district's capacity 72 39 per pupil divided by the capacity per pupil of the 72 40 school district at the fortieth percentile, multiplied 72 41 by fifty percent, except that the percentage in this 72 42 paragraph shall not be less than twenty percent. 72 43 6. "Program" means the state assistance for 72 44 educational infrastructure program established in 72 45 section 292A.2. 72 46 7. "Property tax infrastructure capacity per 72 47 pupil" means the sum of a school district's levies 72 48 under sections 298.2 and 298.18 when the levies are 72 49 imposed to the maximum extent allowable under law in 72 50 the budget year divided by the school district's basic 73 1 enrollment for the budget year. 73 2 8. "Sales tax capacity per pupil" means the 73 3 estimated amount of revenues that a school district 73 4 receives or would receive if a local sales and 73 5 services tax for school infrastructure is imposed at 73 6 one percent pursuant to section 422E.2, divided by the 73 7 school district's basic enrollment for the budget 73 8 year. 73 9 9. "School infrastructure" means activities 73 10 initiated on or after July 1, 2003, for which a school 73 11 district is authorized to contract indebtedness and 73 12 issue general obligation bonds under section 296.1, 73 13 except those activities related to a teacher's or 73 14 superintendent's home or homes, to stadiums, to the 73 15 improving of a site for an athletic field, or to the 73 16 improving of a site already owned for an athletic 73 17 field. These activities include the construction, 73 18 reconstruction, repair, demolition work, purchasing, 73 19 or remodeling of schoolhouses and bus garages and the 73 20 procurement of schoolhouse construction sites and the 73 21 making of site improvements and those activities for 73 22 which revenues under section 298.3 or 300.2 may be 73 23 spent. 73 24 Sec. 130. NEW SECTION. 292A.2 STATE ASSISTANCE 73 25 FOR EDUCATIONAL INFRASTRUCTURE PROGRAM. 73 26 1. a. The department shall establish and 73 27 administer a state assistance for educational 73 28 infrastructure program to provide financial assistance 73 29 in the form of grants to school districts with school 73 30 infrastructure needs. 73 31 b. The department of education, in consultation 73 32 with the department of management, shall annually 73 33 compute the property tax infrastructure capacity per 73 34 pupil for each school district in the state. 73 35 c. The department of education, in consultation 73 36 with the department of revenue and the legislative 73 37 services agency, shall annually calculate the 73 38 estimated sales and services tax for school 73 39 infrastructure, if imposed at one percent, that is or 73 40 would be received by each school district in the state 73 41 pursuant to section 422E.3. These calculations shall 73 42 be made on a total tax and on a tax per pupil basis 73 43 for each school district. 73 44 d. The department of education, in consultation 73 45 with the department of revenue and the department of 73 46 management, shall annually compute capacity per pupil 73 47 and the local match percentage for each school 73 48 district in the state. The calculations shall be 73 49 released not later than September 1 of each year. 73 50 2. a. A school district's local match requirement 74 1 is equivalent to the total investment of a project 74 2 multiplied by the school district's local match 74 3 percentage. A school district may submit an 74 4 application to the department for financial assistance 74 5 under the program if the school district meets the 74 6 district's local match requirement through one or more 74 7 of the following sources: 74 8 (1) The issuance of bonds pursuant to section 74 9 298.18. 74 10 (2) Local sales and services tax moneys received 74 11 pursuant to section 422E.3. 74 12 (3) A physical plant and equipment levy under 74 13 chapter 298. 74 14 (4) Other moneys locally obtained by the school 74 15 district excluding other state or federal grant 74 16 moneys. 74 17 b. If the project is in collaboration with other 74 18 public or private entities, the school district shall 74 19 be eligible to apply for only the school district's 74 20 portion of the project. As such, state or federal 74 21 grants received by the other entities cannot be used 74 22 toward the local match requirement under paragraph 74 23 "a", subparagraph (4). 74 24 c. A school district may submit an application for 74 25 a project which includes activities at more than one 74 26 attendance center. However, if the activities relate 74 27 to new construction, the project shall only relate to 74 28 one attendance center. 74 29 d. A school district may submit an application for 74 30 conditional approval to the department for financial 74 31 assistance under the program if the school district 74 32 submits a plan for securing the school district's 74 33 local match requirement under paragraph "a". If a 74 34 school district does not meet the local match 74 35 requirement of paragraph "a" within nine months of 74 36 receiving conditional approval from the department, 74 37 the application for financial assistance shall be 74 38 denied by the department and the financial assistance 74 39 shall be carried forward to be made available under 74 40 the allocation provided under subsection 5, paragraph 74 41 "d", for the next available grant cycle. 