H.F. 2501 Section 1. Section 12B.10, subsection 6, Code 2022, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . n. Investments by the veterans trust fund 3 established in section 35A.13. 4 Sec. 2. Section 12B.10C, subsection 4, Code 2022, is amended 5 by adding the following new paragraph: 6 NEW PARAGRAPH . k. The veterans trust fund established in 7 section 35A.13. 8 Sec. 3. Section 35A.13, subsection 3, Code 2022, is amended 9 to read as follows: 10 3. Moneys credited to the trust fund shall not be 11 transferred, used, obligated, appropriated, or otherwise 12 encumbered, except as provided in this section . Moneys in the 13 trust fund may be used for cash flow purposes during a fiscal 14 year provided that any moneys so allocated are returned to the 15 trust fund by the end of that fiscal year. Moneys in the trust 16 fund may also be used for cemetery grant development purposes 17 provided that any moneys so allocated, except for moneys used 18 for department of administrative services expenditures related 19 to the grant, are returned to the trust fund upon receipt of 20 federal funds received for such purposes. 21 Sec. 4. Section 35A.13, Code 2022, is amended by adding the 22 following new subsection: 23 NEW SUBSECTION . 3A. a. Notwithstanding subsection 4, 24 moneys in the fund, except so much of the fund as may be 25 necessary to be kept on hand for the making of disbursements 26 under this section, shall be invested by the treasurer of 27 state, in consultation with the commission and the public 28 retirement systems committee established by section 97D.4, 29 in any investments authorized for the Iowa public employees’ 30 retirement system in section 97B.7A, including common stock, 31 and subject to the requirements of chapters 12F, 12H, and 12J, 32 and the earnings therefrom shall be credited to the fund. The 33 treasurer of state may execute contracts and agreements with 34 investment advisors, consultants, and investment management and 35 -1- LSB 1048HV (4) 89 dg/rn 1/ 5

H.F. 2501 benefit consultant firms in the administration of investments 1 of moneys in the fund. 2 b. Investment management expenses shall be charged to the 3 investment income of the fund and there is appropriated to the 4 treasurer of state from the investment income of the fund an 5 amount required for the investment management expenses. 6 c. For purposes of this subsection, investment management 7 expenses are limited to the following: 8 (1) Fees for investment advisors, consultants, and 9 investment management and benefit consultant firms hired by 10 the treasurer of state in administering the investments of the 11 fund. 12 (2) Fees and costs for safekeeping fund assets. 13 (3) Costs for performance and compliance monitoring, and 14 accounting for fund investments. 15 (4) Any other costs necessary to prudently invest or protect 16 the assets of the fund. 17 d. The commission, the public retirement systems committee 18 established by section 97D.4, and the treasurer of state, 19 and their employees, are not personally liable for claims 20 based upon an act or omission of the person performed in the 21 discharge of the person’s duties concerning the veterans trust 22 fund, except for acts or omissions which involve malicious or 23 wanton misconduct. 24 Sec. 5. Section 35A.13, subsection 4, Code 2022, is amended 25 by striking the subsection and inserting in lieu thereof the 26 following: 27 4. a. For each fiscal year that the balance of the trust 28 fund on July 1 is below fifty million dollars, the interest 29 and earnings on moneys in the fund and the first five hundred 30 thousand dollars transferred pursuant to section 99G.39 from 31 the lottery fund are appropriated to the commission to be used 32 to achieve the purposes of subsection 6. Moneys appropriated 33 to the commission under this paragraph that remain unencumbered 34 or unobligated at the end of the fiscal year shall revert to 35 -2- LSB 1048HV (4) 89 dg/rn 2/ 5

