Summary — SF 659 (Chapter 159, 2025)
Status and purpose
- Enacted as Chapter 159 (signed by Governor Kim Reynolds on June 11, 2025).
- Introduced May 14, 2025; amendment S‑3195 adopted in committee; passed Senate (28–11) and House (78–3).
- Omnibus state government and finance bill that (1) adjusts FY 2025–2026 appropriations and expenditure authority, and (2) makes numerous policy and corrective changes across state programs. The bill’s title lists many subjects included in the act (psilocybin, medical residency positions, reinsurance association membership, school employee student‑abuse rules, wagering taxes, 911 services, and more); text excerpts below highlight principal fiscal and corrective provisions that are explicit in the reprinted/enrolled version.
Key fiscal and appropriation provisions (FY 2025–2026)
- Nonpublic school pupil transportation: Limits the standing appropriation for payment of claims under Iowa Code §285.2 to $8,997,091 for FY 2025–2026. If approved claims exceed this amount, reimbursements must be prorated by the Department of Education.
- Instructional Support State Aid: The appropriation for instructional support state aid under §257.20 is set to zero for FY 2025–2026 (i.e., no state appropriation for that program in that fiscal year).
- Salary adjustments: Authorizes the Department of Management to fund otherwise‑provided salary adjustments using unappropriated moneys remaining in various revolving/trust/special funds (commerce revolving, gaming funds, primary road fund, road use tax fund, fish & game protection fund, IPERS fund, and other departmental special funds) subject to constitutional limits.
- Use of Economic Emergency Fund excess: Directs $21,881,303 of excess moneys transferred to the General Fund (per §8.55) to be used in lieu of other General Fund dollars to pay foundation aid under chapter 257 for FY 2025–2026.
- State aid reductions for K–12: Amends §257.35 to (a) reduce amounts for school districts and Area Education Agencies (AEAs) by $7,500,000 (proportionally) beginning with the FY that started July 1, 2024/2025; and (b) add a new reduction of $25,000,000 to the state aid portion of amounts specified in §257.10(7) for FY 2025–2026 (also prorated by district). Together these reductions total $32.5 million in aggregate reductions allocated proportionally across districts.
- Payments to AEAs for nonpublic school services: Authorizes the Director of the Department of Management to deduct from state aid due to each district amounts attributable to nonpublic‑school students for media and educational services and pay those amounts to the respective AEAs monthly (Sept. 15–June 15) to fund services to students attending nonpublic schools.
Corrective and policy provisions (examples)
- STORM Act fund language (Iowa Code §29D.4): Corrects language describing permitted uses of moneys in the STORM Act fund and clarifies they are not part of the General Fund for purposes of inclusion in general fund balance calculations.
- Investigational drugs/expanded access (§144E.3): Clarifies manufacturer and eligible facility rights; explicitly allows manufacturers/eligible facilities to provide investigational drugs or individualized investigational treatments without compensation or to require eligible patients to pay costs of manufacture, resolving prior cross‑references and compliance language.
- The enrolled bill (and title) also covers additional policy topics (crystalline polymorph psilocybin; medical residency and fellowship positions; state membership in the Iowa Individual Health Benefit Reinsurance Association; student abuse by school employees; wagering taxes; state fire marshal study; legislative interim studies; 911 emergency communications). The provided excerpt does not show full text for all of these topics; they are referenced in the bill title and likely addressed in other divisions/sections of the act.
Who is affected
- Public K–12 school districts and Area Education Agencies (state aid reductions, deductions for nonpublic services, prorated reimbursements for nonpublic transportation).
- Nonpublic (private) school pupils (transportation reimbursement limits; AEA service funding).
- State departments (Department of Management, Department of Education, Department administering STORM loans).
- Employers and employees statewide to the extent salary adjustments are funded from special funds rather than the General Fund.
- Manufacturers and facilities involved in investigational drug access.
- State fiscal position—uses Economic Emergency Fund excess for foundation aid rather than other General Fund moneys.
Procedural/timing notes
- Effective as enacted (Chapter 159) with various sections specifying FY 2025–2026 impacts (fiscal year July 1, 2025–June 30, 2026). Some provisions reference prior fiscal years or corrective retroactive applicability in statutory cross‑references; text indicates inclusion of effective date, applicability, and retroactive applicability provisions although full details for each provision are in the full enrolled act.
For more detail
- The enrolled bill (Chapter 159) should be consulted for the full text of each division/section, as the excerpted document focuses on key appropriation and corrective changes; the act contains additional policy measures across multiple subject areas.
