Senate File 559 H-1353 Amend Senate File 559, as amended, passed, and reprinted by 1 the Senate, as follows: 2 1. Page 25, after line 27 by inserting: 3 < DIVISION ___ 4 NEIGHBORHOOD HOUSING RENOVATION 5 Sec. ___. NEW SECTION . 16.230 Neighborhood housing 6 renovation grant program —— fund. 7 1. a. A neighborhood housing renovation grant fund 8 is created in the state treasury under the control of the 9 authority. Moneys in the fund are appropriated to the 10 authority to award grants under the neighborhood housing 11 renovation grant program. 12 b. There is appropriated to the authority for deposit in the 13 neighborhood housing renovation grant fund for the fiscal year 14 beginning July 1, 2023, from the moneys available to the state 15 pursuant to the federal American Rescue Plan Act of 2021, Pub. 16 L. No. 117-2, the sum of five million dollars. 17 c. Notwithstanding section 12C.7, subsection 2, interest 18 or earnings on moneys in the neighborhood housing renovation 19 grant fund shall accrue to the authority and shall be used for 20 purposes of this section. Notwithstanding section 8.33, moneys 21 in the neighborhood housing renovation grant fund at the end of 22 each fiscal year shall not revert to any other fund but shall 23 remain in the neighborhood housing renovation grant fund for 24 expenditure for subsequent fiscal years. All repayments or 25 recaptures of grants awarded under this section shall accrue to 26 the authority and shall be used for purposes of this section. 27 d. The authority shall not use more than three percent of 28 the moneys in the neighborhood housing renovation grant fund at 29 the beginning of the fiscal year for purposes of administrative 30 costs, marketing, and other program support. 31 2. a. The authority shall establish and administer a 32 neighborhood housing renovation grant program for purposes of 33 awarding grants to eligible homeowners for qualifying exterior 34 home improvements, repairs, or renovations. 35 -1- SF 559.2168 (2) 90 ko/ns 1/ 9 #1.
b. To qualify for the neighborhood housing renovation grant 1 program, a homeowner’s household income shall not exceed one 2 hundred nine thousand dollars. 3 c. The property at which the qualifying exterior home 4 improvements, repairs, or renovations will occur must be 5 occupied by the homeowner. 6 d. A grant awarded under the neighborhood housing renovation 7 grant program shall not exceed twenty thousand dollars. 8 e. Exterior improvements, repairs, and renovations that 9 qualify for the neighborhood housing renovation grant program 10 shall include all of the following: 11 (1) Roof repair or replacement. 12 (2) Foundation repair. 13 (3) Exterior siding repair or replacement. 14 (4) Exterior paint. 15 (5) Window and door repair or replacement. 16 (6) Garage repair or replacement. 17 (7) Exterior energy efficiency-related repairs or upgrades. 18 (8) Exterior wheelchair or mobility assistive device 19 accessibility. 20 (9) Sidewalk and driveway repair or replacement. 21 3. The authority shall adopt rules pursuant to chapter 17A 22 to administer this section. 23 DIVISION ___ 24 IOWA HOUSING TAX CREDIT PROGRAM 25 Sec. ___. NEW SECTION . 16.37A Definitions. 26 For purposes of this part, unless the context otherwise 27 requires: 28 1. “Compliance period” means the period of fifteen years 29 beginning with the first taxable year of the credit period. 30 2. “Credit period” means the period of ten tax years 31 beginning with the tax year in which a qualified development 32 is placed in service and the Iowa housing tax credit may be 33 claimed. If a qualified development consists of more than 34 one building, the qualified development is placed in service 35 -2- SF 559.2168 (2) 90 ko/ns 2/ 9
in the tax year in which the last building of the qualified 1 development is placed in service. 2 3. “Department” means the Iowa department of revenue. 3 4. “Qualified allocation plan” means the qualified 4 allocation plan adopted by the authority pursuant to section 5 42(m) of the Internal Revenue Code. 6 5. “Qualified basis” means the qualified basis determined 7 under section 42(c)(1) of the Internal Revenue Code. 8 6. “Qualified development” means a qualified low-income 9 housing project under section 42(g) of the Internal Revenue 10 Code that is financed with tax-exempt bonds, pursuant to 11 section 42(i)(2) of the Internal Revenue Code, and located in 12 this state. 13 7. “Taxpayer” means an individual, a person, firm, 14 corporation, or other entity that owns an interest, direct 15 or indirect, in a qualified development and who claims a tax 16 credit under section 16.37C. 17 Sec. ___. NEW SECTION . 16.37B Application —— review —— 18 authorization. 19 1. The authority shall develop a system for the application, 20 review, and authorization of Iowa housing tax credits awarded 21 pursuant to this part and shall control the issuance of all tax 22 credit certificates to taxpayers pursuant to this part. 23 2. Applications for Iowa housing tax credits shall be 24 accepted during an annual application period established by the 25 authority. 26 3. The authority may authorize the tax credit if all of the 27 following conditions are satisfied: 28 a. The tax credit certificate is issued to a taxpayer who 29 has an ownership interest in the qualified development. 30 b. The tax credit amount is allocated pursuant to a 31 qualified allocation plan. 32 c. The tax credit is necessary for the financial feasibility 33 of the qualified development. 34 d. The amount of the tax credit allocated to an owner 35 -3- SF 559.2168 (2) 90 ko/ns 3/ 9
