Senate File 295 H-1315 Amend the amendment, H-1311, to Senate File 295, as 1 passed by the Senate, as follows: 2 1. Page 18, after line 49 by inserting: 3 < DIVISION ___ 4 COUNTY AND CITY BUDGET LIMITATION 5 Sec. ___. Section 23A.2, subsection 10, paragraph 6 h, Code 2013, is amended to read as follows: 7 h. The performance of an activity listed in 8 section 331.424 , Code 2013 as a service for which a 9 supplemental levy county may be certified include in 10 its budget . 11 Sec. ___. Section 28M.5, subsection 2, Code 2013, 12 is amended to read as follows: 13 2. If a regional transit district budget allocates 14 revenue responsibilities to the board of supervisors 15 of a participating county, the amount of the regional 16 transit district levy that is the responsibility of the 17 participating county shall be deducted from the maximum 18 rates amount of taxes authorized to be levied by the 19 county pursuant to section 331.423, subsections 1 and 20 2 subsection 3, paragraph “b” and “c” , as applicable, 21 unless the county meets its revenue responsibilities as 22 allocated in the budget from other available revenue 23 sources. However, for a regional transit district 24 that includes a county with a population of less than 25 three hundred thousand, the amount of the regional 26 transit district levy that is the responsibility of 27 such participating county shall be deducted from the 28 maximum rate amount of taxes authorized to be levied 29 by the county pursuant to section 331.423, subsection 30 1 3, paragraph “b” . 31 Sec. ___. Section 29C.17, subsection 2, paragraph 32 a, Code 2013, is amended by striking the paragraph. 33 Sec. ___. Section 123.38, subsection 2, Code 2013, 34 is amended to read as follows: 35 2. Any licensee or permittee, or the licensee’s 36 or permittee’s executor or administrator, or any 37 person duly appointed by the court to take charge of 38 and administer the property or assets of the licensee 39 or permittee for the benefit of the licensee’s or 40 permittee’s creditors, may voluntarily surrender a 41 license or permit to the division. When a license 42 or permit is surrendered the division shall notify 43 the local authority, and the division or the local 44 authority shall refund to the person surrendering the 45 license or permit, a proportionate amount of the fee 46 received by the division or the local authority for 47 the license or permit as follows: if a license or 48 permit is surrendered during the first three months 49 of the period for which it was issued, the refund 50 -1- H1311.1751 (1) 85 md/sc 1/ 15 #1.

shall be three-fourths of the amount of the fee; 1 if surrendered more than three months but not more 2 than six months after issuance, the refund shall be 3 one-half of the amount of the fee; if surrendered more 4 than six months but not more than nine months after 5 issuance, the refund shall be one-fourth of the amount 6 of the fee. No refund shall be made, however, for 7 any special liquor permit, nor for a liquor control 8 license, wine permit, or beer permit surrendered more 9 than nine months after issuance. For purposes of this 10 subsection, any portion of license or permit fees 11 used for the purposes authorized in section 331.424, 12 subsection 1 , paragraph “a” , subparagraphs (1) and 13 (2), Code 2013, and in section 331.424A , shall not be 14 deemed received either by the division or by a local 15 authority. No refund shall be made to any licensee or 16 permittee, upon the surrender of the license or permit, 17 if there is at the time of surrender, a complaint filed 18 with the division or local authority, charging the 19 licensee or permittee with a violation of this chapter . 20 If upon a hearing on a complaint the license or permit 21 is not revoked or suspended, then the licensee or 22 permittee is eligible, upon surrender of the license 23 or permit, to receive a refund as provided in this 24 section ; but if the license or permit is revoked or 25 suspended upon hearing the licensee or permittee is not 26 eligible for the refund of any portion of the license 27 or permit fee. 28 Sec. ___. Section 218.99, Code 2013, is amended to 29 read as follows: 30 218.99 Counties to be notified of patients’ personal 31 accounts. 