Bill Text: IA HF2588 | 2021-2022 | 89th General Assembly | Introduced
Bill Title: A bill for an act relating to water quality by increasing the sales and use tax rates and conditioning the use of moneys from the natural resources and outdoor recreation trust fund, and including effective date provisions.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2022-04-25 - Introduced, referred to Ways and Means. H.J. 855. [HF2588 Detail]
Download: Iowa-2021-HF2588-Introduced.html
House
File
2588
-
Introduced
HOUSE
FILE
2588
BY
ISENHART
A
BILL
FOR
An
Act
relating
to
water
quality
by
increasing
the
sales
and
1
use
tax
rates
and
conditioning
the
use
of
moneys
from
the
2
natural
resources
and
outdoor
recreation
trust
fund,
and
3
including
effective
date
provisions.
4
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
5
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DIVISION
I
1
SALES
AND
USE
TAXES
AND
THE
NATURAL
RESOURCES
AND
OUTDOOR
2
RECREATION
TRUST
FUND
3
Section
1.
Section
423.2,
subsection
1,
unnumbered
4
paragraph
1,
Code
2022,
is
amended
to
read
as
follows:
5
There
is
imposed
a
tax
of
six
percent
at
the
rate
specified
6
in
subsection
12
upon
the
sales
price
of
all
sales
of
tangible
7
personal
property,
sold
at
retail
in
the
state
to
consumers
or
8
users
except
as
otherwise
provided
in
this
subchapter
.
9
Sec.
2.
Section
423.2,
subsections
2
and
3,
Code
2022,
are
10
amended
to
read
as
follows:
11
2.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
12
12
is
imposed
upon
the
sales
price
of
the
sale
or
furnishing
13
of
gas,
electricity,
water,
heat,
pay
television
service,
and
14
communication
service,
including
the
sales
price
from
such
15
sales
by
any
municipal
corporation
or
joint
water
utility
16
furnishing
gas,
electricity,
water,
heat,
pay
television
17
service,
and
communication
service
to
the
public
in
its
18
proprietary
capacity,
except
as
otherwise
provided
in
this
19
subchapter
,
when
sold
at
retail
in
the
state
to
consumers
or
20
users.
21
3.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
22
12
is
imposed
upon
the
sales
price
of
all
sales
of
tickets
23
or
admissions
to
places
of
amusement,
fairs,
and
athletic
24
events
except
those
of
elementary
and
secondary
educational
25
institutions.
A
tax
of
six
percent
at
the
rate
specified
in
26
subsection
12
is
imposed
on
the
sales
price
of
an
entry
fee
or
27
like
charge
imposed
solely
for
the
privilege
of
participating
28
in
an
activity
at
a
place
of
amusement,
fair,
or
athletic
event
29
unless
the
sales
price
of
tickets
or
admissions
charges
for
30
observing
the
same
activity
are
taxable
under
this
subchapter
.
31
A
tax
of
six
percent
at
the
rate
specified
in
subsection
12
32
is
imposed
upon
that
part
of
private
club
membership
fees
or
33
charges
paid
for
the
privilege
of
participating
in
any
athletic
34
sports
provided
club
members.
35
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Sec.
3.
Section
423.2,
subsection
4,
paragraph
a,
Code
2022,
1
is
amended
to
read
as
follows:
2
a.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
3
12
is
imposed
upon
the
sales
price
derived
from
the
operation
4
of
all
forms
of
amusement
devices
and
games
of
skill,
games
of
5
chance,
raffles,
and
bingo
games
as
defined
in
chapter
99B
,
and
6
card
game
tournaments
conducted
under
section
99B.27
,
that
are
7
operated
or
conducted
within
the
state,
the
tax
to
be
collected
8
from
the
operator
in
the
same
manner
as
for
the
collection
of
9
taxes
upon
the
sales
price
of
tickets
or
admission
as
provided
10
in
this
section
.
Nothing
in
this
subsection
shall
legalize
any
11
games
of
skill
or
chance
or
slot-operated
devices
which
are
now
12
prohibited
by
law.
13
Sec.
4.
Section
423.2,
subsection
5,
Code
2022,
is
amended
14
to
read
as
follows:
15
5.
There
is
imposed
a
tax
of
six
percent
at
the
rate
16
specified
in
subsection
12
upon
the
sales
price
from
the
17
furnishing
of
services
as
defined
in
section
423.1
.
18
Sec.
5.