74 42 e. For the fiscal year beginning July 1, 2003, and 74 43 every fiscal year thereafter, applications shall be 74 44 submitted to the department by October 15 of each 74 45 year. 74 46 f. For the fiscal year beginning July 1, 2003, and 74 47 every fiscal year thereafter, the department shall 74 48 notify all approved applicants by December 15 of each 74 49 year regarding the approval of the application. 74 50 g. An applicant which is not successful in 75 1 obtaining financial assistance under the program may 75 2 reapply for financial assistance in succeeding years. 75 3 3. The application shall include, but shall not be 75 4 limited to, the following information: 75 5 a. The total capital investment of the project. 75 6 b. The amount and percentage of moneys which the 75 7 school district will be providing for the project. 75 8 c. The infrastructure needs of the school 75 9 district, especially the fire and health safety needs 75 10 of the school district, and including the extent to 75 11 which the project would allow the school district to 75 12 meet the infrastructure needs of the school district 75 13 on a long-term basis. 75 14 d. The financial assistance needed by the school 75 15 district based upon the capacity per pupil. 75 16 e. Any previous efforts by the school district to 75 17 secure infrastructure funding from federal, state, or 75 18 local resources, including any funding received for 75 19 any project under the school infrastructure program 75 20 provided in chapter 292. The previous efforts shall 75 21 be evaluated on a case-by-case basis. 75 22 f. Evidence that the school district meets or will 75 23 meet the local match requirement in subsection 2, 75 24 paragraph "a". 75 25 g. The nature of the proposed project and its 75 26 relationship to improving educational opportunities 75 27 for the students. 75 28 h. Evidence that the school district has 75 29 reorganized on or after July 1, 2002, or that the 75 30 school district has initiated a resolution to 75 31 reorganize by July 1, 2005, or entered into an 75 32 innovative collaboration with another school district 75 33 or school districts. 75 34 i. Evidence that the school district receives 75 35 sales and services tax for school infrastructure 75 36 funding under section 422E.3. 75 37 4. A school district with less than two hundred 75 38 fifty actual enrollment or less than one hundred 75 39 actual enrollment in the high school that submits an 75 40 application for assistance for new construction or for 75 41 payments for bonds issued for new construction shall 75 42 include on the application, in addition to that in 75 43 subsection 3, all of the following: 75 44 a. Enrollment trends in the grades that will be 75 45 served at the new construction site. 75 46 b. The infeasibility of remodeling, 75 47 reconstructing, or repairing existing buildings. 75 48 c. The fire and health safety needs of the school 75 49 district. 75 50 d. The distance, convenience, cost of 76 1 transportation, and accessibility of the new 76 2 construction site to the students to be served at the 76 3 new construction site. 76 4 e. Availability of alternative, less costly, or 76 5 more effective means of serving the needs of the 76 6 students. 76 7 f. The financial condition of the district, 76 8 including the effect of the decline of the budget 76 9 guarantee and unspent balance. 76 10 g. Broad and long-term ability of the district to 76 11 support the facility and the quality of the academic 76 12 program. 76 13 h. Cooperation with other educational entities 76 14 including other school districts, area education 76 15 agencies, postsecondary institutions, and local 76 16 communities. 76 17 5. A school district shall not receive more than 76 18 one grant under the program. The financial assistance 76 19 shall be in the form of grants and shall be allocated 76 20 in the following manner: 76 21 a. Twenty-five percent of the financial assistance 76 22 each year shall be awarded to school districts with an 76 23 enrollment of one thousand one hundred ninety-nine 76 24 students or less. 76 25 b. Twenty-five percent of the financial assistance 76 26 each year shall be awarded to school districts with an 76 27 enrollment of more than one thousand one hundred 76 28 ninety-nine students but not more than four thousand 76 29 seven hundred fifty students. 76 30 c. Twenty-five percent of the financial assistance 76 31 each year shall be awarded to school districts with an 76 32 enrollment of more than four thousand seven hundred 76 33 fifty students. 76 34 d. Twenty-five percent of the financial assistance 76 35 each year, any financial assistance not awarded under 76 36 paragraphs "a" through "c", and financial assistance 76 37 not awarded in previous fiscal years shall be awarded 76 38 to school districts with any size enrollment. 