House File 2529
HOUSE FILE
BY COMMITTEE ON LOCAL
GOVERNMENT
(SUCCESSOR TO HF 2250)
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to shared governmental functions among local
2 governments by allowing certain cities and counties to be
3 certified as freedom communities, providing incentives for
4 such certification, and by modifying the establishment and
5 authority of community clusters and related county enterprise
6 authority, and providing an effective date.
7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
8 TLSB 5515HV 80
9 sc/pj/5
PAG LIN
1 1 DIVISION I
1 2 FREEDOM COMMUNITIES
1 3 Section 1. NEW SECTION. 332.1 PURPOSE.
1 4 The purpose of this chapter is to encourage the sharing of
1 5 the provision of services by political subdivisions and to
1 6 provide political subdivisions with flexibility to operate
1 7 once sharing has occurred. It is further the purpose of this
1 8 chapter to measure the effectiveness of sharing of services
1 9 and report the outcomes to the department of management and to
1 10 the residents of the community.
1 11 Sec. 2. NEW SECTION. 332.2 DEFINITIONS.
1 12 1. "Municipality" means a city or county.
1 13 2. "Political subdivision" means a city, county, school
1 14 district, township, merged area as defined in section 260C.2,
1 15 or institution under the control of the state board of
1 16 regents.
1 17 Sec. 3. NEW SECTION. 332.3 ELIGIBILITY FOR FREEDOM
1 18 COMMUNITY STATUS.
1 19 1. A municipality may achieve freedom community status if
1 20 it meets the qualifications of this section and section 332.4.
1 21 2. To be eligible for freedom community status, a city or
1 22 county shall have accomplished one of the following:
1 23 a. Adopted by referendum a charter for city=county
1 24 consolidation pursuant to sections 331.247 through 331.252.
1 25 b. Adopted by referendum a charter for a community
1 26 commonwealth pursuant to sections 331.260 through 331.263.
1 27 c. Adopted by referendum a charter for multicounty
1 28 consolidation pursuant to sections 331.253 through 331.256.
1 29 d. Adopted by referendum a charter for a consolidated
1 30 metropolitan corporation pursuant to chapter 373.
1 31 e. Entered into at least one chapter 28E agreement with
1 32 one or more political subdivisions if the duration of the
1 33 agreement is at least five years and the agreement, or the
1 34 total of all such agreements between a municipality and one or
1 35 more political subdivisions, results in the shared provision
2 1 of services by the municipality and one or more political
2 2 subdivisions the budgeted expenditures for which equal at
2 3 least twenty=five percent of budgeted expenditures for all
2 4 services provided by at least one of the parties to the 28E
2 5 agreement. A chapter 28E agreement includes a unified law
2 6 enforcement district established pursuant to sections 28E.21
2 7 through 28E.30 and a community cluster established pursuant to
2 8 sections 28E.35 through 28E.40. Chapter 28E agreements
2 9 entered into before the effective date of this Act qualify as
2 10 agreements under this paragraph if such agreements are to be
2 11 in effect for five years following the effective date of this
2 12 Act.
2 13 f. Assumed the exercise of powers and duties relating to
2 14 emergency services pursuant to section 331.385 and assumed the
2 15 exercise of powers and duties relating to cemeteries pursuant
2 16 to section 331.325.
2 17 Sec. 4. NEW SECTION. 332.4 APPLICATION FOR FREEDOM
2 18 COMMUNITY STATUS == GRANTS == PUBLIC HEARING == ELECTION.
2 19 1. A municipality must apply to the department of
2 20 management to receive certification as a freedom community.
2 21 The application must show that the municipality has done all
2 22 of the following:
2 23 a. Qualifies as a freedom community pursuant to section
2 24 332.3. The municipality shall submit with the application for
2 25 freedom community status an abstract of the votes on the
2 26 referendum cited in section 332.3, subsection 2, or a summary
2 27 and signature page of the chapter 28E agreement along with
2 28 documentation showing that the agreement results in shared
2 29 services meeting the requirements of section 332.3, subsection
2 30 2, paragraph "f", or a copy of the ordinance required by
2 31 section 331.325 and a copy of the resolution required by
2 32 section 331.385.
2 33 b. Prepared plans for development of a format for
2 34 tailoring the accountability report required by section 332.6
2 35 to include information specific to the proposed freedom
3 1 community area.
