Senate Study Bill 1146 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON DAWSON) A BILL FOR An Act relating to certain financial obligations, including 1 under the consumer credit code, and including under the 2 criminal and juvenile justice system by modifying criminal 3 and civil surcharges, fines, fees, costs, and court debt, 4 providing civil penalties, and including effective date and 5 retroactive applicability provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 1174XC (9) 89 as/rh

S.F. _____ Section 1. Section 537.1301, subsection 12, Code 2021, is 1 amended to read as follows: 2 12. “Consumer credit transaction” means a consumer credit 3 sale or consumer loan, or a refinancing or consolidation 4 thereof, or a consumer lease, or a consumer rental purchase 5 agreement. “Consumer credit transaction” does not include 6 goods, services, or any other benefits provided by or on behalf 7 of the state or a state agency. 8 Sec. 2. Section 602.8105, subsection 2, paragraph h, Code 9 2021, is amended to read as follows: 10 h. For applicable convictions under section 692A.110 prior 11 to July 1, 2009, a civil penalty of two hundred ten dollars, 12 and for applicable convictions under section 692A.110 on or 13 after July 1, 2009 June 25, 2020 , a civil penalty of two 14 hundred sixty dollars. 15 Sec. 3. Section 602.8106, subsection 1, Code 2021, is 16 amended by adding the following new paragraph: 17 NEW PARAGRAPH . i. For submitting a dishonored check for the 18 payment of any court debt, thirty dollars. 19 Sec. 4. Section 602.8107, subsection 1, paragraph a, Code 20 2021, is amended to read as follows: 21 a. “Court debt” means all restitution as defined in section 22 910.1 , fees, and forfeited bail , and other debt paid to or 23 collected by the clerk of the district court . 24 Sec. 5. Section 602.8107, subsection 3, Code 2021, is 25 amended to read as follows: 26 3. Collection by department of revenue. 27 a. (1) Thirty days after court debt has been assessed 28 and full payment has not been received, or if an installment 29 payment is not received within thirty days after the date it is 30 due, the judicial branch shall assign a case to the department 31 of revenue, unless the case has been assigned to the county 32 attorney under paragraph “c” “d” . 33 (2) The department of revenue may impose a fee established 34 by rule to reflect the cost of processing which shall be added 35 -1- LSB 1174XC (9) 89 as/rh 1/ 10

S.F. _____ to the debt owed to the clerk of the district court. 1 b. (1) In addition, court debt which is being collected 2 under an installment agreement pursuant to section 321.210B 3 which is in default that remains delinquent shall remain 4 assigned to the department of revenue if the installment 5 agreement was executed with the department of revenue; or 6 to the county attorney or county attorney’s designee if the 7 installment agreement was executed with the county attorney 8 or county attorney’s designee The department of revenue shall 9 receive fifteen percent of all court debt payments collected on 10 cases assigned to the department of revenue for collection to 11 reflect the cost of processing, with the remainder of the court 12 debt to be collected by the clerk of the district court for 13 distribution in accordance with applicable law . The department 14 of revenue shall not receive payment pursuant to this paragraph 15 from any court debt collected that is payable to a crime victim 16 as pecuniary damages until after the clerk of the district 17 court has received the entirety of the court debt payable to 18 the crime victim as pecuniary damages. 19 (2) Payments made by a person under subparagraph (1) between 20 January 1, 2021, and the effective date of this Act which added 21 the department of revenue processing fee to the debt owed to 22 the clerk of the district court pursuant to section 602.8107, 23 subsection 3, paragraph “a” , subparagraph (2), Code 2021, 24 shall be calculated as if the payment had been made pursuant 25 to subparagraph (1) and the department’s fee in subparagraph 26 (1) shall be applied to such a payment. The department of 27 revenue processing fee added to the debt shall be deducted from 28 the amount of court debt owed to the clerk of the district 29 court. If a payment made by a person owing court debt between 30 January 1, 2021, and the effective date of this Act reduces 31 the total amount of court debt owed to zero, the department 32 of revenue shall issue a refund to the person in the amount 33 attributable to the processing fee added to the court debt. 34 This subparagraph is repealed on January 1, 2023. 35 -2- LSB 1174XC (9) 89 as/rh 2/ 10

