Senate File 659 - Reprinted SENATE FILE 659 BY COMMITTEE ON APPROPRIATIONS (SUCCESSOR TO SSB 1241) (As Amended and Passed by the Senate May 15, 2025 ) A BILL FOR An Act relating to state government and finances, including by 1 making, modifying, limiting, or reducing appropriations, 2 distributions, or transfers; authorizing expenditure of 3 unappropriated moneys in special funds; providing for 4 properly related matters including crystalline polymorph 5 psilocybin, medical residency and fellowship positions, 6 state membership in the Iowa individual health benefit 7 reinsurance association, student abuse by school employees, 8 modified supplemental amounts for school budgets, wagering 9 taxes, a state fire marshal study, certain legislative 10 interim studies, and 911 emergency communications 11 services; making corrections; and including effective date, 12 applicability, and retroactive applicability provisions. 13 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 14 SF 659 (2) 91 ns/jh/mb

S.F. 659 DIVISION I 1 APPROPRIATIONS, DISTRIBUTIONS, TRANSFERS, AND EXPENDITURE 2 AUTHORITY 3 Section 1. LIMITATIONS OF STANDING APPROPRIATIONS —— FY 4 2025-2026. Notwithstanding the standing appropriation in the 5 following designated section for the fiscal year beginning July 6 1, 2025, and ending June 30, 2026, the amount appropriated from 7 the general fund of the state pursuant to that section for the 8 following designated purpose shall not exceed the following 9 amount: 10 For payment of claims for nonpublic school pupil 11 transportation under section 285.2 : 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,997,091 13 If total approved claims for reimbursement for nonpublic 14 school pupil transportation exceed the amount appropriated in 15 accordance with this section, the department of education shall 16 prorate the amount of each approved claim. 17 Sec. 2. INSTRUCTIONAL SUPPORT STATE AID —— FY 2025-2026. In 18 lieu of the appropriation provided in section 257.20, 19 subsection 2, the appropriation for the fiscal year 20 beginning July 1, 2025, and ending June 30, 2026, for paying 21 instructional support state aid under section 257.20 for the 22 fiscal year is zero. 23 Sec. 3. SPECIAL FUNDS —— SALARY ADJUSTMENTS —— FY 24 2025-2026. For the fiscal year beginning July 1, 2025, and 25 ending June 30, 2026, salary adjustments otherwise provided 26 may be funded as determined by the department of management, 27 subject to any applicable constitutional limitation, using 28 unappropriated moneys remaining in the commerce revolving 29 fund, the gaming enforcement revolving fund, the gaming 30 regulatory revolving fund, the primary road fund, the road 31 use tax fund, the fish and game protection fund, and the Iowa 32 public employees’ retirement fund, and in other departmental 33 revolving, trust, or special funds for which the general 34 assembly has not made an operating budget appropriation. 35 -1- SF 659 (2) 91 ns/jh/mb 1/ 22

S.F. 659 Sec. 4. IOWA ECONOMIC EMERGENCY FUND EXCESS —— USE FOR 1 FOUNDATION AID. Of the excess moneys transferred to the 2 general fund of the state under section 8.55, subsection 2, 3 paragraph “b”, for the fiscal year beginning July 1, 2024, 4 $21,881,303 shall be used in lieu of a like amount of other 5 general fund moneys to pay foundation aid under chapter 257, 6 as described in section 257.16, for the fiscal year beginning 7 July 1, 2025. This section is based on the application of 8 assessment limitations calculated under section 441.21 due to 9 the enactment of 2023 Iowa Acts, chapter 5. 10 Sec. 5. Section 257.35, subsection 2, Code 2025, is amended 11 to read as follows: 12 2. Notwithstanding the deduction and payment under 13 subsection 1, the The amounts specified for school districts 14 and area education agencies in subsection 1 , paragraph “a” 15 section 257.10, subsection 7 , for the fiscal year beginning 16 July 1, 2024 2025 , and each succeeding fiscal year, shall be 17 reduced by the department of management by seven million five 18 hundred thousand dollars. The department of management shall 19 calculate a state aid reduction such that such amounts shall 20 be reduced proportionally to the amount that the district or 21 agency would otherwise have received under this section if the 22 reduction imposed pursuant to this subsection did not apply 23 257.10, subsection 7 . 24 Sec. 6. Section 257.35, Code 2025, is amended by adding the 25 following new subsections: 26 NEW SUBSECTION . 19A. In addition to the state aid reduction 27 applicable pursuant to subsection 2, the state aid portion of 28 the amounts specified for school districts in section 257.10, 29 subsection 7, for the fiscal year beginning July 1, 2025, and 30 ending June 30, 2026, shall be reduced by the department of 31 management by twenty-five million dollars. The reductions 32 for each district shall be prorated based on the proportional 33 reduction that the district receives under subsection 2. 34 NEW SUBSECTION . 19B. The director of the department of 35 -2- SF 659 (2) 91 ns/jh/mb 2/ 22

