House Study Bill 252 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON APPROPRIATIONS BILL BY CHAIRPERSON GRASSLEY) A BILL FOR An Act relating to rural economic development by establishing 1 a rural economic revitalization center and requiring that 2 a certain percentage of the tax incentives administered by 3 the economic development authority be provided to projects 4 located in small cities, and including applicability 5 provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 1404YC (8) 88 jm/jh

H.F. _____ Section 1. Section 15.105, Code 2019, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 8A. The members of the authority shall 3 administer the rural economic revitalization center established 4 in section 15.106F. 5 Sec. 2. NEW SECTION . 15.106F Rural economic revitalization 6 center. 7 1. A rural economic revitalization center is established 8 within the authority. A rural economic revitalization 9 center office shall be established and maintained in each 10 congressional district on the campus of either a community 11 college or regents institution within each district. 12 2. The rural economic revitalization center shall support 13 rural communities by doing all of the following: 14 a. Identify and study successful strategies to attract and 15 grow economic development and the workforce. 16 b. Identify and assist in applications for economic 17 development programs. 18 c. Identify and provide pathways for rural community 19 improvement. 20 d. Assist in and serve as a conduit for rural policy 21 development. 22 3. The board shall serve as the governing body of the rural 23 economic revitalization center, and shall provide an annual 24 report to the general assembly and the governor relating to 25 rural revitalization issues and efforts by January 15, 2021, 26 and by every January 15, thereafter. 27 Sec. 3. Section 15.119, Code 2019, is amended by adding the 28 following new subsection: 29 NEW SUBSECTION . 3A. a. Of the total amount of tax credits 30 allocated for purposes of subsection 2, paragraph “a” , during 31 each fiscal year, at least fifty percent shall be allocated for 32 purposes of small city projects that meet all of the following 33 criteria: 34 (1) An accredited public or private postsecondary 35 -1- LSB 1404YC (8) 88 jm/jh 1/ 4

H.F. _____ educational institution is located in the county in which the 1 small city is located. 2 (2) Sufficient housing is located within thirty miles of 3 the project to accommodate such a project. As used in this 4 subparagraph, “sufficient housing” means a determination using 5 information from the latest American community survey conducted 6 by the United States census bureau relating to statistics on 7 rental housing, owner-occupied housing, vacancy rates, and 8 vacancy units. 9 b. In the event this small city allocation percentage is not 10 satisfied in a given fiscal year, a shortfall is declared to 11 exist, and the percentage of the total amount of tax credits 12 allocated for purposes of subsection 2, paragraph “a” , during 13 the succeeding fiscal year that shall be allocated for purposes 14 of projects located in a small city shall be adjusted to equal 15 an amount necessary to reach the fifty percent small city 16 allocation percentage for that fiscal year, plus an amount 17 equal to the shortfall for the prior fiscal year or years. 18 c. For purposes of this subsection, “small city” means any 19 city located in this state with a population of thirty thousand 20 or less in a county with a population of fifty thousand or 21 less. A small city that is located in more than one county 22 shall be considered to be located in the county having the 23 greatest taxable base within the city. 24 Sec. 4. APPLICABILITY. The following applies to fiscal 25 years beginning on or after the effective date of this Act: 26 The section of this Act amending section 15.119. 27 EXPLANATION 28 The inclusion of this explanation does not constitute agreement with 29 the explanation’s substance by the members of the general assembly. 30 This bill relates to rural economic development by 31 establishing a rural economic revitalization center and 32 requiring a certain percentage of the tax incentives 33 administered by the economic development authority (authority) 34 to be provided to projects located in small cities. 35 -2- LSB 1404YC (8) 88 jm/jh 2/ 4

H.F. _____ The bill establishes a rural economic revitalization center 1 within the authority. A rural economic revitalization center 2 office shall be established in each congressional district on 3 the campus of either a community college or regents institution 4 within each district. The bill specifies that the rural 5 economic revitalization center shall support rural communities 6 by identifying and studying successful strategies to attract 7 and grow economic development and the workforce; assisting 8 in and serving as a conduit for rural policy development; 9 identifying and assisting in applications for economic 10 development programs; and identifying and providing pathways 11 for rural community improvement. 12 The members of the authority appointed by the governor 13 pursuant to Code section 15.105 shall serve as the governing 14 body of the rural economic revitalization center. The 15 bill requires the governing body of the rural economic 16 revitalization center to provide an annual report to 17 the general assembly and the governor relating to rural 18 revitalization issues and efforts by January 15, 2021, and by 19 every January 15, thereafter. 20 Under the tax credit program administered by the authority, 21 the authority provides various tax incentives to eligible 22 businesses that complete projects in Iowa. The bill requires 23 that at least 50 percent of the tax incentives awarded by the 24 authority each fiscal year shall be allocated for projects 25 located in a small city based upon certain criteria. The 26 criteria for purposes of allocation of projects in a small 27 city require the following: an accredited public or private 28 postsecondary educational institution located in the county in 29 which the small city is located and sufficient housing located 30 within 30 miles of the project. The bill defines “sufficient 31 housing” to mean a determination using information from the 32 latest American community survey conducted by the United States 33 census bureau relating to statistics on rental housing, owner 34 occupied housing, vacancy rates, and vacancy units. 35 -3- LSB 1404YC (8) 88 jm/jh 3/ 4

H.F. _____ The bill defines “small city” to mean any city located in 1 this state with a population of 30,000 or less in a county with 2 a population of 50,000 or less. If a small city is located in 3 more than one county, it is considered to be located in the 4 county having the greatest taxable base within the city. 5 In the event this small city percentage is not satisfied in 6 a given fiscal year, a shortfall is declared to exist, and the 7 percentage of tax incentives awarded to projects in a small 8 city in the succeeding fiscal year shall be adjusted to equal 9 an amount necessary to reach the 50 percent requirement for 10 that fiscal year, plus an amount equal to the shortfall for the 11 prior fiscal year or years. 12 The amendment relating to the tax credits administered by 13 the authority applies to fiscal years beginning on or after the 14 effective date of the bill. 15 -4- LSB 1404YC (8) 88 jm/jh 4/ 4