does not exceed thirty percent of the qualified basis of the 1 qualified development. 2 e. The qualified development is the subject of a recorded 3 restrictive covenant requiring that, for the compliance period 4 or for a longer period agreed to by the authority and the 5 owner of the qualified development, the development shall be 6 maintained and operated as a qualified development and shall be 7 in compliance with Tit. VIII of the federal Civil Rights Act of 8 1968, as amended. 9 4. Upon review of an application, the authority may approve 10 the qualified development for the tax credit program provided 11 in section 16.37C, and issue a tax credit certificate stating 12 the amount of the tax credit the authority determines the 13 applicant is eligible to claim for each year of the credit 14 period. 15 5. Unless otherwise provided in this section or the context 16 clearly requires otherwise, the authority shall determine 17 eligibility for a credit and allocate credits in accordance 18 with the standards and requirements set forth in section 42 of 19 the Internal Revenue Code. 20 6. An applicant that is unsuccessful in receiving a tax 21 credit award during an annual application period may make 22 additional applications during subsequent annual application 23 periods. Such applicants shall be required to submit a new 24 application which shall be reviewed in the same manner as other 25 applications in that annual application period. 26 Sec. ___. NEW SECTION . 16.37C Iowa housing tax credits —— 27 limits. 28 1. An Iowa housing tax credit shall be allowed against 29 the taxes imposed in chapter 422, subchapters II, III, and V, 30 and in chapter 432, and against the moneys and credits tax 31 imposed in section 533.329, in the amount determined by the 32 authority pursuant to this part. Any tax credit in excess of 33 the taxpayer’s liability for the tax year is not refundable but 34 may be credited to the tax liability for the following five 35 -4- SF 559.2168 (2) 90 ko/ns 4/ 9
years or until depleted, whichever is earlier. 1 2. An individual may claim a tax credit under this 2 subsection of a partnership, limited liability company, 3 S corporation, estate, or trust electing to have income 4 taxed directly to the individual. The amount claimed by the 5 individual shall be based upon the pro rata share of the 6 individual’s earnings from the partnership, limited liability 7 company, S corporation, estate, or trust. 8 3. In any calendar year, the aggregate amount of all tax 9 credits allocated by the authority shall not exceed fifteen 10 million dollars, plus the sum of the following amounts: 11 a. The total of all unallocated tax credits, if any, for the 12 preceding calendar years. 13 b. The total amount of all previously allocated tax credits 14 that have been recaptured, revoked, canceled, or otherwise 15 recovered by the authority. 16 4. a. To claim a tax credit under this section, a taxpayer 17 shall include one or more tax credit certificates issued by the 18 authority with the taxpayer’s tax return. 19 b. The tax credit certificate shall contain the taxpayer’s 20 name, address, tax identification number, the amount of the 21 credit including the amount the authority determines the 22 taxpayer is eligible to claim for each year of the credit 23 period, the name of the qualified development, any other 24 information required by the department of revenue, and a place 25 for the name and tax identification number of a transferee and 26 the amount of the tax credit being transferred. 27 c. Tax credit certificates issued under this section may 28 be transferred to any person or entity. Within ninety days 29 of transfer, the transferee shall submit the transferred tax 30 credit certificate to the authority along with a statement 31 containing the transferee’s name, tax identification number, 32 and address, the denomination that each replacement tax credit 33 certificate is to carry, and any other information required by 34 the department of revenue. 35 -5- SF 559.2168 (2) 90 ko/ns 5/ 9
d. Within thirty days of receiving the transferred tax 1 credit certificate and the transferee’s statement, the 2 authority shall issue one or more replacement tax credit 3 certificates to the transferee. Each replacement tax credit 4 certificate must contain the information required for the 5 original tax credit certificate and must have the same 6 expiration date that appeared in the transferred tax credit 7 certificate. Tax credit certificate amounts of less than 8 the minimum amount established by rule of the Iowa finance 9 authority shall not be transferable. 10 e. A tax credit shall not be claimed by a transferee 11 under this section until a replacement tax credit certificate 12 identifying the transferee as the proper holder has been 13 issued. The transferee may use the amount of the tax credit 14 transferred against the taxes imposed in chapter 422, 15 subchapters II, III, and V, and in chapter 432, and against the 16 moneys and credits tax imposed in section 533.329, for any tax 17 year the original transferor could have claimed the tax credit. 