S.F. 659 management may deduct the following from the state aid due to 1 each school district pursuant to this chapter and shall pay the 2 amounts to the respective area education agencies on a monthly 3 basis from September 15 through June 15 during each school year 4 for purposes of providing services to students enrolled in 5 nonpublic schools within the boundaries of the area education 6 agency: 7 a. The amount calculated for media services for the school 8 district that is attributable to the number of students 9 enrolled in nonpublic schools within the school district who 10 are provided with media services by an area education agency. 11 b. The amount calculated for educational services for the 12 school district that is attributable to the number of students 13 enrolled in nonpublic schools within the school district who 14 are provided with educational services by an area education 15 agency. 16 DIVISION II 17 CORRECTIVE PROVISIONS 18 Sec. 7. Section 29D.4, subsection 2, paragraph b, as enacted 19 by 2025 Iowa Acts, Senate File 619, section 8, is amended to 20 read as follows: 21 b. Moneys in the fund are appropriated to the department to 22 provide loans to eligible entities pursuant to section 29D.9 23 29D.8 , and for administration of the program as permitted 24 under the STORM Act. Moneys in the fund shall not be used to 25 provide a loan to a private entity for the acquisition of real 26 property. Moneys in the fund shall not be considered part of 27 the general fund of the state subject to appropriation for any 28 other purpose by the general assembly, and in determining a 29 general fund balance, shall not be included in the general fund 30 of the state subject to section 16.31, insofar as section 16.31 31 complies with the STORM Act. 32 Sec. 8. Section 144E.3, Code 2025, as amended by 2025 Iowa 33 Acts, Senate File 233, section 2, if enacted, is amended to 34 read as follows: 35 -3- SF 659 (2) 91 ns/jh/mb 3/ 22

S.F. 659 144E.3 Manufacturer and eligible facility rights. 1 1. A manufacturer of an investigational drug, biological 2 product, or device or a manufacturer operating within, 3 and in compliance with all requirements applicable to, an 4 eligible facility may make available, and an eligible patient, 5 as applicable under section 144E.1 144E.2 , subsection 2, 6 paragraph “a” or “b” , may request from a manufacturer of 7 an investigational drug, biological product, or device, 8 or a manufacturer operating within, and in compliance with 9 all requirements applicable to, an eligible facility, the 10 manufacturer’s investigational drug, biological product, or 11 device, or the manufacturer’s individualized investigational 12 treatment under this chapter . This chapter does not require a 13 manufacturer of an investigational drug, biological product, 14 or device, or of an individualized investigational treatment 15 to provide or otherwise make available the investigational 16 drug, biological product, or device, or the individualized 17 investigational treatment to an eligible patient. 18 2. An eligible facility, or a manufacturer described 19 in subsection 1 , that is in compliance with all applicable 20 requirements, may do any of the following: 21 a. Provide an investigational drug, biological product, 22 or device, or an individualized investigational treatment 23 to an eligible patient, as applicable under section 144E.1 24 144E.2 , subsection 2, paragraph “a” or “b” , without receiving 25 compensation. 26 b. Require an eligible patient, as applicable under section 27 144E.1 144E.2 , subsection 2, paragraph “a” or “b” , to pay the 28 costs of, or the costs associated with, the manufacture of the 29 investigational drug, biological product, or device, or the 30 individualized investigational treatment. 31 Sec. 9. Section 237.10, subsection 1, paragraph d, if 32 enacted by 2025 Iowa Acts, House File 644, section 3, is 33 amended to read as follows: 34 d. (1) The department shall notify an individual licensee, 35 -4- SF 659 (2) 91 ns/jh/mb 4/ 22

