House Study Bill 241 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON APPROPRIATIONS BILL BY CHAIRPERSON RAECKER) A BILL FOR An Act relating to flood mitigation by establishing a flood 1 mitigation program, establishing a flood mitigation board, 2 authorizing the use of certain sales tax revenue and 3 other financial assistance for flood mitigation projects, 4 establishing a flood mitigation fund, authorizing the 5 issuance of bonds for certain flood mitigation projects, and 6 including effective date provisions. 7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 8 TLSB 2776HC (1) 84 md/sc

H.F. _____ Section 1. Section 29C.8, subsection 3, Code 2011, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . h. Carry out duties related to the flood 3 mitigation program and the flood mitigation board under chapter 4 418. 5 Sec. 2. Section 331.430, subsection 2, Code 2011, is amended 6 by adding the following new paragraph: 7 NEW PARAGRAPH . d. Payments required to be made from the 8 debt service fund to a flood project fund under section 418.14, 9 subsection 5. 10 Sec. 3. Section 384.4, subsection 1, Code 2011, is amended 11 by adding the following new paragraph: 12 NEW PARAGRAPH . e. Payments required to be made from the 13 debt service fund to a flood project fund under section 418.14, 14 subsection 5. 15 Sec. 4. NEW SECTION . 418.1 Definitions. 16 For purposes of this chapter, unless the context otherwise 17 requires: 18 1. “Base year” means the fiscal year ending during the 19 calendar year in which the governmental entity’s project is 20 approved by the board under section 418.9. 21 2. “Board” means the flood mitigation board as created in 22 section 418.5. 23 3. “Division” means the homeland security and emergency 24 management division of the department of public defense. 25 4. “Governmental entity” means any of the following: 26 a. A county. 27 b. A city. 28 c. A joint board or other legal or administrative entity 29 established or designated in an agreement pursuant to chapter 30 28E between a county and one or more cities located within the 31 county. 32 5. “Project” means the construction and reconstruction 33 of levees, embankments, impounding reservoirs, or conduits 34 that are necessary for the protection of property from the 35 -1- LSB 2776HC (1) 84 md/sc 1/ 24

H.F. _____ effects of floodwaters and may include the deepening, widening, 1 alteration, change, diversion, or other improvement of 2 watercourses if necessary for the protection of such property 3 from the effects of floodwaters. 4 6. “Retail establishment” means a business operated by a 5 retailer as defined in section 423.1. 6 7. “Sales tax” means the sales and services tax imposed 7 pursuant to section 423.2. 8 Sec. 5. NEW SECTION . 418.4 Projects. 9 1. A governmental entity may use the moneys in its flood 10 project fund established pursuant to section 418.13 to fund 11 projects that meet the requirements of this section. 12 2. Prior to undertaking a project, the governmental entity 13 shall adopt a project plan. The project plan shall include 14 a detailed description of the project, clearly state the 15 cost of the project and the amount of debt to be incurred 16 for purposes of funding the project, and include a detailed 17 description of all funding sources for the project, including 18 information relating to either the proposed use of financial 19 assistance from the flood mitigation fund under section 418.10 20 or the proposed use of sales tax increment revenues received 21 under section 418.12. The project plan shall also include 22 information related to the approval criteria in section 418.9, 23 subsection 2. 24 3. A governmental entity shall not undertake a project under 25 this chapter unless all of the following conditions are met: 26 a. Bidding for the project has been completed. 27 b. The project has been approved to receive financial 28 assistance in an amount equal to at least twenty percent of 29 the total project cost or thirty million dollars, whichever 30 is less, under the federal Water Resources Development Act or 31 other federal program providing assistance specifically for 32 hazard mitigation. 33 c. The project plan has been approved by the board under 34 section 418.9. 35 -2- LSB 2776HC (1) 84 md/sc 2/ 24

