Fiscal Note
Fiscal Services Division
SF 339 – Employment of Unauthorized Aliens, E-Verify (LSB1681SV)
Staff Contact: Eric Richardson (515.281.6767) eric.richardson@legis.iowa.gov
Fiscal Note Version – New
Description
Senate File 339 prohibits licensed employers from knowingly employing unauthorized aliens
and authorizes a county attorney, local law enforcement official, or member of the public to file a
complaint of a violation with the Iowa Department of Workforce Development (IWD). If the IWD
determines that an employer has committed a violation, the IWD is required to bring an action in
district court against the employer for the violation in the county where the unauthorized alien
employee is or was employed by the employer. The Bill requires licensed employers hiring or
rehiring an employee to verify the employee’s employment eligibility through the federal E-Verify
Program and certify to the IWD that the employer has done so. The Bill further requires the
IWD to adopt administrative rules to carry out the IWD’s duties under the Bill.
The Bill also requires the Secretary of State to maintain an online database of employers
registered with the federal E-Verify Program, first-time employer offenders, and related court
documents.
Background
The federal Immigration Reform and Control Act of 1986 (IRCA) (8 USC §1324a) made it illegal
for employers to knowingly hire immigrants who are unauthorized to work in the United States.
The IRCA established an employment verification process (the Form I-9 process) that required
employers to review documents presented by new employees to establish their identity and
employment eligibility. The IRCA provides for penalties or sanctions against employers that
knowingly violate the law. Employers are required to certify that they have reviewed the
documents presented by their employees and that the documents reasonably appear genuine
and relate to the individual presenting them. The Illegal Immigration Reform and Immigrant
Responsibility Act of 1996 created E-Verify as a pilot program. The program has since been
expanded. Employers participating in E-Verify are required to retain Form I-9s for all newly
hired employees in accordance with the IRCA. Currently, 25 states have some type of E-Verify
mandate for businesses and/or governments, while the federal government mandates that all
federal contractors utilize E-Verify.
Assumptions
• Enactment of the Bill would require the IWD to incur additional expenses for vehicles,
phones, computers, employee support, preparation of rules, development of training
materials, training of staff, investigative time, postage, filing fees, service of process fees,
witness subpoenas, travel time and expenses, court preparation and appearances,
monitoring employers, and following up on court orders. This will result in the IWD adding
the following 9.0 full-time equivalent (FTE) positions:
• Public Service Manager 1 1.0 FTE position
• Secretary 1 1.0 FTE position
• Attorney 2 1.0 FTE position
1
 • Investigator 2 4.0 FTE positions
• Field Auditor 2.0 FTE positions
• Salary costs include benefits and are estimated at the entry level of the salary range for
each position. Salary costs for FY 2022 assume positions are filled by October 1, 2021.
• The IWD will investigate 500 complaints per year and file 50 court actions, administered
through the Iowa Judicial Branch.
• The Secretary of State will develop and maintain a permanent searchable database. The
database will be developed in house.
• The Secretary of State will use a link to the federal Department of Human Services E-Verify
System for the purposes of new Iowa Code section 95.3(3).
• The Secretary of State will use 0.5 hours of staff time at $20 per hour to manage court
documents for each court action.
Fiscal Impact
The Bill will result in increased cost to the IWD of an estimated $656,000 for 9.0 FTE positions
in FY 2022 and $687,000 in subsequent years, to be paid from the IWD General Fund
appropriation.
The Secretary of State will utilize an estimated $25,000 from its Secretary of State Technology
Modernization Fund appropriation in FY 2022 for the creation of a database and approximately
$500 from its annual General Fund appropriation, beginning with FY 2023, for the processing of
court documents and data entry.
The Iowa Judicial Branch will incur expenses estimated at $75,000 per year to administer
complaints that might be filed against an employer by a county attorney, law enforcement
officer, or member of the public, with a subsequent determination by the IWD that a violation
has occurred. There are offsetting amounts of filing fees and court costs of an estimated $300
per instance made to the General Fund and other funds. See estimated costs in table below.
Estimated Costs, Senate File 339
Agency Category FTE Est. Cost
FY 2022 FY 2023
Salary and Benefits 0.0 $ - $ 500
Secretary of State
Database Development 25,000 -
Trial Costs $ 75,000 $ 75,000
Judicial Branch
Court Fees and Filing Fees -15,000 -15,000
Salary and Benefits 9.0 $ 453,444 $ 617,289
Capital Outlay 150,000 -
Iowa Workforce
Travel 15,000 20,000
Development (IWD)
Fees and Postage 15,000 20,000
Other Operating Costs 22,500 30,000
Total 9.0 $ 740,944 $ 747,789
2
Sources
Legislative Services Agency
Iowa Department of Workforce Development
Iowa Secretary of State
Iowa Judicial Branch
General Accounting Office (GAO)
/s/ Holly M. Lyons
February 17, 2021
Doc ID 1212555
The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in
developing this fiscal note is available from the Fiscal Services Division of the Legislative Services
Agency upon request.
www.legis.iowa.gov
3