House File 666 - Introduced HOUSE FILE 666 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 277) (SUCCESSOR TO HSB 113) A BILL FOR An Act providing for programs and regulations administered 1 and enforced by the department of agriculture and land 2 stewardship, providing fees, providing for the allocation of 3 moneys, making penalties applicable, and including effective 4 date provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 1218HZ (2) 90 da/ns

H.F. 666 DIVISION I 1 REGULATION OF COMMERCIAL ESTABLISHMENTS 2 Section 1. Section 162.2, subsection 19, Code 2023, is 3 amended by striking the subsection and inserting in lieu 4 thereof the following: 5 19. “Pet shop” means a facility where vertebrate animals, 6 excluding fish, not born and reared on the facility’s premises 7 are bought, sold, exchanged, or offered for sale or exchange to 8 the public, at retail. “Pet shop” does not include a facility 9 if one of the following applies: 10 a. The facility receives less than one thousand dollars from 11 the sale or exchange of vertebrate animals, excluding fish, 12 during a twelve-month period. 13 b. The facility sells or exchanges less than twelve 14 vertebrate animals, excluding fish, during a twelve-month 15 period. 16 DIVISION II 17 GRAIN REGULATION 18 PART A 19 GRAIN DEALERS 20 Sec. 2. Section 203.1, Code 2023, is amended by adding the 21 following new subsection: 22 NEW SUBSECTION . 12A. “Scale weight ticket” means the same 23 as defined in section 203C.1. 24 Sec. 3. Section 203.5, subsection 8, paragraph a, Code 2023, 25 is amended to read as follows: 26 a. The applicant has caused liability to the Iowa grain 27 depositors and sellers indemnity fund in regard to a license 28 issued under this chapter or chapter 203C , and the liability 29 has not been discharged, settled, or satisfied. 30 Sec. 4. Section 203.11, subsection 2, paragraph a, 31 subparagraph (3), Code 2023, is amended to read as follows: 32 (3) Uses a scale weight ticket or credit-sale contract in 33 violation of this chapter or a requirement established by the 34 department under this chapter . 35 -1- LSB 1218HZ (2) 90 da/ns 1/ 18

H.F. 666 Sec. 5. Section 203.15, subsection 2, paragraph f, Code 1 2023, is amended to read as follows: 2 f. The duration of the credit-sale contract, which shall 3 not exceed twelve fifteen months from the date the contract is 4 executed. 5 Sec. 6. Section 203.17, Code 2023, is amended to read as 6 follows: 7 203.17 Documents and records. 8 1. The department may adopt rules specifying the form, 9 content, use, and maintenance of documents issued by a grain 10 dealer under this chapter including but not limited to scale 11 weight tickets, settlement sheets, daily position records, and 12 credit-sale contracts. The department may adopt rules for 13 both printed and electronic documents, including rules for 14 the transmission, receipt, authentication, and archiving of 15 electronically generated or stored documents. 16 2. All scale weight ticket forms in the possession of a 17 grain dealer shall have been permanently and consecutively 18 numbered at the time of printing. A grain dealer shall 19 maintain an accurate record of all scale weight ticket numbers. 20 The record shall include the disposition of each numbered form, 21 whether issued, destroyed, or otherwise disposed of. 22 Sec. 7. Section 203.20, Code 2023, is amended to read as 23 follows: 24 203.20 Shrinkage adjustments —— disclosures —— penalties. 25 1. A person who, in connection with the receipt of 26 corn or soybeans grain for storage, processing, or sale, 27 adjusts the scale weight of the grain to compensate for the 28 moisture content of the grain shall compute the amount of 29 the adjustment by multiplying the scale weight of the grain 30 by that factor which results in a rate of adjustment of one 31 and eighteen hundredths percent of weight per one percent of 32 moisture content. The use of person who uses any rate of 33 weight adjustment for moisture content other than the one 34 prescribed by this subsection is commits a fraudulent practice 35 -2- LSB 1218HZ (2) 90 da/ns 2/ 18