S.F. _____ c. The centralized debt collection facilities of the 1 department of revenue established pursuant to section 421.17, 2 subsection 27, shall collect court debt assigned to the 3 department of revenue pursuant to this section. 4 c. d. Thirty days after court debt has been assessed 5 and full payment has not been received, or if an installment 6 payment is not received within thirty days after the date it 7 is due, and if a county attorney has filed with the clerk 8 of the district court a notice of full commitment to collect 9 delinquent court debt pursuant to subsection 4 , the case shall 10 be assigned to the county attorney as provided in subsection 4 . 11 The judicial branch shall assign cases with delinquent court 12 debt to a county attorney in the same format and with the same 13 frequency as cases with delinquent court debt are assigned to 14 the department of revenue under paragraph “a” , and a county 15 attorney shall not be required to file an individual notice 16 of full commitment to collect delinquent court debt for each 17 assigned case. If the county attorney or the county attorney’s 18 designee, while collecting delinquent court debt pursuant to 19 subsection 4 , determines that a person owes additional court 20 debt for which a case has not been assigned by the judicial 21 branch, the county attorney or the county attorney’s designee 22 shall notify the clerk of the district court of the appropriate 23 case numbers and the judicial branch shall assign these cases 24 to the county attorney for collection if the additional court 25 debt is delinquent. 26 Sec. 6. Section 602.8107, subsection 4, paragraph a, Code 27 2021, is amended to read as follows: 28 a. This subsection does not apply to amounts collected 29 for restitution involving pecuniary damages, the victim 30 compensation fund, the crime services surcharge, sex offender 31 civil penalty the human trafficking victim surcharge, domestic 32 abuse assault, domestic abuse protective order contempt, 33 sexual abuse, stalking, the human trafficking surcharge , the 34 agricultural theft surcharge, or amounts collected as a result 35 -3- LSB 1174XC (9) 89 as/rh 3/ 10

S.F. _____ of procedures initiated under subsection 5 the sex offender 1 civil penalty, or under section 8A.504 . 2 Sec. 7. Section 602.8107, subsection 5, Code 2021, is 3 amended by striking the subsection and inserting in lieu 4 thereof the following: 5 5. Uncollectible debt. 6 a. Court debt that has been assigned to the department of 7 revenue for collection pursuant to subsection 3 may be charged 8 off from active collection by the director of the department of 9 revenue if either of the following conditions exist: 10 (1) The person owing the court debt is deceased and there 11 are no assets in the person’s estate or there are no assets 12 available for the payment of court debt under section 633.425. 13 (2) The person owing the court debt cannot be located 14 after diligent inquiry and the director of the department of 15 revenue determines the department will not be able to locate 16 the person. 17 b. Court debt for any of the following shall not be charged 18 off until sixty-five years from the date of imposition: 19 (1) Victim restitution. 20 (2) Victim compensation. 21 (3) A criminal penalty surcharge. 22 (4) A sex offender civil penalty. 23 (5) A drug abuse resistance education surcharge. 24 (6) A law enforcement initiative surcharge. 25 (7) A county enforcement surcharge. 26 (8) Fees charged pursuant to section 356.7. 27 c. Debt that is charged off shall remain due and owing, but 28 the judicial branch shall close the corresponding case file for 29 the purposes of collection pursuant to this section. 30 Sec. 8. Section 692A.110, subsection 2, Code 2021, is 31 amended to read as follows: 32 2. In addition to any other penalty, at the time of 33 conviction for a public offense committed on or after July 1, 34 1995, which requires a sex offender to register under this 35 -4- LSB 1174XC (9) 89 as/rh 4/ 10