76 39 6. A district shall receive the lesser of one 76 40 million dollars of financial assistance under the 76 41 program, or the total capital investment of the 76 42 project minus the local match requirement. If the 76 43 amount of grants awarded in a fiscal year is less than 76 44 the maximum amount provided for grants for that fiscal 76 45 year, the amount of the difference shall be carried 76 46 forward to subsequent fiscal years for purposes of 76 47 providing grants under the program and the maximum 76 48 amount of grants for each fiscal year shall be 76 49 adjusted accordingly. 76 50 7. The school budget review committee shall review 77 1 all applications for financial assistance under the 77 2 program and make recommendations regarding the 77 3 applications to the department. The department shall 77 4 make the final determination on grant awards. The 77 5 school budget review committee shall base the 77 6 recommendations on the criteria established pursuant 77 7 to subsections 3 and 8 and subsection 4, if 77 8 applicable. 77 9 8. The department shall form a task force to 77 10 review applications for financial assistance and 77 11 provide recommendations to the school budget review 77 12 committee. The task force shall include, at a 77 13 minimum, representatives from the kindergarten through 77 14 grade twelve education community, the state fire 77 15 marshal, and individuals knowledgeable in school 77 16 infrastructure and construction issues. The 77 17 department, in consultation with the task force, shall 77 18 establish the parameters and the details of the 77 19 criteria for awarding grants based on the information 77 20 listed in subsection 3, including greater priority to 77 21 the following: 77 22 a. A school district with a lower capacity per 77 23 pupil. 77 24 b. A school district whose plans address specific 77 25 occupant safety issues. 77 26 c. A school district reorganizing or collaborating 77 27 as described in subsection 3, paragraph "h". 77 28 d. A school district for which a sales and 77 29 services tax for school infrastructure has not been 77 30 imposed pursuant to section 422E.2 or a school 77 31 district receiving minimal revenues under section 77 32 422E.3 when the total enrollment of the school 77 33 district is considered. 77 34 9. An applicant receiving financial assistance 77 35 under the program shall submit a progress report to 77 36 the department as requested by the department which 77 37 shall include a description of the activities under 77 38 the project, the status of the implementation of the 77 39 project, and any other information required by the 77 40 department. 77 41 10. A school district located in whole or in part 77 42 in a county which has imposed the maximum rate of 77 43 sales and services tax for school infrastructure 77 44 pursuant to section 422E.2 and has sales and services 77 45 tax for school infrastructure revenue of more than the 77 46 statewide average of sales tax capacity per pupil, as 77 47 defined in section 292.1, subsection 8, shall not be 77 48 eligible for financial assistance under the program. 77 49 For purposes of this subsection, an individual school 77 50 district's sales tax capacity per pupil is the 78 1 estimated total sales and services tax for 78 2 infrastructure revenue to be actually received by the 78 3 school district divided by the school district's 78 4 enrollment as specified in section 292.1, subsection 78 5 8. 78 6 Sec. 131. NEW SECTION. 292A.3 STATE ASSISTANCE 78 7 FOR EDUCATIONAL INFRASTRUCTURE FUND. 78 8 A state assistance for educational infrastructure 78 9 fund is created as a separate and distinct fund in the 78 10 state treasury under the control of the department. 78 11 Moneys in the fund include revenues credited to the 78 12 fund pursuant to this chapter, appropriations made to 78 13 the fund, and other moneys deposited into the fund. 78 14 Any amounts disbursed from the fund shall be utilized 78 15 for school infrastructure purposes as provided in this 78 16 chapter. 78 17 Sec. 132. NEW SECTION. 292A.4 RULES. 78 18 The department shall adopt rules, pursuant to 78 19 chapter 17A, necessary for administering the state 78 20 assistance for educational infrastructure program and 78 21 fund. 78 22 DIVISION XXIII 78 23 EFFECTIVE DATE 78 24 Sec. 133. EFFECTIVE DATE. Unless otherwise 78 25 provided in this Act, this Act takes effect July 1, 78 26 2003." 78 27 # . Title page, by striking lines 1 and 2 and 78 28 inserting the following: "An Act concerning 78 29 regulatory, taxation, and statutory requirements 78 30 affecting individuals and business relating to 78 31 taxation of property, income and utilities, liability 78 32 reform, workers' compensation, financial services, 78 33 unemployment compensation employer surcharges, 78 34 economic development, and school infrastructure 78 35 assistance, and including effective date, 78 36 applicability, and retroactive applicability 78 37 provisions."" 78 38 78 39 78 40 78 41 LARRY McKIBBEN 78 42 HF 692.318 80 78 43 sc/cf
Text: S03400 Text: S03402 Text: S03400 - S03499 Text: S Index Bills and Amendments: General Index Bill History: General Index
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