Bill Text: IA HF249 | 2015-2016 | 86th General Assembly | Introduced
Bill Title: A bill for an act relating to the establishment, operation, and dissolution of rural improvement zones. (See Cmte. Bill HF 557) (See Cmte. Bill HF 615)
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2015-04-07 - Withdrawn. H.J. 766. [HF249 Detail]
Download: Iowa-2015-HF249-Introduced.html
House File 249 - Introduced HOUSE FILE BY BAUDLER A BILL FOR 1 An Act relating to the establishment, operation, and 2 dissolution of rural improvement zones. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: TLSB 1257YH (7) 86 md/sc PAG LIN 1 1 Section 1. Section 357H.1, subsection 1, Code 2015, is 1 2 amended to read as follows: 1 3 1. The board of supervisors of a county with less than 1 4 twenty thousand residents, not counting persons admitted or 1 5 committed to an institution enumerated in section 218.1 or 1 6 904.102, based upon the2000most recent certified federal 1 7 census, and with a private lake development shall designate an 1 8 area surrounding the lake, if it is an unincorporated area of 1 9 the county, a rural improvement zone upon receipt of a petition 1 10 pursuant to section 357H.2, and upon the board's determination 1 11 that the area is in need of improvements. 1 12 Sec. 2. Section 357H.1, subsection 2, paragraph b, Code 1 13 2015, is amended to read as follows: 1 14 b. "Improvements" means dredging, installation of erosion 1 15 control and water quality measures, land acquisition, and 1 16 related improvements, including soil conservation practices, 1 17 within or outside of the boundaries of the zone. 1 18 Sec. 3. Section 357H.1, subsection 2, Code 2015, is amended 1 19 by adding the following new paragraph: 1 20 NEW PARAGRAPH. c. "Lake" means a body of water that has a 1 21 surface area of at least eighty acres. 1 22 Sec. 4. Section 357H.2, subsection 1, paragraph a, Code 1 23 2015, is amended to read as follows: 1 24 a. The need for the proposed zone., which shall be based 1 25 upon a report of a licensed professional engineer prepared not 1 26 more than two years before the date the petition is filed, and 1 27 that includes all of the following: 1 28 (1) Surface area of the lake in acres. 1 29 (2) Number of acres of land comprising the lake's watershed. 1 30 (3) Soil classification of the land comprising the lake's 1 31 watershed. 1 32 (4) Description of all current land uses within the lake's 1 33 watershed. 1 34 (5) Estimate of historical annual silt accumulation for the 1 35 lake during the twenty years immediately preceding the year in 2 1 which the engineer's report was completed. 2 2 (6) Estimate of the amount of silt currently accumulated in 2 3 the lake. 2 4 (7) Estimates of annual silt accumulation in the lake for 2 5 the twenty=year period following establishment of the rural 2 6 improvement zone. 2 7 (8) Estimate of remaining space available to the proposed 2 8 zone in existing detention basins for storage of dredged and 2 9 removed silt. 2 10 (9) Estimate of storage space that will be required to store 2 11 dredged and removed silt from the lake for the twenty=year 2 12 period following establishment of the rural improvement zone. 2 13 (10) Assessment of the current water quality of the lake. 2 14 (11) Assessment of the current need for preventative 2 15 practices to improve the water quality of the lake. 2 16 (12) Assessment of the impact preventative practices will 2 17 have on the water quality of the lake. 2 18 (13) Estimate of the cost to effectively address erosion 2 19 control and water quality for the twenty=year period following 2 20 establishment of the rural improvement zone. 2 21 Sec. 5. Section 357H.2, Code 2015, is amended by adding the 2 22 following new subsection: 2 23 NEW SUBSECTION. 1A. A copy of the report prepared by the 2 24 licensed professional engineer and used to prepare the petition 2 25 shall be submitted with the petition under this section. 2 26 Sec. 6. Section 357H.3, Code 2015, is amended to read as 2 27 follows: 2 28 357H.3 Time of public hearing. 2 29 1.TheIf the petition substantially meets the requirements 2 30 of section 357H.2, the public hearing required in section 2 31 357H.2 shall be held withinthirtysixty days of the 2 32 presentation of the petition. Notice of hearing shall be given 2 33 by publication as provided in section 331.305. 2 34 2. If the board determines that the petition or the 2 35 engineer's report does not substantially meet the requirements 3 1 of section 357H.2, the board may, within thirty days of 3 2 presentation of the petition, request additional information 3 3 from the petitioners. The board's request for additional 3 4 information shall be limited to the information required under 3 5 section 357H.2 that was not contained in the petition or the 3 6 accompanying engineer's report. The board shall be limited to 3 7 one request for additional information under this section. The 3 8 public hearing required in section 357H.2 shall be held within 3 9 sixty days of receiving the additional information. Notice of 3 10 hearing shall be given in the same manner as required under 3 11 subsection 1. 