S.F. 659 and the parents or guardians of a child, if the department 1 delegates the department’s right to consent to emergency 2 medical care and routine medical care on behalf of the child 3 under section 232.2, subsection 12, paragraph “c” , to the 4 individual licensee. 5 (2) The department shall notify the department of 6 education, an individual licensee, and the parents or guardians 7 of a child if the department delegates the department’s right 8 to consent to participation in an individualized education 9 program on behalf of the child under section 232.2, subsection 10 12, paragraph “c” , to the individual licensee. 11 Sec. 10. Section 237.10, subsection 1, paragraph d, if 12 enacted by 2025 Iowa Acts, House File 644, section 7, is 13 amended to read as follows: 14 d. (1) The department shall notify an individual licensee 15 or an approved kinship caregiver, and the parents or guardians 16 of a child, if the department delegates the department’s right 17 to consent to emergency medical care and routine medical care 18 on behalf of the child under section 232.2, subsection 12, 19 paragraph “c” , to the individual licensee or approved kinship 20 caregiver. 21 (2) The department shall notify the department of 22 education, an individual licensee or an approved kinship 23 caregiver, and the parents or guardians of a child, if the 24 department delegates the department’s right to consent to 25 participation in an individualized education program on behalf 26 of the child under section 232.2, subsection 12, paragraph “c” , 27 to the individual licensee or approved kinship caregiver. 28 Sec. 11. Section 256.9, subsection 69, as enacted by 2025 29 Iowa Acts, House File 782, section 1, is amended to read as 30 follows: 31 69. On or before May 1, 2025, develop and distribute 32 to school districts, accredited nonpublic schools, charter 33 schools, and innovation zone schools model policies that, 34 if adopted, would satisfy the a school district’s , charter 35 -5- SF 659 (2) 91 ns/jh/mb 5/ 22

S.F. 659 school’s, or innovation zone school’s responsibilities under 1 section 279.87 relating to policies governing student use of 2 personal electronic devices. 3 Sec. 12. Section 280.36, subsection 1, as enacted by 2025 4 Iowa Acts, Senate File 583, section 4, is amended to read as 5 follows: 6 1. The board of directors of each school district and the 7 authorities in charge of each accredited nonpublic school may 8 establish a multidisciplinary school safety assessment team. 9 If established, the multidisciplinary school safety assessment 10 team shall coordinate resources and assess and intervene 11 when a student enrolled in the school district or accredited 12 nonpublic school exhibits behavior that may pose a threat to 13 the safety of the school district or accredited nonpublic 14 school, employees of the school district or accredited 15 nonpublic school, or other student students enrolled in the 16 school district or accredited nonpublic school. 17 Sec. 13. Section 299.1D, subsection 1, paragraph f, if 18 enacted by 2025 Iowa Acts, House File 870, section 2, is 19 amended to read as follows: 20 f. The school district or accredited nonpublic school 21 must not expend any moneys related to the course in religious 22 instruction, not including de minimis administrative costs 23 associated with processing notifications received under 24 subsection 1 paragraph “a” and tracking the child’s attendance 25 to ensure compliance with this section. 26 Sec. 14. Section 404A.3, subsection 3, paragraph b, 27 subparagraph (5), subparagraph division (c), if enacted by 2025 28 Iowa Acts, House File 975, section 19, is amended to read as 29 follows: 30 (c) Upon application of the eligible taxpayer made prior 31 to the expiration of an extension under subparagraph division 32 (b), the authority may, at the discretion of the authority, 33 extend the date by which the qualified rehabilitation project 34 must be complete up to an additional twelve consecutive months. 35 -6- SF 659 (2) 91 ns/jh/mb 6/ 22

S.F. 659 The qualified eligible taxpayer must substantiate to the 1 satisfaction of the authority that the requested extension is 2 warranted due to extenuating circumstances outside the control 3 of the eligible taxpayer. 4 Sec. 15. Section 510B.8E, subsection 3, unnumbered 5 paragraph 1, if enacted by 2025 Iowa Acts, Senate File 383, 6 section 7, is amended to read as follows: 7 The pharmacy benefits manger manager shall respond to an 8 appeal within seven business days after the date on which the 9 pharmacy benefits manager receives the appeal. 10 Sec. 16. Section 514F.8, subsection 1A, paragraph c, 11 subparagraph (8), if enacted by 2025 Iowa Acts, House File 303, 12 section 1, is amended to read as follows: 13 (8) The average and median time that elapsed between the 14 submission of a nonurgent prior authorization request and a 15 determination by the utilization review organization for the 16 urgent nonurgent prior authorization request, aggregated for 17 all health care services or items. 18 Sec. 17. Section 522F.4, subsection 2, as enacted by 2025 19 Iowa Acts, Senate File 619, section 59, is amended to read as 20 follows: 21 2. Any The fee for a criminal history check shall be 22 the same as any applicable fee for a criminal history check 23 pursuant to section 522B.5A. 24 Sec. 18. Section 522F.9, subsection 2, as enacted by 2025 25 Iowa Acts, Senate File 619, section 64, is amended to read as 26 follows: 27 2. Any The fee for a criminal history check shall be 28 the same as any applicable fee for a criminal history check 29 pursuant to section 522B.5A. 30 Sec. 19. CODE EDITOR DIRECTIVE. 2025 Iowa Acts, Senate File 31 619, section 29, amends section 515.137A, subsections 3, 4, and 32 5, Code 2025, by striking the subsections and inserting in lieu 33 thereof new subsections 3, 4, and 5, and, notwithstanding the 34 Acts section lead-in, adds new subsections 6, 7, 8, 9, and 10. 35 -7- SF 659 (2) 91 ns/jh/mb 7/ 22