18 Any consideration received for the transfer of the tax credit 19 shall not be included as income under chapter 422, subchapters 20 II, III, and V. Any consideration paid for the transfer of the 21 tax credit shall not be deducted from income under chapter 422, 22 subchapters II, III, and V. 23 Sec. ___. NEW SECTION . 16.37D Recapture. 24 1. As of the last day of any tax year during the compliance 25 period, if the amount of the qualified basis of a qualified 26 development owned by a taxpayer claiming the credit is less 27 than the amount of the qualified basis as of the last day of the 28 immediately preceding tax year, the amount of the taxpayer’s 29 liability under this part shall be increased by the recapture 30 amount determined using the method under section 42(j) of the 31 Internal Revenue Code. 32 2. If a recapture event occurs, the taxpayer shall include 33 the recaptured proportion of the credit on the return submitted 34 for the tax year in which the recapture event is identified. 35 -6- SF 559.2168 (2) 90 ko/ns 6/ 9
Sec. ___. NEW SECTION . 16.37E Compliance monitoring. 1 The authority shall monitor and oversee compliance with 2 sections 16.37A through 16.37D and shall report specific 3 occurrences of noncompliance to the department. 4 Sec. ___. NEW SECTION . 16.37F Report to the general 5 assembly. 6 On or before January 31 of each year, the authority shall 7 submit to the general assembly a report that includes all of 8 the following: 9 1. A statement of the number of qualified developments for 10 which the authority issued tax certificates that year. 11 2. A description of each qualified development for which 12 the authority issued a tax certificate that year, including the 13 geographic location of the development, the household type and 14 any specific demographic information available concerning the 15 residents intended to be served by the development, the income 16 levels of residents intended to be served by the development, 17 and the rents or set-asides authorized for each development. 18 3. An analysis of housing market and demographic 19 information that shows how the qualified developments for 20 which the authority has issued tax certificates at any time 21 are addressing the need for affordable housing within the 22 communities those developments are intended to serve, and an 23 analysis of any remaining disparities in the affordability of 24 housing within those communities. 25 Sec. ___. NEW SECTION . 16.37G Rules. 26 The authority and the department shall adopt rules pursuant 27 to chapter 17A as necessary for the implementation and 28 administration of this part. 29 Sec. ___. NEW SECTION . 422.10C Iowa housing tax credit. 30 The taxes imposed under this subchapter, less the credits 31 allowed under section 422.12, shall be reduced by an Iowa 32 housing tax credit allowed under section 16.37C. 33 Sec. ___. Section 422.33, Code 2023, is amended by adding 34 the following new subsection: 35 -7- SF 559.2168 (2) 90 ko/ns 7/ 9
NEW SUBSECTION . 17. The taxes imposed under this subchapter 1 shall be reduced by an Iowa housing tax credit as allowed under 2 section 16.37C. 3 Sec. ___. Section 422.60, Code 2023, is amended by adding 4 the following new subsection: 5 NEW SUBSECTION . 16. The taxes imposed under this subchapter 6 shall be reduced by an Iowa housing tax credit as allowed under 7 section 16.37C. 8 Sec. ___. NEW SECTION . 432.12P Iowa housing tax credit. 9 The taxes imposed under this chapter shall be reduced by an 10 Iowa housing tax credit allowed under section 16.37C. 11 Sec. ___. Section 533.329, subsection 2, Code 2023, is 12 amended by adding the following new paragraph: 13 NEW PARAGRAPH . n. The moneys and credits tax imposed under 14 this section shall be reduced by an Iowa housing tax credit 15 allowed under section 16.37C. 16 Sec. ___. CODE EDITOR DIRECTIVE. The Code editor shall 17 designate sections 16.37A through 16.37G, as enacted by 18 this division of this Act, as a new part within chapter 16, 19 subchapter VII, and may redesignate the new and preexisting 20 parts, replace references to sections 16.37A through 16.37G 21 with references to the new part, and correct internal 22 references as necessary, including references in subchapter or 23 part headnotes. 24 Sec. ___. EFFECTIVE DATE. This division of this Act takes 25 effect January 1, 2024. 26 Sec. ___. APPLICABILITY. This division of this Act applies 27 to tax years beginning on or after January 1, 2024. 28 DIVISION ___ 29 FIRST-TIME HOMEBUYER SAVINGS ACCOUNTS 30 Sec. ___. Section 422.7, subsection 27, paragraph a, 31 subparagraph (1), subparagraph division (a), subparagraph 32 subdivisions (i) and (ii), Code 2023, are amended to read as 33 follows: 34 (i) For married taxpayers who file a joint return and 35 -8- SF 559.2168 (2) 90 ko/ns 8/ 9
maintain a joint first-time homebuyer savings account, four ten 1 thousand dollars. 2 (ii) For any other account holder, two five thousand 3 dollars. > 4 2. Title page, by striking line 9 and inserting < program, 5 new job training agreements, and first-time homebuyer accounts, 6 and creating the neighborhood housing renovation grant and Iowa 7 housing tax credit programs. > 8 3. By renumbering as necessary. 9 ______________________________ MATSON of Polk -9- SF 559.2168 (2) 90 ko/ns 9/ 9 #2. #3.