S.F. _____ Section 1. Section 8.55, subsection 2, paragraph a, Code 1 2009, is amended to read as follows: 2 a. The maximum balance of the fund is the amount equal 3 to two and one-half percent of the adjusted revenue estimate 4 for the fiscal year. If the amount of moneys in the Iowa 5 economic emergency fund is equal to the maximum balance, 6 moneys in excess of this amount shall be transferred to the 7 general disaster recovery fund created in section 8.56A . 8 Sec. 2. NEW SECTION . 8.56A Disaster recovery fund. 9 1. A disaster recovery fund is created. The fund shall be 10 separate from the general fund of the state and the balance in 11 the fund shall not be considered part of the balance of the 12 general fund of the state. The moneys credited to the fund 13 are not subject to section 8.33, and shall not be transferred, 14 used, obligated, appropriated, or otherwise encumbered except 15 as provided in this section. 16 2. The maximum balance of the fund is the amount equal to 17 ten percent of the adjusted revenue estimate for the fiscal 18 year. If the amount of moneys in the disaster recovery fund is 19 equal to the maximum balance, moneys in excess of this amount 20 shall be transferred to the general fund of the state. 21 3. a. If the president of the United States, at the request 22 of the governor, has declared a major disaster to exist in this 23 state, not more than fifty million dollars or twenty percent 24 of the unencumbered, unobligated balance of the disaster 25 recovery fund, whichever is less, as of the issuance date of 26 the executive council’s determination in accordance with this 27 subsection, is appropriated to the department of management to 28 be used in accordance with this subsection to address necessary 29 disaster-related expenses, serious needs, or other assistance 30 for citizens of this state who are adversely affected by the 31 major disaster. The appropriation made in this subsection is 32 contingent upon the executive council issuing a determination 33 that the expenses, needs, and other assistance to be addressed 34 by the appropriation are within the purposes authorized in 35 -1- LSB 6069XC (7) 83 jp/rj 1/ 6

S.F. _____ paragraph “b” and cannot be funded by any other source. 1 b. The amount appropriated in this subsection shall only be 2 used for one or more of the following purposes: 3 (1) For the department of human services to provide 4 case management services for disaster-affected individuals 5 to identify sources of federal, state, local, private, and 6 charitable support. 7 (2) For the department of human services to provide grants 8 of not more than two thousand five hundred dollars to reimburse 9 disaster-affected families for unmet needs. The unmet needs 10 addressed by the grants may include expenses associated 11 with lost personal property, home repair, food assistance, 12 mental health assistance, utility assistance, child care, and 13 temporary housing. 14 (3) For the department of economic development to provide 15 case management services for disaster-affected businesses and 16 nonprofit organizations to identify sources of federal, state, 17 local, private, and charitable support. 18 (4) For the department of economic development to provide 19 assistance to disaster-affected businesses and nonprofit 20 organizations to repair property damaged in the disaster or to 21 maintain the wages and benefits of all or some of the persons 22 employed prior to the disaster whose employment is impacted by 23 the disaster. 24 (5) For the Iowa finance authority to provide grants to 25 temporarily or permanently repair or replace disaster-affected 26 housing. 27 (6) For the homeland security and emergency management 28 division of the department of public defense to provide 29 disaster assistance to units of local government. The disaster 30 assistance may include but is not limited to debris removal, 31 repair of infrastructure and facilities damaged in the 32 disaster, local case management services, services to address 33 local individual unmet needs, local housing assistance, and 34 local business or nonprofit organization assistance. 35 -2- LSB 6069XC (7) 83 jp/rj 2/ 6

S.F. _____ (7) For the department of management to provide matching 1 funding for the disaster-related necessary expenses or serious 2 needs of units of local or state governments in accordance with 3 section 29C.6, subsection 17. 4 c. Assistance provided under paragraph “b” shall not be used 5 to supplant any other financial support, assistance, or grants 6 provided by any federal or other state agency. 7 4. a. Moneys in the fund may be used for cash flow purposes 8 during a fiscal year provided that any moneys so allocated are 9 returned to the fund by the end of that fiscal year. 10 b. Except as provided in section 8.58, the disaster recovery 11 fund shall be considered a special account for the purposes of 12 section 8.53 in determining the cash position of the general 13 fund of the state for the payment of state obligations. 14 5. Notwithstanding section 12C.7, subsection 2, interest 15 or earnings on moneys deposited in the disaster recovery fund 16 shall be credited to the fund. Such credited moneys, if 17 appropriated, may be used for the expenses of providing ongoing 18 training and staffing for disaster response and recovery by 19 the department of human services, department of economic 20 development, Iowa finance authority, or division of homeland 21 security and emergency management of the department of public 22 safety. 23 Sec. 3. Section 8.58, Code 2009, is amended to read as 24 follows: 25 8.58 Exemption from automatic application. 26 1. To the extent that moneys appropriated under section 27 8.57 do not result in moneys being credited to the general 28 fund under section 8.55, subsection 2, moneys appropriated 29 under section 8.57 and moneys contained in the cash reserve 30 fund, rebuild Iowa infrastructure fund, environment first 31 fund, disaster recovery fund, and Iowa economic emergency fund 32 shall not be considered in the application of any formula, 33 index, or other statutory triggering mechanism which would 34 affect appropriations, payments, or taxation rates, contrary 35 -3- LSB 6069XC (7) 83 jp/rj 3/ 6