32 The administrator in control of a state institution 33 shall direct the business manager of each institution 34 under the administrator’s jurisdiction which is 35 mentioned in section 331.424, subsection 1 , paragraph 36 “a” , subparagraphs (1) and (2), and for which services 37 are paid under section 331.424A , to quarterly inform 38 the county of legal settlement’s entity designated to 39 perform the county’s central point of coordination 40 process of any patient or resident who has an amount 41 in excess of two hundred dollars on account in the 42 patients’ personal deposit fund and the amount on 43 deposit. The administrators shall direct the business 44 manager to further notify the entity designated to 45 perform the county’s central point of coordination 46 process at least fifteen days before the release of 47 funds in excess of two hundred dollars or upon the 48 death of the patient or resident. If the patient or 49 resident has no county of legal settlement, notice 50 -2- H1311.1751 (1) 85 md/sc 2/ 15

shall be made to the director of human services and the 1 administrator in control of the institution involved. 2 Sec. ___. Section 331.263, subsection 2, Code 2013, 3 is amended to read as follows: 4 2. The governing body of the community commonwealth 5 shall have the authority to levy county taxes and shall 6 have the authority to levy city taxes to the extent the 7 city tax levy authority is transferred by the charter 8 to the community commonwealth. A city participating 9 in the community commonwealth shall transfer a portion 10 of the city’s tax levy authorized under section 384.1 11 or 384.12 , whichever is applicable, to the governing 12 body of the community commonwealth. The maximum 13 rates amount of taxes authorized to be levied under 14 sections section 384.1 and the maximum amount of taxes 15 authorized to be levied under section 384.12 by a city 16 participating in the community commonwealth shall be 17 reduced by an amount equal to the rates of the same or 18 similar taxes levied in the city by the governing body 19 of the community commonwealth. 20 Sec. ___. Section 331.301, subsection 12, Code 21 2013, is amended to read as follows: 22 12. The board of supervisors may credit funds to 23 a reserve for the purposes authorized by subsection 24 11 of this section ; section 331.424, subsection 1 , 25 paragraph “a” , subparagraph (5); and section 331.441, 26 subsection 2 , paragraph “b” . Moneys credited to the 27 reserve, and interest earned on such moneys, shall 28 remain in the reserve until expended for purposes 29 authorized by subsection 11 of this section ; section 30 331.424, subsection 1 , paragraph “a” , subparagraph (5); 31 or section 331.441, subsection 2 , paragraph “b” . 32 Sec. ___. Section 331.421, subsections 1 and 10, 33 Code 2013, are amended by striking the subsections. 34 Sec. ___. Section 331.421, Code 2013, is amended by 35 adding the following new subsection: 36 NEW SUBSECTION . 7A. “Item” means a budgeted 37 expenditure, appropriation, or cash reserve from a 38 fund for a service area, program, program element, or 39 purpose. 40 Sec. ___. Section 331.422, unnumbered paragraph 1, 41 Code 2013, is amended to read as follows: 42 Subject to this section and sections 331.423 through 43 331.426 331.424 or as otherwise provided by state law, 44 the board of each county shall certify property taxes 45 annually at its March session to be levied for county 46 purposes as follows: 47 Sec. ___. Section 331.423, Code 2013, is amended by 48 striking the section and inserting in lieu thereof the 49 following: 50 -3- H1311.1751 (1) 85 md/sc 3/ 15

331.423 Property tax dollars —— maximums. 1 1. Annually, the board shall determine separate 2 property tax levy limits to pay for general county 3 services and rural county services in accordance with 4 this section. The property tax levies separately 5 certified for general county services and rural county 6 services under section 331.434 shall not raise property 7 tax dollars that exceed the amount determined under 8 this section. 9 2. For purposes of this section and section 10 331.423B, unless the context otherwise requires: 11 a. “Annual growth factor” means an index, expressed 12 as a percentage, determined by the department of 13 management by January 1 of the calendar year in which 14 the budget year begins. In determining the annual 15 growth factor, the department shall calculate the 16 average of the preceding twelve-month percentage 17 change, which shall be computed on a monthly basis, 18 in the midwest consumer price index, ending with the 19 percentage change for the month of November. The 20 department shall then add that average percentage 21 change to one hundred percent. In no case, however, 22 shall the annual growth factor exceed one hundred four 23 percent. 