S.F. 659 The Code editor is directed to codify 2025 Iowa Acts, Senate 1 File 619, section 29, by striking section 515.137A, subsections 2 3, 4, and 5, Code 2025, and inserting in lieu thereof new 3 subsections 3, 4, and 5, and then by amending section 515.137A, 4 Code 2025, by adding new subsections 6, 7, 8, 9, and 10. 5 Sec. 20. EFFECTIVE DATE. The following, being deemed of 6 immediate importance, takes effect upon enactment: 7 The section of this division of this Act amending section 8 256.9, subsection 69, as enacted by 2025 Iowa Acts, House File 9 782, section 1. 10 Sec. 21. RETROACTIVE APPLICABILITY. The following applies 11 retroactively to April 30, 2025: 12 The section of this division of this Act amending section 13 256.9, subsection 69, as enacted by 2025 Iowa Acts, House File 14 782, section 1. 15 DIVISION III 16 CRYSTALLINE POLYMORPH PSILOCYBIN 17 Sec. 22. Section 124.201, subsection 5, if enacted by 2025 18 Iowa Acts, House File 383, section 1, is amended to read as 19 follows: 20 5. a. Notwithstanding section 124.204, subsection 4, a drug 21 that contains the pharmaceutical composition of crystalline 22 polymorph psilocybin , also known as COMP 360, or any other 23 trade name approved by the United States food and drug 24 administration, shall be immediately removed from schedule I 25 under section 124.204, subsection 4, paragraph “s” , upon its 26 approval by the United States food and drug administration and 27 rescheduled based upon the recommendations of the United States 28 food and drug administration and its listing in the federal 29 Controlled Substances Act, 21 U.S.C. §812, and 21 C.F.R. 30 §1308.14. 31 b. Immediately upon the rescheduling of the drug under 32 paragraph “a” , it shall be lawful to prescribe, distribute, and 33 market the pharmaceutical composition of crystalline polymorph 34 psilocybin , also known as COMP 360, or any other trade name 35 -8- SF 659 (2) 91 ns/jh/mb 8/ 22

S.F. 659 approved by the United States food and drug administration . 1 DIVISION IV 2 MEDICAL RESIDENCY AND FELLOWSHIP POSITIONS —— RESIDENTS OF IOWA 3 Sec. 23. Section 262.9, subsection 39, paragraph e, 4 subparagraph (2), if enacted by 2025 Iowa Acts, House File 516, 5 section 1, is amended to read as follows: 6 (2) An individual who has lived in Iowa for at least four 7 consecutive years immediately preceding the date the individual 8 applies for admission to begins classes at the college of 9 medicine in the doctor of medicine program or the college of 10 dentistry at the state university of Iowa, or for begins a 11 residency at the university of Iowa hospitals and clinics. 12 DIVISION V 13 STATE MEMBERSHIP —— REINSURANCE ASSOCIATION 14 Sec. 24. Section 513C.10, subsection 1, paragraph a, Code 15 2025, is amended to read as follows: 16 a. All persons that provide health benefit plans in this 17 state including insurers providing accident and sickness 18 insurance under chapter 509 , 514 , or 514A , whether on an 19 individual or group basis; fraternal benefit societies 20 providing hospital, medical, or nursing benefits under chapter 21 512B ; and health maintenance organizations, other entities 22 providing health insurance or health benefits subject to state 23 insurance regulation, and all other insurers as designated 24 by the board of directors of the Iowa comprehensive health 25 insurance association with the approval of the commissioner 26 shall be members of the association. However, the state, 27 including a department, an independent agency, the state board 28 of regents, and an institution under the control of the state 29 board of regents, shall not be a member of the association. 30 Sec. 25. EFFECTIVE DATE. This division of this Act, being 31 deemed of immediate importance, takes effect upon enactment. 32 Sec. 26. RETROACTIVE APPLICABILITY. This division of this 33 Act applies retroactively to January 1, 2020. 34 DIVISION VI 35 -9- SF 659 (2) 91 ns/jh/mb 9/ 22

