House Study Bill 165 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON PUBLIC SAFETY BILL BY CHAIRPERSON BAUDLER) A BILL FOR An Act establishing a length of service award program for 1 volunteer fire fighters, concerning income tax deductions 2 for volunteer fire fighters, making appropriations, and 3 including effective date provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 2628YC (2) 87 ec/rj

H.F. _____ Section 1. Section 100B.2, Code 2017, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 9. Establish a length of service 3 award program for volunteer fire fighters pursuant to the 4 requirements of section 100B.41. 5 Sec. 2. NEW SECTION . 100B.41 Length of service award 6 program. 7 1. The state fire service and emergency response council, in 8 consultation with the department of administrative services, 9 shall establish a length of service award program for volunteer 10 fire fighters as defined in section 85.61. The program shall 11 provide length of service awards, as described in section 12 457(e)(11) of the Internal Revenue Code, to volunteer fire 13 fighters of a fire department of a municipality, township, 14 or benefited fire district that elects to participate in 15 the program. The program shall be designed as a defined 16 contribution pension plan, consistent, to the extent possible, 17 with the requirements of section 509A.12, requiring mandatory 18 employer contributions from a participating municipality, 19 township, or benefited fire district. The program shall be 20 designed to treat awards from the program as a tax-deferred 21 benefit under the Internal Revenue Code. The council shall 22 develop and submit to the state fire marshal for adoption rules 23 providing for minimum contribution requirements, eligibility 24 requirements for participation by volunteer fire fighters, 25 minimum vesting requirements, and such other rules as deemed 26 necessary to operate the program. 27 2. The council shall provide a state match for all 28 annual contributions paid for volunteer fire fighters by 29 a participating municipality, township, or benefited fire 30 district up to a maximum of one hundred dollars per fiscal year 31 per volunteer fire fighter. There is appropriated annually 32 from the general fund of the state to the council an amount 33 sufficient to provide the state match as provided in this 34 subsection. 35 -1- LSB 2628YC (2) 87 ec/rj 1/ 3

H.F. _____ Sec. 3. Section 422.12, subsection 1, paragraph f, Code 1 2017, is amended by striking the paragraph. 2 Sec. 4. Section 422.12, subsection 2, paragraph c, Code 3 2017, is amended to read as follows: 4 c. (1) A volunteer fire fighter and volunteer emergency 5 medical services personnel member credit equal to one hundred 6 dollars to compensate the taxpayer for the voluntary services 7 if the volunteer served for the entire tax year. A taxpayer 8 who is a paid employee of an emergency medical services program 9 or a fire department and who is also a volunteer emergency 10 medical services personnel member or volunteer fire fighter in 11 a city, county, or area governed by an agreement pursuant to 12 chapter 28E where the emergency medical services program or 13 fire department performs services, shall qualify for the credit 14 provided under this paragraph “c” . 15 (2) If the taxpayer is not a volunteer fire fighter or 16 volunteer emergency medical services personnel member for 17 the entire tax year, the maximum amount of the credit shall 18 be prorated and the amount of credit for the taxpayer shall 19 equal the maximum amount of credit for the tax year, divided by 20 twelve, multiplied by the number of months in the tax year the 21 taxpayer was a volunteer. The credit shall be rounded to the 22 nearest dollar. If the taxpayer is a volunteer during any part 23 of a month, the taxpayer shall be considered a volunteer for 24 the entire month. If the taxpayer is a volunteer fire fighter 25 and a volunteer emergency medical services personnel member 26 during the same month, a credit may be claimed for only one 27 volunteer position for that month. 28 (3) The taxpayer is required to have a written statement 29 from the fire chief or other appropriate supervisor verifying 30 that the taxpayer was a volunteer fire fighter or volunteer 31 emergency medical services personnel member for the months for 32 which the credit under this paragraph “c” is claimed. 33 Sec. 5. Section 422.12, subsection 2, paragraph d, 34 subparagraph (3), Code 2017, is amended to read as follows: 35 -2- LSB 2628YC (2) 87 ec/rj 2/ 3

H.F. _____ (3) If the taxpayer is a reserve peace officer during 1 the same month as the taxpayer is a volunteer fire fighter 2 or volunteer emergency medical services personnel member, as 3 defined in this section , a credit may be claimed for only one 4 position for that month under either paragraph “c” or this 5 paragraph “d” . 6 Sec. 6. EFFECTIVE DATE. This Act takes effect January 1, 7 2018. 8 EXPLANATION 9 The inclusion of this explanation does not constitute agreement with 10 the explanation’s substance by the members of the general assembly. 11 This bill requires the state fire service and emergency 12 response council, in consultation with the department of 13 administrative services, to establish a length of service award 14 program for volunteer fire fighters. The program shall be 15 designed as a defined contribution pension plan consistent 16 with the requirements for a deferred compensation program for 17 governmental employees as provided by Code section 509A.12. 18 The program shall provide for a minimum contribution to the 19 plan from a participating municipality, township, or benefited 20 fire district, but participation in the plan by such an entity 21 is optional. The council is also required to develop rules 22 for adoption by the state fire marshal governing minimum 23 contribution requirements, eligibility requirements for 24 participation by volunteer fire fighters, and such other rules 25 as deemed necessary to operate the program. The bill provides 26 for a state match of contributions made up to $100. The bill 27 provides for an appropriation from the general fund of the 28 state to the council in an amount necessary to provide for the 29 state match. 30 Code section 422.12, concerning deductions from income tax, 31 is amended to eliminate the volunteer fire fighter tax credit 32 equal to $100 to compensate the volunteer if the volunteer 33 served for the entire tax year. 34 The bill takes effect January 1, 2018. 35 -3- LSB 2628YC (2) 87 ec/rj 3/ 3