S.F. 2074 Section 1. Section 423.2, subsection 11, paragraph b, 1 subparagraph (7), Code 2018, is amended to read as follows: 2 (7) Beginning the first day of the quarter following July 3 1, 2014, transfer to the raceway facility tax rebate fund 4 created in section 423.4, subsection 11 , paragraph “e” , that 5 portion of the sales tax receipts collected and remitted upon 6 sales of tangible personal property or services furnished by 7 retailers at a raceway facility meeting the qualifications of 8 section 423.4, subsection 11 , that remains after the transfers 9 required in subparagraphs (1) through (6) of this paragraph 10 “b” . This subparagraph is repealed June 30, 2025, or thirty 11 days following the date on which an amount of total rebates 12 specified in section 423.4, subsection 11 , paragraph “c” , 13 subparagraph (4), subparagraph division (a) or (b), whichever 14 is applicable (3) , has been provided or thirty days following 15 the date on which rebates cease as provided in section 423.4, 16 subsection 11 , paragraph “c” , subparagraph (5) (4) , whichever 17 is earliest. 18 Sec. 2. Section 423.4, subsection 11, paragraphs b, c, d, e, 19 and g, Code 2018, are amended to read as follows: 20 b. The owner or operator of a raceway facility may apply to 21 the department for a rebate of the following: 22 (1) Sales sales tax imposed and collected by retailers upon 23 sales of tangible personal property or services furnished to 24 purchasers at the raceway facility. Notwithstanding the state 25 sales tax imposed in section 423.2 , a sales tax rebate issued 26 pursuant to this subparagraph shall not exceed the amounts 27 transferred to the raceway facility tax rebate fund pursuant to 28 section 423.2, subsection 11 , paragraph “b” , subparagraph (7). 29 (2) (a) Sales or use tax upon the sales price of all 30 tangible personal property, or from services furnished to a 31 contractor, used in the fulfillment of a written contract with 32 the owner or operator if the property becomes an integral part 33 of the project under contract and at the completion of the 34 project becomes part of the raceway facility. 35 -1- LSB 5503XS (3) 87 mm/jh 1/ 6

S.F. 2074 (b) The rebate available under this subparagraph shall be 1 limited to one project per raceway facility. If such a project 2 is undertaken, the owner or operator of the raceway facility 3 shall notify the department upon completion of the project. 4 (c) Notwithstanding the state sales tax imposed in section 5 423.2 , a sales tax rebate issued pursuant to this subparagraph 6 shall not exceed the amounts remaining after the transfers 7 required under section 423.2, subsection 11 , paragraph “b” , 8 subparagraphs (1) through (6), have been made from the total 9 amount of sales tax for which the rebate is requested. 10 (d) Notwithstanding the state use tax imposed in section 11 423.5 , a use tax rebate issued pursuant to this subparagraph 12 shall not exceed the amounts remaining after the transfers 13 required under section 423.43, subsection 1 , have been made 14 from the total amount of use tax for which the rebate is 15 requested. 16 c. The rebate may be obtained only in the following amounts 17 and manner and only under the following conditions: 18 (1) For rebates pursuant to paragraph “b” , subparagraph (1), 19 on On forms furnished by the department within the time period 20 provided by the department by rule, which time period shall not 21 be longer than quarterly. 22 (2) For rebates pursuant to paragraph “b” , subparagraph (2), 23 on forms furnished by the department within the time period 24 provided by the department by rule, but not more than one year 25 after the final settlement has been made. 26 (3) (2) The owner or operator shall provide information as 27 deemed necessary by the department. 28 (4) (3) The transactions for which sales or use tax was 29 collected and the rebate is sought occurred on or after January 30 1, 2015, but before January 1, 2025. However, the total amount 31 of rebates provided pursuant to this subsection shall not 32 exceed the lesser of the following amounts: 33 (a) Twenty-five percent of the project costs, as determined 34 by the department, if such a project is undertaken by the owner 35 -2- LSB 5503XS (3) 87 mm/jh 2/ 6

S.F. 2074 or operator. For purposes of this subparagraph division, 1 “project costs” means costs incurred by the owner or operator 2 in connection with the planning, design, construction, and 3 installation of property that becomes an integral part of the 4 project under contract which project upon completion becomes 5 part of the raceway facility, and other costs incurred by 6 the owner or operator in connection with the project that 7 are customarily associated with the renovation, remodeling, 8 reconstruction, expansion, equipping, or improvement of 9 real property. Project costs shall be determined after the 10 department receives notification of completion of the project 11 pursuant to paragraph “b” , subparagraph (2), subparagraph 12 division (b). However, if rebates cease because of a change of 13 control of the raceway facility as provided in paragraph “c” , 14 subparagraph (5), project costs shall be determined as of the 15 date the change of control occurs. 16 (b) Two one million eight hundred thousand dollars. 17 (5) (4) Notwithstanding subparagraph (4) (3) , the rebate 18 of sales or use tax shall cease for transactions occurring 19 on or after the date of the change of control of the raceway 20 facility. 21 (6) (5) The raceway facility has not received or shall not 22 receive any grants under the community attraction and tourism 23 program pursuant to chapter 15F, subchapter II , or the vision 24 Iowa program pursuant to chapter 15F, subchapter III . 25 d. To assist the department in determining the amount of the 26 rebate, the following shall occur: 27 (1) For rebates pursuant to paragraph “b” , subparagraph 28 (1), the owner or operator shall identify to the department 29 retailers located at the raceway facility who will be 30 collecting sales tax. The department shall verify such 31 identity and ensure that all proper permits have been issued. 32 For purposes of this subsection , advance ticket and admissions 33 sales shall be considered occurring at the raceway facility 34 regardless of where the transactions actually occur. 35 -3- LSB 5503XS (3) 87 mm/jh 3/ 6

