Text: HF00656 Text: HF00658 Text: HF00600 - HF00699 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. NEW SECTION. 15E.181 INTENT.
1 2 It is the intent of the general assembly that this division
1 3 be administered in a manner to promote new economic
1 4 development in economically distressed areas by encouraging
1 5 communities to target resources in ways that attract
1 6 productive private investment.
1 7 Sec. 2. NEW SECTION. 15E.182 ENTERPRISE ZONES.
1 8 1. A county may create an economic development enterprise
1 9 zone as authorized in this division, subject to certification
1 10 by the department of economic development, by designating up
1 11 to one percent of the county area for that purpose. A county
1 12 may establish more than one enterprise zone.
1 13 2. A city with a population of twenty-five thousand or
1 14 more may create an economic development enterprise zone as
1 15 authorized in this division, subject to certification by the
1 16 department of economic development, by designating one or more
1 17 contiguous census tracts, as determined in the most recent
1 18 federal census, for that purpose. In creating an enterprise
1 19 zone, a city with a population of twenty-five thousand or more
1 20 may designate as part of the area tracts located in a
1 21 contiguous city if such tracts meet the criteria and the city
1 22 agrees to being included. The city may establish more than
1 23 one enterprise zone. Reference in this division to "city"
1 24 means a city with a population of twenty-five thousand or
1 25 more.
1 26 3. A county or city may apply to the department for an
1 27 area to be certified as an enterprise zone at any time prior
1 28 to July 1, 2000. However, the total amount of land designated
1 29 as enterprise zones under subsections 1 and 2 shall not exceed
1 30 in the aggregate one percent of the total county area.
1 31 4. An enterprise zone designation shall remain in effect
1 32 for ten years following the date of certification. Any state
1 33 or local incentives or assistance that may be conferred must
1 34 be conferred before the designation expires. However, the
1 35 benefits of the incentive or assistance may continue beyond
2 1 the expiration.
2 2 Sec. 3. NEW SECTION. 15E.183 ELIGIBLE BUSINESS.
2 3 1. A business which is or will be located in an enterprise
2 4 zone is eligible to receive incentives and assistance under
2 5 this division if the business has not closed or substantially
2 6 reduced its operation in one area of the state and relocated
2 7 substantially the same operation into the enterprise zone and
2 8 if the business meets all of the following:
2 9 a. Is not a retail or professional service business.
2 10 b. Pays at least eighty percent of the cost of a standard
2 11 medical and dental insurance plan for all full-time employees.
2 12 c. Pays an average wage that is at or greater than ninety
2 13 percent of the lesser of the average county wage or average
2 14 regional wage, as determined by the department. However, the
2 15 average wage paid by the business shall not be less than seven
2 16 dollars and fifty cents per hour.
2 17 d. Creates at least ten full-time positions and maintains
2 18 them for at least ten years.
2 19 e. Makes a one-time capital investment of at least five
2 20 hundred thousand dollars. If the business is occupying a
2 21 vacant building suitable for industrial use, the fair market
2 22 value of the building and land shall be counted toward the
2 23 capital investment requirement. An existing business that has
2 24 been operating in the enterprise zone for at least five years
2 25 is exempt from the capital investment requirement of this
2 26 paragraph.
2 27 2. A business is not ineligible under this section when
2 28 the business expands its operation in an enterprise zone if
2 29 existing operations of a similar nature in the state are not
2 30 closed or substantially reduced.
2 31 Sec. 4. NEW SECTION. 15E.184 DISTRESS CRITERIA.
2 32 1. An enterprise zone may be designated by a county in an
2 33 area which meets at least two of the following criteria:
2 34 a. The area has an average weekly wage that ranks among
2 35 the bottom twenty-five counties in the state based on the 1995
3 1 annual average weekly wage for employees in private business.
3 2 b. The area has a family poverty rate that ranks among the
3 3 top twenty-five counties in the state based on the 1990
3 4 census.
3 5 c. The area has experienced a percentage population loss
3 6 that ranks among the top twenty-five counties in the state
3 7 between 1990 and 1995.
3 8 d. The area has a percentage of persons sixty-five years
3 9 of age or older that ranks among the top twenty-five counties
3 10 in the state based on the 1990 census.
3 11 2. An enterprise zone may be designated by a city which
3 12 meets at least two of the following criteria:
3 13 a. The area has a per capita income of nine thousand six
3 14 hundred dollars or less based on the 1990 census.
3 15 b. The area has a family poverty rate of twelve percent or
3 16 higher based on the 1990 census.
3 17 c. Ten percent or more of the housing units are vacant in
3 18 the area.
3 19 d. The valuations of each class of property in the
3 20 designated area is seventy-five percent or less of the
3 21 citywide average for that classification based upon the most
3 22 recent valuations for property tax purposes.
3 23 3. The department of economic development shall certify
3 24 eligible enterprise zones that meet the requirements of
3 25 subsection 1 upon request by the county or subsection 2 upon
3 26 request by the city, as applicable.
3 27 Sec. 5. NEW SECTION. 15E.185 ENTERPRISE ZONE COMMISSION.
3 28 A county or city for which an eligible enterprise zone is
3 29 certified shall establish an enterprise zone commission to
3 30 review applications from qualified businesses located within
3 31 or requesting to locate within an enterprise zone to receive
3 32 incentives or assistance as provided in section 15E.186. The
3 33 commission shall include but not be limited to representatives
3 34 from the board of supervisors, cities, school districts,
3 35 community or regional economic development offices, community
4 1 colleges, and the servicing utility companies. A county and
4 2 any cities within the county may combine their commissions
4 3 into one commission.