S.F. _____ provisions of the Code notwithstanding. 1 2. To the extent that moneys appropriated under section 2 8.57 do not result in moneys being credited to the general 3 fund under section 8.55, subsection 2, moneys appropriated 4 under section 8.57 and moneys contained in the cash reserve 5 fund, rebuild Iowa infrastructure fund, environment first fund, 6 disaster recovery fund, and Iowa economic emergency fund shall 7 not be considered by an arbitrator or in negotiations under 8 chapter 20. 9 Sec. 4. EFFECTIVE UPON ENACTMENT AND APPLICABILITY. This 10 Act, being deemed of immediate importance, takes effect upon 11 enactment and is applicable to moneys transferred from the Iowa 12 economic emergency fund pursuant to section 8.55, subsection 2, 13 paragraph “a” , as amended by this Act, beginning with the close 14 of the fiscal year ending on June 30, 2010. 15 EXPLANATION 16 This bill creates a disaster recovery fund in new Code 17 section 8.56A. 18 Under current state financing law, surplus state general 19 fund moneys are first credited to the cash reserve until 20 it reaches its maximum balance equal to 7.5 percent of the 21 adjusted revenue estimate for the applicable fiscal year, the 22 surplus moneys are credited to the Iowa economic emergency 23 fund until it reaches its maximum balance equal to 2.5 percent 24 of the adjusted revenue estimate. The bill provides for the 25 surplus moneys to flow to the disaster recovery fund once 26 the first two funds have reached the maximum balance. Under 27 current law, the surplus funding is transferred to the general 28 fund of the state. The bill provides that if the disaster 29 recovery fund reaches its maximum balance equal to 10 percent 30 of the adjusted revenue estimate, surplus moneys then flow to 31 the general fund. 32 The bill provides a contingent appropriation from the fund 33 to address the effects of a major disaster. The appropriation 34 amount is limited to the lesser of $50 million or 20 percent of 35 -4- LSB 6069XC (7) 83 jp/rj 4/ 6

S.F. _____ the amount available in the fund. 1 The appropriation is contingent upon the president of the 2 United States having declared a major disaster to exist in this 3 state and the executive council issuing a determination that 4 the expenses, needs, and other assistance to be addressed by 5 the appropriation cannot be funded by any other source. 6 The appropriation can only be used for addressing necessary 7 disaster-related expenses, serious needs, or other assistance 8 for citizens of this state who are adversely affected by the 9 major disaster through one or more of the following authorized 10 purposes: case management and assistance provided by the 11 department of human services to disaster-affected individuals 12 and families; case management and assistance provided by 13 the department of economic development to disaster-affected 14 businesses and nonprofit organizations to address property 15 damage and the wages and benefits of disaster-affected 16 employees; for assistance provided by the Iowa finance 17 authority to repair or replace housing; for assistance provided 18 to local governments by the homeland security and emergency 19 management division of the department of public defense; 20 and for the department of management to provide matching 21 funding of up to 25 percent for federal assistance for the 22 disaster-related necessary expenses or serious needs of 23 units of local or state governments in accordance with Code 24 section 29C.6, subsection 17. The moneys from the contingent 25 appropriation cannot be used to supplant any other financial 26 support, assistance, or grants provided by any federal or other 27 state agency. 28 Moneys credited to the new fund are otherwise not subject to 29 transfer, use, obligation, appropriation, or other encumbrance 30 except for disaster recovery. However, during the course of 31 a fiscal year moneys in the fund may be used for cash flow 32 purposes provided that any moneys so allocated are returned to 33 the fund by the end of that fiscal year. 34 Interest or earnings on moneys in the fund are retained by 35 -5- LSB 6069XC (7) 83 jp/rj 5/ 6

S.F. _____ the fund instead of the general fund as otherwise provided in 1 Code section 12C.7. These retained moneys may be appropriated 2 for training and staffing of disaster and recovery functions 3 of the state agencies receiving funding from the contingent 4 appropriation in the bill. 5 Code section 8.58 is amended to include the disaster 6 recovery fund in the list of various reserve funds that are 7 exempted from being considered to be available for any formula, 8 index, or other statutory triggering mechanism which would 9 affect appropriations, payments, or taxation rates or being 10 considered by an arbitrator or in negotiations under Code 11 chapter 20, relating to public employee collective bargaining. 12 The bill takes effect upon enactment and applies to 13 transfers of surplus moneys from the Iowa economic emergency 14 fund beginning with the fiscal year ending on June 30, 2010. 15 -6- LSB 6069XC (7) 83 jp/rj 6/ 6