S.F. 2074 (2) For rebates pursuant to paragraph “b” , subparagraph (2), 1 the contractor shall state under oath, on forms provided by 2 the department, the amount of such sales of tangible personal 3 property, or services furnished and used in the performance 4 of a contract, and upon which sales or use tax has been paid, 5 and shall file such forms with the owner or operator which has 6 made any written contract for performance by the contractor. 7 The forms shall be filed by the contractor with the owner or 8 operator before final settlement is made. Any contractor who 9 willfully makes a false report of tax paid under the provisions 10 of this subsection is guilty of a simple misdemeanor and in 11 addition shall be liable for the payment of the tax and any 12 applicable penalty and interest. 13 e. There is established within the state treasury under 14 the control of the department a raceway facility tax rebate 15 fund consisting of the amount of state sales tax revenues 16 transferred pursuant to section 423.2, subsection 11 , paragraph 17 “b” , subparagraph (7). An account is created within the 18 fund for each raceway facility meeting the qualifications of 19 this subsection . Moneys in the fund shall only be used to 20 provide rebates of state sales tax pursuant to paragraph “b” , 21 subparagraph (1) . The total amount of rebates paid from the 22 fund shall not exceed the amount specified in paragraph “c” , 23 subparagraph (4), subparagraph division (a) or (b), whichever 24 is applicable one million eight hundred thousand dollars . Any 25 moneys in the fund which represent state sales tax revenue for 26 which the time period in paragraph “c” for receiving a rebate 27 has expired, or which otherwise represent state sales tax 28 revenue that has become ineligible for rebate pursuant to this 29 subsection shall immediately revert to the general fund of the 30 state. 31 g. This subsection is repealed June 30, 2025, or thirty 32 days following the date on which an amount of total rebates 33 specified in paragraph “c” , subparagraph (4), subparagraph 34 division (a) or (b), whichever is applicable, has one million 35 -4- LSB 5503XS (3) 87 mm/jh 4/ 6

S.F. 2074 eight hundred thousand dollars in total rebates have been 1 provided and no overpayment of rebates exists, or thirty days 2 following the date on which rebates cease as provided in 3 paragraph “c” , subparagraph (5) (4) , and no overpayment of 4 rebates exists, whichever is earliest. 5 Sec. 3. REBATES. Notwithstanding section 423.4, subsection 6 11, or section 423.47, or any other provision of law to the 7 contrary, a claim for rebate of sales tax imposed and collected 8 by retailers upon sales of tangible personal property or 9 services furnished to purchasers at a raceway facility and 10 occurring before the enactment of this Act shall be considered 11 timely if the claim is filed with the department of revenue 12 within ninety days following the enactment of this Act. 13 Sec. 4. EFFECTIVE DATE. This Act, being deemed of immediate 14 importance, takes effect upon enactment. 15 Sec. 5. RETROACTIVE APPLICABILITY. This Act applies 16 retroactively to January 1, 2015, for sales occurring on or 17 after that date. 18 EXPLANATION 19 The inclusion of this explanation does not constitute agreement with 20 the explanation’s substance by the members of the general assembly. 21 BACKGROUND. Current law provides a rebate of sales and use 22 tax to the owner or operator of a raceway facility that meets 23 certain requirements. The rebate is available for two types of 24 transactions. The first type is for state sales tax collected 25 on purchases made at the raceway facility. The second type is 26 for state sales or use tax paid by a contractor in completion 27 of a project at the raceway facility. The rebate related to 28 the completion of a project is limited to one project per 29 raceway facility. The rebates only apply to transactions 30 occurring between January 1, 2015, and January 1, 2025. The 31 maximum amount of rebates is limited to $2 million or 25 32 percent of the project costs if such a project is undertaken at 33 the raceway facility, whichever is less. 34 BILL CHANGES. This bill strikes provisions allowing the 35 -5- LSB 5503XS (3) 87 mm/jh 5/ 6

S.F. 2074 rebate for state sales or use tax paid by a contractor in 1 completion of a project at the raceway facility, and strikes 2 other provisions relating to the administration of that 3 component of the rebate. The rebate will now be available only 4 for state sales tax collected on purchases made at the raceway 5 facility. The bill also amends the maximum rebate limit to 6 equal $1.8 million. 7 The bill also provides that a claim for rebate of sales tax 8 relating to sales occurring prior to the enactment of the bill 9 will be considered timely if it is filed with the department 10 of revenue within 90 days of the enactment date of the bill, 11 notwithstanding any other provision of law to the contrary. 12 The bill takes effect upon enactment and applies 13 retroactively to January 1, 2015, for sales occurring on or 14 after that date. 15 -6- LSB 5503XS (3) 87 mm/jh 6/ 6