4 4 The commission may adopt more stringent requirements for a
4 5 business to be eligible for incentives or assistance than
4 6 provided in section 15E.183. The commission may develop as an
4 7 additional requirement that preference in hiring be given to
4 8 individuals who live within the enterprise zone. The
4 9 commission shall work with the local workforce development
4 10 center to determine the labor availability in the area.
4 11 If the enterprise zone commission determines that a
4 12 business qualifies for inclusion in an enterprise zone and is
4 13 eligible to receive incentives or assistance as provided in
4 14 section 15E.186, the commission shall submit an application
4 15 for incentives or assistance to the department of economic
4 16 development. The department may approve, defer, or deny the
4 17 application. A business that is approved to receive
4 18 incentives or assistance shall, for the length of its
4 19 designation as an enterprise zone business, certify annually
4 20 to the county or city, as applicable, and the department of
4 21 economic development its compliance with the requirements of
4 22 section 15E.183.
4 23 Sec. 6. NEW SECTION. 15E.186 INCENTIVES – ASSISTANCE.
4 24 For purposes of determining the incentives or assistance
4 25 provided in this section, "eligible business" means a business
4 26 which has been approved to receive incentives and assistance
4 27 by the department of economic development pursuant to
4 28 application as provided in section 15E.185. The incentives
4 29 and assistance provided under this division for businesses
4 30 located in enterprise zones shall be for a period not to
4 31 exceed ten years and shall include all of the following:
4 32 1. In addition to any new jobs credit from withholding
4 33 allowed pursuant to section 260E.5, an amount equal to one and
4 34 one-half percent of the gross wages paid to the new employees
4 35 in the zone. This amount shall be credited from the payment
5 1 made by the business pursuant to section 422.16. The amount
5 2 available to the business under this subsection may be used
5 3 for additional job training pursuant to chapter 260E or may be
5 4 used for capital investment in the zone.
5 5 2. Sales, services, and use tax refund, as provided in
5 6 section 15.331A.
5 7 3. Investment tax credit, as provided in section 15.333.
5 8 4. Research activities credit, as provided in section
5 9 15.335.
5 10 5. The county or city for which an eligible enterprise
5 11 zone is certified may exempt from all property taxation all or
5 12 a portion of the property upon which an eligible business
5 13 locates or expands in an enterprise zone and which is used in
5 14 the operation of the eligible business. The exemption may be
5 15 allowed for a period not to exceed ten years beginning the
5 16 year the eligible business enters into an agreement with the
5 17 county or city to locate or expand operations in an enterprise
5 18 zone.
5 19 6. Exemption from the state sales, services, and use taxes
5 20 of the gross receipts from the sale, furnishing, or service of
5 21 gas, electricity, water, and heat to the business premises in
5 22 the zone.
5 23 7. Exemption from the state corporate tax under chapter
5 24 422, division III, if the business's commercial domicile, as
5 25 defined in section 422.32, is located in the zone. If the
5 26 business is a subchapter S corporation or partnership where
5 27 the income is taxed to the shareholders or partners, the
5 28 exemption applies to the state individual income tax on the
5 29 business income based upon each shareholder's or partner's pro
5 30 rata share of the business income.
5 31 EXPLANATION
5 32 The bill authorizes a county to designate up to 1 percent
5 33 of its total area as enterprise zones. A city with a
5 34 population of 25,000 or more may designate more than one or
5 35 more contiguous census tracts as enterprise zones. However,
6 1 the total amount of land that may be in these city and county
6 2 zones cannot exceed in the aggregate 1 percent of the total
6 3 area of the county. In addition, the department of economic
6 4 development must approve any such designation. In order for
6 5 an area to be designated an enterprise zone, at least two of
6 6 four criteria must be met. In the case of county-designated
6 7 areas, these are having an average weekly wage that ranks
6 8 among the bottom 25 counties based upon 1995 statistics;
6 9 family poverty rate that ranks among the top 25 counties based
6 10 upon the 1990 census; percentage population loss that ranks
6 11 among the top 25 counties between 1990 and 1995; and a
6 12 percentage of persons 65 years old that ranks among the top 25
6 13 counties. In the case of city-designated areas these are
6 14 having per capita income of $9,600 or less, poverty rate of 12
6 15 percent or more, and 10 percent of more of housing units are
6 16 vacant, all according to the 1990 census, and the valuations
6 17 in the area equal 75 percent or less of the average for the
6 18 city. A business that is or will be located in the enterprise
6 19 zone shall receive incentives or assistance if the business
6 20 meets all of certain eligibility criteria. These criteria
6 21 include paying at least 80 percent of the cost of standard
6 22 medical and dental insurance, in a county-designated zone
6 23 paying at least 90 percent of the lesser of the average county
6 24 wage or average regional wage with a minimum wage of $7.50 per
6 25 hour, creation of at least 10 new jobs, and making a capital
6 26 investment of at least $500,000. Retail or professional
6 27 service businesses are not eligible nor are businesses that
6 28 move similar operations from another part of the state to the
6 29 enterprise zone. The county or city may establish more
6 30 stringent criteria than these.
6 31 The incentives and assistance that shall be provided are a
6 32 one and one-half percent credit from withholding of income tax
6 33 from wages of new employees which may be used for training new
6 34 employees to work in the zone or for capital investment,
6 35 refund of sales and services taxes for utility services
7 1 furnished in the zone and for materials used in construction
7 2 contracts done in the zone, investment tax credit for
7 3 investments made in the zone, credit for increasing research
7 4 activities in the state, exemption from all property taxation
7 5 for property used in the business in the zone if the county or
7 6 city so decides, exemption from state sales, services, and use
7 7 taxes on utility services, and possible exemption from the
7 8 state taxes on business income.
7 9 LSB 2714HV 77
7 10 mg/sc/14
Text: HF00656 Text: HF00658 Text: HF00600 - HF00699 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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