S.F. _____ chapter , the offender shall be assessed a civil penalty of two 1 hundred dollars, to be payable to the clerk of the district 2 court as provided in section 602.8105 and distributed as 3 provided in section 602.8108 . With respect to a conviction 4 for a public offense committed on or after July 1, 2009, which 5 requires a sex offender to register under this chapter , the 6 offender shall be assessed a civil penalty of two hundred fifty 7 dollars, payable to the clerk of the district court as provided 8 in section 602.8105 and distributed as provided in section 9 602.8108 . 10 Sec. 9. Section 910.3, subsection 8, Code 2021, is amended 11 to read as follows: 12 8. The court shall enter a permanent restitution order 13 setting out the amount of restitution including the amount of 14 public service to be performed as restitution and the persons 15 to whom restitution must be paid. A permanent restitution 16 order entered at the time of sentencing is part of the final 17 judgment of sentence as defined in section 814.6 and shall 18 be considered in a properly perfected appeal. An appellate 19 court shall not review or modify any issue related to a 20 defendant’s ability to pay unless the defendant has exhausted 21 the defendant’s remedies under section 910.7 and obtained a 22 ruling from the district court prior to the issue being raised 23 in the appellate court. 24 Sec. 10. Section 911.2B, Code 2021, is amended to read as 25 follows: 26 911.2B Domestic abuse assault, domestic abuse protective 27 order contempt, and sexual abuse , stalking, and human trafficking 28 crimes surcharge. 29 1. In addition to any other surcharge, the court shall 30 assess a domestic abuse assault, domestic abuse protective 31 order contempt, sexual abuse, stalking, and human trafficking 32 victim surcharge of ninety dollars if an adjudication of guilt 33 or a deferred judgment has been entered for a violation of 34 section 708.2A , 708.11 , or 710A.2 , or chapter 709 , or if a 35 -5- LSB 1174XC (9) 89 as/rh 5/ 10

S.F. _____ defendant is held in contempt of court for violating a domestic 1 abuse protective order issued pursuant to chapter 236 . 2 2. In the event of multiple offenses, the surcharge shall be 3 imposed for each applicable offense. 4 3. The surcharge shall be remitted by the clerk of court as 5 provided in section 602.8108, subsection 6 . 6 Sec. 11. RESCISSION OF ADMINISTRATIVE RULES. Contingent 7 on the passage of the section of this Act amending section 8 602.8107, subsection 3, paragraph “a”, the following 9 administrative rule is rescinded: 10 Iowa administrative code rule 701 —— 155.1(602). 11 Sec. 12. EFFECTIVE DATE. The following, being deemed of 12 immediate importance, take effect upon enactment: 13 1. The section of this Act amending section 602.8105, 14 section 2, paragraph “h”. 15 2. The section of this Act amending section 602.8107, 16 subsection 3. 17 Sec. 13. RETROACTIVE APPLICABILITY. The following applies 18 retroactively to January 1, 2021, for collected delinquent 19 court debt: 20 The section of this Act amending section 602.8107, 21 subsection 3. 22 Sec. 14. RETROACTIVE APPLICABILITY. The following applies 23 retroactively to June 25, 2020: 24 The section of this Act amending section 602.8105, 25 subsection 2, paragraph “h”. 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 certain financial obligations, 30 including under the consumer credit code, and including under 31 the criminal and juvenile justice system by modifying criminal 32 and civil surcharges, fines, fees, costs, and court debt. 33 The bill provides that a “consumer credit transaction” does 34 not include goods, services, or any other benefits provided by 35 -6- LSB 1174XC (9) 89 as/rh 6/ 10

S.F. _____ or on behalf of the state or a state agency for purposes of the 1 consumer credit code under Code chapter 537. 2 The bill provides that the clerk of the district court 3 shall collect, for applicable convictions that occur under 4 Code section 692A.110 (registration fees and civil penalty for 5 sex offenders) on or after June 25, 2020, a civil penalty of 6 $260. The bill makes a conforming Code change to Code section 7 692A.110(2). 8 The bill provides that the clerk of the district court shall 9 collect a dishonored check fee of $30 submitted for the payment 10 of any court debt. 11 The bill amends the definition of “court debt” to mean all 12 restitution as defined in Code section 910.1, fees, forfeited 13 bail, and other debt paid to or collected by the clerk of 14 the district court. “Restitution” means pecuniary damages, 15 category “A” restitution, and category “B” restitution. 16 The bill provides that the department of revenue shall 17 receive 15 percent of all court debt payments collected on 18 cases assigned to the department of revenue for collection 19 to reflect the cost of processing, with the remainder of the 20 court debt to be collected by the clerk of the district court 21 for distribution in accordance with applicable law. The 22 department of revenue shall not receive payment from any court 23 debt collected that is payable to a crime victim as pecuniary 24 damages until after the clerk of the district court has 25 received the entirety of the court debt payable to the crime 26 victim as pecuniary damages. Payments made by a person between 27 January 1, 2021, and the effective date of the bill shall be 28 calculated as if the payment had been made pursuant to Code 29 section 602.8107(3)(a)(2), Code 2021, and the department’s fee 30 shall be applied to such a payment. The department of revenue 31 fee added to the court debt shall be deducted from the amount 32 of court debt owed to the clerk of the district court. If a 33 payment made by a person owing court debt between January 1, 34 2021, and the effective date of the bill reduces the total 35 -7- LSB 1174XC (9) 89 as/rh 7/ 10

