SF 2453 — A bill for an act providing for investment by regents institutions in certified innovation funds and including effective date provisions.

Senate File 2453 - ReprintedEnrolled SENATESenate FILEFile 2453 BYAN COMMITTEEACT ONPROVIDING COMMERCE (SUCCESSOR TO SSB 3180) (As Amended and Passed by the Senate March 10, 2026) A BILL FOR AnINVESTMENT ActBY providingREGENTS forINSTITUTIONS investmentIN byCERTIFIED regentsINNOVATION institutionsFUNDS inAND certifiedINCLUDING innovationEFFECTIVE fundsDATE andPROVISIONS. including effective date provisions.

SFSection 24531. (3) 91 je/ns/mb S.F.

2453 Section 1.

A one percent allocation of endowment assets represents a small, diversified portion of institution endowments, consistent with commonly accepted endowment investment practicesSenate andFile long-term2453, portfoliop. strategies.

2 practices and long-term portfolio strategies.

“Board”“Endowment assets” means theall stateunrestricted boardpooled, long-term investment assets held by or for the benefit of regents.an institution, including foundation-managed endowments, quasi-endowments, and long-term investment pools, as such assets are reported in the foundation’s audited financial statements.

“Endowment assets” does not include assets not treated as endowment funds under applicable fiduciary and accounting standards.

“Endowment assets” means all pooled, investable assets held for the benefit of an institution, including but not limited to foundation-managed endowments, quasi-endowments, SF 2453 (3) 91 -1- je/ns/mb 1/4 S.F.

2453 long-term investment pools, and assets held subject to donor-imposed restrictions.

3.

4.3.

By July 1, 2027, each foundation affiliated with an institution shall ensure that no less than one percent of its total endowment assets are invested in one or more innovation funds.

The one percent allocation shall not include any portion of its total endowment assets that is subject to donor restrictions or other expressions of donor intent that expressly prohibit such investment.

AnA foundation affiliated with an institution shallmay retaindetermine discretionwhich innovation funds to determineinvest allin, the timing of such investments, and the following:structure of investment commitments, provided the foundation remains responsible for compliance with this chapter.

a.

Which innovation funds to invest in.

b.

When investments are made, subject to the requirements of this chapter.

c.

The structure of commitments, provided that all investments comply with prudent investor standards.

AnA foundation affiliated with an institution may implement investments required byunder this chapter through anydirect commitments, reallocation of theexisting followingassets, means:or rolling commitments as capital is called, subject to compliance with subsection 1.

a.If the percentage of allocation falls below the amount required by subsection 1 after that date, the foundation Senate File 2453, p.

Direct3 commitments.shall increase its investment in one or more innovation funds as provided in this chapter as necessary in order to meet the required percentage of allocation.

b.

Reallocation of existing assets.

c.

Rolling commitments as capital is called, provided full compliance is achieved by the date provided in subsection 1.

262C.4 WaiverWaiver. —— penalty for noncompliance.

TheA foundation board may grant ana institutionfoundation a one-year waiver from SFthe 2453requirements (3)of 91this -2-chapter je/ns/mbif 2/4adequate S.F.innovation fund capacity is not available or market conditions would materially impair prudent investment.

2453 the requirements of this chapter if adequate innovation fund capacity is not available or market conditions would materially impair prudent investment.

IfA foundation board shall not grant a waiver under this section unless the foundation submits an institutionexplanation failsfor toits complywaiver request and a plan for coming into compliance with the requirements of this chapter withoutin receivingwriting ato waiver, the state board mayof doregents anyand ofprovides a copy to the following:foundation board.

a.3.

DirectIf a foundation is granted two consecutive waivers by a foundation board, the institutionfoundation shall submit written notice to carrythat outeffect correctiveto actionthe withinstate aboard specifiedof timeregents frame.when the second consecutive waiver is granted.

b.The state board shall provide such notice in a report to the general assembly.

If the institution fails to complete the corrective action required under paragraph “a” within the time frame specified by the board, withhold up to one-half of one percent of the moneys appropriated to the institution through the board in the fiscal year until the institution becomes fully compliant.

Each institution shall submit an annual report to the state board of regents that includes all of the following:

c.

The names of innovation funds the institution is invested in and the total commitments and capital deployed in each fund.

d.

The expected or realized economic impact in Iowa of the investments.