3 2 2. The application of a municipality for freedom community
3 3 status may include an application for a grant from the local
3 4 government innovations fund for technical assistance or
3 5 facilitation of efforts to achieve freedom community status,
3 6 including financial assistance to pay for a commission process
3 7 required by statute and necessary to become eligible in
3 8 section 332.3, subsection 2, paragraphs "a" through "d". A
3 9 municipality applying for freedom community status and
3 10 submitting the documents required by subsection 1, paragraph
3 11 "a", may receive a grant from the local government innovations
3 12 fund even if freedom community status is denied.
3 13 3. Prior to submitting an application for freedom
3 14 community status to the department of management, the
3 15 governing body of the municipality shall hold a public hearing
3 16 on the application. Notice of the date and time of the public
3 17 hearing and a summary of the application shall be published in
3 18 a newspaper of general circulation in the municipality not
3 19 less than four nor more than twenty days before the hearing.
3 20 The governing body shall receive comments on the application
3 21 from those attending the public hearing.
3 22 4. The department of management shall notify a
3 23 municipality when it has received the municipality's
3 24 application for certification as a freedom community. The
3 25 department shall grant or deny freedom community certification
3 26 to a municipality within forty=five days of receiving the
3 27 application. The department shall immediately notify the
3 28 municipality of the action taken on the application.
3 29 5. After certification as a freedom community has been
3 30 granted by the department of management, the certification
3 31 must be approved by the electors of the municipality before
3 32 taking effect. The governing body of the municipality shall
3 33 direct the county commissioner of elections to submit the
3 34 proposition at a special election. The special election may
3 35 be the same day as the general election if the municipality is
4 1 a county and may be the same day as the regular city election
4 2 if the municipality is a city. The proposition is adopted if
4 3 it receives a favorable majority of the votes cast on the
4 4 proposition at the election.
4 5 Sec. 5. NEW SECTION. 332.5 DEPARTMENT OF MANAGEMENT ==
4 6 DUTY TO MONITOR == ANNUAL REPORT.
4 7 Once a municipality has been certified as a freedom
4 8 community, the department of management shall monitor and
4 9 annually report on tax collections, other revenue, and
4 10 expenditures of the freedom community and compare such
4 11 information with similar information of local governments that
4 12 have not applied for or been granted freedom community status.
4 13 If provided in a timely manner, a summary of these comparisons
4 14 may be included in the accountability report in section 332.6.
4 15 The report shall also include a brief description of waivers
4 16 granted and alternative methods of compliance approved
4 17 pursuant to section 332.11. The department shall submit a
4 18 summary of the report for the most recently ended fiscal year
4 19 to the general assembly by January 15 of each year.
4 20 Sec. 6. NEW SECTION. 332.6 ACCOUNTABILITY REPORT.
4 21 1. A municipality certified as a freedom community shall
4 22 report every twelve months on progress made in planning and
4 23 goal setting for additional mergers of services, joint
4 24 operations of facilities, or reorganization of government.
4 25 2. The freedom community shall determine when the report
4 26 shall be prepared, the manner in which the public shall be
4 27 notified of the availability of the report, and the means by
4 28 which the public may access or obtain a copy of the report.
4 29 3. The department of management, in consultation with the
4 30 city finance committee and the county finance committee, shall
4 31 formulate standards for uniform information to be included in
4 32 the report. The standards for reporting must emphasize
4 33 simplified and clear reporting. The standards for reporting
4 34 must allow for flexibility for communities to report
4 35 information specific to their community.
5 1 Sec. 7. NEW SECTION. 332.7 CITIZEN COMMISSION.
5 2 The governing body of a municipality that is certified as a
5 3 freedom community may establish a citizen commission charged
5 4 with planning and setting goals for the freedom community.
5 5 The citizen commission shall establish an agenda for the
5 6 future relating to provision of services and operation of
5 7 facilities in the freedom community.
5 8 Sec. 8. NEW SECTION. 332.8 COMPLIANCE.
5 9 1. The governing body of a municipality certified as a
5 10 freedom community that fails to comply with the reporting
5 11 requirement in section 332.6 shall be notified by the
5 12 department of that fact. The department's notification shall
5 13 inform the governing body that it must rectify the areas of
5 14 noncompliance within twelve months or freedom community
5 15 certification will be withdrawn. The department shall
5 16 withdraw certification for noncompliance after twelve months.