S.F. _____ amount of court debt owed to zero, the department of revenue 1 shall issue a refund to the person in the amount attributable 2 to the processing fee added to the court debt. Code section 3 602.8107(3)(b)(2) is repealed on January 1, 2023. 4 Current law allows the county attorney or the county 5 attorney’s designee to collect a percentage of court debt 6 collected after the court debt is deemed delinquent, but not 7 for amounts collected for restitution involving pecuniary 8 damages, the victim compensation fund, the crime services 9 surcharge, the sex offender civil penalty, the agricultural 10 theft surcharge, or amounts collected as a result of written 11 off or setoff debt. The bill amends debts for which the county 12 attorney is not entitled to include amounts collected for the 13 human trafficking victim surcharge, domestic abuse assault, 14 domestic abuse protective order contempt, sexual abuse, 15 stalking, and a human trafficking surcharge. 16 The bill provides that court debt that has been assigned 17 to the department of revenue for collection may be charged 18 off from active collection by the director of the department 19 of revenue if the person owing the court debt is deceased 20 and there are no assets in the person’s estate or there are 21 no assets available for the payment of court debt under Code 22 section 633.425 or the person owing the court debt cannot be 23 found after diligent inquiry and the director of the department 24 of revenue determines the department will not be able to locate 25 the person owing the court debt. 26 Court debt for any of the following shall not be charged 27 off until 65 years after the date of imposition: victim 28 restitution, the victim compensation fund, a criminal 29 penalty surcharge, a sex offender civil penalty, a drug abuse 30 resistance education surcharge, a law enforcement initiative 31 surcharge, a county enforcement surcharge, or fees charged 32 pursuant to Code section 356.7. Charged off debts shall 33 remain due and owing, but the judicial branch shall close the 34 corresponding case file for the purposes of uncollectable debt 35 -8- LSB 1174XC (9) 89 as/rh 8/ 10

S.F. _____ pursuant to the bill. 1 The county attorney or the county attorney’s designee may 2 collect court debt after the court debt is deemed delinquent; 3 however, the provision does not apply to amounts collected 4 for restitution involving pecuniary damages, the victim 5 compensation fund, the crime victim surcharge, the human 6 trafficking victim surcharge, domestic abuse assault, domestic 7 abuse protective order contempt, sexual abuse, the human 8 trafficking surcharge, the agricultural theft surcharge, the 9 sex offender civil penalty, or under Code section 8A.504 10 (setoff procedures). 11 The bill provides that an appellate court shall not review or 12 modify any issue related to the defendant’s ability to pay a 13 permanent restitution order entered at the time of sentencing 14 unless the defendant has exhausted the defendant’s remedies 15 under Code section 910.7 and obtained a ruling from the 16 district court prior to the issue being raised in the appellate 17 court. 18 The bill changes the headnote for Code section 911.2B to 19 domestic and sexual abuse crimes surcharge. 20 The bill provisionally rescinds the Iowa administrative 21 code rule concerning a fee for the collection of court debt. 22 The rule provides that a fee of 15 percent of the amount of 23 each court debt is imposed on each court debt that has been 24 assigned to the department of revenue for collection under Code 25 section 602.8107(3). The bill provides that the department of 26 revenue shall receive 15 percent of all court debt payments 27 collected on cases assigned to the department of revenue for 28 collection to reflect the cost of processing, which makes the 29 rule unnecessary. 30 The bill provides that the sections of the bill amending Code 31 sections 602.8105(2)(h) (relating to civil penalties for sex 32 offenders) and 602.8107(3) (relating to the collection of court 33 debt by the department of revenue) take effect upon enactment. 34 The section of the bill amending Code section 602.8105(2)(h) 35 -9- LSB 1174XC (9) 89 as/rh 9/ 10