S.F. 659 STUDENT ABUSE INVOLVING A SCHOOL EMPLOYEE —— DEPARTMENT OF 1 HEALTH AND HUMAN SERVICES INVESTIGATIONS 2 Sec. 27. NEW SECTION . 232E.1 Definitions. 3 As used in this chapter, unless the context otherwise 4 requires: 5 1. “Board of educational examiners” means the board created 6 in section 256.146. 7 2. “Department” means the department of health and human 8 services. 9 3. “Investigation” means the process by which the department 10 responds to all accepted reports of alleged student abuse. 11 4. “Nonpublic school” means the same as defined in section 12 280.2. 13 5. “Public school” means the same as defined in section 14 280.2. 15 6. “Public school district” means a public school district 16 as described in chapter 274, and includes a charter school 17 under chapter 256E, or a charter school or an innovation zone 18 school under chapter 256F. 19 7. “School employee” means any of the following: 20 a. A person employed by a public school or a nonpublic 21 school. 22 b. A vendor, or an employee of a vendor, that provides goods 23 or services to a public school or a nonpublic school. 24 c. An agent, or an employee of an agent, of a public school 25 or a nonpublic school. 26 d. A volunteer under the direction and control of any of the 27 following: 28 (1) The board of directors or any administrator of a public 29 school district. 30 (2) The board or authorities in control of a nonpublic 31 school. 32 (3) The board of directors or administrator of an agency 33 called upon by a school official to provide services to 34 students in an educational capacity. 35 -10- SF 659 (2) 91 ns/jh/mb 10/ 22

S.F. 659 8. “Student” means a person enrolled in a public school, 1 a nonpublic school, or a prekindergarten program in a public 2 school or a nonpublic school. 3 9. “Student abuse” means any of the following which occur on 4 school grounds during school time, or on or at a school-related 5 curricular or extracurricular activity: 6 a. Any nonaccidental physical injury, or an injury which 7 does not match the history provided for how the injury 8 occurred, suffered by a student as the result of an act or 9 omission of a school employee, that is not otherwise excluded 10 by section 280.21, subsection 2. 11 b. The commission of a sexual offense under chapter 709, 12 section 726.2, or section 728.12, subsection 1, with or to a 13 student as a result of an act or omission of a school employee. 14 c. An act or omission of a school employee which allows, 15 permits, or encourages a student to engage in an act prohibited 16 under section 725.1. 17 Sec. 28. NEW SECTION . 232E.2 Investigation of alleged 18 student abuse by school employees —— rules. 19 1. The department shall administer this chapter to provide 20 for the investigation of reports of alleged student abuse by 21 school employees as specified in this chapter. 22 2. a. If, during the child abuse intake process under 23 chapter 232, subchapter III, part 2, the department receives 24 a report from an identifiable source and the department 25 determines the report constitutes an allegation of student 26 abuse involving a school employee, the department shall notify 27 the board of directors of the public school district or the 28 authorities in charge of the nonpublic school associated with 29 the school employee, and the board of educational examiners, of 30 the determination. 31 b. Upon notification under paragraph “a” , the board of 32 directors of the public school district or the authorities in 33 charge of the nonpublic school shall place the school employee 34 on administrative leave and shall prohibit the school employee 35 -11- SF 659 (2) 91 ns/jh/mb 11/ 22