24 b. “Boundary adjustment” means annexation, 25 severance, incorporation, or discontinuance as those 26 terms are defined in section 368.1. 27 c. “Budget year” is the fiscal year beginning 28 during the calendar year in which a budget is 29 certified. 30 d. “Current fiscal year” is the fiscal year 31 ending during the calendar year in which a budget is 32 certified. 33 e. “Net new valuation taxes” means the amount of 34 property tax dollars equal to the current fiscal year’s 35 levy rate in the county for general county services or 36 for rural county services, as applicable, multiplied by 37 the increase from the current fiscal year to the budget 38 year in taxable valuation due to the following: 39 (1) Net new construction, excluding all incremental 40 valuation that is released in any one year from either 41 a division of revenue under section 260E.4 or 357H.9, 42 or an urban renewal area for which taxes were being 43 divided under section 403.19 if the property for 44 the valuation being released remains subject to the 45 division of revenue under section 260E.4 or 357H.9, or 46 remains part of the urban renewal area that is subject 47 to a division of revenue under section 403.19. 48 (2) Additions or improvements to existing 49 structures. 50 -4- H1311.1751 (1) 85 md/sc 4/ 15

(3) Remodeling of existing structures for which a 1 building permit is required. 2 (4) Net boundary adjustment. 3 (5) A municipality no longer dividing tax revenues 4 in an urban renewal area as provided in section 403.19, 5 a community college no longer dividing revenues as 6 provided in section 260E.4, or a rural improvement zone 7 no longer dividing revenues as provided in section 8 357H.9. 9 (6) That portion of taxable property located in an 10 urban revitalization area on which an exemption was 11 allowed and such exemption has expired. 12 3. a. For the fiscal year beginning July 1, 2014, 13 and subsequent fiscal years, the maximum amount of 14 property tax dollars which may be certified for levy by 15 a county for general county services and rural county 16 services shall be the maximum property tax dollars 17 calculated under paragraphs “b” and “c” , respectively. 18 b. The maximum property tax dollars that may be 19 levied for general county services is an amount equal 20 to the sum of the following: 21 (1) The annual growth factor times the current 22 fiscal year’s maximum property tax dollars for general 23 county services. 24 (2) The amount of net new valuation taxes in the 25 county. 26 c. The maximum property tax dollars that may be 27 levied for rural county services is an amount equal to 28 the sum of the following: 29 (1) The annual growth factor times the current 30 fiscal year’s maximum property tax dollars for rural 31 county services. 32 (2) The amount of net new valuation taxes in the 33 unincorporated area of the county. 34 4. a. For purposes of calculating maximum property 35 tax dollars for general county services for the fiscal 36 year beginning July 1, 2014, only, the term “current 37 fiscal year’s maximum property tax dollars” shall mean 38 the total amount of property tax dollars certified by 39 the county for general county services for the fiscal 40 year beginning July 1, 2013. 41 b. For purposes of calculating maximum property tax 42 dollars for rural county services for the fiscal year 43 beginning July 1, 2014, only, the term “current fiscal 44 year’s maximum property tax dollars” shall mean the 45 total amount of property tax dollars certified by the 46 county for rural county services for the fiscal year 47 beginning July 1, 2013. 48 5. Property taxes certified for mental health, 49 mental retardation, and developmental disabilities 50 -5- H1311.1751 (1) 85 md/sc 5/ 15