3 12 Sec. 7. Section 357H.4, Code 2015, is amended to read as 3 13 follows: 3 14 357H.4 Hearing on petition == action by board. 3 15 1. At the public hearingrequired in section 357H.3,3 16 the board may consider the boundaries of a proposed rural 3 17 improvement zone, whether the boundaries shall be as described 3 18 in the petition or otherwise, and for that purpose may amend 3 19 the petition and change the boundaries of the proposed zone as 3 20 stated in the petition. The board may adjust the boundaries 3 21 of a proposed zone as needed to exclude land that has no 3 22 reasonable likelihood of benefit from inclusion in a rural 3 23 improvement zone. However, the boundaries of a proposed zone 3 24 shall not be changed to incorporate property which is not 3 25 included in the original petition. 3 26 2. Within ten days after the hearing, the board shall 3 27 establish the rural improvement zone by resolution or disallow 3 28 the petition. However, the zone shall not include any area 3 29 which is part of an urban renewal area under chapter 403. 3 30 Sec. 8. Section 357H.8, subsection 2, Code 2015, is amended 3 31 to read as follows: 3 32 2. Certificates may be issued with respect to a single 3 33 improvement project or multiple projects and may contain 3 34 terms or conditions as the board of trustees may provide by 3 35 resolution authorizing the issuance of the certificates. 4 1 However, certificates, including certificates to refund 4 2 outstanding certificates under subsection 3, shall not 4 3 be issuedafter January 1, 2007, except to refund other 4 4 certificates as provided in subsection 3if the maturity 4 5 date of the certificates would be after the date the rural 4 6 improvement zone is, at the time of issuing the certificates, 4 7 to be dissolved by law under section 357H.10. 4 8 Sec. 9. Section 357H.9, subsection 1, Code 2015, is amended 4 9 to read as follows: 4 10 1. a. The board of trustees shall provide by resolution 4 11 that taxes levied on the taxable property in a rural 4 12 improvement zone each year by or for the benefit of the state, 4 13 city, county, school district, or other taxing district after 4 14 the effective date of the resolution shall be divided as 4 15 provided in section 403.19, subsections 1 and 2, in the same 4 16 manner as if the taxable property in the rural improvement 4 17 zone was taxable property in an urban renewal area and the 4 18 resolution was an ordinance within the meaning of those 4 19 subsections. The taxes received by the board of trustees shall 4 20 be allocated to, and when collected be paid into, a special 4 21 fund and may be irrevocably pledged by the trustees to pay the 4 22 principal of and interest on the certificates, contracts, or 4 23 other obligations approved by the board of trustees to finance 4 24 or refinance, in whole or in part, an improvement project. 4 25 However, for fiscal years beginning on or after July 1, 2016, 4 26 when calculating the amount of taxes subject to the division 4 27 of taxes, if the assessed value of the taxable property in 4 28 the rural improvement zone used to calculate the amount of 4 29 taxes under section 403.19, subsection 1, is less than fifty 4 30 percent of the assessed value of the taxable property in the 4 31 rural improvement zone used to calculate the total amount of 4 32 property taxes in the rural improvement zone for the fiscal 4 33 year in which the taxes are due and payable, the assessed value 4 34 of the taxable property in the rural improvement zone used to 4 35 calculate the amount of taxes under section 403.19, subsection 5 1 1, shall be increased for that fiscal year until the amount is 5 2 equal to fifty percent of the assessed value of the taxable 5 3 property in the rural improvement zone used to calculate the 5 4 total amount of property taxes in the rural improvement zone 5 5 for the fiscal year in which the taxes are due and payable. 5 6 b. For fiscal years beginning on or after July 1, 2016, 5 7 when determining the assessed value of property within a rural 5 8 improvement zone which is subject to a division of tax revenues 5 9 pursuant to section 403.19, the requirement under section 5 10 403.20 that the valuation reductions first be subtracted from 5 11 the assessed value of the property as determined pursuant to 5 12 section 403.19, subsection 1, shall not apply, and percentage 5 13 adjustments certified for that year by the director of revenue 5 14 on or before November 1 pursuant to section 441.21, subsection 5 15 9, shall be applied uniformly, by class of property, to all 5 16 actual value in the rural improvement zone. 5 17 c. As used in this section, "taxes" includes but is not 5 18 limited to all levies on an ad valorem basis upon land or real 5 19 property located in the rural improvement zone. 5 20 Sec. 10. NEW SECTION. 357H.9A Annual financial report == 5 21 audit. 