S.F. 659 from entering school property until the investigation is 1 completed. 2 3. If the department determines the alleged student abuse 3 constitutes a criminal act, the department shall do all of the 4 following: 5 a. Immediately refer the matter to, and jointly investigate 6 the matter with, the appropriate law enforcement agency. 7 b. Notify the board of directors of the public school 8 district, or the authorities in charge of the nonpublic school, 9 associated with the school employee of the referral under 10 paragraph “a” . 11 c. If the school employee is licensed, certified, or 12 authorized by the board of educational examiners, or holds 13 an active statement of recognition issued by the board of 14 educational examiners, notify the board of educational 15 examiners of the referral under paragraph “a” . 16 4. Following receipt of a report of alleged student abuse, 17 the department shall do all of the following: 18 a. Commence an investigation within twenty-four hours of 19 receipt of the report. 20 b. Complete the investigation within thirty business days of 21 receipt of the report. 22 5. Upon completion of an investigation, the department 23 shall submit a written investigation report to all of the 24 following: 25 a. The board of directors of the public school district, or 26 the authorities in charge of the nonpublic school, associated 27 with the school employee subject to the investigation. 28 b. The board of educational examiners if the school 29 employee subject to the investigation is licensed, certified, 30 or authorized by the board of educational examiners, or holds 31 an active statement of recognition issued by the board of 32 educational examiners. 33 6. The department shall adopt rules pursuant to chapter 34 17A, in consultation with the department of education, to 35 -12- SF 659 (2) 91 ns/jh/mb 12/ 22

S.F. 659 administer this chapter. Rules adopted by the department shall 1 include rules regarding the intake and investigation processes, 2 investigation reports, case and investigation record retention 3 and dissemination, and case disposition. 4 7. The department shall maintain information and data 5 regarding student abuse reports, investigations, and 6 dispositions under this chapter separately from information 7 and data regarding child abuse reports, assessments, and 8 dispositions under chapter 232. 9 DIVISION VII 10 STUDENT ABUSE INVOLVING A SCHOOL EMPLOYEE —— DEPARTMENT OF 11 EDUCATION 12 Sec. 29. Section 280.17, Code 2025, is amended by striking 13 the section and inserting in lieu thereof the following: 14 280.17 Student abuse investigations —— termination of 15 employment. 16 1. The board of directors of a public school district and 17 the authorities in charge of a nonpublic school shall comply 18 with chapter 232E, and shall cooperate with the department of 19 health and human services during an investigation commenced 20 under chapter 232E. 21 2. The board of directors of a public school or the 22 authorities in charge of a nonpublic school shall terminate the 23 employment of a school employee if the board of directors or 24 authorities in charge receive a written investigation report 25 under section 232E.2, subsection 5, indicating the department 26 of health and human services has determined the school employee 27 committed student abuse. 28 3. The department of education, in consultation with the 29 department of health and human services, shall adopt rules 30 pursuant to chapter 17A, and a model policy, for the handling 31 of investigations pursuant to chapter 232E. 32 Sec. 30. Section 321.375, subsection 3, paragraph d, Code 33 2025, is amended to read as follows: 34 d. The commission of or conviction for a public offense as 35 -13- SF 659 (2) 91 ns/jh/mb 13/ 22

S.F. 659 defined by the Iowa criminal code, if the offense is relevant 1 to and affects driving ability, or if the offense includes 2 sexual involvement with a minor student with the intent to 3 commit acts and practices proscribed under sections 709.2 4 through 709.4 , section 709.8 , and sections 725.1 through 725.3 , 5 or is a violation of the rules of the department of education 6 adopted to implement section 280.17 student abuse as defined 7 in section 232E.1 . 8 DIVISION VIII 9 SCHOOL BUDGETS —— MODIFIED SUPPLEMENTAL AMOUNTS 10 Sec. 31. Section 257.31, subsection 5, paragraph o, Code 11 2025, is amended to read as follows: 12 o. (1) The percentage of students enrolled in the school 13 district as the result of open enrollment under section 14 282.18 is equal to or greater than forty-five percent of the 15 total number of students enrolled in the school district. 16 The committee shall not approve supplemental aid or a 17 modified supplemental amount that exceeds an amount equal 18 to fifty percent of the product of the net change in the 19 school district’s expected enrollment due to open enrollment 20 multiplied by the sum of the following amounts: 21 (a) The difference between the district’s regular program 22 district cost per pupil minus the regular program state cost 23 per pupil. 24 (b) The teacher salary supplement district cost per pupil. 25 (c) (b) The professional development supplement district 26 cost per pupil. 27 (d) (c) The early intervention supplement district cost per 28 pupil. 29 (2) Prior to filing a request for supplemental aid or a 30 modified supplemental amount based on the grounds specified 31 in this paragraph, the board of directors shall hold a public 32 hearing on the issue and shall publish the notice of the time 33 and place of the public hearing. Notice of the time and place 34 of the public hearing shall be published not less than ten nor 35 -14- SF 659 (2) 91 ns/jh/mb 14/ 22

