House File 2355 H-8233 Amend the amendment, H-8225, to House File 2355, as follows: 1 1. By striking page 1, line 1, through page 5, line 29, and 2 inserting: 3 < Amend House File 2355 as follows: 4 1. By striking everything after the enacting clause and 5 inserting: 6 < DIVISION I 7 ECONOMIC DEVELOPMENT LEGISLATIVE FINDINGS 8 Section 1. Section 96.2, Code 2022, is amended to read as 9 follows: 10 96.2 Guide for interpretation. 11 1. As a guide to the interpretation and application of 12 this chapter , the public policy of this state is declared to 13 be as follows: Economic insecurity due to unemployment is 14 a serious menace to the health, morals, and welfare of the 15 people of this state. Involuntary unemployment is therefore 16 a subject of general interest and concern which requires 17 appropriate action by the legislature to prevent its spread 18 and to lighten its burden which now so often falls with 19 crushing force upon the unemployed worker and the worker’s 20 family. The achievement of social security requires protection 21 against this greatest hazard of our economic life. This can 22 be provided by encouraging employers to provide more stable 23 employment and by the systematic accumulation of funds during 24 periods of employment to provide benefits for periods of 25 unemployment, thus maintaining purchasing power and limiting 26 the serious social consequences of poor relief assistance. 27 The legislature, therefore, declares that in its considered 28 judgment the public good and the general welfare of the 29 citizens of this state require the enactment of this measure, 30 under the police powers of the state, for the compulsory 31 setting aside of unemployment reserves to be used for the 32 benefit of persons unemployed through no fault of their own. 33 2. It is the finding of the legislature that true economic 34 development can only be achieved when workers are given the 35 -1- H 8225.3986 (3) 89 dg/rn 1/ 8 #1.

respect they deserve. Economic development must include all 1 residents of this state, including men and women, people of all 2 gender identities, minorities, and immigrants. The legislature 3 further finds that economic development should include but not 4 be limited to residents of this state being paid a living wage, 5 this state being a welcoming place for immigrants, child care 6 and housing being readily affordable and available, and public 7 workers having collective bargaining rights. 8 DIVISION II 9 IOWA HOUSING TAX CREDIT PROGRAM 10 Sec. 2. NEW SECTION . 16.37A Definitions. 11 For purposes of this section and sections 16.37B through 12 16.37G, unless the context otherwise requires: 13 1. “Compliance period” means the period of fifteen years 14 beginning with the first taxable year of the credit period. 15 2. “Credit period” means the period of ten tax years 16 beginning with the tax year in which a qualified development 17 is placed in service and the Iowa housing tax credit may be 18 claimed. If a qualified development consists of more than 19 one building, the qualified development is placed in service 20 in the tax year in which the last building of the qualified 21 development is placed in service. 22 3. “Department” means the Iowa department of revenue. 23 4. “Qualified allocation plan” means the qualified 24 allocation plan adopted by the authority pursuant to section 25 42(m) of the Internal Revenue Code. 26 5. “Qualified basis” means the qualified basis determined 27 under section 42(c)(1) of the Internal Revenue Code. 28 6. “Qualified development” means a qualified low-income 29 housing project under section 42(g) of the Internal Revenue 30 Code that is financed with tax-exempt bonds, pursuant to 31 section 42(i)(2) of the Internal Revenue Code, and located in 32 this state. 33 7. “Taxpayer” means an individual, a person, firm, 34 corporation, or other entity that owns an interest, direct 35 -2- H 8225.3986 (3) 89 dg/rn 2/ 8

or indirect, in a qualified development and who claims a tax 1 credit under section 16.37C. 2 Sec. 3. NEW SECTION . 16.37B Application —— review —— 3 authorization. 4 1. The authority shall develop a system for the application, 5 review, and authorization of Iowa housing tax credits awarded 6 pursuant to this part and shall control the issuance of all tax 7 credit certificates to taxpayers pursuant to this part. 8 2. Applications for Iowa housing tax credits shall be 9 accepted during an application period established by the 10 authority. 11 3. The authority may authorize the tax credit if all of the 12 following conditions are satisfied: 13 a. The tax credit certificate is issued to a taxpayer who 14 has an ownership interest in the qualified development. 15 b. The tax credit amount is allocated pursuant to a 16 qualified allocation plan. 17 c. The tax credit is necessary for the financial feasibility 18 of the qualified development. 19 d. The amount of the tax credit allocated to an owner 20 does not exceed thirty percent of the qualified basis of the 21 qualified development. 22 e. The qualified development is the subject of a recorded 23 restrictive covenant requiring that, for the compliance period 24 or for a longer period agreed to by the authority and the 25 owner of the qualified development, the development shall be 26 maintained and operated as a qualified development and shall be 27 in compliance with Tit. VIII of the federal Civil Rights Act of 28 1968, as amended. 29 4. Upon review of an application, the authority may approve 30 the qualified development for the tax credit program provided 31 in section 16.37C, and issue a tax credit certificate stating 32 the amount of the tax credit the authority determines the 33 taxpayer is eligible to claim for each year of the credit 34 period. 35 -3- H 8225.3986 (3) 89 dg/rn 3/ 8