Section
423.2,
subsection
7,
paragraph
a,
19
unnumbered
paragraph
1,
Code
2022,
is
amended
to
read
as
20
follows:
21
A
tax
of
six
percent
at
the
rate
specified
in
subsection
12
22
is
imposed
upon
the
sales
price
from
the
sales,
furnishing,
or
23
service
of
solid
waste
collection
and
disposal
service.
24
Sec.
6.
Section
423.2,
subsection
8,
paragraph
a,
Code
2022,
25
is
amended
to
read
as
follows:
26
a.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
27
12
is
imposed
on
the
sales
price
from
sales
of
bundled
28
transactions.
For
the
purposes
of
this
subsection
,
a
“bundled
29
transaction”
is
the
retail
sale
of
two
or
more
distinct
and
30
identifiable
products,
except
real
property
and
services
to
31
real
property,
which
are
sold
for
one
nonitemized
price.
A
32
“bundled
transaction”
does
not
include
the
sale
of
any
products
33
in
which
the
sales
price
varies,
or
is
negotiable,
based
on
34
the
selection
by
the
purchaser
of
the
products
included
in
the
35
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transaction.
1
Sec.
7.
Section
423.2,
subsection
9,
Code
2022,
is
amended
2
to
read
as
follows:
3
9.
A
tax
of
six
percent
at
the
rate
specified
in
4
subsection
12
is
imposed
upon
the
sales
price
from
any
mobile
5
telecommunications
service,
including
all
paging
services,
6
that
this
state
is
allowed
to
tax
pursuant
to
the
provisions
7
of
the
federal
Mobile
Telecommunications
Sourcing
Act,
Pub.
8
L.
No.
106-252,
4
U.S.C.
§116
et
seq.
For
purposes
of
this
9
subsection
,
taxes
on
mobile
telecommunications
service,
as
10
defined
under
the
federal
Mobile
Telecommunications
Sourcing
11
Act
that
are
deemed
to
be
provided
by
the
customer’s
home
12
service
provider,
shall
be
paid
to
the
taxing
jurisdiction
13
whose
territorial
limits
encompass
the
customer’s
place
of
14
primary
use,
regardless
of
where
the
mobile
telecommunications
15
service
originates,
terminates,
or
passes
through
and
16
shall
in
all
other
respects
be
taxed
in
conformity
with
17
the
federal
Mobile
Telecommunications
Sourcing
Act.
All
18
other
provisions
of
the
federal
Mobile
Telecommunications
19
Sourcing
Act
are
adopted
by
the
state
of
Iowa
and
incorporated
20
into
this
subsection
by
reference.
With
respect
to
mobile
21
telecommunications
service
under
the
federal
Mobile
22
Telecommunications
Sourcing
Act,
the
director
shall,
if
23
requested,
enter
into
agreements
consistent
with
the
provisions
24
of
the
federal
Act.
25
Sec.
8.
Section
423.2,
subsection
10,
paragraph
a,
Code
26
2022,
is
amended
to
read
as
follows:
27
a.
A
tax
of
six
percent
at
the
rate
specified
in
subsection
28
12
is
imposed
on
the
sales
price
of
specified
digital
products
29
sold
at
retail
in
the
state.
The
tax
applies
whether
the
30
purchaser
obtains
permanent
use
or
less
than
permanent
use
of
31
the
specified
digital
product,
whether
the
sale
is
conditioned
32
or
not
conditioned
upon
continued
payment
from
the
purchaser,
33
and
whether
the
sale
is
on
a
subscription
basis
or
is
not
on
a
34
subscription
basis.
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Sec.
9.
Section
423.2,
subsection
12,
Code
2022,
is
amended
1
by
striking
the
subsection
and
inserting
in
lieu
thereof
the
2
following:
3
12.
a.
For
the
period
beginning
January
1,
2023,
and
ending
4
December
31,
2023,
the
sales
tax
rate
is
six
and
one-eighth
5
percent.
6
b.
For
the
period
beginning
January
1,
2024,
and
ending
7
December
31,
2024,
the
sales
tax
rate
is
six
and
one-fourth
8
percent.
9
c.
For
the
period
beginning
January
1,
2025,
and
ending
10
December
31,
2050,
the
sales
tax
rate
is
six
and
three-eighths
11
percent.
12
d.
Beginning
January
1,
2051,
the
sales
tax
rate
is
five
and
13
three-eighths
percent.
14
Sec.
10.
Section
423.2A,
subsection
2,
Code
2022,
is
amended
15
by
adding
the
following
new
paragraph:
16
NEW
PARAGRAPH
.
