House Study Bill 227
HOUSE FILE
BY (PROPOSED COMMITTEE ON
HUMAN RESOURCES BILL
BY CHAIRPERSON SMITH)
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to individual development accounts available to
2 certain persons with low income and providing effective and
3 applicability date provisions.
4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
5 TLSB 2441HC 83
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PAG LIN
1 1 Section 1. Section 541A.2, subsection 1, Code 2009, is
1 2 amended to read as follows:
1 3 1. a. To be eligible to open an account, a prospective
1 4 account holder must have a household income that is equal to
1 5 or less than two hundred percent of the federal poverty level.
1 6 b. The account is shall be kept in the name of an
1 7 individual account holder.
1 8 Sec. 2. Section 541A.2, subsections 4 and 5, Code 2009,
1 9 are amended to read as follows:
1 10 4. During a calendar year, with the approval of the
1 11 operating organization, an account holder may withdraw make
1 12 withdrawals from the account holder's account the sum of the
1 13 for any of the following authorized purposes:
1 14 a. With the approval of the operating organization,
1 15 amounts withdrawn for any of the following approved purposes:
1 16 (1) Educational costs at an accredited institution of
1 17 higher education.
1 18 (2) b. Training costs for an accredited or licensed
1 19 training program.
1 20 (3) c. Purchase of a primary residence.
1 21 (4) d. Capitalization of a small business start=up.
1 22 (5) e. An improvement to a primary residence which
1 23 increases the tax basis of the property.
1 24 (6) f. Emergency medical costs for the account holder or
1 25 for a member of the account holder's family. However, a
1 26 withdrawal for this purpose is limited to once during the life
1 27 of the account and the amount of the withdrawal shall not
1 28 exceed ten percent of the account balance at the time of the
1 29 withdrawal.
1 30 (7) g. A purpose approved authorized in accordance with
1 31 rule for a refugee individual development account.
1 32 (8) h. Purchase of an automobile.
1 33 (9) i. Purchase of assistive technology, home or vehicle
1 34 modification, or other device or physical improvement to
1 35 assist an account holder or family member with a disability.
2 1 (10) j. Other purpose approved authorized in accordance
2 2 with rule that is intended to move the account holder or a
2 3 family member toward a higher degree of self=sufficiency.
2 4 b. At the account holder's discretion, if the account
2 5 holder is at least fifty=nine and one=half years of age, any
2 6 amount.
2 7 5. An account holder shall not withdraw moneys from the
2 8 holder's account unless the withdrawal is authorized under
2 9 subsection 4.
2 10 Sec. 3. Section 541A.3, subsection 1, paragraph a, Code
2 11 2009, is amended to read as follows:
2 12 a. Payment by the state of a state savings match on
2 13 amounts of up to two thousand dollars that an account holder
2 14 deposits in the account holder's account. To be eligible to
2 15 receive a state match an account holder must have a household
2 16 income that is equal to or less than two hundred percent of
2 17 the federal poverty level.
2 18 Sec. 4. Section 541A.5, subsection 2, paragraph c, Code
2 19 2009, is amended to read as follows:
2 20 c. Subject to the availability of funding, the commission
2 21 may adopt rules implementing an individual development account
2 22 program for refugees. Rules shall identify purposes approved
2 23 authorized for withdrawals to meet the special needs of
2 24 refugee families.
2 25 Sec. 5. EFFECTIVE DATE AND RETROACTIVE APPLICABILITY.
2 26 This Act, being deemed of immediate importance, takes effect
2 27 upon enactment, is retroactively applicable to January 1,
2 28 2009.
2 29 EXPLANATION
2 30 This bill relates to individual development accounts
2 31 available to certain persons with low income under Code
2 32 chapter 541A. Deposits to an account may receive a match
2 33 payment of up to $2,000.
2 34 Under current law in Code section 541A.3, eligibility for
2 35 the match payment is limited to account holders with a
3 1 household income of less than 200 percent of the federal
3 2 poverty level. The bill shifts this income restriction to
3 3 instead be applicable to eligibility to open an account.
3 4 Code section 541A.2, subsections 4 and 5, are amended to
3 5 make a terminology change relating to the purposes authorized
3 6 for making withdrawals from accounts, to consolidate the
3 7 requirements for making withdrawals, and for renumbering.
3 8 Code section 541.5, relating to the rules for the program, is
3 9 amended to include a conforming change to the purposes
3 10 authorized for withdrawals from a refugee account.
3 11 An authorization in Code section 514.2, subsection 4,
3 12 allowing an account holder who is at least 59 and one=half
3 13 years old to withdraw any amount from their account is
3 14 eliminated.
3 15 The bill takes effect upon enactment and is retroactively
3 16 applicable to January 1, 2009.
3 17 LSB 2441HC 83
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