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HF 2694

A bill for an act relating to the regulation of certain places and activities by the governor.

2025-2026 Regular Session

Establishes a continuing-appropriations framework to fund prior-year line-item and standing appropriations if new annual appropriations aren’t enacted by July 1, with safeguards an

Signed by Governor.
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Bill Summary · HF 2694

Summary of HF 2694 (Session 2025-2026) – Iowa

Purpose and intent

HF 2694 proposes two broad changes:

1) Establishes a framework for continuing appropriations in fiscal years when annual state appropriations are not enacted by July 1. The bill designates a method to continue funding certain line-item, standing limited, and standing unlimited appropriations from the prior year, subject to specific conditions and safeguards.

2) Recasts the title to reflect a broader scope for state government regulation, including provisions related to the governor’s regulation of certain places and activities, while coordinating the continuing appropriations mechanism described above.

The core substantive component centers on continuing appropriations in years with missing enacted appropriations, ensuring government operations can continue while the legislature completes appropriations.

Key provisions and changes

1) New section: 2.12C Continuing appropriations (Main mechanism)

  • Applies when the legislature has not enacted one or more line-item, standing limited, or standing unlimited appropriations otherwise limited by law for the immediately preceding fiscal year by July 1.
  • If, after July 1 of the current fiscal year, an appropriation identical to the prior-year provision is enacted, the continuing-appropriations section ceases to apply to that appropriation. Amounts expended under the prior-year mechanism can be substituted for the enacted appropriation.
  • Identical means: no differences other than fiscal year reference, subunit hierarchy references, or differences in amounts, allocations, or full-time equivalents (FTEs).

2) Determination of prior-year appropriations

  • The Department of Management, with the Legislative Services Agency, must determine the total amount of line-item, standing limited, and standing unlimited appropriations (including federal and nonstate funds) for the immediately preceding year.
  • They must identify the entities receiving such appropriations and the entities’ successors.

3) Continuing appropriation amount

  • For the current fiscal year, an appropriation is made to the identified entities equal to the amount of the prior-year appropriations, as determined in subsection 2.
  • This is intended to provide a funding baseline for the year in which enacted appropriations are not yet in place.

4) Duplicative standing appropriations

  • The continuing-appropriations amounts shall supplant any duplicative standing appropriation for the same fiscal year.

5) Miscellaneous provisions

  • Applies existing powers, duties, limitations, and reporting requirements from the prior year to the current year, with dates shifted forward by one year where applicable.

6) Allocation, nonreversion, and FTEs

  • If prior-year appropriations had allocation amounts, those same allocations apply to the current year.
  • If there were nonreversion provisions, the current-year funding follows the same rules (and for limited-period nonreversions, the period is extended by one fiscal year).
  • FTE limits: the number of FTEs may be used at the same level as the prior year.

7) Exclusions

  • One-time appropriations (e.g., certain infrastructure or technology funds) are excluded.
  • Appropriations specifically intended to not be subject to subsection 3 are excluded.
  • If the General Assembly previously passed an identical provision that was disapproved by the governor, subsection 3 does not apply.

8) Expenditure limitation adjustment

  • If continuing appropriations would exceed the general fund expenditure limitation, the Department of Management (with LSA) must reduce the general-fund appropriations under subsection 3 proportionally so total general-fund expenditures comply with the limit.

9) Title and framing changes

  • The title is amended to reflect the act’s relation to state government regulation, including governor-regulation provisions and continuing appropriations for years without enacted annual appropriations.

Who/what is affected

  • State agencies and the entities receiving line-item, standing limited, and standing unlimited appropriations (including those funded with federal or nonstate funds) that would ordinarily be subject to annual appropriation cycles.
  • The Department of Management and the Legislative Services Agency, which must determine prior-year appropriation levels and oversee the continuing-appropriations mechanism.
  • The Governor’s office is implicitly implicated through the broader framing of state government regulation in the revised title.
  • Overall state operations: the mechanism ensures ongoing funding for essential functions in years when annual appropriations have not been enacted by July 1.

Procedural and timeline aspects

  • The mechanism activates in fiscal years where prior-year line-item/standing appropriations were not enacted by July 1.
  • If an identical appropriation is enacted later in the year, the continuing-appropriations method ends for that item, and the enacted appropriation governs going forward.
  • The process requires coordination between the Department of Management and the Legislative Services Agency to quantify and translate prior-year appropriations into continuing appropriations.
  • If the continuing appropriations would violate the overall general fund expenditure limit, adjustments are mandated to maintain compliance.

Notes

  • The bill’s complexity lies in defining “identical” appropriations and ensuring appropriate transfer of funding, allocations, and nonreversion terms while avoiding duplication.
  • One-time and explicitly non-subject-to-subsection-3 appropriations are exempted, preserving intended special funding mechanisms.

Compiled from official sources — confirm details with the bill’s official record.

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