State Government – week of Feb. 9, 2015

SSB 1060 – Regulation of Certified Public Accountants

SSB 1064 – Campaign Finance – Independent Expenditures

SSB 1125– Definition of Beer

SSB 1126– 411 Pension System

SSB 1135– Fireworks

COMMITTEE ACTION:

SSB 1060 effects the regulation of accountants in Iowa. A Certified Public Accountant (CPA) is exempt from the requirements listed under the private investigative agencies and security agents Code chapter. The definition of report is amended to include references to attested information. Conforming changes are made to the Code provision addressing permits for accounting firms that perform attest services. The reference to “financial statement” is replaced with “information” in the Code provision providing that the unlawful acts section of Code 542 does not apply to certain holders of licenses granted by foreign countries.

The Code provision requiring a holder or applicant of a CPA firm permit, which is required for accounting firms that perform attest services in the state, to notify the Iowa accountancy examining board within 30 days of a change in the identity of a partner, officer, shareholder, member or manager who performs professional services in Iowa is eliminated. Currently, CPA accounting firms are allowed to include nonlicensee owners with some requirements. SSB 1060 allows CPA accounting firms organized as professional corporations or professional limited liability companies to include a nonlicensee owner as long as the firm meets the current requirements and rules established by the Iowa Accountancy Examining Board. [2/9: 15-0]

SSB 1064 is proposed by the Iowa Ethics and Campaign Disclosure Board, and is in response to the Eighth Circuit Court decision striking down parts of Iowa’s independent expenditure law. SSB 1064 eliminates ongoing and supplemental reporting for those making independent expenditures, leaving only event-driven reporting of independent expenditures. SSB 1064 also eliminates the “termination report” for those making independent expenditures. SSB 1064 requires a “person” instead of an “entity” to obtain authorization from its board of directors before making independent expenditures. It strikes “of the corporation” from the certification requirement so that all “persons” who have to obtain authorization from their board of directors to make independent expenditures also have to certify to the Ethics Board on the event-driven independent expenditure statements that they have obtained authorization. [2/9: 15-0]

SSB 1125 amends 123A of the Iowa Code, which deals with beer brewers and wholesalers. SSB 1125 defines “beer” for purposes of Code chapter 123A as beer or high alcoholic content beer as defined in Code chapter 123. The current definition of beer in Code chapter 123A does not include high alcoholic content beer. High alcohol content beer has more than 5 percent alcohol by weight or 6.25 percent alcohol by volume, but not more than 12 percent alcohol by weight or 15 percent alcohol by volume. Currently, high alcoholic content beer is not defined in 123A. The two chapters will now have consistent definitions. [2/9: 15-0]

SSB 1126 establishes an annual general fund appropriation to the Statewide Fire and Police Retirement System (411 Pension System). The annual appropriation is equal to 3.79 percent of the covered earnable compensation to the members. The 66th General Assembly had originally established this cost of benefits. The state appropriation was repealed by the Legislature in 2010. SSB 1126 appropriates $9.8 million during the current fiscal year (FY15), and is effective upon enactment. [2/9: 11-3-1 (Chapman, Schultz, Whitver “no”; Dvorsky “pass”)]

SSB 1135 allows the possession, sale, transfer purchase and use of fireworks in Iowa. Highlights include:

