First Funnel Deadline

The Iowa Legislature has officially reached the First Funnel Deadline, a major procedural milestone in the 2026 session. As of this week, most policy bills were required to advance through a full committee in either the House or Senate in order to remain eligible for consideration this year. Tax and spending legislation, including Ways and Means and Appropriations bills, are not subject to funnel deadlines.

Lawmakers worked at a rapid pace to meet the cutoff. To date, 865 subcommittees have been held, averaging nearly 40 per day. Many bills were amended, moved, and even newly filed in the final days to ensure they advanced before the deadline.

The next major deadline is March 20, when most surviving bills must pass out of one full chamber and be approved by committee in the opposite chamber to remain alive.

Legislative Snapshot

Property Tax Reform

Property tax relief remains a top priority. Three major reform proposals are advancing:

–  SSB 3034 / HSB 563 – Governor’s Proposal
–  HSB 596 – House Republican Proposal
– SSB 3001 – Senate Republican Proposal

Each proposal seeks to address property tax burdens on Iowans and employers. NFIB continues to engage lawmakers to ensure meaningful relief for small businesses.

Taxpayer Protection

–  SJR 11 – Two-Thirds Majority to Raise Taxes
Constitutional amendment requiring a supermajority vote to increase taxes.

–  SF 493 – Ban Taxpayer-Funded Lobbyists
Prohibits public entities from using taxpayer dollars to hire lobbyists.

Agricultural Right to Repair

–  HSB 751 – Iowa Right to Repair Act

HSB 751 requires agricultural equipment manufacturers to provide farmers and independent repair providers access to documentation, parts, embedded software, firmware, tools, and authorized data needed to repair equipment.

Access must be offered on fair and reasonable terms without unnecessary barriers or forced registration requirements. Manufacturers may not use contracts to restrict these repair rights.

The bill protects trade secrets, maintains compliance with safety and emissions laws, and shields manufacturers from liability for independent repairs.

For Iowa’s farmers and small repair shops, this legislation promotes competition, reduces costly downtime, and strengthens operational independence during critical planting and harvest seasons.

Energy Cost Reform

–  SF 2273 – Utility Rate Transparency & Reform

SF 2273 strengthens oversight of Iowa’s public utilities and helps protect small businesses from unpredictable energy costs.

The bill requires utilities to file a general rate case at least every three years and eliminates automatic rate adjustment mechanisms for electric utilities. Instead of using rate trackers that can increase bills outside of full review, utilities must justify costs through transparent rate cases.

For small businesses, energy is a major overhead expense. This legislation promotes accountability, transparency, and smarter long-term planning while helping provide the cost certainty Iowa job creators need to grow and compete.

Regulatory Reform

–  SF 2314 / HF 2413 – REINS Act

This proposal strengthens legislative oversight of major administrative rules before they take effect.

Under this reform:

–  Major regulations would require affirmative legislative approval
–  Courts would apply de novo review for significant rules, ensuring judges independently interpret the law rather than deferring to agency interpretations

For small businesses, this means greater transparency, predictability, and accountability in rulemaking that impacts hiring, compliance costs, and operations.

Certificate of Need Reform

–  SSB 3084 – Narrowing Iowa’s CON Requirements

This legislation reduces the circumstances under which health care providers must obtain state approval for expansion or new services. CON rules would focus only on major projects such as new facilities or significant capacity changes.

Budget Stability

–  SSB 3176 (Renumbered SF 2388) – Budget Continuation

This proposal prevents a government shutdown by automatically continuing existing appropriations if a budget is not passed on time.

Small businesses depend on stability and predictability. This reform reduces political brinkmanship and protects Iowa from disruptive shutdowns that create economic uncertainty.

Legal System Integrity

–  SF 586 – Third Party Litigation Financing Regulation

The Senate Judiciary Committee advanced bipartisan legislation regulating third party litigation financing, a growing practice where outside investors fund lawsuits in exchange for a portion of the financial outcome.

This bill would impose new transparency and regulatory requirements aimed at protecting consumers and businesses from bad actors who use litigation as an investment vehicle. Excessive third party financing can increase costs for industry and distort the civil justice system.

The legislation would also prohibit sovereign wealth funds and nations hostile to the United States from financing lawsuits in Iowa.

Several states have already addressed this issue. Lawmakers have indicated a broader floor amendment is expected to refine the bill as it advances.

What’s Next at the Capitol

With the First Funnel now complete, the pace at the Capitol will shift from committee rooms to floor debate. Lawmakers will begin spending longer days debating surviving bills in both the House and Senate, while leadership teams negotiate amendments and build consensus around priority legislation.

The next major deadline is March 20, the Second Funnel. By that date, most policy bills must have passed out of one full chamber and advanced through committee in the opposite chamber to remain eligible this session. As before, tax and appropriations bills are not subject to funnel deadlines and will continue moving on a separate track.

In the weeks ahead, expect increased focus on:

–  Property tax reform negotiations
–  State budget targets and spending priorities
–  Regulatory and workforce proposals that cleared the first funnel
–  Utility and energy cost legislation impacting employers

NFIB will continue working to ensure that small business voices remain front and center as legislation advances. The coming weeks will be critical in shaping the final policy outcomes of the 2026 session.