H.F. 2125 Section 1. NEW SECTION . 15.371 Child care future zones 1 program and fund. 2 1. As used in this section, unless the context otherwise 3 requires: 4 a. “Child care future zone” means any census tract in this 5 state with more than fifty children under the age of five that 6 contains either no child care providers or so few child care 7 providers that there are more than three times as many children 8 under the age of five as there are spaces available at the 9 existing child care providers. 10 b. “Financial assistance” means assistance provided only 11 from the funds, rights, and assets legally available to the 12 authority and includes but is not limited to assistance in the 13 form of tax incentives, tuition reimbursement, low-interest 14 loans, and grants. 15 c. “Fund” means the child care future zones fund. 16 d. “Program” means the child care future zones program. 17 2. a. A child care future zones fund is created in 18 the state treasury under the control of the authority and 19 consists of any moneys appropriated by the general assembly 20 and any other moneys available and obtained or accepted by the 21 authority for placement in the fund. The fund shall be used to 22 provide financial assistance to persons under the program. The 23 authority shall use any moneys specifically appropriated for 24 purposes of this section only for the purposes of this section. 25 b. Notwithstanding section 8.33, moneys in the fund at the 26 end of each fiscal year shall not revert to any other fund 27 but shall remain in the fund for expenditures for subsequent 28 fiscal years. Notwithstanding section 12C.7, subsection 2, 29 interest or earnings on moneys in the fund shall accrue to the 30 authority and shall be used for purposes of this section. All 31 repayments, payments of interest, or recaptures of financial 32 assistance provided under this section shall accrue to the 33 authority and shall be used for purposes of this section. 34 c. The authority shall use not more than five percent of 35 -1- LSB 5574YH (2) 88 ko/jh 1/ 5

H.F. 2125 the moneys in the fund at the beginning of the fiscal year for 1 purposes of administrative costs, marketing, and other program 2 support. 3 3. The authority shall establish and administer a child 4 care future zones program to provide financial assistance to 5 eligible persons who own, or work in, a child care-related 6 business in a child care future zone; or who are enrolled in an 7 early childhood development degree program and currently work 8 in, or have committed to work in, a child care future zone. 9 4. A person seeking financial assistance under this section 10 shall apply to the authority pursuant to rules adopted by the 11 authority. 12 5. The authority, in consultation with the department of 13 human services, shall adopt rules pursuant to chapter 17A to 14 implement and administer this section. The rules shall, at a 15 minimum, provide for all of the following: 16 a. The identification and designation of child care future 17 zones. 18 b. The requirements for a person to be eligible to apply to 19 the program. 20 c. The eligibility requirements for a person to be eligible 21 for specific financial assistance including all of the 22 following: 23 (1) A five-year property tax exemption. 24 (2) A five-year sales tax exemption. 25 (3) A five-year income tax liability exemption. 26 (4) Tuition reimbursement for obtaining a degree in early 27 childhood education. 28 d. The application process for applying to the program. 29 e. The maximum financial assistance any one person may be 30 awarded on an annual basis and on an aggregate basis. 31 Sec. 2. ANALYSIS OF NONEMPLOYEE ENROLLMENT IN THE STATE 32 OF IOWA’S EMPLOYEE GROUP HEALTH PLAN. The director of the 33 department of administrative services, or the director’s 34 designee, shall conduct an analysis of the legality and 35 -2- LSB 5574YH (2) 88 ko/jh 2/ 5

H.F. 2125 feasibility of offering enrollment in the state of Iowa’s 1 employee group health plan to a nonemployee as a type of 2 financial assistance available under the program. The director 3 shall submit the director’s, or the director’s designee’s, 4 findings to the general assembly no later than January 31, 5 2021. 6 Sec. 3. AUTHORITY’S COMMUNITY DEVELOPMENT BLOCK GRANT 7 ANNUAL ACTION PLAN. As part of the authority’s 2020 community 8 development block grant (CDBG) annual action plan submission to 9 the United States department of housing and urban development 10 (HUD), the director of the authority, or the director’s 11 designee, shall include the program as one of the authority’s 12 goals and objectives and seek an allocation of CDBG funds for 13 the fund. 14 EXPLANATION 15 The inclusion of this explanation does not constitute agreement with 16 the explanation’s substance by the members of the general assembly. 17 This bill establishes a child care future zones program 18 and fund within the economic development authority to award 19 financial assistance to eligible persons involved in child 20 care. 21 “Child care future zone” is defined by the bill as any census 22 tract in this state with more than 50 children under the age 23 of five that contain either no child care providers or so few 24 child care providers that there are more than three times as 25 many children under age five as there are spaces available at 26 the existing child care providers. 27 The bill establishes a child care future zones fund (fund) 28 in the state treasury under the control of the authority 29 consisting of any moneys appropriated by the general assembly 30 and any other moneys available and obtained or accepted by 31 the authority for placement in the fund. The fund is to be 32 used to provide financial assistance to persons under the 33 child care future zones program (program). The authority must 34 use any moneys specifically appropriated for purposes of the 35 -3- LSB 5574YH (2) 88 ko/jh 3/ 5

H.F. 2125 program only for the purposes of the program. The bill defines 1 “financial assistance” as assistance provided only from the 2 funds, rights, and assets legally available to the authority 3 and includes but is not limited to assistance in the form of 4 tax incentives, tuition reimbursement, low-interest loans, and 5 grants. 6 Moneys in the fund at the end of each fiscal year do not 7 revert to any other fund but must remain in the fund for 8 expenditures for subsequent fiscal years. Interest or earnings 9 on moneys in the fund accrue to the authority to be used for 10 purposes of the program. All repayments, payments of interest, 11 or recaptures of financial assistance provided under the 12 program accrue to the authority for purposes of the program. 13 The authority cannot use more than 5 percent of the moneys in 14 the fund at the beginning of the fiscal year for purposes of 15 administrative costs, marketing, and other program support. 16 The bill directs the authority to establish and administer a 17 child care future zones program to provide financial assistance 18 to eligible persons who own, or work in, a child care-related 19 business in a child care future zone; or who are enrolled in an 20 early childhood development degree program and currently work 21 in, or have committed to work in, a child care future zone. 22 A person seeking financial assistance under the program 23 must apply to the authority pursuant to rules adopted by the 24 authority. The authority, in consultation with the department 25 of human services, must adopt rules to implement and administer 26 the bill provisions. The rules must, at a minimum, provide 27 for the identification and designation of child care future 28 zones; the requirements for a person to be eligible to apply to 29 the program; the requirements for a person to be eligible for 30 specific types of financial assistance as detailed in the bill; 31 the application process for applying to the program; and the 32 maximum financial assistance any one person may be awarded on 33 an annual or aggregate basis. 34 The bill directs the director of the department of 35 -4- LSB 5574YH (2) 88 ko/jh 4/ 5

H.F. 2125 administrative services, or the director’s designee, to 1 conduct an analysis of the legality and feasibility of offering 2 enrollment in the state of Iowa’s employee group health plan 3 to nonemployees as a type of financial assistance available 4 under the program. The director must submit the finding to the 5 general assembly no later than January 31, 2021. 6 The bill directs the authority to include the program as one 7 of the authority’s goals and objectives, and seek an allocation 8 of community development block grant (CDBG) funds for the fund, 9 in the authority’s 2020 annual CDBG action plan submission to 10 the United States department of housing and urban development. 11 -5- LSB 5574YH (2) 88 ko/jh 5/ 5