H.F. _____ d. Following approval of the project plan by the board, 1 the governmental entity has adopted a resolution authorizing 2 the use of sales tax increment revenue from the governmental 3 entity’s flood project fund, if sales tax increment revenue 4 was approved by the board as a funding source for the project. 5 Within ten days of adoption, the governmental entity shall 6 provide a copy of the resolution to the department of revenue. 7 4. A governmental entity shall not seek approval from the 8 board for a project if the governmental entity previously 9 had a project approved pursuant to section 418.9 or if the 10 governmental entity previously was part of a governmental 11 entity as defined in section 418.1, subsection 4, paragraph “c”, 12 that had a project approved pursuant to section 418.9. 13 4A. If a project is eligible for state financial assistance 14 under section 29C.6, subsection 17, such project is ineligible 15 for approval by the board under this chapter. 16 5. Following approval of a project under section 418.9, the 17 governmental entity shall on or before December 15 of each year 18 submit a report to the board detailing all of the following: 19 a. The current status of the project. 20 b. Total expenditures and the types of expenditures that 21 have been made related to the project. 22 c. The amount of the total project cost remaining as of the 23 date the report is submitted. 24 d. The amounts, types, and sources of funding being used. 25 e. The amount of bonds issued or other indebtedness incurred 26 for the project, including information related to the rate of 27 interest, length of term, costs of issuance, and net proceeds. 28 The report shall also include the amounts and types of moneys 29 used for payment of such bonds or indebtedness. 30 6. A governmental entity may contract with a council of 31 governments to perform any duty or power authorized under this 32 chapter or for the completion of a project. 33 Sec. 6. NEW SECTION . 418.5 Flood mitigation board. 34 1. The flood mitigation board is established consisting of 35 -3- LSB 2776HC (1) 84 md/sc 3/ 24

H.F. _____ nine voting members and four ex officio, nonvoting members, and 1 is located for administrative purposes within the division. 2 The administrator of the division shall provide office space, 3 staff assistance, and necessary supplies and equipment for 4 the board. The administrator shall budget funds to pay the 5 necessary expenses of the board. In performing its functions, 6 the board is performing a public function on behalf of the 7 state and is a public instrumentality of the state. 8 2. The voting membership of the board shall include all of 9 the following: 10 a. Four members of the general public. Each general public 11 member of the board shall have demonstrable experience or 12 expertise in the field of natural disaster or flood mitigation. 13 b. The director of the department of natural resources or 14 the director’s designee. 15 c. The secretary of agriculture or the secretary’s designee. 16 d. The treasurer of state or the treasurer’s designee. 17 e. The administrator of the division or the administrator’s 18 designee. 19 f. The executive director of the Iowa finance authority or 20 the executive director’s designee. 21 3. The general public members shall be appointed by 22 the governor, subject to confirmation by the senate. The 23 appointments shall comply with sections 69.16 and 69.16A. 24 4. The chairperson and vice chairperson of the board shall 25 be designated by the governor from the board members listed 26 in subsection 2. In case of the absence or disability of the 27 chairperson and vice chairperson, the members of the board 28 shall elect a temporary chairperson by a majority vote of those 29 members who are present and voting. 30 5. The members appointed under subsection 2, paragraph 31 “a” , shall be appointed to three-year staggered terms and the 32 terms shall commence and end as provided by section 69.19. If 33 a vacancy occurs, a successor shall be appointed to serve the 34 unexpired term. A successor shall be appointed in the same 35 -4- LSB 2776HC (1) 84 md/sc 4/ 24

H.F. _____ manner and subject to the same qualifications as the original 1 appointment. 2 6. The board’s ex officio membership shall include four 3 members of the general assembly with one each appointed by 4 the majority leader of the senate, the minority leader of the 5 senate, the speaker of the house of representatives, and the 6 minority leader of the house of representatives. A legislative 7 member serves for a term as provided in section 69.16B in an ex 8 officio, nonvoting capacity and is eligible for per diem and 9 expenses as provided in section 2.10. 10 7. A majority of the board constitutes a quorum. 11 Sec. 7. NEW SECTION . 418.6 Expenses of board members. 12 The voting members of the board are entitled to receive 13 reimbursement for actual expenses incurred while engaged in the 14 performance of official duties. A member of the board is not 15 eligible to receive the additional expense allowance provided 16 in section 7E.6, subsection 2. 17 Sec. 8. NEW SECTION . 418.7 Division duties. 18 The division, subject to approval by the board, shall 19 adopt administrative rules pursuant to chapter 17A necessary 20 to administer the flood mitigation program. The division 21 shall provide the board with assistance in implementing 22 administrative functions and providing technical assistance and 23 application assistance to applicants under the program. 24 Sec. 9. NEW SECTION . 418.8 Flood mitigation program. 25 1. The board shall establish and the division, subject 26 to direction and approval by the board, shall administer a 27 flood mitigation program to assist governmental entities 28 in undertaking projects approved under this chapter. The 29 flood mitigation program shall include projects approved 30 by the board to utilize either financial assistance from 31 the flood mitigation fund created under section 418.10 or 32 sales tax revenues remitted to the governmental entity under 33 section 418.12. A governmental entity shall not be approved 34 by the board to utilize both financial assistance from the 35 -5- LSB 2776HC (1) 84 md/sc 5/ 24