services, the emergency services fund in section 1 331.424C, the debt service fund in section 331.430, 2 any capital projects fund established by the county 3 for deposit of bond, loan, or note proceeds, and 4 any temporary increase approved pursuant to section 5 331.424, are not included in the maximum amount of 6 property tax dollars that may be certified for a budget 7 year under subsection 3. 8 6. The department of management, in consultation 9 with the county finance committee, shall adopt rules 10 to administer this section. The department shall 11 prescribe forms to be used by counties when making 12 calculations required by this section. 13 Sec. ___. NEW SECTION . 331.423B Ending fund 14 balance. 15 1. a. Budgeted ending fund balances for a budget 16 year in excess of twenty-five percent of budgeted 17 expenditures in either the general fund or rural 18 services fund for that budget year shall be explicitly 19 reserved or designated for a specific purpose. 20 b. A county is encouraged, but not required, to 21 reduce ending fund balances for the budget year to an 22 amount equal to approximately twenty-five percent of 23 budgeted expenditures and transfers from the general 24 fund and rural services fund for that budget year 25 unless a decision is certified by the state appeal 26 board ordering a reduction in the ending fund balance 27 of any of those funds. 28 c. In a protest to the county budget under section 29 331.436, the county shall have the burden of proving 30 that the budgeted balances in excess of twenty-five 31 percent are reasonably likely to be appropriated for 32 the explicitly reserved or designated specific purpose. 33 The excess budgeted balance for the specific purpose 34 shall be considered an increase in an item in the 35 budget for purposes of section 24.28. 36 2. a. For a county that has, as of June 30, 2013, 37 reduced its actual ending fund balance to less than 38 twenty-five percent of actual expenditures, additional 39 property taxes may be computed and levied as provided 40 in this subsection. The additional property tax levy 41 amount is an amount not to exceed twenty-five percent 42 of actual expenditures from the general fund and rural 43 services fund for the fiscal year beginning July 1, 44 2012, minus the combined ending fund balances for those 45 funds for that year. 46 b. The amount of the additional property taxes 47 shall be apportioned between the general fund and the 48 rural services fund. However, the amount apportioned 49 for general county services and for rural county 50 -6- H1311.1751 (1) 85 md/sc 6/ 15

services shall not exceed for each fund twenty-five 1 percent of actual expenditures for the fiscal year 2 beginning July 1, 2012. 3 c. All or a portion of additional property tax 4 dollars may be levied for the purpose of increasing 5 cash reserves for general county services and rural 6 county services in the budget year. The additional 7 property tax dollars authorized under this subsection 8 but not levied may be carried forward as unused ending 9 fund balance taxing authority until and for the fiscal 10 year beginning July 1, 2019. The amount carried 11 forward shall not exceed twenty-five percent of the 12 maximum amount of property tax dollars available in 13 the current fiscal year. Additionally, property taxes 14 that are levied as unused ending fund balance taxing 15 authority under this subsection may be the subject of 16 a protest under section 331.436, and the amount will 17 be considered an increase in an item in the budget for 18 purposes of section 24.28. The amount of additional 19 property taxes levied under this subsection shall not 20 be included in the computation of the maximum amount of 21 property tax dollars which may be certified and levied 22 under section 331.423. 23 Sec. ___. Section 331.424, Code 2013, is amended by 24 striking the section and inserting in lieu thereof the 25 following: 26 331.424 Authority to levy beyond maximum property 27 tax dollars. 28 1. The board may certify additions to the maximum 29 amount of property tax dollars to be levied for 30 a period of time not to exceed two years if the 31 proposition has been submitted at a special election 32 and received a favorable majority of the votes cast on 33 the proposition. 34 2. The special election is subject to the 35 following: 36 a. The board must give at least thirty-two days’ 37 notice to the county commissioner of elections that the 38 special election is to be held. In no case, however, 39 shall a notice be given to the county commissioner 40 of elections after December 31 for an election on a 41 proposition to exceed the statutory limits during the 42 fiscal year beginning in the next calendar year. 43 b. The special election shall be conducted by the 44 county commissioner of elections in accordance with 45 law. 46 c. The proposition to be submitted shall be 47 substantially in the following form: 48 Vote “yes” or “no” on the following: Shall the 49 county of _______ levy for an additional $_______ each 50 -7- H1311.1751 (1) 85 md/sc 7/ 15