5 17 2. After certification as a freedom community has been
5 18 approved at election, the governing body shall submit to the
5 19 department of management a report showing the per capita tax
5 20 and fee collections of the municipality for the fiscal year
5 21 immediately preceding the first fiscal year under which the
5 22 municipality operates as a freedom community. For each
5 23 subsequent fiscal year, the municipality, on or before
5 24 December 15 following the end of the fiscal year, shall
5 25 provide a report showing the per capita tax and fee
5 26 collections of the municipality. If, after applying inflation
5 27 and population increases or decreases to such per capita
5 28 figures, the department determines that the municipality has
5 29 increased tax and fee collections per capita as a freedom
5 30 community, the department shall notify the municipality that
5 31 freedom community certification shall be withdrawn beginning
5 32 with the fiscal year following the calendar year in which the
5 33 determination is made. The department shall make a
5 34 determination under this subsection no sooner than February 15
5 35 following submission of the report by the municipality. The
6 1 municipality may apply to the department to have withdrawal of
6 2 certification delayed for another fiscal year.
6 3 Sec. 9. NEW SECTION. 332.9 FREEDOM COMMUNITY FINANCIAL
6 4 FLEXIBILITIES.
6 5 1. If a county that is a freedom community wishes to
6 6 impose a countywide local option sales tax, the county may do
6 7 so by resolution of the board of supervisors and by approval
6 8 of the proposition to impose the sales tax by a majority of
6 9 persons in the county voting on the proposition voting in
6 10 favor of such proposition, notwithstanding the election
6 11 requirements of section 422B.8. If the proposition is
6 12 approved, the local option sales tax revenue shall be
6 13 allocated in the manner provided in section 422B.10. A
6 14 freedom community shall not impose a local option sales tax if
6 15 imposition of such a tax has already been approved under
6 16 chapter 422B.
6 17 2. A municipality certified as a freedom community may
6 18 adopt ordinances creating special taxing districts for
6 19 delivering services and may impose property tax levies on
6 20 property located within the districts, including the delivery
6 21 of a service jointly with another political subdivision.
6 22 3. The county board of supervisors of a county certified
6 23 as a freedom community may direct the county auditor to
6 24 establish a rural debt service tax district for the purpose of
6 25 issuing general obligation bonds for rural county services.
6 26 The rural debt service tax district shall include only
6 27 unincorporated portions of the county. The county's debt
6 28 service tax levy for the general obligation bonds for rural
6 29 county services shall be levied only against taxable property
6 30 within the county which is included within the boundaries of
6 31 the rural debt service tax district. The board may issue
6 32 general obligation bonds for general county purposes and
6 33 essential county purposes in the rural debt service tax
6 34 district if such stated purpose is intended to exclusively
6 35 benefit those persons residing in the county outside of
7 1 incorporated city areas. General obligation bonds for rural
7 2 county services are subject to approval at an election held in
7 3 the manner provided in section 331.442, subsections 1 through
7 4 4, except that only those registered voters residing within
7 5 the rural service area tax district may vote on the
7 6 proposition.
7 7 Sec. 10. NEW SECTION. 332.10 STATE REIMBURSEMENTS AND
7 8 LOCAL GOVERNMENT ASSISTANCE == COMPLIANCE WITH STATE MANDATES.
7 9 1. Notwithstanding any provision of the Code to the
7 10 contrary, if a state appropriation that reimburses cities and
7 11 counties or that otherwise provides local government
7 12 assistance to cities and counties is reduced as a result of
7 13 the governor's action pursuant to section 8.31 to reduce
7 14 appropriations to prevent a deficit in the general fund of the
7 15 state or as a result of the action of the general assembly to
7 16 limit or reduce a standing appropriation or to not appropriate
7 17 a sufficient amount, the actual amount appropriated shall
7 18 first be used to reimburse or compensate, in full, all amounts
7 19 due to cities and counties certified as freedom communities as
7 20 provided in the law establishing the amount of the
7 21 reimbursement or local government assistance.
7 22 This subsection does not apply to local government
7 23 assistance appropriated by the general assembly as a result of
7 24 operation of section 25B.2.
7 25 2. A municipality certified as a freedom community shall
7 26 not be required to comply with a state mandate as that term is
7 27 defined in section 25B.3 unless the total cost of the state
7 28 mandate is funded by the state pursuant to section 25B.2.
7 29 This subsection does not apply to mandates originating with
7 30 the federal government; mandates relating to the conduct of
7 31 elections in the state; and mandates which provide for local
7 32 funding in the legislation containing the mandate, such as
7 33 allowing imposition of a fee or providing for an increase in
7 34 any maximum property tax levy rate authorized by state law.