H.F. 2501 the fund. 1 b. For each fiscal year that the balance of the trust fund 2 on July 1 is above fifty million dollars but the balance of the 3 fund was below fifty million dollars on July 1 of the previous 4 fiscal year, moneys transferred pursuant to section 99G.39 from 5 the lottery fund are appropriated to the commission to be used 6 to achieve the purposes of subsection 6. Moneys appropriated 7 to the commission under this paragraph that remain unencumbered 8 or unobligated at the end of the fiscal year shall revert to 9 the fund. 10 c. For each fiscal year that the balance of the trust fund 11 on July 1 is above fifty million dollars and the balance of 12 the fund was above fifty million dollars on July 1 of the 13 previous fiscal year, moneys equal to the net income the fund 14 received in the previous fiscal year are appropriated to the 15 commission to be used to achieve the purposes of subsection 16 6. Moneys appropriated to the commission under this paragraph 17 that remain unencumbered or unobligated at the end of the 18 fiscal year shall revert to the fund. For the purposes of this 19 paragraph, “income” means moneys credited to the veterans trust 20 fund pursuant to subsection 2 and moneys transferred pursuant 21 to section 99G.39. 22 d. Notwithstanding paragraphs “a” , “b” , and “c” , moneys 23 credited to the war orphans educational assistance account 24 shall be expended as provided in subsection 7. 25 Sec. 6. Section 97D.4, subsection 3, Code 2022, is amended 26 by adding the following new paragraph: 27 NEW PARAGRAPH . 0g. Consult with the treasurer of state and 28 the commission of veterans affairs in accordance with section 29 35A.13, subsection 3A. 30 EXPLANATION 31 The inclusion of this explanation does not constitute agreement with 32 the explanation’s substance by the members of the general assembly. 33 This bill relates to the investment and use of funds in the 34 veterans trust fund. 35 -3- LSB 1048HV (4) 89 dg/rn 3/ 5

H.F. 2501 The bill exempts the veterans trust fund (trust fund) from 1 rules adopted by the treasurer of state to limit certain 2 investments of public funds. 3 The bill removes the ability to use moneys from the trust 4 fund for cash flow purposes. 5 The bill allows the treasurer of state, in consultation 6 with the commission of veterans affairs (commission) and the 7 public retirement systems committee, to invest moneys in the 8 trust fund not necessary for disbursements to benefit veterans 9 in any investments authorized for the Iowa public employees’ 10 retirement system. Any earnings shall be credited to the 11 trust fund, and the treasurer of state may make contracts 12 and agreements with investment advisors, consultants, and 13 investment management and benefit consultant firms for the 14 administration of investments. 15 The bill provides that certain investment management 16 expenses shall be charged to the investment income of the trust 17 fund. 18 The bill exempts the commission, the public retirement 19 systems committee, the treasurer of state, and their employees 20 from liability based upon an act or omission of the entity or 21 person’s duties regarding the investment of the trust fund, 22 except for acts or omissions which involve malicious or wanton 23 misconduct. 24 The bill provides that for each fiscal year that the balance 25 of the trust fund on July 1 is below $50 million, the interest 26 and earnings on moneys in the fund and the first $500,000 of 27 the $2.5 million transferred annually to the trust fund from 28 the lottery fund will be appropriated to the commission for 29 certain enumerated benefits to veterans. 30 The bill provides that for each fiscal year that the balance 31 of the trust fund on July 1 is above $50 million, but the 32 balance of the fund was below $50 million on July 1 of the 33 previous fiscal year, the moneys transferred to the trust fund 34 from the lottery fund will be appropriated to the commission 35 -4- LSB 1048HV (4) 89 dg/rn 4/ 5

H.F. 2501 for certain enumerated benefits to veterans. 1 The bill provides that for each fiscal year that the balance 2 of the trust fund on July 1 is above $50 million, and the 3 balance of the fund was above $50 million on July 1 of the 4 previous fiscal year, moneys equal to the trust fund’s net 5 income for the previous fiscal year will be appropriated to the 6 commission for certain enumerated benefits to veterans. 7 -5- LSB 1048HV (4) 89 dg/rn 5/ 5