Des Moines, Iowa – April 17, 2026 — Governor Kim Reynolds signed House File 2697 on April 16, 2026. The law, effective July 1, 2026, allows Iowa courts to order defendants to pay pecuniary damages to victims and certain court costs even when criminal charges or ordinance violations are dismissed — but only with the explicit consent of both the defendant and the prosecutor.

The new measure adds a narrow exception to Iowa Code Section 910.2:

Notwithstanding any other statute or rule of law, with the consent of the defendant and the prosecuting attorney, the court may order as part of the dismissal of a public offense or violation of an ordinance that the defendant pay pecuniary damages to the victim, category ‘B’ restitution, which shall include court costs.”

Before HF 2697, restitution (victim damages, medical bills, lost wages, and prosecution costs) could only be ordered after a conviction or deferred judgment. The bill creates a consensual option for dismissed cases, giving victims a path to compensation without a full trial when both sides agree.

Lawmakers responded directly to the 2026 Iowa Supreme Court ruling in State v. Pagliai, which found that courts lacked authority to impose such costs in dismissed cases. The change lets prosecutors and defense attorneys negotiate practical resolutions that help victims recover losses efficiently.

Supporters’ View

Proponents say the law promotes justice by ensuring victims are not left empty-handed when charges are dropped for reasons other than acquittal. It offers a quicker, less costly alternative to trial while respecting the defendant’s right to consent.

Opponents, including the Fines and Fees Justice Center, argue the measure risks violating due-process rights under the Iowa and U.S. Constitutions. They contend that even “consent” may feel coercive for defendants facing ongoing prosecution, and that imposing costs on someone presumed innocent echoes the U.S. Supreme Court’s Nelson v. Colorado decision.

Effective July 1, 2026, the law gives judges a new tool for consensual dismissals. Courts will need to ensure consent is knowing and voluntary. Future cases may test its constitutionality, but for now it marks a targeted update to Iowa’s restitution rules aimed at balancing victim rights with fair process.