7 35 Sec. 11. NEW SECTION. 332.11 WAIVER OF STATUTORY
8 1 REQUIREMENTS AND STATE RULES.
8 2 1. A municipality certified as a freedom community may
8 3 apply to a department of state government for a waiver of
8 4 rules adopted by the department relating to delivery of a
8 5 service or implementation of a statutory requirement. The
8 6 application shall state an alternative method proposed by the
8 7 municipality. A department may adopt rules that specifically
8 8 address requirements of municipalities certified as freedom
8 9 communities relating to delivery of a service or
8 10 implementation of a statutory requirement that result in
8 11 greater authority and flexibility for the freedom community.
8 12 2. A department shall notify the department of management
8 13 when the department has granted a waiver pursuant to
8 14 subsection 2. The notification shall briefly describe the
8 15 waiver granted and the alternative method of compliance
8 16 approved by the department.
8 17 Sec. 12. EFFECTIVE DATE. This division of this Act, being
8 18 deemed of immediate importance, takes effect upon enactment.
8 19 DIVISION II
8 20 COMMUNITY CLUSTERS
8 21 Sec. 13. Section 28E.35, Code 2003, is amended to read as
8 22 follows:
8 23 28E.35 DEFINITIONS.
8 24 As used in this division unless the context otherwise
8 25 requires:
8 26 1. "Community cluster" means a cooperative community unit
8 27 established pursuant to this chapter for the joint exercise of
8 28 powers by two or more governmental units and for sharing one
8 29 or more governmental functions between two or more
8 30 governmental units participating in a community cluster.
8 31 2. "Governing board" means the governing board of a
8 32 community cluster appointed pursuant to section 28E.37.
8 33 2. 3. "Governmental unit" means a city, county, township,
8 34 school district, merged area as defined in section 260C.2, or
8 35 special taxing district.
9 1 4. "Shared governmental function" includes, but is not
9 2 limited to, joint delivery of services, joint operation of
9 3 facilities, joint development of infrastructure, or joint
9 4 fostering of economic development.
9 5 Sec. 14. Section 28E.36, Code 2003, is amended to read as
9 6 follows:
9 7 28E.36 ESTABLISHMENT OF COMMUNITY CLUSTER.
9 8 Two or more governmental units located in the state may, by
9 9 resolution of each governmental unit, establish a community
9 10 cluster by entering into an agreement for the joint exercise
9 11 of powers pursuant to this chapter to make more efficient use
9 12 of their resources by providing for joint functions, services,
9 13 facilities, development of infrastructure and for revenue
9 14 sharing, and to foster economic development shared
9 15 governmental functions between two or more of the governmental
9 16 units participating in the community cluster.
9 17 A community cluster and its governing board shall have all
9 18 the rights, powers, duties, privileges, and immunities of a
9 19 governmental unit and governmental unit governing body to the
9 20 extent that such rights, powers, duties, privileges, and
9 21 immunities relate to shared governmental functions of the
9 22 governmental units participating in the community cluster.
9 23 Sec. 15. Section 28E.37, Code 2003, is amended by striking
9 24 the section and inserting in lieu thereof the following:
9 25 28E.37 COMMUNITY CLUSTER GOVERNING BOARD.
9 26 The governing body of each governmental unit participating
9 27 in a community cluster shall appoint two of its members to a
9 28 community cluster governing board. However, an alternative
9 29 board composition may be agreed upon by the participating
9 30 governmental units. A member of the governing board shall
9 31 serve for two years or until the member's term on the
9 32 governing body of the governmental unit expires, whichever is
9 33 earlier. A vacancy on the governing board shall be filled in
9 34 the same manner as the original appointment. A member of the
9 35 governing board shall not receive compensation for service on
10 1 the governing board.
10 2 Sec. 16. Section 28E.38, Code 2003, is amended by striking
10 3 the section and inserting in lieu thereof the following:
10 4 28E.38 POWERS AND DUTIES OF GOVERNING BOARD == EXISTING
10 5 BONDED INDEBTEDNESS == TAXING AUTHORITY.
10 6 1. The governing board shall identify governmental
10 7 functions, services, facilities, development of
10 8 infrastructure, or economic development efforts that will be
10 9 shared or jointly provided or operated within the community
10 10 cluster.
10 11 2. The governing board shall establish an official name
10 12 for the community cluster.