H.F. _____ flood mitigation fund and sales tax revenues remitted to the 1 governmental entity. 2 2. The board shall, by rules adopted under section 3 418.7, prescribe application instructions, forms, and other 4 requirements deemed necessary to operate the flood mitigation 5 program. 6 3. The board may contract with or otherwise consult with the 7 Iowa flood center, established under section 466C.1, to assist 8 the board in administering the flood mitigation program. 9 4. The board shall submit a written report to the governor 10 and the general assembly on or before January 15 of each year. 11 The report shall include information relating to all projects 12 approved by the board for inclusion in the flood mitigation 13 program, the status of such projects, summaries of each report 14 submitted to the board under section 418.4, subsection 5, 15 information relating to the types of funding being used for 16 each approved project, including all indebtedness incurred by 17 the applicable governmental entities, and any recommendations 18 for legislative action to modify the provisions of this 19 chapter. 20 Sec. 10. NEW SECTION . 418.9 Project application review. 21 1. a. A governmental entity shall submit an application 22 to the board for approval of a project plan. The board shall 23 not approve a project for inclusion in the program if the 24 application is submitted after January 1, 2016. 25 b. The application shall specify whether the governmental 26 entity is requesting financial assistance from the flood 27 mitigation fund or approval for the use of sales tax revenues. 28 Applications for financial assistance from the flood mitigation 29 fund shall describe the type and amount of assistance 30 requested. Applications for the use of sales tax revenues 31 shall state the amount of sales tax revenues necessary for 32 completion of the project. 33 2. Each application shall include or have attached to 34 the application, the governmental entity’s project plan 35 -6- LSB 2776HC (1) 84 md/sc 6/ 24

H.F. _____ adopted under section 418.4, subsection 2. When reviewing 1 applications, in addition to the project plan, the board shall 2 consider, at a minimum, all of the following: 3 a. Whether the project is designed to mitigate future 4 flooding of property that has sustained significant flood 5 damage and is likely to sustain significant flood damage in the 6 future. 7 b. Whether the project plan addresses the impact of flooding 8 both upstream and downstream from the area where the project is 9 to be undertaken. 10 c. Whether the area that would benefit from the project’s 11 flood mitigation efforts is valuable to the economic viability 12 of the state or is of historic value to the state. 13 d. The extent to which the project would utilize local 14 matching funds. The board shall not approve a project unless 15 at least fifty percent of the total cost of the project, less 16 any federal financial assistance for the project, is funded 17 using local matching funds, and unless the project will result 18 in nonpublic investment in the governmental entity’s area as 19 defined in section 418.11, subsection 3, of an amount equal to 20 fifty percent of the total cost of the project. For purposes 21 of this paragraph, “nonpublic investment” means investment 22 by nonpublic entities consisting of capital investment or 23 infrastructure improvements occurring in anticipation of or as 24 a result of the project during the period of time between July 25 1, 2008, and ten years following completion of the project. 26 e. The extent of nonfinancial support committed to the 27 project from public and nonpublic sources. 28 f. The net number of new jobs proposed to be created as a 29 direct result of the project and its completion in the area for 30 which the project is designed to mitigate future flooding. 31 g. Whether the project plan is consistent with the 32 applicable comprehensive, countywide emergency operations plan 33 in effect. 34 h. Whether financial assistance through the flood mitigation 35 -7- LSB 2776HC (1) 84 md/sc 7/ 24