5. Unless otherwise provided in this section or the context 1 clearly requires otherwise, the authority shall determine 2 eligibility for a credit and allocate credits in accordance 3 with the standards and requirements set forth in section 42 of 4 the Internal Revenue Code. 5 6. An applicant that is unsuccessful in receiving a tax 6 credit award during an application period may make additional 7 applications during subsequent application periods. Such 8 applicants shall be required to submit a new application which 9 shall be reviewed in the same manner as other applications in 10 that application period. 11 Sec. 4. NEW SECTION . 16.37C Iowa housing tax credits —— 12 limits. 13 1. An Iowa housing tax credit shall be allowed against 14 the taxes imposed in chapter 422, subchapters II, III, and V, 15 and in chapter 432, and against the moneys and credits tax 16 imposed in section 533.329, in the amount determined by the 17 authority pursuant to this part. Any tax credit in excess of 18 the taxpayer’s liability for the tax year is not refundable but 19 may be credited to the tax liability for the following five 20 years or until depleted, whichever is earlier. 21 2. An individual may claim a tax credit under this section 22 of a partnership, limited liability company, S corporation, 23 estate, or trust electing to have income taxed directly to 24 the individual. The amount claimed by the individual shall 25 be based upon the pro rata share of the individual’s earnings 26 from the partnership, limited liability company, S corporation, 27 estate, or trust. 28 3. In any calendar year, the aggregate amount of all tax 29 credits allocated by the authority shall not exceed fifteen 30 million dollars, plus the sum of the following amounts: 31 a. The total of all unallocated tax credits, if any, for the 32 preceding calendar years. 33 b. The total amount of all previously allocated tax credits 34 that have been recaptured, revoked, canceled, or otherwise 35 -4- H 8225.3986 (3) 89 dg/rn 4/ 8

recovered by the authority. 1 4. a. To claim a tax credit under this section, a taxpayer 2 shall include one or more tax credit certificates issued by the 3 authority with the taxpayer’s tax return. 4 b. The tax credit certificate shall contain the taxpayer’s 5 name, address, tax identification number, the amount of the 6 credit including the amount the authority determines the 7 taxpayer is eligible to claim for each year of the credit 8 period, the name of the qualified development, any other 9 information required by the department of revenue, and a place 10 for the name and tax identification number of a transferee and 11 the amount of the tax credit being transferred. 12 c. Tax credit certificates issued under this section may 13 be transferred to any person or entity. Within ninety days 14 of transfer, the transferee shall submit the transferred tax 15 credit certificate to the authority along with a statement 16 containing the transferee’s name, tax identification number, 17 and address, the denomination that each replacement tax credit 18 certificate is to carry, and any other information required by 19 the department of revenue. 20 d. Within thirty days of receiving the transferred tax 21 credit certificate and the transferee’s statement, the 22 authority shall issue one or more replacement tax credit 23 certificates to the transferee. Each replacement tax credit 24 certificate must contain the information required for the 25 original tax credit certificate and must have the same 26 expiration date that appeared in the transferred tax credit 27 certificate. Tax credit certificate amounts of less than the 28 minimum amount established by rule of the authority shall not 29 be transferable. 30 e. A tax credit shall not be claimed by a transferee 31 under this section until a replacement tax credit certificate 32 identifying the transferee as the proper holder has been 33 issued. The transferee may use the amount of the tax credit 34 transferred against the taxes imposed in chapter 422, 35 -5- H 8225.3986 (3) 89 dg/rn 5/ 8