year for ___ years beginning July 1, _____, in excess 1 of the statutory limits otherwise applicable for the 2 (general county services or rural services) fund? 3 d. The canvass shall be held beginning at 1:00 p.m. 4 on the second day which is not a holiday following the 5 special election. 6 e. Notice of the special election shall be 7 published at least once in a newspaper as specified 8 in section 331.305 prior to the date of the special 9 election. The notice shall appear as early as 10 practicable after the board has voted to submit a 11 proposition to the voters to levy additional property 12 tax dollars. 13 3. Registered voters in the county may vote on the 14 proposition to increase property taxes for the general 15 fund in excess of the statutory limit. Registered 16 voters residing outside the corporate limits of a 17 city within the county may vote on the proposition to 18 increase property taxes for the rural services fund in 19 excess of the statutory limit. 20 4. The amount of additional property tax dollars 21 certified under this section shall not be included in 22 the computation of the maximum amount of property tax 23 dollars which may be certified and levied under section 24 331.423. 25 Sec. ___. Section 331.424A, subsection 4, Code 26 2013, is amended to read as follows: 27 4. For the fiscal year beginning July 1, 1996, 28 and for each subsequent fiscal year, the county shall 29 certify a levy for payment of services. For each 30 fiscal year, county revenues from taxes imposed by the 31 county credited to the services fund shall not exceed 32 an amount equal to the amount of base year expenditures 33 for services as defined in section 331.438 , less the 34 amount of property tax relief to be received pursuant 35 to section 426B.2 , in the fiscal year for which the 36 budget is certified. The county auditor and the 37 board of supervisors shall reduce the amount of the 38 levy certified for the services fund by the amount of 39 property tax relief to be received. A levy certified 40 under this section is not subject to the appeal 41 provisions of section 331.426 or to any other provision 42 in law authorizing a county to exceed, increase, or 43 appeal a property tax levy limit. 44 Sec. ___. Section 331.427, subsection 3, paragraph 45 l, Code 2013, is amended to read as follows: 46 l. Services listed in section 331.424, subsection 47 1 , Code 2013, and section 331.554 . 48 Sec. ___. Section 331.428, subsection 2, paragraph 49 d, Code 2013, is amended to read as follows: 50 -8- H1311.1751 (1) 85 md/sc 8/ 15

d. Services listed under section 331.424, 1 subsection 2 , Code 2013 . 2 Sec. ___. Section 331.434, unnumbered paragraph 1, 3 Code 2013, is amended to read as follows: 4 Annually, the board of each county, subject to 5 section 331.403, subsection 4 , sections 331.423 through 6 331.426 331.424 , and other applicable state law, shall 7 prepare and adopt a budget, certify taxes, and provide 8 appropriations as follows: 9 Sec. ___. Section 331.435, unnumbered paragraph 1, 10 Code 2013, is amended to read as follows: 11 The board may amend the adopted county budget, 12 subject to sections 331.423 through 331.426 331.424 and 13 other applicable state law, to permit increases in any 14 class of proposed expenditures contained in the budget 15 summary published under section 331.434, subsection 3 . 16 Sec. ___. Section 373.10, Code 2013, is amended to 17 read as follows: 18 373.10 Taxing authority. 19 The metropolitan council shall have the authority 20 to levy city taxes to the extent the city tax levy 21 authority is transferred by the charter to the 22 metropolitan council. A member city shall transfer 23 a portion of the city’s tax levy authorized under 24 section 384.1 or 384.12 , whichever is applicable, to 25 the metropolitan council. The maximum rates amount of 26 taxes authorized to be levied under sections section 27 384.1 and the taxes authorized to be levied under 28 section 384.12 by a member city shall be reduced by an 29 amount equal to the rates of the same or similar taxes 30 levied in the city by the metropolitan council. 31 Sec. ___. Section 384.1, Code 2013, is amended by 32 striking the section and inserting in lieu thereof the 33 following: 34 384.1 Property tax dollars —— maximums. 