10 13 3. The governing board may provide for the transfer or
10 14 other disposition of property and other rights, claims,
10 15 assets, and franchises as they relate to a shared governmental
10 16 function within the community cluster, subject to approval of
10 17 the governing body of the governmental unit that has
10 18 jurisdiction over such property or other rights, claims,
10 19 assets, and franchises. The governing body of a governmental
10 20 unit participating in a community cluster may make donations
10 21 of property, real or personal, including gratuitous leases, to
10 22 the community cluster and the governing board as deemed proper
10 23 and appropriate in aiding the community cluster and the
10 24 governing board effectuate their purposes.
10 25 4. The governing board may provide for the transfer,
10 26 reorganization, abolition, adjustment, and absorption or
10 27 merger of existing boards, existing subordinate service
10 28 districts, local improvement districts, and agencies of the
10 29 participating governmental units to the extent they relate to
10 30 a shared governmental function within the community cluster,
10 31 subject to approval of the governing body of the governmental
10 32 unit that has jurisdiction over such boards, districts, and
10 33 agencies.
10 34 5. The governing board may determine the boundaries of the
10 35 service areas within the community cluster and shall provide
11 1 for administration of the provision of services in each of the
11 2 designated service areas.
11 3 6. The governing board may employ and fix the compensation
11 4 of administrative, technical, professional, and clerical
11 5 assistance as necessary to administer a shared governmental
11 6 function.
11 7 7. a. The governing board may adopt budgets for shared
11 8 governmental functions within the community cluster and may
11 9 levy property taxes to the extent the taxing authority of a
11 10 participating governmental unit is transferred to the
11 11 community cluster to fund a shared governmental function. The
11 12 governing board in its budget shall allocate the revenue
11 13 responsibilities of each governmental unit participating in
11 14 the community cluster. The governing board shall follow the
11 15 same procedures for adoption of a budget as if the community
11 16 cluster were a city and the governing board a city council.
11 17 b. The governing board may devise formulas for the
11 18 transfer of taxing authority from governmental units that are
11 19 participating in the community cluster to the governing board
11 20 of the community cluster to fund a shared governmental
11 21 function. The maximum rates of taxes authorized to be levied
11 22 by a governmental unit participating in a community cluster
11 23 shall be reduced by an amount equal to that portion of the
11 24 levy rates transferred to the authority of the governing
11 25 board.
11 26 c. In lieu of transferring property taxing authority to a
11 27 governing board, a governmental unit participating in a
11 28 community cluster may meet its shared revenue obligations by
11 29 transferring other sources of revenue authorized to be
11 30 collected by the governmental unit.
11 31 8. The governing board may accept donations,
11 32 contributions, grants, or gifts from individuals,
11 33 associations, municipal and private corporations, and the
11 34 United States, or any agency or instrumentality of the United
11 35 States, and may enter into agreements in connection therewith.
12 1 9. The governing board may issue bonded indebtedness to
12 2 the extent authorized in section 28E.39.
12 3 10. By December 1 of each year, the governing board shall
12 4 provide a report relating to shared governmental functions and
12 5 administration of the community cluster to the governing body
12 6 of each governmental unit participating in the community
12 7 cluster.
12 8 Sec. 17. Section 28E.39, Code 2003, is amended by striking
12 9 the section and inserting in lieu thereof the following:
12 10 28E.39 ISSUANCE OF BONDS == APPROVAL BY ELECTORATE.
12 11 1. The governing board may propose the expenditure of
12 12 funds, the issuance of revenue bonds, entering into a lease=
12 13 purchase agreement, or the issuance of general obligation
12 14 bonds for the following:
12 15 a. Acquisition of a construction site and construction of
12 16 a building or facility for common public use by two or more
12 17 governmental units participating in the community cluster.
12 18 b. Purchase of an existing building or facility for public
12 19 use, or conversion of a building or facility previously owned
12 20 and maintained by a governmental unit for public use by two or
12 21 more governmental units participating in the community
12 22 cluster.
12 23 c. Equipping or furnishing a new or existing building or
12 24 facility for public use by two or more governmental units
12 25 participating in the community cluster.
12 26 d. Operation, maintenance, or improvement of a building or
12 27 facility for public use by two or more governmental units
12 28 participating in the community cluster.
12 29 e. Any other aspect of construction, acquisition,
12 30 furnishing, operation, or maintenance of a building or
12 31 facility for public use by two or more governmental units
12 32 participating in the community cluster, such other aspect
12 33 having been proposed by the governing board and not otherwise
12 34 prohibited by law.