0b.
(1)
Transfer
the
applicable
percentage
17
as
specified
in
this
paragraph
of
the
remaining
revenues
to
the
18
secure
an
advanced
vision
and
education
fund
created
in
section
19
423F.2,
as
follows:
20
(a)
For
the
period
beginning
January
1,
2023,
and
ending
21
December
31,
2023,
the
applicable
percentage
is
sixteen
and
22
three
thousand
two
hundred
sixty-five
ten-thousandths
percent.
23
(b)
For
the
period
beginning
January
1,
2024,
and
ending
24
December
31,
2024,
the
applicable
percentage
is
sixteen
25
percent.
26
(c)
For
the
period
beginning
January
1,
2025,
and
ending
27
December
31,
2050,
the
applicable
percentage
is
fifteen
and
six
28
thousand
eight
hundred
sixty-three
ten-thousandths
percent.
29
(2)
This
paragraph
is
repealed
on
January
1,
2051.
30
Sec.
11.
Section
423.2A,
subsection
2,
paragraphs
b,
c,
and
31
d,
Code
2022,
are
amended
to
read
as
follows:
32
b.
Transfer
from
the
remaining
revenues
the
amounts
required
33
under
Article
VII,
section
10,
of
the
Constitution
of
the
State
34
of
Iowa
to
the
natural
resources
and
outdoor
recreation
trust
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fund
created
in
section
461.31
,
if
applicable
.
1
c.
Transfer
one-sixth
of
the
remaining
revenues
to
the
2
secure
an
advanced
vision
for
education
fund
created
in
section
3
423F.2
.
This
paragraph
“c”
is
repealed
January
1,
2051.
4
d.
Transfer
to
the
baseball
and
softball
complex
sales
tax
5
rebate
fund
that
portion
of
the
sales
tax
receipts
described
6
in
subsection
1
,
paragraph
“b”
,
remaining
after
the
transfers
7
required
under
paragraphs
“a”
,
“0b”
,
and
“b”
,
and
“c”
of
this
8
subsection
2
.
This
paragraph
is
repealed
thirty
days
following
9
the
date
on
which
five
million
dollars
in
total
rebates
have
10
been
provided
under
section
423.4,
subsection
10
.
11
Sec.
12.
Section
423.5,
subsection
1,
unnumbered
paragraph
12
1,
Code
2022,
is
amended
to
read
as
follows:
13
Except
as
provided
in
paragraph
“b”
,
an
excise
tax
at
the
14
rate
of
six
percent
specified
in
subsection
4
of
the
purchase
15
price
or
installed
purchase
price
is
imposed
on
the
following:
16
Sec.
13.
Section
423.5,
subsection
4,
Code
2022,
is
amended
17
by
striking
the
subsection
and
inserting
in
lieu
thereof
the
18
following:
19
4.
a.
For
the
period
beginning
January
1,
2023,
and
ending
20
December
31,
2023,
the
use
tax
rate
is
six
and
one-eighth
21
percent.
22
b.
For
the
period
beginning
January
1,
2024,
and
ending
23
December
31,
2024,
the
use
tax
rate
is
six
and
one-fourth
24
percent.
25
c.
For
the
period
beginning
January
1,
2025,
and
ending
26
December
31,
2050,
the
use
tax
rate
is
six
and
three-eighths
27
percent.
28
d.
Beginning
January
1,
2051,
the
use
tax
rate
is
five
and
29
three-eighths
percent.
30
Sec.
14.
Section
423.43,
subsection
1,
paragraph
b,
Code
31
2022,
is
amended
to
read
as
follows:
32
b.
Subsequent
to
the
deposit
into
the
general
fund
of
the
33
state
and
after
the
transfer
of
such
pursuant
to
paragraph
“a”
,
34
the
department
shall
do
the
following
in
the
order
prescribed:
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(1)
Transfer
the
revenues
collected
under
chapter
423B
,
the
1
department
shall
transfer
one-sixth
.
2
(2)
(a)
Transfer
the
applicable
percentage
as
specified
3
in
subparagraph
division
(b)
of
such
remaining
revenues
to
the
4
secure
an
advanced
vision
for
education
fund
created
in
section
5
423F.2
.
6
(b)
(i)
For
the
period
beginning
January
1,
2023,
and
7
ending
December
31,
2023,
the
applicable
percentage
is
sixteen
8
and
three
thousand
two
hundred
sixty-five
ten-thousandths
9
percent.
