1. Legislative Developments from the 2014 Iowa Legislative Session Marc Beltrame BrownWinick 666 Grand Avenue, Suite 2000 Des Moines, IA 50309-2510 Telephone: 515-242-2449 (direct) Telephone: 515-229-9134 (cell) Facsimile: 515-323-8549 E-mail: beltrame@brownwinick.com

2. Political Considerations Iowa Senate: 26 (Democrats) 24 (Republicans) Iowa House: 53 (Republicans) 47 (Democrats) Governor Terry Branstad (Republican) 2014 = Election Year

3. 2013 Review “Major Activity” 1.Historic commercial property tax reform legislation. 2.Education reform. 3.Medicaid reform. Result: A.$1 billion surplus spent. B.Appetite for major action in 2014 limited.

4. 2014 Overview Major Accomplishments of Session Major Disappointments Tax Litigation Agriculture/Environmental

5. Major Accomplishments Tuition Freeze (2 nd straight year) Medical Cannabis Oil Drone Regulation Greyhound Racing Paddlefishing Crossbows Uniform Power of Attorney Act

6. Major Disappointments Gas tax increase Broadband expansion Texting while driving Fantasy sports authorization Easier power transmission line permitting Sales tax increase for outdoor trust fund

7. Tax Section 42: Low Income Housing (HF 2466) 1.Removes IRC Section 42 assessment procedures when property is no longer eligible for that tax treatment. 2.Allows property owner to make a one-time and irrevocable election to withdraw eligible property from IRC Section 42 assessment. 3.Passed.

8. Tax (cont.) Military Veterans (SF 303) 1.Exempts military pensions from state income tax (surviving spouses included in exemption). 2.Part of “Home Base Iowa” proposal to recruit veterans from other states to Iowa. 3.Passed.

9. Litigation Pitts v. Farm Bureau Fix (Passed) 1.Insurance agents not in business of supplying information. 2.Insurance agents have no duty to change beneficiary unless in writing. 3.Insurance agents owe duties only to policy holder or person in privity of contract.

10. Litigation (cont.) Statute of Repose (HF 2094) 1.Would have amended Iowa Code Section 614 concerning the repose period for improvements to real property. a. Residential: would remain at 15 years. b. Commercial: would be reduced to 10 years. 2. Passed House. Not taken up in Senate. Did not become law.

11. Litigation (cont.) Wage Payment Collection Act (SF 2295) 1.Makes violation strict liability (removes intent requirement). 2.Expands retaliatory action to persons other than employees (so-called “whistleblower”). 3. Creates a rebuttable presumption that employer did not pay required minimum wage if records are not kept properly by employer. 4.Passed Senate but did not become law.

12. Agriculture/Environmental Native Prairie and Wetlands (SF 2017) 1.Specifies that payments received by an owner of real property under the federal wetlands program shall not be considered a use of the property for economic gain. 2.Some county assessors are considering the federal money as economic gain and taxing the land as agriculture. 3.Did not become law.

13. Agriculture/Environmental (cont.) Record Funding 1.REAP: $25 million for first time in history of program (25 th anniversary). 2.Lake/River Restoration: $9.6 million for lakes; $2 million for rivers (both record amounts).

14. Website: www.brownwinick.comwww.brownwinick.com Toll Free Phone Number: 1-888-282-3515 OFFICE LOCATIONS: 666 Grand Avenue, Suite 2000 Des Moines, Iowa 50309-2510 Telephone: (515) 242-2400 Facsimile: (515) 283-0231 616 Franklin Place Pella, Iowa 50219 Telephone: (641) 628-4513 Facsimile: (641) 628-8494 DISCLAIMER: No oral or written statement made by BrownWinick attorneys should be interpreted by the recipient as suggesting a need to obtain legal counsel from BrownWinick or any other firm, nor as suggesting a need to take legal action. Do not attempt to solve individual problems upon the basis of general information provided by any BrownWinick attorney, as slight changes in fact situations may cause a material change in legal result.