35 1. A city shall certify taxes to be levied by the 36 city on all taxable property within the city limits, 37 for all city government purposes. Annually, the city 38 council may certify basic levies for city government 39 purposes, subject to the limitation on property tax 40 dollars provided in this section. 41 2. For purposes of this section and section 384.1B, 42 unless the context otherwise requires: 43 a. “Annual growth factor” means an index, expressed 44 as a percentage, determined by the department of 45 management by January 1 of the calendar year in which 46 the budget year begins. In determining the annual 47 growth factor, the department shall calculate the 48 average of the preceding twelve-month percentage 49 change, which shall be computed on a monthly basis, 50 -9- H1311.1751 (1) 85 md/sc 9/ 15

in the midwest consumer price index, ending with the 1 percentage change for the month of November. The 2 department shall then add that average percentage 3 change to one hundred percent. In no case, however, 4 shall the annual growth factor exceed one hundred four 5 percent. 6 b. “Boundary adjustment” means annexation, 7 severance, incorporation, or discontinuance as those 8 terms are defined in section 368.1. 9 c. “Budget year” is the fiscal year beginning 10 during the calendar year in which a budget is 11 certified. 12 d. “Current fiscal year” is the fiscal year 13 ending during the calendar year in which a budget is 14 certified. 15 e. “Net new valuation taxes” means the amount of 16 property tax dollars equal to the current fiscal year’s 17 levy rate in the city for the general fund multiplied 18 by the increase from the current fiscal year to the 19 budget year in taxable valuation due to the following: 20 (1) Net new construction, excluding all incremental 21 valuation that is released in any one year from either 22 a division of revenue under section 260E.4 or an urban 23 renewal area for which taxes were being divided under 24 section 403.19 if the property for the valuation being 25 released remains subject to the division of revenue 26 under section 260E.4 or remains part of the urban 27 renewal area that is subject to a division of revenue 28 under section 403.19. 29 (2) Additions or improvements to existing 30 structures. 31 (3) Remodeling of existing structures for which a 32 building permit is required. 33 (4) Net boundary adjustment. 34 (5) A municipality no longer dividing tax revenues 35 in an urban renewal area as provided in section 403.19 36 or a community college no longer dividing revenues as 37 provided in section 260E.4. 38 (6) That portion of taxable property located in an 39 urban revitalization area on which an exemption was 40 allowed and such exemption has expired. 41 3. a. For the fiscal year beginning July 1, 2014, 42 and subsequent fiscal years, the maximum amount of 43 property tax dollars which may be certified for levy 44 by a city for the general fund shall be the maximum 45 property tax dollars calculated under paragraph “b” . 46 b. The maximum property tax dollars that may be 47 levied for deposit in the general fund is an amount 48 equal to the sum of the following: 49 (1) The annual growth factor times the current 50 -10- H1311.1751 (1) 85 md/sc 10/ 15

fiscal year’s maximum property tax dollars for the 1 general fund. 2 (2) The amount of net new valuation taxes in the 3 city. 4 4. For purposes of calculating maximum property tax 5 dollars for the city general fund for the fiscal year 6 beginning July 1, 2014, only, the term “current fiscal 7 year’s maximum property tax dollars” shall mean the 8 total amount of property tax dollars certified by the 9 city for the city’s general fund for the fiscal year 10 beginning July 1, 2013. 11 5. Property taxes certified for deposit in the 12 debt service fund in section 384.4, trust and agency 13 funds in section 384.6, capital improvements reserve 14 fund in section 384.7, the emergency fund in section 15 384.8, any capital projects fund established by the 16 city for deposit of bond, loan, or note proceeds, 17 any temporary increase approved pursuant to section 18 384.12A, property taxes collected from a voted levy 19 in section 384.12, and property taxes levied under 20 section 384.12, subsection 18, are not counted against 21 the maximum amount of property tax dollars that may be 22 certified for a fiscal year under subsection 3. 