1999 Summary of Legislation Published by the Iowa General Assembly -- Legislative Service Bureau

ECONOMIC DEVELOPMENT

ECONOMIC DEVELOPMENT LEGISLATION

SENATE FILE 68 - Mid-America Port Commission - Counties Included(full text of act)

BY SHEARER, FRAISE, HEDGE, McLAREN, AND MILLER. The Mid-America Port Commission Agreement and the Mid-America Port Commission Act were passed by the General Assembly during the 1998 Legislative Session. The agreement is entered into and enacted into law with the states of Illinois and Missouri only if those states legally join the agreement in substantially the same form. Generally, the agreement would confer upon a Mid-America Port Commission the power to control the waterways, and related facilities and lands, common to the three states. Currently, the Iowa counties of Lee, Henry and Des Moines are included in the jurisdiction of the agreement. This Act adds Jefferson, Van Buren and Wapello Counties in the jurisdiction of the Mid-America Port Commission Agreement.

SENATE FILE 280 - Financial Institutions Investments in Iowa Agricultural Industry Finance Corporations(full text of act)

BY COMMITTEE ON SMALL BUSINESS, ECONOMIC DEVELOPMENT AND TOURISM. This Act amends provisions relating to investments made by financial institutions such as banks. In 1998, the General Assembly enacted S.F. 2415 (1998 Iowa Acts, Ch. 1207), which allowed the formation of agricultural industry finance corporations for the purpose of encouraging local agricultural producer-led ventures to expand production and processing of high-value agricultural products.

Code Section 12C.6A requires that public funds of the state be deposited in a financial institution which demonstrates a commitment to serve the needs of the local community in which it is chartered to do business. This required commitment may be demonstrated by participation in local community and rural development and redevelopment projects, and in state and federal business and economic development programs. This Act provides that the financial institution's participation may include investment in an Iowa agricultural industry finance corporation.

SENATE FILE 465 - Accelerated Career Education Program(full text of act)

BY COMMITTEE ON WAYS AND MEANS. This Act provides that a community college may enter into an agreement with certain employers in the community college's merged area to establish an Accelerated Career Education (ACE) Program. The Act provides that the program shall be developed by an employer, a community college, and any employee of an employer who represents a program job and, if a bargaining agreement is in place, a representative of the employee bargaining unit.

The Act provides that certain types of community college programs are eligible for designation as ACE programs. The Act provides that, after entering into the agreement, the community college and the employer must notify the Department of Revenue and Finance and the Department of Economic Development.

The Act provides that the agreement shall specify the type and amount of funding sources that will be used to pay for the program costs. Possible funding sources include cash or in-kind contributions by the employer, and tuition, fees or special charges fixed by the community college.

The Act provides that as part of the agreement, the employer shall agree to interview graduating participants in the program and provide future hiring preferences. Also as part of an agreement, if an employer has more than four sponsored participants in the program, the employer shall agree to offer a program job position to at least 25 percent of those participants who successfully complete the program. An agreement may allow for an employer to decline to satisfy job guarantee provisions of the Act if the employer experiences an economic downturn. The Act requires an agreement to provide for a wage level of no less than 200 percent of the federal poverty level for a family of two. Participants in the program must agree to interview with the employer. The Act also requires an agreement to provide for employer default procedures.

The Act requires that participants in the programs be included in the customer tracking system implemented by the Department of Workforce Development.

Moneys appropriated by the General Assembly for program capital costs shall be allocated according to rules adopted by the Department of Economic Development. In order to receive such moneys, a program agreement must be in place, the program capital cost requests must be approved by the Iowa Economic Development Board within 60 days of the receipt of the request, and employer contributions toward program capital costs shall be certified and agreed to in the agreement. The General Assembly, in H.F. 772 (see Appropriations), appropriates $7,500,000 for FY 1999-2000 from the Rebuild Iowa Infrastructure Fund to the Department of Economic Development for purposes of the program.

The Act takes effect May 24, 1999.

THE GOVERNOR ITEM VETOED THE FOLLOWING:

1. Provisions related to the use and allocation of tax credits from withholding as a funding source to pay for program costs.
2. A provision requiring the Department of Economic Development to administer the statewide allocations of program job credits, and collect data and submit a report related to the programs.
3. Provisions reducing the maximum amount of job training withholding to be transferred from all participating employers to the Workforce Development Fund Account each year.