H.F. 666 as defined in section 714.8 . The person shall post on the 1 business premises in a conspicuous place notice of the rate 2 of adjustment for moisture content that is as prescribed by 3 this subsection . Failure The person who fails to make this 4 disclosure is commits a simple misdemeanor. 5 2. A person who, in connection with the receipt of grain for 6 storage, processing , or sale, adjusts the quantity of the grain 7 received to compensate for losses to be incurred during the 8 handling, processing, or storage of the grain shall post on the 9 business premises in a conspicuous place notice of the rate of 10 adjustment to be made for this shrinkage. Failure The person 11 who fails to make the required this disclosure is commits a 12 simple misdemeanor. 13 3. A person who adjusts the scale weight of corn or soybeans 14 both grain for moisture content and for handling, processing, 15 or storage losses may combine the two adjustment factors into 16 a single factor and may use this resulting factor to compute 17 the amount of weight adjustment in connection with storage, 18 processing, or sale transactions, provided that the person 19 shall post on the business premises in a conspicuous place a 20 notice that discloses the moisture shrinkage factor prescribed 21 by subsection 1 , the handling shrinkage factor to be imposed, 22 and the single factor that results from combining these 23 factors. Failure The person who fails to make the required 24 this disclosure is commits a simple misdemeanor. 25 PART B 26 WAREHOUSE OPERATORS 27 Sec. 8. Section 203C.5, subsection 2, Code 2023, is amended 28 to read as follows: 29 2. a. The department may adopt rules specifying the 30 form, content, and use of documents issued by a warehouse 31 operator under this chapter including but not limited to scale 32 weight tickets, warehouse receipts, settlement sheets, and 33 daily position records. The department may adopt rules for 34 both printed and electronic documents, including rules for 35 -3- LSB 1218HZ (2) 90 da/ns 3/ 18

H.F. 666 the transmission, receipt, authentication, and archiving of 1 electronically generated or stored documents. 2 b. All scale weight ticket forms and warehouse receipt 3 forms in the possession of a warehouse operator shall have been 4 permanently and consecutively numbered at the time of printing. 5 A warehouse operator shall maintain an accurate record of 6 the numbers of these documents. The record shall include 7 the disposition of each form, whether issued, destroyed, or 8 otherwise disposed of. The department may by rule require this 9 use of prenumbered forms and recording for documents other than 10 scale weight tickets and warehouse receipts. 11 Sec. 9. Section 203C.6, subsection 8, paragraph a, Code 12 2023, is amended to read as follows: 13 a. The applicant has caused liability to the Iowa grain 14 depositors and sellers indemnity fund through operations under 15 a license issued under this chapter or chapter 203 , and the 16 liability has not been discharged, settled, or satisfied. 17 Sec. 10. Section 203C.17, subsections 1, 2, 3, 4, and 5, 18 Code 2023, are amended to read as follows: 19 1. Any grain which has been received at any Grain deposited 20 with a licensed warehouse operator for which the actual sale 21 price is has not been fixed and either proper documentation 22 made has not been furnished or payment has not been made shall 23 be construed to be grain held for storage within the meaning of 24 this chapter . Grain may be held considered stored grain and 25 may be retained in open storage or placed on under warehouse 26 receipt. A warehouse receipt shall be issued for all grain 27 held in open storage within one year from the date of delivery 28 to the warehouse, unless the depositor has signed a statement 29 that the depositor does not desire a warehouse receipt. A The 30 licensed warehouse operator shall issue a warehouse receipt 31 shall be issued to the depositor upon request by the depositor. 32 The warehouse operator’s tariff shall apply for to any grain 33 that is retained in open storage or placed under warehouse 34 receipt as provided in section 203C.18 . 35 -4- LSB 1218HZ (2) 90 da/ns 4/ 18