S.F. 659 more than twenty days before the public hearing in a newspaper 1 that is a newspaper of general circulation in the school 2 district. 3 (3) A school district is not eligible for supplemental aid 4 or a modified supplemental amount under this paragraph if a 5 majority of the students enrolled in the school district as 6 the result of open enrollment are students receiving online 7 instruction from a private provider under section 256.43, 8 subsection 2 . 9 (4) A school district is only eligible for supplemental 10 aid or a modified supplemental amount under this paragraph for 11 the budget year beginning July 1, 2024 If a school district is 12 granted a modified supplemental amount under this paragraph for 13 a budget year beginning on or after July 1, 2025, the school 14 district’s combined property tax rate per one thousand dollars 15 for all school district levies for the succeeding budget year 16 shall not exceed the combined property tax rate for all such 17 levies for the budget year for which the modified supplemental 18 amount was granted . 19 Sec. 32. REPEAL. 2024 Iowa Acts, chapter 1152, section 45, 20 is repealed. 21 Sec. 33. EFFECTIVE DATE. This division of this Act, being 22 deemed of immediate importance, takes effect upon enactment. 23 Sec. 34. APPLICABILITY. This division of this Act applies 24 to school budget years beginning on or after July 1, 2025. 25 DIVISION IX 26 WAGERING TAXES 27 Sec. 35. Section 99D.15, subsection 4, paragraph b, Code 28 2025, is amended to read as follows: 29 b. If wagering on simultaneously telecast horse races and 30 dog races is conducted by a licensee under section 99D.9D , 31 a tax of two percent is imposed on the gross sum wagered by 32 the pari-mutuel method on horse races and dog races which 33 are simultaneously telecast in excess of twenty-five million 34 dollars in a calendar year. Of the tax revenue collected 35 -15- SF 659 (2) 91 ns/jh/mb 15/ 22

S.F. 659 from simulcast horse races under this paragraph, one-half of 1 one percent of the gross sum wagered shall be remitted to 2 the treasurer of the county in which a horse racetrack is 3 located in this state and licensed under this chapter . The 4 tax revenue from simulcast horse races under this paragraph 5 shall be deposited in the Iowa horse racing fund created in 6 section 99D.27B. The remaining amount of tax revenue shall be 7 deposited with the commission. 8 Sec. 36. Section 99D.17, Code 2025, is amended to read as 9 follows: 10 99D.17 Use of funds moneys . 11 Funds Unless otherwise provided by section 99D.15 or another 12 provision of law, moneys received pursuant to sections 99D.14 13 and 99D.15 shall be deposited as provided in section 8.57, 14 subsection 3 . These funds moneys shall first be used to the 15 extent appropriated by the general assembly. The commission 16 is subject to the budget requirements of chapter 8 and the 17 applicable auditing requirements and procedures of chapter 11 . 18 Sec. 37. NEW SECTION . 99D.27B Iowa horse racing fund —— 19 advance deposit wagering tax. 20 1. An Iowa horse racing fund is created in the state 21 treasury under the control of the commission. 22 2. The fund shall consist of tax revenue collected and 23 deposited in the fund pursuant to subsection 6 and section 24 99D.15, subsection 4, and such other moneys appropriated to, 25 transferred to, or deposited in the fund. 26 3. a. Moneys in the fund are appropriated to the commission 27 for distribution in a manner and in an amount as determined by 28 the commission to individual entities or a recognized compact 29 of entities tasked with the regulation of the horse racing 30 industry in accordance with the federal Horseracing Integrity 31 and Safety Act of 2020, 15 U.S.C. ch. 57A. 32 b. In the event that the federal Horseracing Integrity 33 and Safety Act of 2020, 15 U.S.C. ch. 57A, is repealed, 34 moneys in the fund shall be transferred to the rebuild Iowa 35 -16- SF 659 (2) 91 ns/jh/mb 16/ 22

