House Study Bill 672 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON REBUILD IOWA AND DISASTER RECOVERY BILL BY CHAIRPERSON SCHUELLER) A BILL FOR An Act relating to emergency management by creating an 1 emergency management trust fund, creating certain insurance 2 policy surcharges, and making appropriations. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5853HC (2) 83 tm/nh

H.F. _____ Section 1. NEW SECTION . 29C.8B Emergency management trust 1 fund. 2 1. An emergency management trust fund is created in the 3 state treasury under the control of the homeland security 4 and emergency management division for purposes of funding 5 county emergency management programs. The trust fund shall 6 consist of surcharges imposed pursuant to subsection 2, moneys 7 appropriated by the general assembly, and moneys available to 8 and obtained or accepted by the division from the United States 9 or private sources for placement in the trust fund. Moneys 10 in the trust fund are appropriated to the division for the 11 purposes provided in this section. Section 8.33 shall not 12 apply to moneys in the trust fund. Notwithstanding section 13 12C.7, moneys earned as income or interest from the trust fund 14 shall remain in the trust fund until expended as provided in 15 this section. 16 2. The following surcharges shall be applied, remitted 17 to the department of revenue, and deposited in the emergency 18 management trust fund: 19 a. An annual surcharge of one dollar per policy shall be 20 charged on every individual renter’s insurance policy issued or 21 renewed on or after July 1, 2010. 22 b. An annual surcharge of two dollars per policy shall 23 be charged on every homeowner’s, mobile homeowner’s, and 24 condominium unit owner’s insurance policy issued or renewed on 25 or after July 1, 2010. 26 c. An annual surcharge of four dollars per policy shall be 27 placed on every commercial fire, commercial multiple peril, and 28 business owner’s insurance policy issued or renewed on or after 29 July 1, 2010. 30 3. The insurer shall collect the surcharges required in 31 subsection 2 and remit such charges to the department of 32 revenue for deposit in the emergency management trust fund. 33 4. The surcharges required in subsection 2 shall not be 34 considered premiums of the insurer; however, nonpayment of 35 -1- LSB 5853HC (2) 83 tm/nh 1/ 4

H.F. _____ a surcharge by the insured may be a valid reason for policy 1 cancellation. 2 5. Moneys in the emergency management trust fund shall be 3 used and distributed as follows: 4 a. Fifty percent of the available balance on June 30 of each 5 year shall be awarded by the division through a competitive 6 grant process to county emergency management commissions to 7 provide funding assistance for emergency mitigation projects. 8 In making awards of grants, the division shall consider whether 9 the application is consistent with local hazard mitigation 10 plans and maximizes the utilization of federal funds that 11 benefit the greatest number of citizens. Applications for 12 grants shall be submitted by July 1 of each year and the 13 division shall make grant awards by August 15 of each year. 14 b. Forty-five percent of the available balance on June 30 15 of each year shall be distributed to each county emergency 16 management commission that is in compliance with section 17 29C.9, to provide improved services and capabilities for 18 preparedness, response, and recovery programs. The moneys 19 shall be distributed as follows: 20 (1) Half of the forty-five percent shall be allocated 21 equally to all eligible counties. 22 (2) Half of the forty-five percent shall be allocated on 23 a proportional basis to each eligible county based on each 24 county’s annual assessed property value for property tax 25 purposes in proportion to the total assessed property value for 26 all the eligible counties. 27 c. Five percent of the available balance on June 30 of each 28 year may be used by the division for purposes of administering 29 this section. 30 6. a. By August 1 of each year, a county receiving moneys 31 from the trust fund under subsection 5, paragraph “a” , shall 32 submit a report to the division. The report shall include 33 information regarding the use of moneys received from the trust 34 fund during the previous fiscal year. 35 -2- LSB 5853HC (2) 83 tm/nh 2/ 4

H.F. _____ b. By October 15 of each year, the division shall submit 1 a report to the general assembly regarding the emergency 2 management trust fund. The report shall include financial 3 information regarding the moneys in the trust fund and 4 information regarding the number, amount, and type of 5 expenditures from the fund during the previous fiscal year. 6 7. The division shall adopt rules pursuant to chapter 17A 7 necessary for the administration of this section. 8 EXPLANATION 9 This bill creates an emergency management trust fund in 10 the state treasury under the control of the homeland security 11 and emergency management division of the department of public 12 defense for purposes of funding county emergency management 13 programs. Moneys in the trust fund are appropriated to the 14 division for the purposes provided in the bill. 15 The bill requires certain surcharges to be applied to 16 certain types of insurance policies. The surcharges are 17 collected by the insurer, remitted to the department of 18 revenue, and deposited in the emergency management trust fund. 19 The types of policies on which surcharges will be applied 20 include individual renter’s insurance policies; homeowner’s, 21 mobile homeowner’s, and condominium unit owner’s insurance 22 policies; and commercial fire, commercial multiple peril, 23 and business owner’s insurance policies. The surcharges are 24 applied to such policies both issued and renewed on or after 25 July 1, 2010. The bill prohibits the surcharges from being 26 considered premiums; however, nonpayment of such surcharges may 27 be a valid reason for policy cancellation. 28 The bill provides that 50 percent of the available balance 29 of the trust fund on June 30 of each year shall be awarded by 30 the division through a competitive grant process to county 31 emergency management commissions to provide funding assistance 32 for emergency mitigation projects. The bill provides that 45 33 percent of the available balance on June 30 of each year shall 34 be distributed, based on a formula, to each county emergency 35 -3- LSB 5853HC (2) 83 tm/nh 3/ 4

H.F. _____ management commission that is in compliance with Code section 1 29C.9 for providing improved services and capabilities for 2 preparedness, response, and recovery programs. The bill 3 provides that 5 percent of the available balance on June 30 4 of each year may be used by the division for purposes of 5 administering the bill. 6 The bill includes reporting requirements. 7 -4- LSB 5853HC (2) 83 tm/nh 4/ 4