5 22 1. Not later than December 1 of each year on forms and 5 23 pursuant to the instructions prescribed by the department 5 24 of management, the board of trustees shall file with the 5 25 county auditor an annual financial report showing the rural 5 26 improvement zone's financial condition as of June 30 and the 5 27 results of operations for the year then ended. 5 28 2. A rural improvement zone is subject to annual audit by 5 29 the auditor of state. In lieu of an audit by the auditor of 5 30 state, the rural improvement zone may contract with or employ 5 31 a certified public accountant to conduct the audit pursuant 5 32 to the applicable terms and conditions prescribed by sections 5 33 11.6, 11.14, 11.19, and 11.41. The audit format shall be as 5 34 prescribed by the auditor of state. The rural improvement zone 5 35 shall pay all expenses incurred by the auditor of state in 6 1 conducting an audit under this section. 6 2 Sec. 11. Section 357H.10, Code 2015, is amended to read as 6 3 follows: 6 4 357H.10 Dissolution of zone. 6 5 1.ThePrior to the date required for dissolution under 6 6 subsection 2, a rural improvement zoneshallmay be dissolved 6 7 upon the adoption of a resolution of the board of trustees 6 8 which specifies that all improvements have been made in the 6 9 zone, the need for the zone, as identified under section 6 10 357H.2, subsection 1, has been satisfied, and all indebtedness 6 11 has been paid. 6 12 2. a. Unless dissolved by resolution of the board of 6 13 trustees under subsection 1, or an extension is approved under 6 14 paragraph "b", each rural improvement zone is dissolved on June 6 15 30, 2019, or twenty years after the first day of the fiscal 6 16 year following the fiscal year in which the zone first receives 6 17 revenue from the division of taxes under section 357H.9, 6 18 whichever date is later. 6 19 b. The date required under this subsection for dissolution 6 20 of a rural improvement zone may be extended by resolution of 6 21 the board adopted prior to the date required for dissolution 6 22 under paragraph "a" or a date prior to the date to which 6 23 the rural improvement zone was previously extended by the 6 24 board under this paragraph "b" or by operation of law under 6 25 subparagraph (1). Each extension approved by the board under 6 26 this paragraph "b" shall be for a period of twenty years. Prior 6 27 to approval of an extension by the board under this paragraph 6 28 "b", all of the following requirements shall be met: 6 29 (1) Not more than forty=eight months nor less than 6 30 thirty=six months prior to the date required for dissolution, 6 31 the board of trustees shall file a petition with the board 6 32 requesting an extension of the zone's dissolution date that 6 33 complies with the petition requirements under section 357H.2. 6 34 The petition shall state the continued need for the rural 6 35 improvement zone and describe the improvements needed in the 7 1 zone beyond the dissolution date otherwise required under 7 2 this section. The board shall, within ninety days after 7 3 receiving the petition, either adopt a resolution granting the 7 4 twenty=year extension without further proceedings or notify the 7 5 board of trustees in writing of the board's intent to review 7 6 the zone's dissolution date under subparagraphs (2) through 7 7 (4). The board may, as part of its notice to the board of 7 8 trustees, request a report prepared by a licensed professional 7 9 engineer containing all of the information required under 7 10 section 357H.2, subsection 1. If the board fails to either 7 11 approve the extension by resolution or notify the board of 7 12 trustees of the board's intent to review the zone's dissolution 7 13 date under subparagraphs (2) through (4) within the ninety=day 7 14 period, the request for a twenty=year extension shall be deemed 7 15 approved. 7 16 (2) Following receipt of the board's notice of intent 7 17 to review and not less than twenty=four months prior to the 7 18 date required for dissolution, the board of trustees shall, 7 19 if requested by the board, submit to the board a report 7 20 prepared by a licensed professional engineer that includes 7 21 the information required under section 357H.2, subsection 1, 7 22 paragraph "a". If the board determined that the petition or the 7 23 engineer's report does not substantially meet the requirements 7 24 of section 357H.2 or that additional relevant information is 7 25 needed, the board may, within thirty days of the date the 7 26 petition was filed, request additional information from the 7 27 board of trustees. The board shall be limited to one request 7 28 for additional information. 7 29 (3) Not more than sixty days after receiving the engineer's 7 30 report required or the additional information requested under 7 31 subparagraph (2), whichever is later, the board shall hold 7 32 a public hearing to determine the continued need for the 7 33 rural improvement zone. Notice of hearing shall be given by 7 34 publication as provided in section 331.305. 