H.F. _____ program is essential to meet the necessary expenses or serious 1 needs of the governmental entity related to flood mitigation. 2 3. Upon review of the applications, the board, following 3 consultation with the department of economic development, shall 4 approve, defer, or deny the applications. If a project plan 5 is denied, the board shall state the reasons for the denial 6 and the governmental entity may resubmit the application so 7 long as the application is filed on or before January 1, 2016. 8 If a project plan application is approved, the board shall 9 specify whether the governmental entity is approved for the 10 use of sales tax revenues under section 418.12 or whether the 11 governmental entity is approved to receive financial assistance 12 from the flood mitigation fund under section 418.10. If 13 the board approves a project plan application that includes 14 financial assistance from the flood mitigation fund, the board 15 shall negotiate and execute on behalf of the division all 16 necessary agreements to provide such financial assistance. 17 4. The board shall not approve a project plan application 18 that includes financial assistance from the flood mitigation 19 fund or the use of sales tax revenue to pay principal and 20 interest on or to refinance any debt or other obligation 21 existing prior to the approval of the project. 22 5. Upon approval of an application for financial assistance 23 under the program, the board shall notify the treasurer of 24 state regarding the amount of moneys needed to satisfy the 25 award of financial assistance and the terms of the award. The 26 treasurer of state shall notify the division any time moneys 27 are disbursed to a recipient of financial assistance under the 28 program. 29 6. If, following approval of a project application under the 30 program, it is determined that the amount of federal financial 31 assistance under section 418.4, subsection 3, paragraph “b” , 32 exceeds the amount of federal financial assistance specified in 33 the application, the board shall reduce the award of financial 34 assistance from the flood mitigation fund or reduce the amount 35 -8- LSB 2776HC (1) 84 md/sc 8/ 24

H.F. _____ of sales tax revenue to be received for the project by a 1 corresponding amount. 2 Sec. 11. NEW SECTION . 418.10 Flood mitigation fund. 3 1. A flood mitigation fund is created as a separate and 4 distinct fund in the state treasury under the control of the 5 board and consists of moneys appropriated by the general 6 assembly and any other moneys available to and obtained or 7 accepted by the board for placement in the fund. Moneys in the 8 fund shall only be used for the purposes of this section. 9 2. Payments of interest, repayments of moneys loaned 10 pursuant to this chapter, and recaptures of grants, if provided 11 for in the financial assistance agreements, shall be deposited 12 in the fund. 13 3. The moneys in the fund shall be used to provide 14 assistance in the form of grants, loans, and forgivable loans. 15 The use of moneys in the fund for such assistance shall be on 16 a first-come, first-served basis. The board may only provide 17 financial assistance from moneys in the fund. 18 4. Moneys in the fund are not subject to section 8.33. 19 Notwithstanding section 12C.7, subsection 2, interest or 20 earnings on moneys in the fund shall be credited to the fund. 21 5. If any portion of the moneys appropriated for deposit 22 in the fund have not been awarded during the fiscal year for 23 which the appropriation is made, the portion which has not 24 been awarded may be utilized by the board to provide financial 25 assistance under the program in subsequent fiscal years. 26 6. The board may make a multiyear commitment to a 27 governmental entity of up to four million dollars in any one 28 fiscal year. 29 7. Moneys received by a governmental entity from the fund 30 shall be deposited in the governmental entity’s flood project 31 fund under section 418.13. 32 8. The board is not required to award financial assistance 33 pursuant to this section unless moneys are appropriated to and 34 available from the fund. 35 -9- LSB 2776HC (1) 84 md/sc 9/ 24

H.F. _____ 9. Following completion of all projects approved to utilize 1 financial assistance from the fund and upon a determination 2 by the board that remaining moneys in the fund are no longer 3 needed for the program, all moneys remaining in the fund or 4 subsequently deposited in the fund shall be credited for 5 deposit in the general fund of the state. 6 Sec. 12. NEW SECTION . 418.11 Sales tax increment 7 calculation. 8 1. The department of revenue shall calculate quarterly the 9 amount of increased sales tax revenues to be deposited in the 10 sales tax increment fund pursuant to section 423.2, subsection 11 11, paragraph “a” , subparagraph (2). 12 2. The department of revenue shall calculate the amount of 13 the increase for purposes of subsection 1 as follows: 14 a. Determine the amount of sales tax revenue collected by 15 the department in each applicable area specified in subsection 16 3, during the corresponding quarter in the base year from 17 retail establishments located in such areas. 18 b. Determine the amount of sales tax revenue collected by 19 the department in each applicable area specified in subsection 20 3, during the corresponding quarter in each subsequent calendar 21 year from retail establishments located in such areas. 22 c. Subtract the base year quarterly amount determined in 23 paragraph “a” from the subsequent calendar year quarterly 24 amount determined in paragraph “b” . 25 d. The result of the calculation in paragraph “c” , to 26 the extent that the amount of revenue in the quarter of the 27 subsequent year exceeds the total amount of revenue in the 28 corresponding quarter of the base year, shall constitute the 29 amount of increased revenues for purposes of subsection 1. 30 3. a. For projects approved for a governmental entity as 31 defined in section 418.1, subsection 4, paragraph “a” , the area 32 used to determine the sales tax increment shall include only 33 the unincorporated areas of the county. 34 b. For projects approved for a governmental entity as 35 -10- LSB 2776HC (1) 84 md/sc 10/ 24