12 35 2. The proposal shall be forwarded to the governing body
13 1 of each governmental unit participating in the community
13 2 cluster that is listed in the proposal as being allocated a
13 3 portion of the cost for any of the purposes in subsection 1,
13 4 paragraphs "a" through "e". The proposal shall specify the
13 5 purposes for which the building or facility shall be used, the
13 6 estimated cost of the building or facility, the estimated
13 7 amount of the cost to be allocated to each of the
13 8 participating governmental units, the proportion and method of
13 9 allocating the expenses of the operation and maintenance of
13 10 the building or facility or improvement, and the disposition
13 11 to be made of any revenues to be derived from operation of the
13 12 building or facility.
13 13 3. a. If a proposal for expenditure of funds, for
13 14 issuance of revenue bonds, or for issuance of general
13 15 obligation bonds described in the proposal as essential county
13 16 purpose bonds or essential corporate purpose bonds is approved
13 17 by the governing body of each governmental unit named in the
13 18 proposal, the governing board may include such expenditures in
13 19 its budget for the following fiscal year.
13 20 b. If a proposal for issuance of general obligation bonds
13 21 described in the proposal as general county purpose bonds or
13 22 general corporate purpose bonds or for entering into a lease=
13 23 purchase agreement is approved by the governing body of each
13 24 governmental unit named in the proposal, the governing board
13 25 shall direct the county commissioner of elections to submit
13 26 the proposition at a special election. The special election
13 27 may be held on the same day as the general election if the
13 28 county commissioner determines that the elections will not
13 29 conflict. However, the election shall be held on the same day
13 30 in each governmental unit voting on the proposition. Only
13 31 those registered voters living within the governmental units
13 32 named in the proposal may vote on the proposition. If
13 33 necessary, the election shall be conducted pursuant to section
13 34 47.2, subsections 2 through 4. The proposition shall be
13 35 adopted if the vote in favor of the proposition is equal to at
14 1 least sixty percent of the vote cast for and against the
14 2 proposition in each governmental unit named in the proposal.
14 3 4. The governing board when issuing indebtedness pursuant
14 4 to this section shall follow the procedures for issuance of
14 5 debt as if the governing board were a city council or a county
14 6 board of supervisors and the applicable bonding provisions of
14 7 chapters 74, 75, 331, and 384 shall apply.
14 8 5. Indebtedness issued pursuant to this section shall
14 9 constitute a debt of the governmental units named in the
14 10 proposal in the same proportion that the cost of the project
14 11 is allocated to the governmental units and such indebtedness
14 12 is subject to any statutory or constitutional limitation on
14 13 issuance of debt if the debt would be subject to such
14 14 limitation if it were issued by a governmental unit acting
14 15 alone.
14 16 Sec. 18. Section 28E.40, Code 2003, is amended by striking
14 17 the section and inserting in lieu thereof the following:
14 18 28E.40 JOINING COMMUNITY CLUSTER OR TERMINATING
14 19 PARTICIPATION.
14 20 1. A governmental unit, by resolution, may request to join
14 21 an existing community cluster. The governing body of the
14 22 governmental unit shall forward the resolution to the
14 23 governing bodies of each governmental unit participating in
14 24 the community cluster. If each of the governing bodies
14 25 approves the resolution, the governmental unit is included in
14 26 the community cluster and shall appoint two of the members of
14 27 its governing body to the governing board of the community
14 28 cluster.
14 29 2. A governmental unit, by resolution, may terminate its
14 30 participation in a community cluster. Immediately upon its
14 31 adoption by the governing body of the governmental unit
14 32 seeking termination of its participation in the community
14 33 cluster, the resolution shall be forwarded to the governing
14 34 board. A resolution to terminate participation is subject to
14 35 the governmental unit seeking to terminate participation and
15 1 the remaining participating governmental units reaching
15 2 agreement relating to adjustment, transfer, or disposition of
15 3 debt and revenue obligations of the governmental unit seeking
15 4 to terminate participation. The governing board is not
15 5 empowered to deny termination but it may set a timetable, not
15 6 to exceed eighteen months after adoption of the resolution,
15 7 for termination to be fully effective.