H.F. 666 2. Bulk grain deposited with a licensed warehouse operator 1 for processing, cleaning, drying, shipping for the account of 2 the depositor , or any other purpose shall be removed within 3 thirty days from the date of deposit or such grain shall be 4 determined as considered stored grain and the . The warehouse 5 operator’s tariff charges shall apply to the bulk grain as 6 provided in section 203C.28 . 7 3. Grain received on deposited and subject to a scale weight 8 ticket which that fails to have the price fixed and properly 9 documented on the records of the licensed warehouse operator 10 shall be construed to be retained in open storage. 11 4. All bulk grain whether retained in open storage and 12 deposited subject to a scale weight ticket or having been 13 placed on under warehouse receipt is covered by the grain 14 depositors and sellers indemnity fund created in as provided in 15 chapter 203D . 16 5. Any grain which has been received at any An unlicensed 17 warehouse and for which the operator shall not retain deposited 18 bulk grain, if its actual sale price has not been fixed , and 19 payment for the bulk grain has not been made within thirty days 20 from receipt of the grain its date of deposit , unless covered 21 purchased by a credit-sale contract , shall be construed to be 22 unlawful storage within the meaning of this chapter . Bulk 23 grain received at any An unlicensed warehouse for any operator 24 who retains deposited bulk gain under any other purpose 25 circumstance must either be returned return the bulk grain to 26 the depositor , or disposed of dispose of the bulk grain by 27 order of the depositor , within thirty days from date of actual 28 the deposit of the bulk grain. 29 Sec. 11. Section 203C.25, Code 2023, is amended to read as 30 follows: 31 203C.25 Shrinkage adjustments —— disclosures —— penalties. 32 1. A person who, in connection with the receipt of 33 corn or soybeans grain for storage, processing, or sale, 34 adjusts the scale weight of the grain to compensate for the 35 -5- LSB 1218HZ (2) 90 da/ns 5/ 18

H.F. 666 moisture content of the grain shall compute the amount of 1 the adjustment by multiplying the scale weight of the grain 2 by that factor which results in a rate of adjustment of one 3 and eighteen hundredths percent of weight per one percent of 4 moisture content. The use of person who uses any rate of 5 weight adjustment for moisture content other than the one 6 prescribed by this subsection is commits a fraudulent practice 7 as defined in section 714.8 . The person shall post on the 8 business premises in a conspicuous place notice of the rate 9 of adjustment for moisture content that is as prescribed by 10 this subsection . Failure The person who fails to make this 11 disclosure is commits a simple misdemeanor. 12 2. A person who, in connection with the receipt of grain for 13 storage, processing , or sale, adjusts the quantity of the grain 14 received to compensate for losses to be incurred during the 15 handling, processing, or storage of the grain shall post on the 16 business premises in a conspicuous place notice of the rate of 17 adjustment to be made for this shrinkage. Failure The person 18 who fails to make the required this disclosure is commits a 19 simple misdemeanor. 20 3. A person who adjusts the scale weight of corn or soybeans 21 both grain for moisture content and for handling, processing, 22 or storage losses may combine the two adjustment factors into 23 a single factor and may use this resulting factor to compute 24 the amount of weight adjustment in connection with storage, 25 processing, or sale transactions, provided that the person 26 shall post on the business premises in a conspicuous place a 27 notice that discloses the moisture shrinkage factor prescribed 28 by subsection 1 , the handling shrinkage factor to be imposed, 29 and the single factor that results from combining these 30 factors. Failure The person who fails to make the required 31 this disclosure is commits a simple misdemeanor. 32 Sec. 12. Section 203C.36, subsection 2, paragraph a, 33 subparagraph (3), Code 2023, is amended to read as follows: 34 (3) Uses a scale weight ticket, warehouse receipt, or 35 -6- LSB 1218HZ (2) 90 da/ns 6/ 18

H.F. 666 other document in violation of this chapter or requirements 1 established by the department under this chapter . 2 PART C 3 INDEMNITY FUND 4 Sec. 13. Section 203D.1, Code 2023, is amended by adding the 5 following new subsection: 6 NEW SUBSECTION . 14A. “Scale weight ticket” means the same 7 as defined in section 203C.1. 8 Sec. 14. Section 203D.3, subsection 3, Code 2023, is amended 9 to read as follows: 10 3. The fiscal assessment year of the fund begins July 11 September 1 and ends on June 30 August 31 . Fiscal Assessment 12 quarters of the fund begin July September 1, October December 13 1, January March 1, and April June 1. The finances of the fund 14 shall be calculated on an accrual basis in accordance with 15 generally accepted accounting principles. 16 Sec. 15. Section 203D.3A, subsection 1, paragraph b, 17 unnumbered paragraph 1, Code 2023, is amended to read as 18 follows: 19 A licensee shall pay a participation fee on four successive 20 installment dates, with each installment date occurring on the 21 last date of the fund’s fiscal assessment quarter as provided 22 in section 203D.3 . The licensee shall pay twenty-five percent 23 of the total participation fee assessed on each installment 24 date. However, nothing in this subsection prevents a licensee 25 from paying the participation fee on an accelerated basis. A 26 licensee shall pay the first installment on the last date of 27 the fund’s fiscal assessment quarter immediately following the 28 licensee’s anniversary date. 29 Sec. 16. Section 203D.5, subsection 1, Code 2023, is amended 30 to read as follows: 31 1. The board shall annually review the debits of and credits 32 to the grain depositors and sellers indemnity fund created 33 in section 203D.3 and shall determine whether to impose the 34 participation fee and per-bushel fee as provided in section 35 -7- LSB 1218HZ (2) 90 da/ns 7/ 18

