HF 2692 (LSB 5845YH (3) 90)

HOUSE FILE 2692

BY  ISENHART

A BILL FOR

An Act providing for a surface water protection user fee assessed and imposed on the sale of nitrogen-based fertilizer and making appropriations.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.
  LEGISLATIVE DECLARATION.
  The general assembly finds and declares all of the following:
   1.  The Iowa nutrient reduction strategy represents a water quality initiative developed and updated in order to assess and reduce nutrients in this state’s watersheds based on the science-based determination that ninety-five percent of nitrogen and phosphorus pollution stems from nonpoint sources, a majority of which originates from agricultural field runoff of nitrogen fertilizers.
   2.  Waters of the state are being used to collect and transport contamination throughout Iowa, damaging lakes and streams and infiltrating groundwater aquifers, putting drinking water sources and public health at risk.
   3.  Since the publication of the Iowa nutrient reduction strategy in 2013, significant public resources have been expended to support demonstration projects in attempts to show how the volume of nutrients reaching waters of the state can be reduced.
   4.  Users depending on the state’s hydrological systems to dispose of pollutants should be assessed user fees to protect, maintain, and restore water resources most important to human and ecosystem health, with such funds dedicated to making watershed-scale investments to prevent further degradation of the state’s natural wealth.
    Sec. 2.  Section 200.8, Code 2024, is amended by adding the following new subsection:
   NEW SUBSECTION.  5.  In addition to the fees imposed under subsections 1 and 4, a surface water protection user fee shall be assessed and imposed upon nitrogen-based fertilizer. The user fee shall be based upon the percentage of actual nitrogen contained in the product. An eighty-two percent nitrogen solution shall be subject to a rate of eight dollars and seventy cents per ton. The user fee amount for other nitrogen-based product formulations shall be based on the percentage of actual nitrogen contained in the formulations with the eighty-two percent nitrogen solution serving as the base. The user fee shall be paid by each licensee registering to sell fertilizer to the secretary of agriculture. The user fees collected shall be deposited in the water quality initiative fund created in section 466B.45. The secretary of agriculture shall adopt rules for the payment, filing, and collection of the user fees. The secretary shall, by rule, allow an exemption to the payment of the user fee for fertilizers which contain trace amounts of nitrogen.
    Sec. 3.  Section 466B.45, subsection 3, Code 2024, is amended to read as follows:
   3.  a.  Moneys Except as provided in paragraph “b”, moneys in the fund are appropriated to the division and shall be used exclusively to carry out the provisions of this subchapter as determined by the division, and shall not require further special authorization by the general assembly.
   b.  (1)  Moneys contributed to the fund from surface water protection user fees collected pursuant to section 200.8 are appropriated to the division and shall be expended according to the following allocation schedule:
   (a)  At least ten percent shall be allocated to the IIHR —— hydroscience and engineering within the college of engineering of the state university of Iowa for water quality monitoring, measuring, and reporting in priority watersheds or in support of projects conducted or approved by a watershed management authority benefiting that watershed.
   (b)  At least twenty-five percent shall be allocated to support projects conducted or approved by a watershed management authority in the benefited watershed.
   (c)  Any remaining moneys shall be expended as provided in paragraph “a”.
   (2)  All moneys contributed to the fund from surface water protection fees shall be expended to support a project in a manner consistent with the source water protection plans of public and private water utilities in the benefited watershed.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill includes a provision finding and declaring that waters of the state are being used to collect and transport contamination throughout Iowa, damaging lakes and streams and infiltrating groundwater aquifers. The bill imposes a surface water protection user fee on the sale of fertilizer based on the percentage of nitrogen contained in the fertilizer. An 82 percent solution is assessed a rate of $.70 per ton (Code section 200.8). The bill requires that the collected user fees be deposited in the water quality initiative fund administered by the division of soil conservation and water quality of the department of agriculture and land stewardship (Code section 466B.45). The bill provides for the expenditure of moneys collected from user fees to support clean water efforts administered by the division. A portion of the user fees are allocated to support the IIHR —— hydroscience and engineering within the college of engineering of the state university of Iowa and to support projects conducted or approved by a watershed management authority in a benefited watershed.