15 8 Sec. 19. Section 331.461, subsection 2, Code 2003, is
15 9 amended by adding the following new paragraph:
15 10 NEW PARAGRAPH. h. Port facilities or port facilities
15 11 systems, including without limitation, real and personal
15 12 property, water, buildings, improvements, and equipment useful
15 13 and suitable for taking care of the needs of commerce and
15 14 shipping, and also including without limitation, wharves,
15 15 docks, basins, piers, quay walls, warehouses, tunnels, belt
15 16 railway facilities, cranes, dock apparatus, and other
15 17 machinery necessary for the convenient and economical
15 18 accommodation and handling of watercraft of all kinds and of
15 19 freight and passengers.
15 20 EXPLANATION
15 21 This bill relates to shared governmental functions among
15 22 local governments.
15 23 Division I of the bill allows a municipality (a city or a
15 24 county) to apply to the department of management for
15 25 certification as a freedom community.
15 26 The division provides that a municipality is eligible for
15 27 freedom community status if it has adopted a charter for city=
15 28 county consolidation, community commonwealth, multicounty
15 29 consolidation, or consolidated metropolitan corporation; or if
15 30 the municipality has entered into a Code chapter 28E agreement
15 31 of at least five years in duration if the agreement results in
15 32 services shared between political subdivisions equal to at
15 33 least 25 percent of budgeted expenditures for services of at
15 34 least one of the parties to the Code chapter 28E agreement.
15 35 The division provides that an eligible municipality shall
16 1 apply to the department of management for certification as a
16 2 freedom community. The division requires the municipality to
16 3 hold a public hearing on the freedom community application
16 4 before submitting the application to the department of
16 5 management. The department of management has 45 days in which
16 6 to act on an application for freedom community status. The
16 7 division provides that if the department grants certification,
16 8 the certification must be approved at an election.
16 9 The division requires the department of management to
16 10 monitor tax collections, other revenue, and expenditures of
16 11 freedom communities and to compare these items to
16 12 municipalities that have not been certified as freedom
16 13 communities. The division further requires that the
16 14 department prepare an annual report containing this
16 15 information and containing information on waivers granted to
16 16 freedom communities by state departments.
16 17 The division provides that each municipality certified as a
16 18 freedom community shall every 12 months prepare an
16 19 accountability report. The division provides that if a
16 20 municipality certified as a freedom community fails to comply
16 21 with this requirement, the department of management shall
16 22 notify the governing body of the municipality that it must
16 23 rectify the areas of noncompliance within 12 months or freedom
16 24 community certification will be withdrawn. The division also
16 25 provides that the freedom community must submit data showing
16 26 that per capita tax and fee collections have not increased
16 27 subsequent to certification as a freedom community or freedom
16 28 community certification will be withdrawn.
16 29 The division further provides that each municipality
16 30 certified as a freedom community may establish a citizen
16 31 commission to plan and set goals for the freedom community.
16 32 The division allows a county certified as a freedom
16 33 community to impose a local option sales and services tax if
16 34 the tax is approved at a countywide election. The division
16 35 also allows a municipality certified as a freedom community to
17 1 create special taxing districts for services and to impose
17 2 property tax levies within those districts. The division
17 3 allows a freedom community that is a county to issue rural
17 4 general obligation bonds payable from property taxes levied in
17 5 the unincorporated areas of the county. The bonds are subject
17 6 to the election requirements for countywide general obligation
17 7 bonds.
17 8 The division provides that if reimbursements or local
17 9 government assistance provided by the state to cities and
17 10 counties are reduced by appropriation or by action of the
17 11 governor, the amount of the actual appropriation shall be
17 12 first paid in full to freedom communities before the remainder
17 13 is paid to other cities and counties. This does not apply to
17 14 appropriations made to fund a specific state mandate. The
17 15 division further provides that a freedom community shall not
17 16 be required to implement a state mandate unless the total cost
17 17 of the mandate is funded by the state. This provision does
17 18 not apply to mandates originating with the federal government,
17 19 mandates relating to the conduct of elections, or legislation
17 20 containing a mandate that also provides for increased
17 21 authority for local funding of the mandate.
17 22 The division allows a municipality certified as a freedom
17 23 community to apply to a department of state government for a
17 24 waiver of rules adopted by the department relating to delivery
17 25 of a service or implementation of a statutory requirement if
17 26 the application proposes an alternative method. The division
17 27 also allows a department to adopt rules that result in greater
17 28 authority and flexibility for municipalities certified as
17 29 freedom communities.
17 30 This division of the bill takes effect upon enactment.