HOUSE FILE 337 - Workforce Development Fund Account - Fees Paid by Community Colleges(full text of act)

BY COMMITTEE ON ECONOMIC DEVELOPMENT. This Act provides that fees received by the Department of Economic Development from community colleges, which are generated through the sale of certificates to fund new jobs training programs under Code Chapter 260E, are to be deposited and accumulate in the department's Job Training Fund and then transferred at the end of the fiscal year to the Workforce Development Fund Account. The Act provides that moneys in the Workforce Development Fund Account can be used to cover costs of the administration of workforce development programs and to support efforts by the community colleges to provide workforce services to Iowa employers

HOUSE FILE 676 - Iowa Agricultural Industry Finance Act - Miscellaneous Provisions(full text of act)

BY COMMITTEE ON ECONOMIC DEVELOPMENT. This Act amends provisions in the Iowa Agricultural Industry Finance Act as enacted by the General Assembly in 1998. As provided in the Iowa Agricultural Industry Finance Act, an entity incorporated under Code Chapter 490 is an Iowa agricultural industry finance corporation if it complies with certain requirements. It provides that the Department of Economic Development may award an Iowa agricultural industry finance loan to an Iowa agricultural industry finance corporation that is repayable in 25 years.

Currently, a corporation is an Iowa agricultural industry finance corporation if at least 51 percent of the corporation's common stock and voting stock is held by agricultural producers. The Act provides that the status of an agricultural producer is determined at the time of the transfer of stock from the corporation to the shareholder in a manner and as provided in the corporation's articles of incorporation or bylaws.

Currently, an Iowa agricultural industry finance corporation must execute an agreement with an eligible recipient as a condition of providing financing. The eligible recipient must agree to become a shareholder in the corporation. If the eligible recipient is an agricultural producer, the agreement cannot be executed unless the agricultural producer holds voting common stock in the corporation equal to at least 5 percent of the financing provided to the agricultural producer pursuant to the agreement. The Act provides that the agreement must provide that the agricultural producer become a shareholder of voting common stock in the corporation. The Act does not otherwise change the 5 percent requirement.

HOUSE FILE 733 - Economic Development Tax Credits - Miscellaneous Provisions(full text of act)

BY COMMITTEE ON WAYS AND MEANS. This Act amends Code Section 15.333, regarding the New Investment Tax Credit under the New Jobs and Income Program. A new investment, under the Act, includes the purchase price of real property and any buildings and structures located on the real property. The Act provides that if within five years of purchase the eligible business sells, disposes of, razes, or otherwise renders unusable all or a part of the land, buildings or other structures for which an investment tax credit was claimed, the income tax liability of the eligible business shall be increased by a varying percentage of the investment tax credit claimed.

The Act adds an insurance premium tax credit to the list of incentives and assistance available under the Enterprise Zone Program.

The Act requests that the Legislative Council establish an enterprise zone interim study committee to consider various issues relating to the Enterprise Zone Program.

HOUSE FILE 767 - Certified Capital Companies - VETOED BY THE GOVERNOR(full text of act)

BY COMMITTEE ON WAYS AND MEANS. This bill would have provided for the creation of certified capital companies to make qualified investments in qualified businesses.

The bill would have directed the Department of Economic Development to certify a person as a certified capital company if the person met all of the conditions listed within the bill. The department would have been able to certify an Iowa agricultural industry finance corporation as a certified capital company provided that certain other criteria were met.

The bill defined a "certified capital investment" as an investment in a certified capital company that is certified by the department and fully funds either the investor's equity interest in the certified capital company, a qualified debt instrument that a certified capital company issues, or both. The bill prohibited the department from certifying more than $60 million in certified capital investments. The bill also would have prohibited the department from certifying any more than 25 percent of the total certified capital investments allowed for investments in an agricultural industry finance corporation that is a certified capital company.

The bill would have prohibited a certified investor from investing any more than $10 million in certified capital investments prior to August 11, 2000.

The bill would have provided for the voluntary and involuntary decertification of a certified capital company and for the disqualification of a noncomplying investment pool. The bill would have required the department to file a report with the General Assembly every two years regarding certified capital companies and the department's assessment of the impact of certified capital companies.

The bill would have allowed a certified investor to earn a vested insurance premium tax credit equal to the total amount of the certified capital investment. The bill would have prohibited a claim for a tax credit that exceeded 10 percent of the total amount of the certified capital investment in any taxable year. Any excess credit could have been carried over to future years until depleted.

