S.F. 203 Section 1. Section 8.55, subsection 2, Code 2011, is amended 1 to read as follows: 2 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, moneys 6 in excess of this amount shall be transferred to the general 7 bond repayment fund. 8 b. Notwithstanding paragraph “a” , any moneys in excess of 9 the maximum balance in the economic emergency fund after the 10 distribution of the surplus in the general bond repayment fund 11 of the state at the conclusion of each fiscal year shall not 12 be transferred to the general bond repayment fund of the state 13 but shall be transferred to the senior living trust fund. The 14 total amount appropriated, reverted, or transferred, in the 15 aggregate, under this paragraph, section 8.57, subsection 2 , 16 and any other law providing for an appropriation or reversion 17 or transfer of an appropriation to the credit of the senior 18 living trust fund, for all fiscal years beginning on or after 19 July 1, 2004, shall not exceed the amount specified in section 20 8.57, subsection 2 , paragraph “c” . 21 Sec. 2. NEW SECTION . 8.57E Bond repayment fund. 22 1. The bond repayment fund is created. The fund shall be 23 separate from the general fund of the state and the balance in 24 the fund shall not be considered part of the balance of the 25 general fund of the state. The moneys credited to the fund 26 are not subject to section 8.33 and shall not be transferred, 27 used, obligated, appropriated, or otherwise encumbered except 28 as provided in this section. 29 2. Moneys in the bond repayment fund shall only be used 30 for the defeasance of outstanding obligations of state-issued 31 revenue bonds that have a debt service paid by a dedicated 32 state revenue source. 33 3. a. Moneys in the fund may be used for cash flow purposes 34 during a fiscal year provided that any moneys so allocated are 35 -1- LSB 1932XS (2) 84 rh/jp 1/ 3

S.F. 203 returned to the fund by the end of that fiscal year. 1 b. Except as provided in section 8.58, the bond repayment 2 fund shall be considered a special account for the purposes of 3 section 8.53 in determining the cash position of the general 4 fund of the state for the payment of state obligations. 5 4. Notwithstanding section 12C.7, subsection 2, interest or 6 earnings deposited in the bond repayment fund shall be credited 7 to the fund. 8 Sec. 3. Section 8.58, Code 2011, is amended to read as 9 follows: 10 8.58 Exemption from automatic application. 11 1. To the extent that moneys appropriated under section 12 8.57 do not result in moneys being credited to the general 13 fund under section 8.55, subsection 2 , moneys appropriated 14 under section 8.57 and moneys contained in the cash reserve 15 fund, rebuild Iowa infrastructure fund, environment first fund, 16 and Iowa economic emergency fund , and bond repayment fund 17 shall not be considered in the application of any formula, 18 index, or other statutory triggering mechanism which would 19 affect appropriations, payments, or taxation rates, contrary 20 provisions of the Code notwithstanding. 21 2. To the extent that moneys appropriated under section 22 8.57 do not result in moneys being credited to the general fund 23 under section 8.55, subsection 2 , moneys appropriated under 24 section 8.57 and moneys contained in the cash reserve fund, 25 rebuild Iowa infrastructure fund, environment first fund, and 26 Iowa economic emergency fund , and bond repayment fund shall not 27 be considered by an arbitrator or in negotiations under chapter 28 20 . 29 Sec. 4. EFFECTIVE UPON ENACTMENT —— APPLICABILITY. 30 1. This Act, being deemed of immediate importance, takes 31 effect upon enactment. 32 2. The amendment to section 8.55, providing for transfer 33 of moneys from the Iowa economic emergency fund to the bond 34 repayment fund instead of the general fund of the state applies 35 -2- LSB 1932XS (2) 84 rh/jp 2/ 3

S.F. 203 to transfers made from the Iowa economic emergency fund after 1 the effective date of this Act and the state general fund 2 expenditure limitation calculated for the fiscal year beginning 3 July 1, 2011, shall be adjusted accordingly. 4 EXPLANATION 5 This bill creates the bond repayment fund and provides 6 effective date and applicability provisions. 7 The bond repayment fund is to be separate from the general 8 fund of the state and the balance in the fund shall not be 9 considered part of the balance of the general fund of the 10 state. Moneys in the bond repayment fund shall only be used 11 for the defeasance of outstanding obligations of state-issued 12 revenue bonds that have a debt service paid by a dedicated 13 state revenue source. 14 Code section 8.55 is amended to provide that when the Iowa 15 economic emergency fund achieves its maximum balance the excess 16 funds are transferred to the bond repayment fund instead of 17 the general fund of the state. Code section 8.58, exempting 18 the balances in existing reserve funds from being considered 19 in the application of any formula, index, or other statutory 20 triggering mechanism which would affect appropriations, 21 payments, or taxation rates, and by an arbitrator or collective 22 bargaining negotiation under Code chapter 20, is amended by 23 adding the new bond repayment fund created in the bill. 24 The bill takes effect upon enactment, applies to transfers 25 made from the Iowa economic emergency fund to the bond 26 repayment fund instead of the general fund on or after the 27 effective date, and requires the effect of such transfers to 28 be reflected by adjusting the state general fund expenditure 29 limitation calculated for fiscal year 2011-2012 accordingly. 30 -3- LSB 1932XS (2) 84 rh/jp 3/ 3