• The state fire marshal is required to establish a consumer fireworks seller license. The state fire marshal is required to adopt rules, establishing minimum requirements for a retailer or community group to be issued a consumer fireworks seller license.
• A person is required to possess a consumer fireworks seller license to sell consumer fireworks.
• The state fire marshal is required to establish a fee schedule for consumer fireworks seller licenses as follows:
  • An annual fee of $400 for any retailer who devotes 50 percent or more of the retail floor space to the sale or display of first-class consumer fireworks.
  • An annual fee of $200 for any retailer who devotes less than 50 percent of retailer’s retail floor space to the sale or display of first-class consumer fireworks.
  • An annual fee of $200 for any community group that offers for sale, exposes for sale or sells first-class consumer fireworks.
  • An annual fee of $25 for any retailer or community group that offers for sale, exposes for sale or sells second-class consumer fireworks, but not first-class consumer fireworks.
  • A license issued to a retailer or community group shall allow the licensee to sell both first-class consumer and second-class consumer fireworks.
• The State fire marshal shall adopt rules to:
  • Require that any retailer or community group selling consumer fireworks at retail, do so in accordance with national fire protection association standard 1124, published in the code for the manufacture, transportation, storage, and retail sales of fireworks and pyrotechnic articles, 2006 addition.
  • Require a licensed retailer or community group to provide proof of and maintain public liability insurance and product liability insurance with a minimum per occurrence coverage of at least $5 million.
  • Permit a licensed retailer or community group to sell consumer fireworks at these locations:
    • A permanent building that meets the requirements year-round.
    • A temporary structure that meets the requirements from June 13 through July 11 each year.
  • A retailer or community group shall not transfer consumer fireworks to a person under 18.
• The state fire marshal is required to adopt rules providing that a person’s license may be revoked for the intentional violation of this section. Revocation proceedings are before the state fire marshal. The license holder may seek judicial review. If a petition for judicial review is not filed, revocation begins the 31st day following the date of the state fire marshal’s order. If a petition for judicial review is filed, revocation shall be from the 31st day following entry of the order of the district court, if the court action is adverse to the licensee.
• A new license shall not be issued to a person whose license has been revoked, or to the business in control of the premises where the violation occurred if it is established that the owner of the business had actual knowledge of the violation resulting in the license revocation, for one year following the date of revocation.
• Establishes a consumer fireworks seller license fee fund under the control of the fire marshal. The fund retains interest earned. Moneys from the fund are appropriated to the state fire marshal to be used to fulfill its functions in this act and to provide grants.
• The state fire marshal is required to establish a local fire protection and emergency medical service providers grant program to provide grants to local fire protection service providers and local emergency medical service providers to provide fireworks safety education programming to the public. The grants may also be for the purchase of necessary enforcement, protection or emergency response equipment related to the sale and use of consumer fireworks in Iowa.
• Violation of a provision in this section is a simple misdemeanor.
• Defines first-class consumer fireworks and second-class consumer fireworks.
• County Home Rule – County Supervisors may, by resolution, suspend the use of display fireworks if the Board determines that the use would constitute a threat to public safety. The Board may provide permits for the use of display fireworks.

• Public Lands and Waters – The Natural Resources Commission may grant a permit for the use of consumer fireworks, display fireworks and novelties.

• Display fireworks is defined. Display fireworks do not include novelties or consumer fireworks enumerated in chapter 3 of the American Pyrotechnics Association’s standard 87-1.
• Novelties – includes all novelties enumerated in chapter 3 of the American Pyrotechnics Association’s standard 87-1, and that comply with federal labeling regulations.
• Allows a City Council or a Board of Supervisors to grant a permit for display fireworks.
• A person who uses or explodes display fireworks while the use of such devices is suspended by a county resolution or by the state fire marshal, commits is a simple misdemeanor, punishable for a fine of not less than $250.
• Consumer fireworks and novelties – A person, firm, partnership or corporation that sells consumer fireworks to someone under 18 commits a simple misdemeanor, punishable by a fine of not less than $250. A person under 18 who purchases consumer fireworks commits a simple misdemeanor, punishable by a fine of not less than $250. A person who explodes consumer fireworks or novelties while the use of such devices is suspended by an order of the state fire marshal commits a simple misdemeanor, punishable for a fine of not less than $250.
• Limitations – A person shall not use or explode consumer fireworks at times other than between 9 a.m. and 10 p.m., except than on the following dates when consumer fireworks shall not be used at times other than between 9 a.m. and 12:30 a.m. on the immediately following day:
  • Memorial Day and the Saturday and Sunday immediately preceding that day.
  • July 4 and the Saturdays and Sundays immediately preceding and following July 4.
  • Labor Day and the Saturday and Sunday immediately preceding that day.
  • December 31 and the Saturdays and Sundays immediately preceding and following December 31.
• A person shall not use consumer fireworks on real property other than that person’s real property or on the real property of a person who has consented to the use of consumer fireworks on that property.
• A person who violates this subsection commits a simple misdemeanor punishable by a fine of not less than $50 and not more than $500.
• Applicability – This section does not prohibit the sale by a resident, dealer, manufacturer or jobber of such fireworks as are not prohibited by this section, or the sale of any kind of fireworks if they are to be shipped out of Iowa, or the sale or use of blank cartridges for a show or the theater, or for signal purposes in athletic sports or by railroads or trucks, for signal purposes, or by a recognized military organization.
• This section does not apply to any substance of composition prepared and sold for medicinal or fumigation purposes.
• Unless specifically provided otherwise, this section does not apply to novelties.

• Effective date is June 1, 2015. [2/9: 9-4-1 (Danielson, Bowman, Horn, Schoenjahn, Bertrand, Feenstra, Chapman, Schultz, Whitver “yes”; Dearden, Johnson, Courtney, Dvorsky “no”; McCoy “pass”; Petersen excused)]