This bill establishes new regulations regarding contracts entered into by state agencies in Iowa, specifically prohibiting certain terms that are deemed contrary to public policy. Provisions that would void a contract include those requiring the state to indemnify another party, imposing unknown vendor terms, limiting the state's right to legal representation, or mandating arbitration. Additionally, the bill specifies that contracts must not include terms that impose confidentiality on payment information, require the state to pay attorney fees, or obligate the state to accept risk of loss before receiving goods.

Furthermore, the bill mandates that all state agency vendor contracts include provisions that specify Iowa law as the governing law and require litigation to occur in Iowa courts. The director of the Department of Administrative Services (DAS) is granted the authority to waive these requirements if necessary to procure essential goods or services, provided that the agency demonstrates the potential for irreparable harm if the procurement cannot proceed. The bill applies to contracts entered into or renewed on or after July 1, 2026.