The bill permits cities in Iowa to create self-supported entertainment areas, which are defined as designated zones that include cultural and entertainment establishments, food and liquor venues, and lodging providers. To establish these areas, a city council must pass an ordinance that meets specific criteria, such as projected attendance levels exceeding 250,000 at cultural or entertainment venues and compliance with zoning requirements. A surcharge on retail sales within these areas can be imposed, capped at three percent, and the ordinance requires a three-fourths majority approval from the city council, or a unanimous vote if property owners within the proposed area file a remonstrance.

Additionally, the bill details the administration of the surcharge, which will be overseen by the Department of Revenue in alignment with state sales tax laws. It establishes a state surcharge revenue fund to collect and distribute the surcharge revenues to the cities that create these entertainment areas, with funds designated for specific purposes like public safety services and capital improvements. The bill also includes provisions for public hearings, property owner petitions, and processes for amending or dissolving the entertainment area, ensuring community involvement and oversight in the establishment and management of these zones.

Statutes affected:
Introduced: 423.2, 423A.5A