7 35 (4) Within ten days after the public hearing, the board 8 1 shall either find a continued need for the rural improvement 8 2 zone and adopt a resolution approving the twenty=year extension 8 3 or find that the continued operation of the rural improvement 8 4 zone is not necessary and deny the request for an extension. 8 5 If the board fails to either approve or deny the extension 8 6 within the ten=day period, the request for a twenty=year 8 7 extension is deemed approved. 8 8 3. Upon dissolution of the zone, all assets shall be deeded 8 9 or otherwise transferred to a nonprofit corporation whose 8 10 members are property owners of the improvement zone. 8 11 4. Upon dissolution of the zone, the collection of the 8 12 property tax authorized under section 357H.8, subsection 4, and 8 13 the division of taxes authorized under section 357H.9 shall 8 14 cease immediately. 8 15 Sec. 12. NEW SECTION. 357H.11 Agreements. 8 16 Any agreement or other instrument in connection with an 8 17 agreement between a board of trustees and a board in existence 8 18 on July 1, 2015, relating to the division of taxes under 8 19 section 357H.9, the dissolution date of a rural improvement 8 20 zone, or the criteria used for determining the continued 8 21 existence of a rural improvement zone that is inconsistent with 8 22 this chapter shall be null and void. 8 23 EXPLANATION 8 24 The inclusion of this explanation does not constitute agreement with 8 25 the explanation's substance by the members of the general assembly. 8 26 This bill relates to the establishment, operation, and 8 27 dissolution of rural improvement zones under Code chapter 357H. 8 28 Current law provides that the population threshold for 8 29 establishing a rural improvement zone is determined using 8 30 the 2000 certified federal census. The bill changes that 8 31 requirement so that the population is determined using the 8 32 most recent certified federal census. The bill also adds a 8 33 definition of "lake" for purposes of determining eligibility to 8 34 establish a rural improvement zone. The bill defines "lake" 8 35 to mean a body of water that has a surface area of at least 80 9 1 acres. 9 2 The bill adds water quality measures to the definition of 9 3 "improvements". Under Code chapter 357H, the board of trustees 9 4 may authorize construction, reconstruction, or repair of 9 5 improvements for the rural improvement zone. 9 6 The bill provides that as part of the approval process for a 9 7 rural improvement zone, the petition must include a statement 9 8 of the need for the proposed zone based upon a report prepared 9 9 by a licensed professional engineer. The report utilized 9 10 in preparing the petition must have been prepared not more 9 11 than two years before the date the petition is filed. The 9 12 information required to be included in the engineer's report 9 13 relates to the size of the lake, soil classification, silt 9 14 accumulation data and estimates, water quality assessments, 9 15 and cost estimates. The bill requires a copy of the report 9 16 prepared by the licensed professional engineer and used to 9 17 prepare the petition to be submitted with the petition. 9 18 The bill changes the period of time required for holding 9 19 a public hearing on the petition from within 30 days 9 20 of presentation of the petition to within 60 days. In 9 21 addition, the bill provides that if the board of supervisors 9 22 determines that the petition or the engineer's report does 9 23 not substantially meet the statutory requirements, the 9 24 board may, within 30 days of presentation of the petition, 9 25 request additional information from the petitioners. The 9 26 board's request for additional information is limited to the 9 27 statutorily required information that was not contained in the 9 28 petition or in the accompanying engineer's report. The bill 9 29 limits the board to one request for additional information. 9 30 Upon presentation of the additional information, the public 9 31 hearing must be held within 60 days of receiving the additional 9 32 information. 9 33 The bill strikes the provision which prohibited the issuance 9 34 of certificates for the payment of a rural improvement zone's 9 35 improvements and activities after January 1, 2007, and provides 10 1 that such certificates, including certificates to refund 10 2 outstanding certificates, may not be issued if the maturity 10 3 date of the certificates would be after the date the rural 10 4 improvement zone is to be dissolved, as provided by the bill. 10 5 Current Code section 357H.9 authorizes rural improvement 10 6 zones to authorize the use of taxes from a division of taxes 10 7 (tax increment financing). The bill provides that for fiscal 10 8 years beginning on or after July 1, 2016, when calculating 10 9 the amount of taxes subject to the division of taxes, if the 10 10 assessed value of the taxable property in the rural improvement 10 11 zone used to calculate the amount of taxes to be paid to the 10 12 other taxing districts is less than 50 percent of the assessed 10 13 value of the taxable property in the rural improvement zone 10 14 used to calculate the total amount of property taxes in the 10 15 rural improvement zone for the fiscal year in which the taxes 10 16 are due and payable, the assessed value of the taxable property 10 17 in the rural improvement zone used to calculate the amount of 10 18 taxes to be paid to the other taxing districts (base value) 10 19 shall be increased for that fiscal year to an amount equal to 10 20 50 percent of the assessed value of the taxable property in the 10 21 rural improvement zone used to calculate the total amount of 10 22 property taxes in the rural improvement zone for the fiscal 10 23 year in which the taxes are due and payable. 