23 6. Notwithstanding the maximum amount of taxes 24 a city may certify for levy, the tax levied by a 25 city on tracts of land and improvements on the 26 tracts of land used and assessed for agricultural or 27 horticultural purposes shall not exceed three dollars 28 and three-eighths cents per thousand dollars of 29 assessed value in any year. Improvements located on 30 such tracts of land and not used for agricultural or 31 horticultural purposes and all residential dwellings 32 are subject to the same rate of tax levied by the city 33 on all other taxable property within the city. 34 7. The department of management, in consultation 35 with the city finance committee, shall adopt rules 36 to administer this section. The department shall 37 prescribe forms to be used by cities when making 38 calculations required by this section. 39 Sec. ___. NEW SECTION . 384.1B Ending fund balance. 40 1. a. Budgeted ending fund balances for a budget 41 year in excess of twenty-five percent of budgeted 42 expenditures from the general fund for that budget 43 year shall be explicitly reserved or designated for a 44 specific purpose. 45 b. A city is encouraged, but not required, to 46 reduce ending fund balances for the budget year to 47 an amount equal to approximately twenty-five percent 48 of budgeted expenditures and transfers from the 49 general fund for that budget year unless a decision 50 -11- H1311.1751 (1) 85 md/sc 11/ 15

is certified by the state appeal board ordering a 1 reduction in the ending fund balance of the fund. 2 c. In a protest to the city budget under section 3 384.19, the city shall have the burden of proving 4 that the budgeted balances in excess of twenty-five 5 percent are reasonably likely to be appropriated for 6 the explicitly reserved or designated specific purpose. 7 The excess budgeted balance for the specific purpose 8 shall be considered an increase in an item in the 9 budget for purposes of section 24.28. 10 2. a. For a city that has, as of June 30, 11 2013, reduced its ending fund balance to less than 12 twenty-five percent of actual expenditures, additional 13 property taxes may be computed and levied as provided 14 in this subsection. The additional property tax levy 15 amount is an amount not to exceed the difference 16 between twenty-five percent of actual expenditures for 17 city government purposes for the fiscal year beginning 18 July 1, 2012, minus the ending fund balance for that 19 year. 20 b. All or a portion of additional property tax 21 dollars may be levied for the purpose of increasing 22 cash reserves for city government purposes in the 23 budget year. The additional property tax dollars 24 authorized under this subsection but not levied may be 25 carried forward as unused ending fund balance taxing 26 authority until and for the fiscal year beginning 27 July 1, 2019. The amount carried forward shall not 28 exceed twenty-five percent of the maximum amount of 29 property tax dollars available in the current fiscal 30 year. Additionally, property taxes that are levied 31 as unused ending fund balance taxing authority under 32 this subsection may be the subject of a protest under 33 section 384.19, and the amount will be considered an 34 increase in an item in the budget for purposes of 35 section 24.28. The amount of additional property tax 36 dollars levied under this subsection shall not be 37 included in the computation of the maximum amount of 38 property tax dollars which may be certified and levied 39 under section 384.1. 40 Sec. ___. Section 384.12, subsection 19, Code 2013, 41 is amended by striking the subsection. 42 Sec. ___. NEW SECTION . 384.12A Authority to levy 43 beyond maximum property tax dollars. 44 1. The city council may certify additions to the 45 maximum amount of property tax dollars to be levied 46 for a period of time not to exceed two years if the 47 proposition has been submitted at a special election 48 and received a favorable majority of the votes cast on 49 the proposition. 50 -12- H1311.1751 (1) 85 md/sc 12/ 15