S.F. 659 infrastructure fund created in section 8.57. 1 4. Members of the commission and those acting on behalf of 2 the commission assisting in the distribution of the moneys in 3 the fund shall be held harmless against any claim of liability 4 made by an individual or entity arising out of the distribution 5 of the moneys from the fund by the commission. 6 5. Section 8.33 does not apply to moneys in the fund. 7 Notwithstanding section 12C.7, subsection 2, interest or 8 earnings on moneys deposited in the fund shall be credited to 9 the fund. 10 6. A tax of two percent is imposed on the gross sum wagered 11 by the pari-mutuel method as an advance deposit wager under 12 section 99D.11, subsection 6, paragraph “c” . The tax imposed 13 under this subsection is in lieu of any tax imposed on such 14 wagers under section 99D.15. The tax revenue generated under 15 this subsection shall be deposited in the fund. 16 DIVISION X 17 STATE FIRE MARSHAL STUDY 18 Sec. 38. STATE FIRE MARSHAL —— COUNTYWIDE FIRE PROTECTION 19 SERVICES STUDY. 20 1. The state fire marshal shall conduct a study of fire 21 protection services in this state to analyze whether a 22 structure of countywide fire protection services would maximize 23 fire protection coverage and emergency response times. The 24 study shall be conducted in consultation with representatives 25 from the following stakeholders: 26 a. The department of homeland security and emergency 27 management. 28 b. The Iowa association of professional fire chiefs. 29 c. The Iowa fire chiefs’ association. 30 d. The Iowa firefighters association. 31 e. The Iowa professional fire fighters. 32 f. The Iowa emergency management association. 33 g. At least one attorney licensed to practice law in this 34 state with experience representing entities associated with 35 -17- SF 659 (2) 91 ns/jh/mb 17/ 22

S.F. 659 fire protection services. 1 h. At least one representative from a city having a 2 population of thirty-seven thousand or more as determined by 3 the 2020 federal decennial census. 4 i. At least one representative from a city having a 5 population of less than five thousand as determined by the 2020 6 federal decennial census. 7 j. At least one representative from a county having a 8 population of ninety thousand or more as determined by the 2020 9 federal decennial census. 10 k. Four members of the general assembly serving as 11 ex officio, nonvoting members, one representative to be 12 appointed by the speaker of the house of representatives, one 13 representative to be appointed by the minority leader of the 14 house of representatives, one senator to be appointed by the 15 president of the senate after consultation with the majority 16 leader of the senate, and one senator to be appointed by the 17 minority leader of the senate. 18 2. The countywide fire protection services study shall 19 include all of the following: 20 a. A cost analysis for upfront and ongoing costs to provide 21 consolidated countywide fire protection services systems. The 22 analysis and recommendations shall include proposed funding 23 mechanisms and potential consolidated funding resources that 24 comply with local, state, and federal law. The analysis shall 25 also include the potential effects countywide fire protection 26 services could have on local authority expenditures and 27 budgets. 28 b. An analysis of current fire protection coverage 29 including current response times and recommendations for 30 placement of service stations to maximize fire protection 31 coverage and emergency response times in the most efficient and 32 cost-effective manner. 33 c. An analysis of current and future staffing needs 34 including a proposed employment structure for countywide 35 -18- SF 659 (2) 91 ns/jh/mb 18/ 22

S.F. 659 fire protection services that focuses on adequate employee 1 pay and volunteer staffing, including benefits, stipends, or 2 other compensation allowed in accordance with local, state, or 3 federal law. 4 d. An analysis of current fire protection services 5 equipment and future fire protection services equipment needs 6 including proposed placement of fire protection services 7 equipment in service stations to maximize fire protection 8 coverage and emergency response times. 9 e. An analysis of current communication and dispatch 10 challenges including proposed recommendations for more 11 efficient and effective communications. 12 f. An analysis of the need for city and township fire 13 protection services in relation to the implementation of a 14 countywide fire protection service. 15 g. An analysis of existing countywide fire protection 16 service programs in this state including outlining current 17 processes and procedures. The analysis under this paragraph 18 must include outlines of any current or proposed fire 19 protection service programs under chapter 28E, 357B, 357F, 20 357G, or 357J, and any other legal agreement, contract, or 21 consolidated effort, including as part of a district. 22 h. An analysis of countywide fire protection services in 23 other states, with an emphasis on midwest states, including an 24 analysis of those fire protection programs in comparison to the 25 fire protection needs of this state. 26 i. Recommendations for the implementation of countywide 27 fire protection services in this state including proposed 28 functionality and an emphasis on the potential impact of 29 implementation on the four most populous counties in this 30 state as determined by the 2020 federal decennial census, 31 along with surrounding counties if a multicounty approach to 32 fire protection services would be more beneficial based on the 33 study’s findings. 34 3. The state fire marshal shall submit a report of the 35 -19- SF 659 (2) 91 ns/jh/mb 19/ 22