10
(ii)
For
the
period
beginning
January
1,
2024,
and
ending
11
December
31,
2024,
the
applicable
percentage
is
sixteen
12
percent.
13
(iii)
For
the
period
beginning
January
1,
2025,
and
ending
14
December
31,
2050,
the
applicable
percentage
is
fifteen
and
six
15
thousand
eight
hundred
sixty-three
ten-thousandths
percent.
16
(c)
This
paragraph
subparagraph
(2)
is
repealed
January
1,
17
2051.
18
Sec.
15.
PURPOSE.
The
purpose
of
this
division
of
this
Act
19
is
to
provide
for
the
implementation
of
Article
VII,
section
20
10,
of
the
Constitution
of
the
State
of
Iowa
by
fully
funding
21
the
natural
resources
and
outdoor
recreation
trust
fund
as
22
created
in
section
461.31,
pursuant
to
Article
VII,
section
10,
23
of
the
Constitution
of
the
State
of
Iowa.
24
Sec.
16.
EFFECTIVE
DATE.
This
division
of
this
Act
takes
25
effect
January
1,
2023.
26
DIVISION
II
27
NATURAL
RESOURCES
AND
OUTDOOR
RECREATION
28
Sec.
17.
Section
461.2,
Code
2022,
is
amended
by
adding
the
29
following
new
subsection:
30
NEW
SUBSECTION
.
3A.
“Iowa
nutrient
reduction
strategy”
31
means
the
latest
version
of
the
Iowa
nutrient
reduction
32
strategy
initially
presented
in
November
2012
by
the
department
33
of
agriculture
and
land
stewardship,
the
department
of
natural
34
resources,
and
Iowa
state
university
of
science
and
technology.
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Sec.
18.
NEW
SECTION
.
461.12
Conditions
on
appropriations.
1
Appropriations
of
trust
fund
moneys
from
the
trust
fund
2
to
the
department
of
natural
resources,
the
department
of
3
agriculture
and
land
stewardship,
the
Iowa
finance
authority,
4
the
economic
development
authority,
or
any
other
public
or
5
private
entity
or
person,
for
any
initiative
related
to
the
6
Iowa
nutrient
reduction
strategy
or
for
any
other
water
quality
7
or
flood
mitigation
initiative,
shall
be
made
subject
to
8
satisfaction
of
all
of
the
following
conditions:
9
1.
The
Iowa
nutrient
reduction
strategy
is
updated
to
10
include
the
interim
goals
and
timelines
of
the
gulf
hypoxia
11
Mississippi
river
task
force
that
call
for
a
twenty
percent
12
reduction
in
nitrates
and
phosphorus
by
calendar
year
2025.
13
2.
Each
initiative
shall
require
a
comprehensive
14
watershed-based
assessment
and
planning
process
open
to
all
15
landowners
and
other
stakeholders,
with
an
absolute
preference
16
for
initiatives
recommended
or
conducted
by,
or
included
in
17
the
plans
of,
a
watershed
management
authority,
with
financial
18
participation
by
local
participants
based
on
principles
adopted
19
according
to
the
Iowa
smart
planning
principles
in
chapter
18B.
20
3.
Funding
preference
shall
be
given
for
initiatives
that
21
achieve
one
or
more
benefits
in
addition
to
nutrient
reduction,
22
including
but
not
limited
to
soil
health,
erosion
prevention,
23
flood
mitigation,
reductions
in
other
pollutants,
wildlife
24
habitat
creation
or
preservation,
and
public
recreational
25
access.
Trust
funds
shall
not
be
used
for
initiatives
that
are
26
solely
demonstration
projects
or
initiatives
under
the
Iowa
27
nutrient
reduction
strategy.
28
4.
The
initiative
establishes
specific
benchmarks,
29
priorities,
goals,
timelines,
and
milestones,
including
30
regular
ambient
water
quality
measurements
for
the
initiative,
31
which
are
consistent
with
the
goals
and
timelines
of
the
Iowa
32
nutrient
reduction
strategy,
including
but
not
limited
to
the
33
changes
required
in
subsection
1.
34
5.
The
initiative
has
its
performance
evaluated
by
a
35
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competent
and
independent
third-party
entity
at
least
once
1
every
two
years
starting
from
the
beginning
of
the
initiative
2
and
again
at
the
conclusion
of
the
initiative.
3
6.
The
initiative
publicly
reports
participation,
progress,
4
and
results
at
least
once
every
two
years,
which
reports
shall
5
include,
at
a
minimum,
measured
changes
in
water
quality.
6
7.
