Senate File 2101 - Introduced SENATE FILE 2101 BY DICKEY A BILL FOR An Act relating to the distribution of gambling games and 1 sports wagering receipts for nonprofit purposes, and 2 including applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5191XS (8) 91 ss/ns

S.F. 2101 Section 1. Section 99F.6, subsection 4, paragraph a, 1 subparagraph (2), Code 2026, is amended to read as follows: 2 (2) (a) A qualified sponsoring organization licensed to 3 operate gambling games under this chapter shall distribute 4 the receipts of all gambling games, less reasonable expenses, 5 charges, taxes, fees, and deductions allowed under this 6 chapter , as winnings to players or participants or shall 7 distribute the receipts for educational, civic, public, 8 charitable, patriotic, or religious uses as defined in section 9 99B.1 . A qualified sponsoring organization shall provide that 10 any organization exempt from federal income taxes under section 11 501(c)(19) of the Internal Revenue Code, as defined in section 12 422.3 , shall be eligible for a distribution of adjusted gross 13 receipts for educational, civic, public, charitable, patriotic, 14 or religious uses as required by this subparagraph. However, a 15 licensee to conduct gambling games under this chapter shall, 16 unless an operating agreement for an excursion gambling boat 17 otherwise provides, distribute at least three percent of the 18 adjusted gross receipts and, if applicable, three-quarters of 19 one percent of sports wagering net receipts for each license 20 year for educational, civic, public, charitable, patriotic, 21 or religious uses as defined in section 99B.1 , as provided in 22 subparagraph division (b) . However, if a licensee who is also 23 licensed to conduct pari-mutuel wagering at a horse racetrack 24 has unpaid debt from the pari-mutuel racetrack operations, 25 the first receipts of the gambling games operated within the 26 racetrack enclosure less reasonable operating expenses, taxes, 27 and fees allowed under this chapter shall be first used to pay 28 the annual indebtedness. 29 (b) (i) A licensee making a required distribution for 30 educational, civic, public, charitable, patriotic, or religious 31 uses pursuant to subparagraph division (a) shall distribute 32 the moneys, including moneys from gambling games and sports 33 wagering receipts contributed by persons who are not residents 34 of Iowa, on a pro rata basis for use in each Iowa county whose 35 -1- LSB 5191XS (8) 91 ss/ns 1/ 4

S.F. 2101 residents contributed to the gambling games or sports wagering 1 receipts of the licensee. 2 (ii) To determine the share of the moneys to be distributed 3 for use in each Iowa county, the licensee shall transmit to the 4 department of revenue a report of the counties of residence 5 of all persons known to the licensee to have contributed to 6 the gambling games or sports wagering receipts of the licensee 7 and the amount each such person contributed to the receipts of 8 the licensee. The licensee shall gather information for the 9 report from data players have given to the licensee, including 10 for participation in rewards programs. Within sixty days of 11 receipt of a report, the department of revenue shall inform the 12 licensee of the percentage of the distribution to be made for 13 use in each Iowa county, which shall be based on the amount 14 of contributions from the residents of a given Iowa county in 15 comparison to the total amount of contributions from residents 16 of Iowa who contributed to such receipts of the licensee. 17 (iii) If the distribution for use in an Iowa county would 18 amount to less than three percent of the total distribution, or 19 if the licensee does not receive a suitable application from 20 an organization for use of the distribution in the county, the 21 licensee may retain the moneys dedicated to distribution for 22 use in the county for a period not to exceed three years. 23 (iv) If a licensee does not receive a suitable application 24 for use of a distribution in a county within the three-year 25 period, the licensee shall transfer the moneys dedicated to 26 distribution for use in the county to the department of revenue 27 for deposit in the county’s account in the county endowment 28 fund created pursuant to section 15E.311. 29 (v) A licensee may make a distribution under this 30 subparagraph division (b) to the department of revenue for 31 deposit in the county’s account in the county endowment fund 32 created pursuant to section 15E.311. 33 Sec. 2. APPLICABILITY. This Act applies to gambling 34 games and sports wagering receipts collected in a fiscal year 35 -2- LSB 5191XS (8) 91 ss/ns 2/ 4

S.F. 2101 beginning on or after the effective date of this Act. 1 EXPLANATION 2 The inclusion of this explanation does not constitute agreement with 3 the explanation’s substance by the members of the general assembly. 4 This bill relates to the allocation of required nonprofit 5 distributions of gambling games and sports wagering receipts. 6 Under current law, most licensees are required to distribute at 7 least 3 percent of the licensee’s adjusted gross receipts from 8 gambling games and three-quarters of 1 percent of net receipts 9 from sports wagering to organizations dedicated to civic, 10 public, charitable, patriotic, or religious uses. The bill 11 requires these distributions to be made on a pro rata basis for 12 use in Iowa counties whose residents are known to the licensee 13 to have contributed to the gambling games and sports wagering 14 receipts of the licensee. 15 To calculate the percentage of a distribution that will 16 be made for use in each Iowa county, the bill requires the 17 licensee to transmit to the department of revenue (department) 18 the counties of residence of all persons known to the licensee 19 to have contributed to the gambling games or sports wagering 20 receipts of the licensee and the amount each such person 21 contributed to the receipts of the licensee. The licensee 22 shall gather information for the report from data players have 23 given to the licensee, including for participation in a rewards 24 program. The department shall then inform the licensee of the 25 percentage of the distribution to be made for use in each Iowa 26 county, based on the amount of contributions from residents 27 of the county. If the distribution within a county would 28 amount to less than 3 percent of the total distribution, or if 29 the licensee does not receive a suitable application from an 30 organization for use in a county, the licensee may retain the 31 moneys dedicated to distribution for use in that county for a 32 period not to exceed three years. After three years, the bill 33 requires a licensee to transfer the moneys to the department 34 for deposit in the county’s account in the county endowment 35 -3- LSB 5191XS (8) 91 ss/ns 3/ 4

S.F. 2101 fund if the licensee does not receive a suitable application 1 from an organization for use in that county. The bill also 2 allows licensees to make distributions under the bill to a 3 county’s account in the county endowment fund. 4 The bill applies to gambling games and sports wagering 5 receipts collected in a fiscal year beginning on or after the 6 effective date of the bill. 7 -4- LSB 5191XS (8) 91 ss/ns 4/ 4