subchapters II, III, and V, and in chapter 432, and against the 1 moneys and credits tax imposed in section 533.329, for any tax 2 year the original transferor could have claimed the tax credit. 3 Any consideration received for the transfer of the tax credit 4 shall not be included as income under chapter 422, subchapters 5 II, III, and V. Any consideration paid for the transfer of the 6 tax credit shall not be deducted from income under chapter 422, 7 subchapters II, III, and V. 8 Sec. 5. NEW SECTION . 16.37D Recapture. 9 1. As of the last day of any tax year during the compliance 10 period, if the amount of the qualified basis of a qualified 11 development owned by a taxpayer claiming the credit is less 12 than the amount of the qualified basis as of the last day of the 13 immediately preceding tax year, the amount of the taxpayer’s 14 liability under chapter 422, subchapter II, III, or V, chapter 15 432, or section 533.329, as applicable, shall be increased by 16 the recapture amount determined using the method under section 17 42(j) of the Internal Revenue Code. 18 2. If a recapture event occurs, the taxpayer shall include 19 the recaptured proportion of the credit on the return submitted 20 for the tax year in which the recapture event is identified. 21 Sec. 6. NEW SECTION . 16.37E Compliance monitoring. 22 The authority shall monitor and oversee compliance with 23 sections 16.37A through 16.37D and shall report specific 24 occurrences of noncompliance to the department. 25 Sec. 7. NEW SECTION . 16.37F Report to the general assembly. 26 On or before January 31 of each year, the authority shall 27 submit to the general assembly a report that includes all of 28 the following: 29 1. A statement of the number of qualified developments for 30 which the authority issued tax certificates the prior year. 31 2. A description of each qualified development for which the 32 authority issued a tax certificate the prior year, including 33 the geographic location of the development, the household type 34 and any specific demographic information available concerning 35 -6- H 8225.3986 (3) 89 dg/rn 6/ 8

the residents intended to be served by the development, 1 the income levels of residents intended to be served by the 2 development, and the rents or set-asides authorized for each 3 development. 4 Sec. 8. NEW SECTION . 16.37G Rules. 5 The authority and the department shall adopt rules pursuant 6 to chapter 17A as necessary for the implementation and 7 administration of this part. 8 Sec. 9. NEW SECTION . 422.10C Iowa housing tax credit. 9 The taxes imposed under this subchapter, less the credits 10 allowed under section 422.12, shall be reduced by an Iowa 11 housing tax credit allowed under section 16.37C. 12 Sec. 10. Section 422.33, Code 2022, is amended by adding the 13 following new subsection: 14 NEW SUBSECTION . 17. The taxes imposed under this subchapter 15 shall be reduced by an Iowa housing tax credit as allowed under 16 section 16.37C. 17 Sec. 11. Section 422.60, Code 2022, is amended by adding the 18 following new subsection: 19 NEW SUBSECTION . 15. The taxes imposed under this subchapter 20 shall be reduced by an Iowa housing tax credit as allowed under 21 section 16.37C. 22 Sec. 12. NEW SECTION . 432.12O Iowa housing tax credit. 23 The taxes imposed under this chapter shall be reduced by an 24 Iowa housing tax credit allowed under section 16.37C. 25 Sec. 13. Section 533.329, subsection 2, Code 2022, is 26 amended by adding the following new paragraph: 27 NEW PARAGRAPH . m. The moneys and credits tax imposed under 28 this section shall be reduced by an Iowa housing tax credit 29 allowed under section 16.37C. 30 Sec. 14. CODE EDITOR DIRECTIVE. The Code editor shall 31 designate sections 16.37A through 16.37G, as enacted by 32 this division of this Act, as a new part within chapter 16, 33 subchapter VII, and may redesignate the new and preexisting 34 parts, replace references to sections 16.37A through 16.37G 35 -7- H 8225.3986 (3) 89 dg/rn 7/ 8

with references to the new part, and correct internal 1 references as necessary, including references in subchapter or 2 part headnotes. 3 Sec. 15. EFFECTIVE DATE. This division of this Act takes 4 effect January 1, 2023. 5 Sec. 16. APPLICABILITY. This division of this Act applies 6 to tax years beginning on or after January 1, 2023. 7 DIVISION III 8 FIRST-TIME HOMEBUYER SAVINGS ACCOUNTS 9 Sec. 17. Section 422.7, subsection 41, paragraph a, 10 subparagraph (1), subparagraph division (a), subparagraph 11 subdivisions (i) and (ii), Code 2022, are amended to read as 12 follows: 13 (i) For married taxpayers who file a joint return and 14 maintain a joint first-time homebuyer savings account, four ten 15 thousand dollars. 16 (ii) For any other account holder, two five thousand 17 dollars. > 18 2. Title page, by striking line 1 and inserting < An Act 19 relating to economic development matters, including legislative 20 findings, housing tax credits, and first-time homebuyer tax 21 incentives, and including effective date and applicability 22 provisions. >> 23 ______________________________ HUNTER of Polk -8- H 8225.3986 (3) 89 dg/rn 8/ 8 #2.