S.F. _____ Section 1. Section 455C.1, subsection 1, Code 2021, is 1 amended to read as follows: 2 1. “Beverage” means wine as defined in section 123.3, 3 subsection 54 , alcoholic liquor as defined in section 123.3, 4 subsection 5 , beer as defined in section 123.3, subsection 5 7 , high alcoholic content beer as defined in section 123.3, 6 subsection 22, canned cocktail as defined in section 123.3, 7 subsection 11, mineral water, soda water , and similar 8 carbonated soft drinks in liquid form and intended for human 9 consumption. 10 Sec. 2. NEW SECTION . 455C.3A Accounting of unpaid refund 11 value. 12 1. As used in this section, “financial institution” means 13 any bank, trust company, savings association, insurance company 14 or related corporation, partnership, foundation, or other 15 institution licensed to do business in the state of Iowa. 16 2. Each distributor shall open a special interest-bearing 17 account at an Iowa branch of a financial institution to the 18 credit of the distributor. The distributor shall deposit in 19 the account an amount equal to the refund value established 20 pursuant to section 455C.2 for each beverage container sold 21 by the distributor on or after July 1, 2021. The distributor 22 shall make the deposit not more than three business days after 23 the date the beverage container is sold to a dealer. All 24 interest, dividends, and returns earned on the account shall 25 be paid directly into the account. Moneys in the account 26 shall be kept separate and apart from all other moneys in the 27 distributor’s possession. 28 3. Reimbursement paid to a dealer, dealer agent, or 29 redemption center pursuant to section 455C.2, subsection 2, 30 shall be paid from the account created pursuant to subsection 31 1 of this section. 32 4. Each distributor shall submit a report to the director by 33 October 31, 2021, covering the period beginning July 1, 2021, 34 and ending September 30, 2021, and thereafter shall submit a 35 -1- LSB 1496XC (3) 89 js/ns 1/ 4

S.F. _____ quarterly report covering the immediately preceding calendar 1 quarter not later than one month after the close of the quarter 2 for which the report is prepared. The report shall be on a form 3 prescribed by the director and contain such information that 4 the director deems necessary, including but not limited to all 5 of the following: 6 a. The balance in the account at the beginning of the 7 quarter for which the report is prepared. 8 b. A list of all deposits credited to the account during 9 the quarter, including those deposits equivalent to the refund 10 values paid to the distributor and all interest, dividends, or 11 returns received on the account. 12 c. A list of all withdrawals from the account during the 13 quarter, all service charges and overdraft charges on the 14 account, and all payments made pursuant to subsection 3. 15 d. The balance in the account at the close of the quarter 16 for which the report is prepared. 17 5. The treasurer of state may, independently or upon 18 request of the director, examine the accounts and records of 19 any distributor maintained by the distributor pursuant to this 20 section, including receipts, disbursements, and such other 21 items as the treasurer of state deems appropriate. 22 6. The attorney general may, independently or upon request 23 of the director, institute any appropriate action or proceeding 24 to enforce any provision of this section or any rule adopted 25 pursuant to this section. 26 EXPLANATION 27 The inclusion of this explanation does not constitute agreement with 28 the explanation’s substance by the members of the general assembly. 29 This bill relates to accounting of unpaid beverage container 30 refund value under the beverage containers control law, also 31 known as the bottle bill. 32 Current law limits beverage containers subject to beverage 33 containers control deposit and refund provisions to any sealed 34 glass, plastic, or metal bottle, can, jar, or carton holding 35 -2- LSB 1496XC (3) 89 js/ns 2/ 4

S.F. _____ wine, alcoholic liquor, beer, mineral water, soda water, or 1 carbonated soft drinks. When a distributor sells beverages 2 in eligible containers to a dealer, the distributor charges 5 3 cents per eligible container to the sale price. When a dealer 4 sells beverages in eligible containers to a consumer, the 5 dealer charges the 5-cent deposit on each beverage container. 6 A consumer can take eligible beverage containers to a dealer, 7 dealer agent, or a redemption center and receive a 5-cent 8 refund for every eligible beverage container that the consumer 9 returns. A distributor collects eligible containers from a 10 dealer, dealer agent, or redemption center, at which time 11 the distributor pays the dealer, dealer agent, or redemption 12 center 5 cents per eligible container plus a handling fee of an 13 additional 1 cent per empty container. 14 The bill adds high alcoholic content beer and canned 15 cocktails to the definition of “beverage”. 16 The bill requires each distributor to open a special 17 interest-bearing account at an Iowa branch of a financial 18 institution, as defined in the bill, to the credit of the 19 distributor. The distributor shall deposit in the account an 20 amount equal to the refund value for each beverage container 21 sold by the distributor on or after July 1, 2021, and the 22 reimbursement of refund value paid by the distributor to a 23 dealer, dealer agent, or redemption center shall be paid from 24 the account. 25 Beginning October 31, 2021, and quarterly thereafter, the 26 bill requires each distributor to submit to the director of 27 the department of natural resources (DNR) a report covering 28 the immediately preceding calendar quarter that includes the 29 balance in the account at the beginning of the quarter for 30 which the report is prepared, a list of all deposits credited 31 to the account during the quarter, a list of all withdrawals 32 from the account during the quarter, and the balance in the 33 account at the close of the quarter for which the report is 34 prepared. 35 -3- LSB 1496XC (3) 89 js/ns 3/ 4

S.F. _____ The bill authorizes the treasurer of state, independently 1 or upon request of the DNR director, to examine the accounts 2 and records of any distributor maintained by the distributor 3 pursuant to the bill. The bill authorizes the attorney 4 general, independently or upon request of the DNR director, to 5 institute any appropriate action or proceeding to enforce any 6 provision of the bill or any rule adopted pursuant to the bill. 7 -4- LSB 1496XC (3) 89 js/ns 4/ 4