H.F. _____ defined in section 418.1, subsection 4, paragraph “b” , the area 1 used to determine the sales tax increment shall include only 2 the incorporated areas of the city. 3 c. For projects approved for a governmental entity as 4 defined in section 418.1, subsection 4, paragraph “c” , the 5 area used to determine the sales tax increment shall include 6 the incorporated areas of each city that is participating in 7 the chapter 28E agreement and the unincorporated areas of the 8 county. 9 4. Each governmental entity shall assist the department 10 of revenue in identifying retail establishments in the 11 governmental entity’s applicable area that are collecting sales 12 tax. This process shall be ongoing until the governmental 13 entity ceases to utilize sales tax revenue under this chapter. 14 Sec. 13. NEW SECTION . 418.12 Sales tax increment fund. 15 1. A sales tax increment fund is established as a separate 16 and distinct fund in the state treasury under the control of 17 the department of revenue consisting of the amount of the 18 increased state sales and services tax revenues collected by 19 the department of revenue within each applicable area specified 20 in section 418.11, subsection 3, and deposited in the fund 21 pursuant to section 423.2, subsection 11, paragraph “a” , 22 subparagraph (2). Moneys in the fund shall only be used for 23 the purposes of this section. 24 2. An account is created within the fund for each 25 governmental entity that has adopted a resolution under section 26 418.4, subsection 3, paragraph “d” . 27 3. The department of revenue shall credit to the fund the 28 moneys described in subsection 1 beginning the first day of the 29 quarter following receipt of a resolution under section 418.4, 30 subsection 3, paragraph “d” . However, in no case shall a sales 31 tax increment be calculated under section 418.11 or such moneys 32 be credited to the fund under this section prior to January 1, 33 2013. 34 4. a. A governmental entity may request remittance of 35 -11- LSB 2776HC (1) 84 md/sc 11/ 24

H.F. _____ the moneys in the governmental entity’s account within the 1 fund. Such requests shall be made not more than quarterly. 2 Requests for remittance shall be submitted on forms prescribed 3 by the department of revenue. Requests for remittance shall 4 be made for the amount of moneys in the governmental entity’s 5 account necessary to pay the governmental entity’s costs or 6 obligations related to the project, according to the sales 7 tax revenue funding needs specified in the approved project 8 plan. A governmental entity shall not, however, during any 9 fiscal year receive remittances under this section exceeding 10 fifteen million dollars or the total yearly amount of increased 11 revenue in the governmental entity’s applicable area, whichever 12 is less. The total amount of remittances during any fiscal 13 year for all governmental entities approved to use sales tax 14 revenues under this chapter shall not exceed, in the aggregate, 15 thirty million dollars. Remittances from the department of 16 revenue shall be deposited in the governmental entity’s flood 17 project fund under section 418.13. 18 b. The department of revenue shall adopt rules for the 19 remittance of moneys to governmental entities. 20 5. If the department of revenue determines that the revenue 21 accruing to the fund or accounts within the fund exceeds 22 thirty million dollars or exceeds the amount necessary for 23 the purposes of this chapter if the amount necessary is less 24 than thirty million dollars, then those excess moneys shall 25 be credited by the department of revenue for deposit in the 26 general fund of the state. 27 Sec. 14. NEW SECTION . 418.13 Flood project fund. 28 1. Sales tax revenue remitted by the department of revenue 29 to a governmental entity under section 418.12 or financial 30 assistance received by a governmental entity pursuant to 31 section 418.10 shall be deposited in the governmental entity’s 32 flood project fund created for purposes of this chapter and 33 shall be used to fund the governmental entity’s approved 34 project and to pay principal and interest on bonds issued 35 -12- LSB 2776HC (1) 84 md/sc 12/ 24