H.F. 666 203D.3A , make adjustments to the fees effective on the previous 1 July September 1, or waive the fees as necessary to comply with 2 this section . The board shall make the determination not later 3 than May 1 of each year. The board shall impose the fees or 4 adjust the fees effective on the previous July September 1 in 5 accordance with chapter 17A . The imposition or adjustment of 6 the fees shall become effective as follows: 7 a. For the participation fee, on the following July 8 September 1. However, the licensee shall continue to pay the 9 participation fee at the rate in effect on the prior July 10 September 1, until the licensee has paid the amount owing. 11 b. For a per-bushel fee, on the following July September 1. 12 Sec. 17. Section 203D.5, subsection 4, Code 2023, is amended 13 to read as follows: 14 4. If on the last date of the fund’s fiscal assessment year 15 as provided in section 203D.3 the assets of the fund exceed 16 eight million dollars, less any encumbered balances or pending 17 or unsettled claims, all of the following apply: 18 a. The participation fee shall be waived and shall not be 19 assessable or owing for the following fiscal assessment year 20 of the fund. However, the licensee shall continue to pay any 21 owing participation fee that was in effect on the prior July 22 September 1. 23 b. The per-bushel fee shall be waived and shall not be 24 assessable or owing. 25 PART D 26 EFFECTIVE DATE 27 Sec. 18. EFFECTIVE DATE. This division of this Act, being 28 deemed of immediate importance, takes effect upon enactment. 29 DIVISION III 30 WEIGHTS AND MEASURES 31 PART A 32 LICENSING, INSPECTIONS, AND FEES 33 Sec. 19. Section 214.2, Code 2023, is amended to read as 34 follows: 35 -8- LSB 1218HZ (2) 90 da/ns 8/ 18

H.F. 666 214.2 License. 1 1. A person who uses or displays for use any commercial 2 weighing and measuring device , as defined in section 215.1 , 3 shall secure must be issued a license from by the department 4 for that device . The department shall issue the license after 5 inspecting the device. 6 2. a. Except as provided in paragraph “b” , a license issued 7 under subsection 1 shall expire on December 31 of each year. 8 b. A license issued under subsection 1 for a motor fuel pump 9 shall expire on June 30 of each year. 10 Sec. 20. Section 214.3, subsection 1, Code 2023, is amended 11 by striking the subsection. 12 Sec. 21. Section 214.3, subsection 2, Code 2023, is amended 13 to read as follows: 14 2. The A license inspection fee is imposed on a person 15 who uses or displays for use a commercial weighing and 16 measuring device . The license fee is due the day the device 17 is placed into service department issues the license . A 18 license inspection fee shall be charged to the person owning 19 or operating a commercial weighing and measuring device 20 inspected The amount of the license fee shall be calculated in 21 accordance with the class or section for devices as established 22 by handbook 44 of the United States national institute of 23 standards and technology. 24 Sec. 22. Section 214.11, subsection 1, Code 2023, is amended 25 to read as follows: 26 1. The department shall provide for annual biennial 27 inspections of all motor fuel pumps, including but not limited 28 to motor fuel blender pumps, licensed under this chapter . 29 Inspections shall be for the purpose of determining the 30 accuracy and correctness of motor fuel pumps. For that purpose 31 the department’s inspectors may enter upon the premises of any 32 a wholesale dealer or a retail dealer motor fuel site . 33 Sec. 23. Section 215.2, Code 2023, is amended to read as 34 follows: 35 -9- LSB 1218HZ (2) 90 da/ns 9/ 18

