The bill establishes new regulations regarding state purchasing contracts, specifically outlining prohibited and required terms for contracts entered into by state agencies. It declares certain provisions void if included in such contracts, including those that require the state to indemnify other parties, impose unknown vendor terms, or limit the state's legal rights, such as waiving the right to a jury trial. Additionally, it prohibits provisions that impose confidentiality on payment terms, require litigation in foreign jurisdictions, or obligate the state to pay attorney fees or accept risk of loss before receiving goods.

Furthermore, the bill mandates that all state agency vendor contracts include specific terms, such as being governed by Iowa law and requiring litigation to occur in Iowa courts. It also allows the director of the state agency to waive these requirements if necessary to procure essential goods or services, provided that the agency demonstrates potential harm from not obtaining the goods or services. The bill applies to contracts entered into or renewed after its effective date.