H.F. _____ pursuant to section 418.14, if applicable. 1 2. In addition to the moneys received pursuant to section 2 418.10 or 418.12, a governmental entity may deposit in the 3 flood project fund any other moneys lawfully received by the 4 governmental entity. 5 Sec. 15. NEW SECTION . 418.14 Bond issuance. 6 1. a. A governmental entity receiving sales tax revenues 7 pursuant to this chapter is authorized to issue bonds that are 8 payable from revenues deposited in the governmental entity’s 9 flood project fund created pursuant to section 418.13 for the 10 purpose of funding a project in the area from which sales tax 11 revenues will be utilized. 12 b. A governmental entity shall have the authority to pledge 13 irrevocably to the payment of the bonds an amount of revenue 14 derived from the sales tax revenue received by the governmental 15 entity pursuant to section 418.12 for each of the years the 16 bonds remain outstanding. 17 2. a. If a governmental entity elects to authorize the 18 issuance of bonds payable as provided in this section, the 19 governmental entity shall follow the authorization procedures 20 for cities set forth in section 384.83. 21 b. A governmental entity shall have the authority to issue 22 bonds for the purpose of refunding outstanding bonds issued 23 under this section without otherwise complying with the notice 24 and hearing provisions of section 384.83. 25 3. If less than four calendar quarters have elapsed 26 following the submission of the resolution to the department of 27 revenue under section 418.4, subsection 3, paragraph “d” , the 28 sales tax collected within the shorter period may be adjusted 29 to project the collections of the designated portion for the 30 full year for the purpose of determining the amount of the 31 bonds which may be issued. 32 4. a. Except as otherwise provided in this section, 33 bonds issued pursuant to this section shall not be subject to 34 the provisions of any other law or charter relating to the 35 -13- LSB 2776HC (1) 84 md/sc 13/ 24

H.F. _____ authorization, issuance, or sale of bonds. 1 b. The bonds may be issued in one or more series and shall 2 comply with all of the following: 3 (1) The bonds shall bear the date of issuance. 4 (2) The bonds shall specify whether they are payable on 5 demand or the time of maturity. 6 (3) The bonds shall bear interest at a rate not exceeding 7 that permitted by chapter 74A. 8 (4) The bonds shall be in a denomination or denominations, 9 be in the form, have the rank or priority, be executed in 10 the manner, be payable in the medium of payment, at the 11 place or places, be subject to the terms of redemption, with 12 or without premium, be secured in the manner, and have the 13 other characteristics, as may be provided by the resolution 14 authorizing their issuance. 15 c. The bonds may be sold at public or private sale at a 16 price as may be determined by the governmental entity. 17 5. a. Bonds, notes, or other obligations issued by a 18 governmental entity for purposes of financing a project under 19 this chapter are not an obligation of this state. Except as 20 provided in paragraph “b” , bonds, notes, or other obligations 21 issued by a governmental entity for purposes of financing 22 a project under this chapter are not an obligation of any 23 political subdivision of this state other than the governmental 24 entity. A governmental entity shall not pledge the credit or 25 taxing power of this state. Except as provided in paragraph 26 “b” , a governmental entity shall not pledge the credit or taxing 27 power of any political subdivision of this state other than the 28 governmental entity or make its debts payable out of any of the 29 moneys except those in the governmental entity’s flood project 30 fund. 31 b. If the moneys in the governmental entity’s flood project 32 fund are insufficient to pay the governmental entity’s costs 33 related to bonds, notes, or other obligations issued under 34 this chapter, the amounts necessary to pay such costs shall 35 -14- LSB 2776HC (1) 84 md/sc 14/ 24