H.F. 666 215.2 Special inspection tests —— request —— fees. 1 1. The owner or servicer of a commercial weighing and 2 measuring device may request the department conduct a special 3 inspection test of the device to determine its accuracy and 4 correctness. 5 2. The fee for special tests, including but not limited to, 6 using state inspection equipment, for the calibration, testing, 7 certification, or repair conducting a special inspection test 8 of a commercial weighing and measuring device shall be paid 9 by the owner or servicer or person requesting the special 10 inspection test in accordance with the following schedule: 11 1. a. Class S, scales, seventy-five dollars per hour. 12 2. b. Class M, meters, fifty-two dollars and fifty cents 13 per hour. 14 Sec. 24. REPEAL. Section 215.12, Code 2023, is repealed. 15 PART B 16 MOTOR FUEL STANDARDS AND CLASSIFICATIONS 17 Sec. 25. Section 159A.6, subsection 1, paragraph c, Code 18 2023, is amended to read as follows: 19 c. Develop standards for decals required pursuant to 20 section 214A.16 214A.21A , which shall be designed to promote 21 the advantages of using renewable fuels. The standards may be 22 incorporated within a model decal adopted by the office. 23 Sec. 26. Section 214A.1, subsection 2, Code 2023, is amended 24 to read as follows: 25 2. “ASTM international” means a nonprofit organization, 26 previously named the American society for testing and materials 27 international. 28 Sec. 27. Section 214A.1, Code 2023, is amended by adding the 29 following new subsections: 30 NEW SUBSECTION . 33A. a. “Renewable diesel” means a motor 31 fuel for use in an internal combustion engine and ignited by 32 pressure without the presence of an electric spark, which 33 is produced from nonfossil renewable resources, including 34 agricultural plants, animal fats, residue, and waste generated 35 -10- LSB 1218HZ (2) 90 da/ns 10/ 18

H.F. 666 from the production, processing, and marketing of agricultural 1 products, and other renewable resources. 2 b. “Renewable diesel” must meet the standards provided in 3 section 214A.2. 4 c. “Renewable diesel” does not include any of the following: 5 (1) Biodiesel. 6 (2) A fuel that has been coprocessed. 7 NEW SUBSECTION . 33B. “Renewable diesel blended fuel” means 8 a blend of renewable diesel with petroleum-based diesel fuel, 9 biodiesel, or a combination of petroleum-based diesel fuel and 10 biodiesel, which meets the standards, including separately 11 the standard for its renewable diesel component, provided in 12 section 214A.2. 13 Sec. 28. Section 214A.2, subsection 4, Code 2023, is amended 14 by adding the following new paragraph: 15 NEW PARAGRAPH . c. (1) If the motor fuel is advertised 16 for sale or sold as renewable diesel or renewable diesel 17 blended fuel, the motor fuel must meet departmental standards 18 based in part or in whole on specifications adopted by ASTM 19 international for renewable diesel or renewable diesel blended 20 motor fuel, to every extent applicable, as determined by the 21 department subject to subparagraph (2). 22 (2) Renewable diesel must at least meet departmental 23 standards based in whole or in part on ASTM international 24 specification D975, or a successor ASTM international 25 specification, established by rule. The specification shall 26 apply to renewable diesel before it leaves its place of 27 manufacture. 28 Sec. 29. Section 214A.2, subsection 5, Code 2023, is amended 29 by adding the following new paragraph: 30 NEW PARAGRAPH . d. (1) Renewable diesel shall be classified 31 RD-100. 32 (2) Renewable diesel blended fuel shall be classified RD-xx 33 where “xx” is the volume percent of renewable diesel. 34 Sec. 30. Section 214A.2B, Code 2023, is amended to read as 35 -11- LSB 1218HZ (2) 90 da/ns 11/ 18

