HF 2200 (LSB 5479HV (1) 91)

HOUSE FILE 2200

BY  COMMITTEE ON STATE GOVERNMENT

(SUCCESSOR TO HSB 587)

A BILL FOR

An Act relating to prohibited activities in the administration of alcoholic beverage control by the department of revenue, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 123.5, subsection 3, Code 2026, is amended to read as follows:
   3.  Members of the commission shall be chosen on the basis of managerial ability and experience as business executives. Not more than two members of the commission may be the holder of or have an interest in a permit or license to manufacture alcoholic liquor, wine, or beer or to sell alcoholic liquor, wine, or beer at wholesale or retail directly or indirectly; individually; as a member of a partnership or an association; as a member, owner, or stockholder, except as an institutional investor, of a corporation or other entity; or as a relative to an individual by blood or marriage within the second degree, do any of the following:
   a.  Hold a permit or license to manufacture alcoholic beverages or sell alcoholic beverages at wholesale or retail.
   b.  Have an interest in the manufacture of or dealing in alcoholic beverages or in an enterprise or industry in which alcoholic beverages are required.
   c.  Receive a commission or profit on the purchase or sale of alcoholic beverages by any person.
   d.  Have an interest in or mortgage or deed of trust on any land or building where alcoholic beverages are manufactured for sale, offered for sale, or sold, or in any personal property used in the manufacture or sale of alcoholic beverages.
    Sec. 2.  Section 123.5, Code 2026, is amended by adding the following new subsections:
   NEW SUBSECTION.  3A.  In addition to the requirements of chapter 68B, members of the commission shall not directly or indirectly use the office of the member to influence, persuade, or induce any person to adopt their political views or to favor any particular candidate for an elective or appointive public office.
   NEW SUBSECTION.  6.  This section does not prohibit a commission member from lawfully purchasing and keeping alcoholic beverages in the possession of the commission member.
    Sec. 3.  Section 123.13, Code 2026, is amended by striking the section and inserting in lieu thereof the following:
   123.13  Prohibitions —— director and employees.
   1.  For purposes of this section, “director” means the director of revenue but does not include the director’s designee.
   2.  The requirements of this section are in addition to the requirements of chapter 68B.
   3.  The director shall not directly or indirectly; individually; as a member of a partnership or an association; as a member, owner, or stockholder, except as an institutional investor, of a corporation or other entity; or as a relative to an individual by blood or marriage within the second degree, do any of the following:
   a.  Have an interest in the manufacture of or dealing in alcoholic beverages or in an enterprise or industry in which alcoholic beverages are required.
   b.  Receive a commission or profit from the purchase or sale of alcoholic beverages by any person.
   c.  Have an interest in or mortgage or deed of trust on any land or building where alcoholic beverages are manufactured for sale, offered for sale, or sold, or in any personal property used in the manufacture or sale of alcoholic beverages.
   4.  An employee of the department shall not license, permit, or participate in the licensing or permitting of a person, business, or organization that requires a license or permit under the laws and rules governing alcoholic beverages, if the employee has an ownership interest related to that person, business, or organization, or is in a position to exercise any control over the purchasing of alcoholic beverages through a position of employment with the person, business, or organization.
   5.  An employee of the department shall not enforce any law or rule governing alcoholic beverages against a person, business, or organization that requires a license or permit under the laws and rules governing alcoholic beverages, if the employee has an ownership interest related to that person, business, or organization, or is in a position to exercise any control over the purchase of alcoholic beverages through a position of employment with the person, business, or organization.
   6.  The director or an employee of the department violating this section or any other provision of this chapter shall, in addition to any other penalties provided by law, be subject to disciplinary action up to and including discharge from employment.
   7.  This section does not prohibit the director or an employee of the department from lawfully purchasing and keeping alcoholic beverages in the possession of the director or the employee.
    Sec. 4.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to prohibited activities in the administration of alcoholic beverage control by the department of revenue (IDR).
   The bill specifies that not more than two members of the alcoholic beverages commission (member) shall directly or indirectly have an interest in alcohol-related enterprises, except as institutional investors. The bill prohibits a member from influencing, persuading, or inducing others to adopt political views of the member or favor any particular elective or appointive candidates. 
   The bill prohibits the director of revenue from having any interest in alcohol-related enterprises, except as an institutional investor.
   The bill prohibits an IDR employee from licensing, permitting, or participating in the licensing or permitting of a person, business, or organization under the laws governing alcoholic beverages, if the employee has an ownership interest related to that person, business, or organization, or is in a position to exercise any control over the purchasing of alcoholic beverages through a position of employment with the person, business, or organization. The bill also prohibits an IDR employee from enforcing any law or rule governing alcoholic beverages against a person, business, or organization, if the employee has an ownership interest related to that person, business, or organization, or is in a position to exercise any control over the purchasing of alcoholic beverages through a position of employment with the person, business, or organization.
   The bill provides the director of revenue or an IDR employee who violates the bill shall, in addition to any other penalties provided by law, be subject to disciplinary action up to and including discharge from employment.
   The bill does not prohibit a member, the director of revenue, or an IDR employee from lawfully purchasing and keeping an alcoholic beverage in the person’s possession.
   The bill takes effect upon enactment.