H.F. _____ be transferred for deposit in the governmental entity’s flood 1 project fund from the debt service fund of the county or the 2 debt service fund of the city or county for a governmental 3 entity as defined in section 418.1, subsection 4, paragraph 4 “c” , as provided in the chapter 28E agreement. The chapter 5 28E agreement for a governmental entity as defined in 6 section 418.1, subsection 4, paragraph “c” , shall specify the 7 participating city or county responsible for any payment from a 8 debt service fund required under this paragraph. 9 Sec. 16. NEW SECTION . 418.15 Durational limitation on use 10 of revenues —— property disposition. 11 1. A governmental entity shall not utilize sales tax revenue 12 under this chapter after twenty-five years from the date the 13 governmental entity’s project was approved by the board. 14 2. If the governmental entity ceases to need the sales 15 tax revenues prior to the expiration of the limitation under 16 subsection 1, the governmental entity shall notify the director 17 of revenue. 18 3. Upon the receipt of a notification pursuant to subsection 19 2, or the expiration of the limitation under subsection 1, the 20 department of revenue shall cease to credit revenues to the 21 governmental entity’s account in the sales tax increment fund. 22 4. All property and improvements acquired by a governmental 23 entity as defined in section 418.1, subsection 4, paragraph 24 “c” , relating to a project shall be transferred to the county 25 or city designated in the chapter 28E agreement to receive 26 such property and improvements. The city or county to which 27 such property or improvements are transferred shall, unless 28 otherwise provided in the chapter 28E agreement, be solely 29 responsible for the ongoing maintenance and support of such 30 property and improvements. 31 Sec. 17. Section 423.2, subsection 11, Code 2011, is amended 32 to read as follows: 33 11. a. (1) All revenues arising under the operation of the 34 provisions of this section shall be deposited into the general 35 -15- LSB 2776HC (1) 84 md/sc 15/ 24

H.F. _____ fund of the state. 1 (2) Subsequent to the deposit into the general fund of 2 the state, the director shall credit an amount equal to 3 six cents of every dollar of the amount of the increase 4 in sales subject to the tax imposed under this section and 5 made in the applicable area of a governmental entity that is 6 approved to use sales tax revenues under chapter 418 into an 7 account created for that governmental entity in the sales 8 tax increment fund created in section 418.12. The director 9 shall credit the moneys beginning the first day of the quarter 10 following adoption of the resolution pursuant to section 418.4, 11 subsection 3, paragraph “d” . 12 b. Subsequent to the deposit into the general fund of the 13 state and after the transfer of such pursuant to paragraph “a” , 14 the department shall do the following in the order prescribed: 15 (1) Transfer the revenues collected under chapter 423B , the 16 department shall transfer . 17 (2) Transfer one-sixth of such the remaining revenues to the 18 secure an advanced vision for education fund created in section 19 423F.2 . This paragraph subparagraph (2) is repealed December 20 31, 2029. 21 (3) Credit that portion of the sales tax receipts described 22 in paragraph “a” , subparagraph (2). 23 Sec. 18. EFFECTIVE UPON ENACTMENT. This Act, being deemed 24 of immediate importance, takes effect upon enactment. 25 EXPLANATION 26 This bill relates to flood mitigation by establishing a 27 flood mitigation program, establishing a flood mitigation 28 board, authorizing the use of certain sales tax revenue and 29 other financial assistance for certain flood-related projects, 30 establishing a flood mitigation fund, and authorizing the 31 issuance of bonds for certain flood mitigation projects. 32 The bill authorizes certain governmental entities to 33 undertake flood-related projects. The bill defines “project” 34 to mean the construction and reconstruction of levees, 35 -16- LSB 2776HC (1) 84 md/sc 16/ 24

H.F. _____ embankments, impounding reservoirs, or conduits that are 1 necessary for the protection of property from the effects 2 of floodwaters and may include the deepening, widening, 3 alteration, change, diversion, or other improvement of 4 watercourses if necessary for the protection of such property 5 from the effects of floodwaters. The bill requires a project 6 to be preceded by adoption of a project plan that includes a 7 detailed description of the project, clearly states the cost of 8 the project and the amount of debt to be incurred for purposes 9 of funding the project, and includes a description of all 10 funding sources for the project. The project plan must also 11 include information related to the approval criteria used by 12 the flood mitigation board. 13 The bill prohibits a governmental entity from undertaking 14 a project unless bidding for the project is complete, the 15 project has been approved to receive certain federal financial 16 assistance, the project plan has been approved by the flood 17 mitigation board, and the governmental entity has adopted and 18 filed with the department of revenue a resolution authorizing 19 the use of sales tax increment revenue, if sales tax increment 20 revenue was designated as a funding source for the project. 21 The bill authorizes a governmental entity to contract with a 22 council of governments to perform any duty or power authorized 23 in the bill or for the completion of the project. 24 The bill provides that a governmental entity may not seek 25 approval from the board for a project if the governmental 26 entity previously had a project approved under the flood 27 mitigation program or was part of a governmental entity that 28 previously had a project approved by the board under the flood 29 mitigation program. 30 The bill provides that a project eligible for state 31 financial assistance under Code section 29C.6(17) is ineligible 32 for approval by the board under the flood mitigation program. 33 The bill requires a governmental entity that has a project 34 approved by the flood mitigation board to prepare and submit an 35 -17- LSB 2776HC (1) 84 md/sc 17/ 24