H.F. 666 follows: 1 214A.2B Laboratory for motor fuel and biofuels fuels, 2 biofuels, and renewable fuels . 3 A laboratory for motor fuel and biofuels is established at a 4 community college which is engaged in biofuels testing on July 5 1, 2007, and which testing includes but is not limited to The 6 Iowa central fuel testing laboratory at Iowa central community 7 college shall test motor fuels, biofuels, and renewable fuels, 8 including but not limited to B-20 biodiesel fuel testing for 9 use by motor trucks and the ability of biofuels to meet ASTM 10 international standards . The laboratory shall conduct the 11 testing of motor fuel fuels sold in this state and biofuel 12 which is biofuels blended in with motor fuel fuels in this 13 state to ensure that the motor fuel or fuels, biofuels , and 14 renewable fuels meet the requirements departmental standards 15 in section 214A.2 . 16 PART C 17 CODE EDITOR DIRECTIVE 18 Sec. 31. CODE EDITOR DIRECTIVE. 19 1. The Code editor is directed to make the following 20 transfer: 21 Section 214A.16 to section 214A.21A. 22 2. The Code editor shall correct internal references in the 23 Code and in any enacted legislation as necessary due to the 24 enactment of this section. 25 DIVISION IV 26 WATER QUALITY 27 Sec. 32. Section 466B.43, subsection 6, Code 2023, is 28 amended to read as follows: 29 6. By October 1, 2019, and each October 1 thereafter of 30 each year , the division shall submit a report to the governor 31 and the general assembly itemizing expenditures, by hydrologic 32 unit code 8 watershed, under the programs , if any, during the 33 previous fiscal year , if any . 34 Sec. 33. Section 466B.44, subsection 5, Code 2023, is 35 -12- LSB 1218HZ (2) 90 da/ns 12/ 18

H.F. 666 amended to read as follows: 1 5. Notwithstanding any other provision in this section 2 to the contrary, beginning on July 1, 2018, the division 3 may use any amount available to support the water quality 4 urban infrastructure program to instead extend do any of the 5 following: 6 a. Extend and support the three-year data collection of 7 in-field agricultural practices project as enacted in 2015 Iowa 8 Acts, ch. 132, §18 . 9 b. Support water quality agriculture infrastructure programs 10 created in section 466B.43, to the extent that moneys are not 11 obligated or encumbered during a fiscal year to adequately 12 support all urban infrastructure program projects that meet the 13 division’s requirements. 14 Sec. 34. Section 466B.44, subsection 7, Code 2023, is 15 amended to read as follows: 16 7. By October 1, 2019, and by October 1 of each year 17 thereafter , the division shall submit a report to the governor 18 and the general assembly itemizing expenditures under the 19 program, if any, during the previous fiscal year. 20 EXPLANATION 21 The inclusion of this explanation does not constitute agreement with 22 the explanation’s substance by the members of the general assembly. 23 GENERAL. This bill relates to a number of regulations 24 and programs administered and enforced by the department of 25 agriculture and land stewardship (DALS). Specifically, the 26 bill amends provisions regulating commercial establishments 27 including pet shops engaged in the business of purchasing and 28 transferring (by sale or exchange) vertebrate animals (animals) 29 other than agricultural animals (Code chapter 162). The 30 bill regulates grain transactions including by grain dealers 31 (dealers) and warehouse operators (operators) (Code chapters 32 203 and 203C) and the indemnification of losses by sellers or 33 depositors from the grain depositors and sellers indemnity fund 34 (Code chapter 203D). The bill also regulates the commercial 35 -13- LSB 1218HZ (2) 90 da/ns 13/ 18

H.F. 666 use of weights and measures, including motor fuel pumps (fuel 1 pumps) that are part of motor fuel dispensers (dispensers), 2 and types of motor fuel advertised for sale (Code chapters 3 214, 214A, and 215), including diesel fuel for use in certain 4 internal combustion engines. Finally, the bill provides for 5 the expenditure of moneys for surface water quality initiatives 6 (initiatives) in order to assess and reduce nutrients in this 7 state’s watersheds (Code chapter 466B) in conformance with the 8 Iowa nutrient reduction strategy (Code section 455B.171). 9 COMMERCIAL ESTABLISHMENTS —— PET SHOPS. Under current law, 10 a business classified as a pet shop is a type of establishment 11 required to be annually licensed (Code section 162.5) and pay 12 an associated fee (Code section 162.2B). A business is not 13 regulated as a pet shop if, during the prior 12-month period, 14 the business either receives less than $500 or transfers 15 less than six animals. The bill doubles the exemption 16 qualifications to less than $1,000 or less than 12 animals 17 (amended Code section 162.2). 18 COMMERCIAL ESTABLISHMENTS —— PENALTY. A person who operates 19 as a pet shop in violation of licensing requirements is guilty 20 of a simple misdemeanor (Code section 162.13). 21 GRAIN REGULATION —— BACKGROUND. As part of a grain 22 transaction, an operator issues a prenumbered scale 23 weight ticket to a depositor as evidence of stored grain. 24 Alternatively, the operator may issue a warehouse receipt as a 25 form which may be a document of title and therefore negotiable 26 (Code chapter 554, Art. 7). In order for a seller or depositor 27 to be indemnified for a loss by the fund, the dollar value of 28 a claim for transferred grain is based on either a warehouse 29 receipt or scale weight ticket (Code section 203D.6). 30 GRAIN REGULATION —— TERMS. Currently, several different 31 terms are used to describe the same item. The bill changes 32 the terms to be uniform, including “scale ticket” to “scale 33 weight ticket” and “Iowa grain depositors and sellers indemnity 34 fund” to “grain depositors and sellers indemnity fund”, which 35 -14- LSB 1218HZ (2) 90 da/ns 14/ 18