The
initiative
shall
require,
at
a
minimum,
at
least
7
a
fifty
percent
cost
share
from
landowners
or
other
private
8
entities
or
persons
for
improvements
to
private
property,
9
including
both
installation
and
maintenance,
and
including
10
regular
maintenance
in
accordance
with
public
easements
for
a
11
minimum
of
twenty
years.
Any
public
moneys
appropriated
for
12
improvements
that
are
not
maintained
or
that
are
removed
shall
13
be
returned
to
the
trust
fund.
14
EXPLANATION
15
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
16
the
explanation’s
substance
by
the
members
of
the
general
assembly.
17
This
bill
relates
to
water
quality
by
increasing
the
sales
18
and
use
tax
rates
and
conditioning
the
use
of
moneys
from
the
19
natural
resources
and
outdoor
recreation
trust
fund.
20
DIVISION
I
——
SALES
AND
USE
TAXES.
Division
I
of
the
bill
21
relates
to
state
sales
and
use
taxes
and
to
an
amendment
to
22
the
Iowa
Constitution
ratified
on
November
2,
2010,
which
23
created
a
natural
resources
and
outdoor
recreation
trust
fund
24
(fund)
and
dedicated
a
portion
of
state
revenues
to
the
fund
25
for
the
purposes
of
protecting
and
enhancing
water
quality
and
26
natural
areas
in
the
state
including
parks,
trails,
and
fish
27
and
wildlife
habitat,
and
conserving
agricultural
soils
in
28
the
state
(Article
VII,
section
10).
The
fund
is
codified
in
29
Code
section
461.31.
Pursuant
to
the
amendment,
the
amount
30
credited
to
the
fund
will
be
equal
to
the
amount
generated
31
by
an
increase
in
the
state
sales
tax
rate
occurring
after
32
the
effective
date
of
the
constitutional
amendment,
but
shall
33
not
exceed
the
amount
that
a
state
sales
tax
rate
of
0.375
34
percent
would
generate.
The
state
sales
tax
rate
has
not
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been
increased
since
the
effective
date
of
the
constitutional
1
amendment,
so
no
amounts
have
been
credited
to
the
fund.
The
2
division
increases
the
sales
tax
rate
and
the
use
tax
rate
3
from
6
percent
to
6.125
percent
on
January
1,
2023,
from
6.125
4
percent
to
6.25
percent
on
January
1,
2024,
and
from
6.25
5
percent
to
6.375
percent
on
January
1,
2025.
The
division
also
6
amends
the
transfer
of
sales
and
use
tax
revenues
to
the
secure
7
an
advanced
vision
for
education
fund
(SAVE)
in
Code
section
8
423F.2
to
ensure
that
SAVE
receives
approximately
the
same
9
proportion
of
the
total
sales
and
use
tax
revenue
as
it
did
10
prior
to
the
use
tax
rate
increases
provided
in
the
division.
11
The
division
takes
effect
January
1,
2023.
12
DIVISION
II
——
NATURAL
RESOURCES
AND
OUTDOOR
RECREATION.
13
Division
II
relates
to
the
natural
resources
and
outdoor
14
recreation
trust
fund
codified
in
Code
chapter
461.
The
15
division
defines
“Iowa
nutrient
reduction
strategy”
for
16
purposes
of
Code
chapter
461.
The
division
also
prescribes
17
numerous
conditions
that
must
be
satisfied
in
order
for
18
an
appropriation
of
trust
fund
moneys
to
be
made
from
the
19
trust
fund
to
any
public
or
private
entity
or
person
for
an
20
initiative
related
to
the
Iowa
nutrient
reduction
strategy,
21
or
for
another
similar
water
quality
or
flood
mitigation
22
initiative.
The
conditions
require
that
the
Iowa
nutrient
23
reduction
strategy
be
updated
to
include
certain
goals
and
24
timelines
of
the
gulf
hypoxia
Mississippi
river
task
force,
and
25
in
general
require
initiatives
to
engage
in
or
include
certain
26
assessments,
goals,
measurements,
evaluations,
or
reports
as
27
described
in
the
division,
and
establishes
certain
funding
28
preferences
and
cost-share
requirements
as
described
in
the
29
division.
The
conditions
also
prohibit
trust
fund
moneys
30
from
being
used
for
initiatives
that
are
solely
demonstration
31
projects,
and
requires
the
repayment
of
certain
public
moneys
32
appropriated
for
improvements
to
private
property
if
the
33
improvements
are
not
maintained
or
are
removed.
34
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