2. The special election is subject to the 1 following: 2 a. The city council must give at least thirty-two 3 days’ notice to the county commissioner of elections 4 that the special election is to be held. In no 5 case, however, shall a notice be given to the county 6 commissioner of elections after December 31 for an 7 election on a proposition to exceed the statutory 8 limits during the fiscal year beginning in the next 9 calendar year. 10 b. The special election shall be conducted by the 11 county commissioner of elections in accordance with 12 law. 13 c. The proposition to be submitted shall be 14 substantially in the following form: 15 Vote “yes” or “no” on the following: Shall the city 16 of _______ levy for an additional $_______ each year 17 for ___ years beginning next July 1, ____, in excess of 18 the statutory limits otherwise applicable for the city 19 general fund? 20 d. The canvass shall be held beginning at 1:00 p.m. 21 on the second day which is not a holiday following the 22 special election. 23 e. Notice of the special election shall be 24 published at least once in a newspaper as specified 25 in section 362.3 prior to the date of the special 26 election. The notice shall appear as early as 27 practicable after the city council has voted to submit 28 a proposition to the voters to levy additional property 29 tax dollars. 30 3. The amount of additional property tax dollars 31 certified under this section shall not be included in 32 the computation of the maximum amount of property tax 33 dollars which may be certified and levied under section 34 384.1. 35 Sec. ___. Section 384.19, Code 2013, is amended by 36 adding the following new unnumbered paragraph: 37 NEW UNNUMBERED PARAGRAPH . For purposes of a tax 38 protest filed under this section, “item” means a 39 budgeted expenditure, appropriation, or cash reserve 40 from a fund for a service area, program, program 41 element, or purpose. 42 Sec. ___. Section 386.8, Code 2013, is amended to 43 read as follows: 44 386.8 Operation tax. 45 A city may establish a self-supported improvement 46 district operation fund, and may certify taxes not 47 to exceed the rate limitation as established in the 48 ordinance creating the district, or any amendment 49 thereto, each year to be levied for the fund against 50 -13- H1311.1751 (1) 85 md/sc 13/ 15

all of the property in the district, for the purpose 1 of paying the administrative expenses of the district, 2 which may include but are not limited to administrative 3 personnel salaries, a separate administrative office, 4 planning costs including consultation fees, engineering 5 fees, architectural fees, and legal fees and all other 6 expenses reasonably associated with the administration 7 of the district and the fulfilling of the purposes of 8 the district. The taxes levied for this fund may also 9 be used for the purpose of paying maintenance expenses 10 of improvements or self-liquidating improvements for a 11 specified length of time with one or more options to 12 renew if such is clearly stated in the petition which 13 requests the council to authorize construction of the 14 improvement or self-liquidating improvement, whether 15 or not such petition is combined with the petition 16 requesting creation of a district. Parcels of property 17 which are assessed as residential property for property 18 tax purposes are exempt from the tax levied under this 19 section except residential properties within a duly 20 designated historic district. A tax levied under 21 this section is not subject to the levy limitation in 22 section 384.1 . 23 Sec. ___. Section 386.9, Code 2013, is amended to 24 read as follows: 25 386.9 Capital improvement tax. 26 A city may establish a capital improvement fund 27 for a district and may certify taxes, not to exceed 28 the rate established by the ordinance creating the 29 district, or any subsequent amendment thereto, 30 each year to be levied for the fund against all of 31 the property in the district, for the purpose of 32 accumulating moneys for the financing or payment 33 of a part or all of the costs of any improvement or 34 self-liquidating improvement. However, parcels of 35 property which are assessed as residential property 36 for property tax purposes are exempt from the tax 37 levied under this section except residential properties 38 within a duly designated historic district. A tax 39 levied under this section is not subject to the levy 40 limitations in section 384.1 or 384.7 . 41 Sec. ___. REPEAL. Sections 331.425 and 331.426, 42 Code 2013, are repealed. 43 Sec. ___. APPLICABILITY. This division of this Act 44 applies to fiscal years beginning on or after July 1, 45 2014. > 46 2. Page 19, line 8, after < property, > by inserting 47 < establishing limitations on city and county budgets, > 48 3. By renumbering, redesignating, and correcting 49 internal references as necessary. 50 -14- H1311.1751 (1) 85 md/sc 14/ 15 #2.