The bill would have provided for a recapture tax in the case of certain decertifications of a certified capital company or certain disqualifications of an investment pool. The bill would have allowed for the sale of a certified capital company tax credit.

RELATED LEGISLATION

SENATE FILE 136 -- Tax Administration and Related Matters (Complete summary under TAXATION.)

This Act amends various provisions of state and local tax law. The Act requires the Department of Economic Development to submit a report to the General Assembly on the phaseout of the machinery, equipment and computer property tax, including estimated economic impact and recommendations for modification of the reimbursement formula.

SENATE FILE 221 -- Public Assistance - Family Investment Program - Individual Development Accounts (Complete summary under HUMAN SERVICES.)

This Act allows funding available in the Self-Employment Loan Program Account of the Strategic Investment Fund administered by the Department of Economic Development to be used as matching funding for individual development accounts held by low-income Iowans.

SENATE FILE 230 -- Internal Revenue Code References and Income Tax Provisions (Complete summary under TAXATION.)

This Act updates the references to the Internal Revenue Code to make the federal income tax revisions enacted by Congress in 1998 applicable for Iowa income tax purposes. Iowa Code Sections 15.335, 15A.9, 422.10, and 422.33 are amended to update the Iowa Code references to the state research activities credit for individuals, corporations, corporations in economic development areas, and corporations in quality jobs enterprise zones to include the 1998 changes to the federal research activities credit. The Act takes effect May 6, 1999, and applies retroactively to January 1, 1998, for tax years beginning on or after that date.

SENATE FILE 283 -- Federal Block Grant Appropriations (Complete summary under APPROPRIATIONS.)

This Act appropriates federal block grant and other nonstate moneys to various state agencies for the federal fiscal year beginning October 1, 1999, and ending September 30, 2000, and for the state fiscal year beginning July 1, 1999, and ending June 30, 2000. The Act includes approximately $30 million in funding for community development programs administered by the Department of Economic Development.

HOUSE FILE 144 -- Distribution of Certified School to Career Program Trust Moneys (Complete summary under EDUCATION.)

This Act affects the distribution of moneys held in trust for a participant in the Certified School to Career Program by allowing one-half of the trust moneys to be used to pay the participant's tuition or expenses in an apprenticeship program if that program has been approved under a provision of the federal regulations titled "Labor Standards for the Registration of Apprenticeship Programs."

HOUSE FILE 210 -- Business Opportunity Promotions - Excluded Transactions (Complete summary under BUSINESS, BANKING & INSURANCE.)

This Act excludes certain business transactions from the definition of "business opportunity" under the Business Opportunity Promotions Law in Code Chapter 523B. The Act takes effect April 29, 1999, and applies retroactively to July 1, 1998.

HOUSE FILE 218 -- Loess Hills Development and Conservation (Complete summary under LOCAL GOVERNMENT.)

This Act creates a Loess Hills Alliance under the general direction of the Loess Hills Development and Conservation Authority with the mission of creating a common vision for Iowa's Loess Hills, protecting special natural and cultural resources while ensuring economic viability and private property rights of the region.

HOUSE FILE 745 -- Appropriations - Economic Development (Complete summary under APPROPRIATIONS.)

This Act makes a number of appropriations from the General Fund of the State to the Department of Economic Development for the administration of the department and for specific programs.

HOUSE FILE 772 -- Appropriations - Infrastructure and Capital Projects (Complete summary under APPROPRIATIONS.)

This Act makes appropriations from and to the Rebuild Iowa Infrastructure Fund for various capital and other projects. The Act establishes the Community Attraction and Tourism Development Program and Fund to provide assistance to political subdivisions in the state in the development and creation of multiple-purpose attraction and tourism facilities.

HOUSE FILE 779 -- Linked Investment Programs (Complete summary under AGRICULTURE.)

This Act amends provisions in Code Chapter 12 that allow the Treasurer of State to invest up to $68 million or 10 percent of the balance of the State Pooled Money Fund in certificates of deposit in eligible lending institutions. The state receives a lower interest rate as part of an agreement in which the lending institution loans moneys to eligible persons, under programs specified in the chapter, at a reduced rate of interest. The Act increases the amount that the Treasurer of State may invest to $108 million, but provides that the additional moneys must be used to support a program for traditional livestock producers and a program for value-added agricultural projects. The Act takes effect May 24, 1999.

© 1998 Cornell College and League of Women Voters of Iowa

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Last update: SAT July 10 1999
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