S.F. 5 Section 1. Section 8.55, subsection 2, Code 2013, is amended 1 to read as follows: 2 2. The maximum balance of the fund is the amount equal to 3 two and one-half percent of the adjusted revenue estimate for 4 the fiscal year. If the amount of moneys in the Iowa economic 5 emergency fund is equal to the maximum balance, moneys in 6 excess of this amount shall be distributed as follows: 7 a. The first sixty million dollars of the difference between 8 the actual net revenue for the general fund of the state for 9 the fiscal year and the adjusted revenue estimate for the 10 fiscal year shall be transferred to the taxpayers trust fund. 11 b. Moneys in excess of the amount transferred under 12 paragraph “a” , up to a maximum of one hundred million dollars, 13 shall be transferred to the critical needs road fund created 14 under section 312B.1. 15 b. c. The remainder of the excess, if any, shall be 16 transferred to the general fund of the state. 17 Sec. 2. Section 8.58, Code 2013, is amended to read as 18 follows: 19 8.58 Exemption from automatic application. 20 1. To the extent that moneys appropriated under section 21 8.57 do not result in moneys being credited to the general fund 22 under section 8.55, subsection 2 , moneys appropriated under 23 section 8.57 and moneys contained in the cash reserve fund, 24 rebuild Iowa infrastructure fund, environment first fund, Iowa 25 economic emergency fund, and taxpayers trust fund , and critical 26 needs road fund shall not be considered in the application of 27 any formula, index, or other statutory triggering mechanism 28 which would affect appropriations, payments, or taxation rates, 29 contrary provisions of the Code notwithstanding. 30 2. To the extent that moneys appropriated under section 31 8.57 do not result in moneys being credited to the general fund 32 under section 8.55, subsection 2 , moneys appropriated under 33 section 8.57 and moneys contained in the cash reserve fund, 34 rebuild Iowa infrastructure fund, environment first fund, Iowa 35 -1- LSB 1400XS (1) 85 dea/nh 1/ 3

S.F. 5 economic emergency fund, and taxpayers trust fund , and critical 1 needs road fund shall not be considered by an arbitrator or in 2 negotiations under chapter 20 . 3 Sec. 3. NEW SECTION . 312B.1 Critical needs road fund. 4 1. A critical needs road fund is created in the state 5 treasury under the control of the department of transportation. 6 The fund shall be separate from the general fund of the state 7 and the balance in the fund shall not be considered part of 8 the balance of the general fund of the state. The fund shall 9 consist of moneys appropriated by the general assembly and any 10 revenues credited by law to the critical needs road fund. The 11 moneys in the fund are not subject to section 8.33 and shall 12 not be transferred, used, obligated, appropriated, or otherwise 13 encumbered except as provided in this section. Notwithstanding 14 section 12C.7, subsection 2, interest or earnings on moneys 15 deposited in the critical needs road fund shall be credited to 16 the fund. 17 2. Moneys in the critical needs road fund are appropriated 18 to the department of transportation to be used as directed by 19 the department exclusively for the repair and maintenance of 20 roads on the primary or secondary road system or the municipal 21 street system, including bridges. The department shall 22 establish guidelines to be used by the department, counties, 23 and cities for identifying roads and bridges in critical 24 need of repair or maintenance and for the department to use 25 in evaluating and prioritizing state and local road projects 26 to receive funding under this section. Counties and cities 27 may apply for funding from the critical needs road fund by 28 submitting to the department proposals for projects on roads 29 under their respective jurisdictions. A qualifying proposal 30 shall include information regarding the status and condition 31 of the road that is the subject of the proposal, the plan for 32 completing the project, and any other information required by 33 the department. The department shall develop an application 34 process for counties and cities to use for the submission of 35 -2- LSB 1400XS (1) 85 dea/nh 2/ 3

S.F. 5 proposals for the use of funds under this section. Moneys 1 distributed from the critical needs road fund may be used 2 in combination with other available funding as necessary to 3 accomplish the completion of a qualifying project and to 4 accomplish the goal of reducing the number of Iowa roads and 5 bridges with critical needs. 6 EXPLANATION 7 This bill establishes a critical needs road fund in the state 8 treasury under the control of the department of transportation. 9 Moneys in the fund are appropriated to the department to be 10 used exclusively for repair and maintenance of state and local 11 roads. The department is authorized to direct the use of the 12 fund’s resources according to guidelines to be established by 13 the department for identifying roads and bridges in critical 14 need of repair or maintenance and for prioritizing state 15 and local critical needs projects. Counties and cities 16 may submit proposals for the use of funds on roads under 17 their jurisdiction according to an application process to be 18 developed by the department. Moneys from the fund may be used 19 in combination with other available funding. 20 The bill provides that if the economic emergency fund 21 reaches the maximum balance, after the required transfer of a 22 portion of the excess to the taxpayers trust fund and before 23 any remaining excess is transferred to the general fund of the 24 state, any excess moneys in an amount up to $100 million shall 25 be transferred to the critical needs road fund. 26 -3- LSB 1400XS (1) 85 dea/nh 3/ 3