H.F. 666 are both defined (amended Code sections 203.1, 203.5, 203.11, 1 203.17, 203C.5, 203C.6, 203C.17, 203C.36, and 203D.1). 2 GRAIN REGULATION —— GRAIN MOISTURE CONTENT. A person 3 receiving corn or soybeans as part of a transaction involving 4 storage, processing, or sale may adjust the scale weight to 5 account for moisture content (i.e., reducing the scale weight 6 by a special factor calculated for each 1 percent of moisture 7 content). The bill provides that the adjustment applies to all 8 grain in which there are standards established by the United 9 States department of agriculture (Code sections 203.1 and 10 203C.1 and amended Code sections 203.20 and 203C.25). 11 GRAIN REGULATION —— CREDIT-SALE CONTRACT. A buyer and 12 seller of grain may execute a credit-sale contract, also known 13 as a price-later contract, for transfer of title, in which the 14 seller delivers the grain to the buyer who pays the seller 15 a price more than 30 days later (Code section 203.1). In 16 order to engage in these transactions, a buyer who is a grain 17 dealer must maintain a class 1 license requiring a net worth 18 of at least $75,000 (Code section 203.3(4)), the parties must 19 execute a contract form meeting statutory requirements (amended 20 Code section 203.15(2)), and the grain is not considered as 21 purchased grain covered by the grain depositors and sellers 22 indemnity fund (Code section 203D.6(4)). The bill extends the 23 maximum period of a credit-sale contract’s duration, requiring 24 later payment for the delivered grain, from 12 to 15 months 25 (amended Code section 203.15(2)). 26 GRAIN REGULATION —— OPEN STORAGE. An operator may retain 27 delivered grain in open storage (meaning without issuing a 28 warehouse receipt or making a purchase) subject to certain 29 limitations. Grain subject to a scale weight ticket without 30 having the price fixed and documented by the operator is 31 considered to be retained in open storage. Currently, if 32 grain is retained in open storage, the operator must issue the 33 depositor a warehouse receipt within one year of the grain’s 34 delivery date, unless the depositor signs a statement refusing 35 -15- LSB 1218HZ (2) 90 da/ns 15/ 18

H.F. 666 it. The bill eliminates this requirement. Upon request, the 1 operator must still issue the depositor a warehouse receipt 2 (amended Code section 203C.17). 3 GRAIN REGULATION —— PENALTIES. A person who violates Code 4 chapter 203 or 203C is guilty of a simple misdemeanor (Code 5 sections 203.11 and 203C.36). 6 GRAIN DEPOSITORS AND SELLERS INDEMNITY FUND. The fund 7 compensates a “depositor” storing grain with a licensed 8 operator who fails to return possession of the grain to 9 the depositor, or a “seller” selling grain to a licensed 10 dealer incurred when the dealer fails to make payment for the 11 purchased grain (Code section 203D.6). The fund is supported 12 by fees paid by operators and dealers. A dealer is assessed a 13 participation fee and per-bushel fee based on purchased grain. 14 An operator is assessed a participation fee based on warehouse 15 storage capacity (Code sections 203D.3A and 203D.5). The Iowa 16 grain indemnity fund board (board) acts on behalf of the fund, 17 including by establishing the rate of fees to be assessed and 18 owing each 12-month period beginning July 1 and ending June 30 19 which are divided into 3-month quarters (subject to a floor 20 of $3 million when fees must be assessed and a ceiling of $8 21 million when fees can no longer be assessed). The bill changes 22 the 12-month periods to begin September 1 and end August 31, 23 and makes coordinating changes to when the quarterly periods 24 begin and end. 25 WEIGHTS AND MEASURES. A person who uses or displays a 26 commercial weighing or measuring device (device) must be 27 licensed. The term of the license is 12 months. Generally, 28 the term is on a calendar year basis (January 1 to December 29 31) but for motor fuel pumps the term is on a fiscal year 30 basis (July 1 to June 30). A fee is required for the issuance 31 of the license and an inspection (license inspection fee) 32 first due when the device is placed into service. DALS is 33 expressly required to inspect motor fuel pumps each year. The 34 bill provides that the fee is for the issuance of the license 35 -16- LSB 1218HZ (2) 90 da/ns 16/ 18