17 31 Division II of the bill expands current statutory
17 32 provisions relating to establishment of community clusters.
17 33 Community clusters are cooperative community units established
17 34 for the joint exercise of powers by two or more governmental
17 35 units.
18 1 Currently, a governmental unit that may participate in a
18 2 community cluster is defined as a city, county, or special
18 3 taxing district. The division adds townships, school
18 4 districts, and merged areas (community colleges) to the
18 5 definition of governmental unit. The division defines "shared
18 6 governmental functions" to include joint delivery of services,
18 7 joint operation of facilities, joint development of
18 8 infrastructure, and joint fostering of economic development.
18 9 The division provides that a community cluster and its
18 10 governing board shall have all the rights, powers, duties,
18 11 privileges, and immunities, as they relate to shared
18 12 governmental functions, as those governmental units
18 13 participating in the community cluster.
18 14 The division provides that the governing body of each
18 15 governmental unit participating in a community cluster may
18 16 appoint two of its members to a community cluster governing
18 17 board unless a different board membership is agreed upon by
18 18 the participating governmental units. The term of a member of
18 19 the governing board is two years or until the member's term on
18 20 the governing body expires, whichever is earlier.
18 21 The division requires the governing board to identify
18 22 shared governmental functions of the community cluster. The
18 23 division authorizes the governing board to provide for
18 24 transfer or disposition of property, subject to the approval
18 25 of the applicable governing body; reorganization of existing
18 26 administrative boards, agencies, and services districts
18 27 subject to the approval of the applicable governing body; to
18 28 accept donations, contributions, grants, or gifts; and to
18 29 employ necessary personnel insofar as all of these things
18 30 relate to administration of shared governmental functions
18 31 within the community cluster. The division also provides that
18 32 the governing board has the authority to adopt budgets for
18 33 shared governmental functions. The division allows the
18 34 governing board to devise formulas for the transfer of taxing
18 35 authority from participating governmental units to fund shared
19 1 governmental functions. Any amount of taxing authority
19 2 transferred shall be subtracted from the statutory maximum, if
19 3 any, for that governmental unit. A participating governmental
19 4 unit may transfer other revenues, in lieu of transferring
19 5 property tax authority, in order to meet its shared revenue
19 6 obligations. The division requires the governing board to
19 7 report annually to the governing body of each governmental
19 8 unit participating in the community cluster.
19 9 The division authorizes the governing board to expend
19 10 funds, enter into lease=purchase agreements, and issue revenue
19 11 bonds or general obligation bonds for acquisition,
19 12 construction, improvement, equipping, maintenance, and
19 13 operation of a building or facility for common public use by
19 14 two or more governmental units participating in the community
19 15 cluster. The proposal to expend funds or issue debt for a
19 16 building or facility must be approved by the governing body of
19 17 each governmental unit named in the proposal as being
19 18 allocated a portion of the cost of the building or facility.
19 19 The division provides that the governing board is to proceed
19 20 as if it were a city or a county expending the funds or
19 21 issuing the indebtedness. This means, among other things,
19 22 that if the proposal identifies the bonds as general county
19 23 purpose or general corporate purpose bonds, issuance of such
19 24 bonds must be approved at an election. Indebtedness that
19 25 would be subject to any statutory or constitutional limitation
19 26 if a governmental unit had issued the debt acting alone shall
19 27 be considered debt of the governmental unit as part of the
19 28 community cluster in the same proportion that the costs of the
19 29 building or facility were allocated to the governmental unit.
19 30 The division allows a governmental unit, by resolution, to
19 31 request joining an existing community cluster. The resolution
19 32 must be approved by the governing bodies of each governmental
19 33 unit participating in the community cluster. The division
19 34 also allows a governmental unit, by resolution, to terminate
19 35 participation in a community cluster. The governing board may
20 1 not deny termination, but it may set a timetable, not to
20 2 exceed 18 months, for termination to be fully effective. An
20 3 agreement relating to remaining debt and revenue obligations
20 4 is required before termination can occur.
20 5 The division adds port facilities and port facilities
20 6 systems to the definition of county enterprise. Currently,
20 7 port facilities and port facilities systems are included in
20 8 the definition of city enterprise.
20 9 The division strikes a provision of the Code that required
20 10 an election before a community cluster could share property
20 11 tax revenues. The division also strikes a provision of the
20 12 Code relating to establishment of regional metropolitan
20 13 service areas.
20 14 LSB 5515HV 80
20 15 sc/pj/5