10 24 The bill provides that for fiscal years beginning on or after 10 25 July 1, 2016, when determining the assessed value of property 10 26 within a rural improvement zone that is subject to a division 10 27 of tax revenues, the requirement under Code section 403.20 10 28 that the valuation reductions (rollback) first be subtracted 10 29 from the assessed value of the property as determined pursuant 10 30 to Code section 403.19(1) (base value), does not apply and 10 31 provides that the rollbacks for that year shall instead be 10 32 applied uniformly, by class of property, to all actual value 10 33 in the rural improvement zone. 10 34 The bill provides that not later than December 1 of each 10 35 year the board of trustees of a zone shall file with the 11 1 county auditor an annual financial report showing the rural 11 2 improvement zone's financial condition as of June 30 and the 11 3 results of operations for the year then ended. The bill also 11 4 provides that all rural improvement zones are subject to annual 11 5 audit either by the auditor of state or by a certified public 11 6 accountant contracted with or employed by the rural improvement 11 7 zone to conduct the audit. 11 8 The bill provides that, unless dissolved by resolution of 11 9 the board of trustees, each rural improvement zone is dissolved 11 10 on June 30, 2019, or 20 years from the first day of the fiscal 11 11 year following the fiscal year in which the zone first receives 11 12 revenue from the division of taxes, whichever is later. The 11 13 bill further provides that the date required for dissolution 11 14 may be extended by resolution of the board of supervisors 11 15 adopted prior to the date required for dissolution or prior to 11 16 the date to which the rural improvement zone was previously 11 17 extended by the board of supervisors under the provisions of 11 18 the bill. Each extension shall be for a period of 20 years. 11 19 The bill updates language relating to the disposition of 11 20 property upon dissolution of the zone and specifies that any 11 21 collection of, or division of, property taxes under Code 11 22 chapter 357H ceases immediately upon dissolution of the zone. 11 23 Under the bill, the rural improvement zone's board of 11 24 trustees must file a petition with the board of supervisors 11 25 requesting an extension of the dissolution date. The petition 11 26 must state the continued need for the rural improvement zone 11 27 and describe the improvements needed in the zone beyond the 11 28 dissolution date otherwise required by the bill. Within 90 11 29 days after receiving the petition, the board of supervisors 11 30 must either adopt a resolution granting the 20=year extension 11 31 without further proceedings, or notify the board of trustees in 11 32 writing of the board's intent to review the zone's dissolution 11 33 date. The board may, as part of its notice to the board of 11 34 trustees, request a report prepared by a licensed professional 11 35 engineer. If the board fails to either approve the extension 12 1 by resolution or notify the board of trustees of the board's 12 2 intent to review the zone's dissolution date within the 90=day 12 3 period, the request for a 20=year extension is deemed approved. 12 4 The board of supervisors requests additional information from 12 5 the board of trustees. As part of the board of supervisors' 12 6 further review of the petition, a public hearing must be held 12 7 within the period of time specified in the bill. Within 12 8 10 days after the public hearing, the board of supervisors 12 9 is required to either find a continued need for the rural 12 10 improvement zone and adopt a resolution approving the 20=year 12 11 extension or find that the continued operation of the rural 12 12 improvement zone is not necessary and deny the request for an 12 13 extension. If the board fails to either approve or deny the 12 14 extension within the 10=day period, the request for a 20=year 12 15 extension is deemed approved. 12 16 The bill provides that any agreement or other instrument in 12 17 connection with an agreement between a board of trustees and a 12 18 board in existence on July 1, 2015, relating to the division 12 19 of taxes, the dissolution date of a rural improvement zone, or 12 20 the criteria used for determining the continued existence of 12 21 a rural improvement zone that is inconsistent with this Code 12 22 chapter shall be null and void. LSB 1257YH (7) 86 md/sc