H.F. 666 rather than the inspection, the license fee is due when the 1 license is issued, and that DALS must inspect motor fuel pumps 2 on a biennial basis (amended Code sections 214.2, 214.3, and 3 214.11). The bill also eliminates a requirement that persons 4 engaged in repairing scales must file a bond with the state 5 (repealed Code section 215.12). 6 WEIGHTS AND MEASURES —— MOTOR FUEL STANDARDS AND 7 CLASSIFICATIONS. Motor fuels include fossil (petroleum) based 8 gasoline and diesel fuel as well as certain biofuel components 9 derived from renewable (nonpetroleum) resources such as ethanol 10 classified as E-100 and biodiesel comprised of monoalkyl esters 11 of long-chain fatty acids and classified as B-100. Both types 12 of substances are used to produce renewable fuels (e.g., E-15 13 or B-5) subject to separate departmental standards based on 14 ASTM international (ASTM) specifications. The bill regulates 15 another liquid fuel referred to renewable diesel classified as 16 RD-100 that may be used as a motor fuel or a blending component 17 and classified as RD-xx. RD-100 is produced from nonfossil 18 renewable resources but is not biodiesel due to manufacturing 19 processes. Petroleum-based diesel fuel and RD-100 are subject 20 to the same ASTM specification D975 while B-100 is subject to 21 ASTM specification D6751 (amended Code sections 214A.1 and 22 214A.2). 23 WEIGHTS AND MEASURES —— TESTING LABORATORY. The bill 24 expressly recognizes the Iowa central fuel testing laboratory 25 at Iowa central community college as the official laboratory 26 for testing motor fuels, biofuels, and renewable fuels (amended 27 Code section 214A.2B). 28 WEIGHTS AND MEASURES —— CODE EDITOR DIRECTIVE. The bill 29 transfers Code section 214A.16 from subchapter I to subchapter 30 II of Code chapter 214A. The Code section regulates a notice 31 required to be posted for consumers purchasing renewable fuels. 32 In 2022, the general assembly enacted 2022 Iowa Acts, chapter 33 1152, which reorganized Code chapter 214A. Subchapter I 34 regulates general matters such as standards and classifications 35 -17- LSB 1218HZ (2) 90 da/ns 17/ 18

H.F. 666 and subchapter II regulates the advertisement, sale, and use 1 of motor fuel. 2 WEIGHTS AND MEASURES —— PENALTY. A person who fails to allow 3 for an inspection of a motor fuel pump is guilty of a simple 4 misdemeanor. 5 WATER QUALITY. DALS regulates two water quality 6 initiatives, including water quality agriculture infrastructure 7 programs (amended Code section 466B.43) and the water quality 8 urban infrastructure program (amended Code section 466B.44). 9 The initiative is supported by the water quality initiative 10 fund (Code section 466B.45), the water quality infrastructure 11 fund (Code section 8.57B), and the water quality financial 12 assistance fund (Code section 16.134A). Moneys in the last 13 fund (15 percent) are appropriated to support the water quality 14 urban infrastructure program. The bill provides that if moneys 15 remain after adequately supporting all water quality urban 16 infrastructure program projects for the fiscal year, DALS may 17 use those moneys to instead support water quality agriculture 18 infrastructure programs. The bill also eliminates dates in 19 several Code sections that are now extraneous. 20 APPLICABLE PENALTIES. A simple misdemeanor is punishable by 21 confinement for no more than 30 days and a fine of at least $105 22 but not more than $855. 23 -18- LSB 1218HZ (2) 90 da/ns 18/ 18