H.F. _____ annual report on or before December 15 to the board detailing 1 the status and progress of the project. 2 The bill establishes a flood mitigation board within the 3 homeland security and emergency management division of the 4 department of public defense consisting of nine voting members 5 and four ex offico, nonvoting legislative members. The voting 6 membership of the board includes four members of the general 7 public having demonstrable experience or expertise in the field 8 of natural disaster or flood mitigation, the director of the 9 department of natural resources or the director’s designee, 10 the secretary of agriculture or the secretary’s designee, 11 the treasurer of state or the treasurer’s designee, the 12 administrator of the homeland security and emergency management 13 division or the administrator’s designee, and the executive 14 director of the Iowa finance authority or the executive 15 director’s designee. Appointment of the general public members 16 shall be made by the governor, shall be subject to confirmation 17 by the senate, and shall be for three-year staggered terms. 18 The members of the board are entitled to receive reimbursement 19 for actual expenses incurred while engaged in the performance 20 of official duties. 21 The bill requires the board to establish and administer a 22 flood mitigation program to assist governmental entities in 23 undertaking approved projects. The flood mitigation program 24 includes projects approved by the board to utilize either 25 financial assistance from the flood mitigation fund created 26 in the bill or sales tax increment revenues remitted to the 27 governmental entity. The bill prohibits a project from being 28 approved by the board to utilize both financial assistance from 29 the flood mitigation fund and sales tax increment revenues for 30 the same project. The bill authorizes the board to consult 31 with the Iowa flood center to assist the board in administering 32 the flood mitigation program. 33 Governmental subdivisions must submit project applications 34 to the flood mitigation board for approval. The board is 35 -18- LSB 2776HC (1) 84 md/sc 18/ 24

H.F. _____ prohibited from approving applications submitted after 1 January 1, 2016. The application shall specify whether the 2 governmental entity is requesting financial assistance from 3 the flood mitigation fund or approval for the use of sales tax 4 increment revenues. Applications for financial assistance 5 from the flood mitigation fund are required to describe the 6 type and amount of assistance requested. Applications for the 7 use of sales tax increment revenues shall state the amount of 8 such revenues necessary for completion of the project. Each 9 application shall include, or have attached to the application, 10 the governmental entity’s project plan. 11 The bill requires the board, when reviewing applications, 12 in addition to the governmental entity’s project plan, to 13 consider, at a minimum, whether the project is designed 14 to mitigate future flooding of property that has sustained 15 significant flood damage and is likely to sustain significant 16 flood damage in the future, whether the project addresses 17 the impact of flooding both upstream and downstream from 18 the area where the project is to be undertaken, whether the 19 area that would benefit from the project’s flood mitigation 20 efforts is valuable to the economic viability of the state or 21 is of historic value to the state, the extent to which the 22 project would utilize local matching funds including whether 23 the project meets specific local matching funds requirements, 24 whether the project will result in specified amounts of 25 nonpublic investment, as defined in the bill, the extent of 26 nonfinancial support from public and nonpublic sources, the 27 net number of new jobs proposed to be created as a direct 28 result of the project and its completion in the area for which 29 the project is designed to mitigate future flooding, whether 30 the project is consistent with the applicable comprehensive, 31 countywide emergency operations plan, and whether financial 32 assistance through the flood mitigation program is essential 33 to meet the necessary expenses or serious needs of the 34 governmental entity related to flood mitigation. 35 -19- LSB 2776HC (1) 84 md/sc 19/ 24