House File 1054 H-1350 Amend House File 1054 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < DIVISION I 4 ECONOMIC DEVELOPMENT PROGRAMS —— TAX CREDIT LIMITS 5 Section 1. Section 15.119, Code 2025, is amended to read as 6 follows: 7 15.119 Aggregate tax credit limit for certain economic 8 business development programs. 9 1. a. Notwithstanding any provision to the contrary in any 10 of the business development programs listed in subsection 2 , 11 the authority, except as provided in paragraph “b” , shall not 12 authorize for any one fiscal year an amount of tax credits for 13 the programs specified in subsection 2 that is in excess of one 14 hundred seventy ten million dollars. 15 b. (1) The authority may authorize an amount of tax credits 16 during a fiscal year that is in excess of the amount specified 17 in paragraph “a” , but the amount of such excess shall not exceed 18 twenty percent of the amount specified in paragraph “a” , and 19 shall be counted against the total amount of tax credits that 20 may be authorized for the next fiscal year. 21 (2) Any amount of tax credits authorized and awarded during 22 a fiscal year for a program specified in subsection 2 which 23 are irrevocably declined by the awarded business or revoked 24 by the authority on or before June 30 of the next fiscal year 25 may be reallocated, authorized, and awarded during the fiscal 26 year in which the declination or revocation occurs. Tax 27 credits authorized pursuant to this subparagraph shall not be 28 considered for purposes of subparagraph (1). 29 2. The authority, with the approval of the board, shall 30 adopt by rule a procedure for allocating the aggregate tax 31 credit limit established in this section among the following 32 The aggregate tax credit limit specified in subsection 1 shall 33 be allocated to business development programs as follows : 34 a. (1) The high quality jobs program administered pursuant 35 -1- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 1/ 72 #1.

to subchapter II, part 13 . 1 (2) In allocating tax credits pursuant to this subsection 2 for the fiscal year beginning July 1, 2022, and for each fiscal 3 year thereafter, the authority shall not allocate more than 4 sixty-eight million dollars for purposes of this paragraph. 5 (3) In allocating tax credits pursuant to this subsection , 6 the authority shall prioritize issuing additional research 7 activities tax credits pursuant to section 15.335 . 8 b. The enterprise zones program administered pursuant to 9 sections 15E.191 through 15E.197, Code 2014 . 10 c. The assistive device tax credit program administered 11 pursuant to section 422.33, subsection 9 . 12 d. The tax credits for investments in qualifying businesses 13 issued pursuant to section 15E.43 . In allocating tax credits 14 pursuant to this subsection , the authority shall allocate two 15 million dollars for purposes of this paragraph, unless the 16 authority determines that the tax credits awarded will be less 17 than that amount. 18 e. a. (1) The tax credits for investments in an innovation 19 fund pursuant to section 15E.52 chapter 15E, subchapter VI, 20 and the seed investor tax credit pursuant to chapter 15E, 21 subchapter IV . In allocating tax credits pursuant to this 22 subsection , the authority shall allocate eight ten million 23 dollars for purposes of this paragraph, unless the authority 24 determines that the tax credits awarded will be less than that 25 amount and the board shall determine the tax credit amount 26 allocated to each program under this paragraph each fiscal 27 year . 28 (2) For the fiscal year beginning July 1, 2025, the 29 allocation pursuant to this paragraph shall be reduced by any 30 tax credit authorized by the authority prior to July 1, 2026, 31 for an investment in a qualifying business pursuant to chapter 32 15E, subchapter V, Code 2025. This subparagraph is repealed 33 July 1, 2026. 34 f. The redevelopment tax credit program for brownfields 35 -2- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 2/ 72

and grayfields administered pursuant to sections 15.293A and 1 15.293B . 2 g. The workforce housing tax incentives program administered 3 pursuant to subchapter II, part 17 . In allocating tax credits 4 pursuant to this subsection , the authority shall not allocate 5 more than thirty-five million dollars for purposes of this 6 paragraph. Of the moneys allocated under this paragraph, 7 seventeen million five hundred thousand dollars shall be 8 reserved for allocation to qualified housing projects in small 9 cities, as defined in section 15.352 , that are registered on 10 or after July 1, 2017. 11 h. The renewable chemical production tax credit program 12 administered pursuant to subchapter II, part 12 . In allocating 13 tax credits pursuant to this subsection for the fiscal year 14 beginning July 1, 2021, and for each fiscal year beginning 15 before July 1, 2037, the authority shall not allocate more than 16 five million dollars for purposes of this paragraph. This 17 paragraph is repealed July 1, 2039. 18 3. In allocating the amount of tax credits authorized 19 pursuant to subsection 1 among the programs specified in 20 subsection 2 , the authority shall not allocate more than 21 fifteen million dollars for purposes of subsection 2 , paragraph 22 “f” . 23 b. The renewable chemical production tax credit pursuant 24 to subchapter II, part 12, and the sustainable aviation fuel 25 production tax credit program pursuant to subchapter II, part 26 36. In allocating tax credits pursuant to this subsection, the 27 authority shall allocate ten million dollars for purposes of 28 this paragraph, and the board shall determine the tax credit 29 amount allocated to each program specified in this paragraph 30 for each fiscal year. 31 c. The research and development tax credit program pursuant 32 to subchapter II, part 35. In allocating tax credits pursuant 33 to this subsection, the authority shall allocate forty million 34 dollars for purposes of this paragraph. 35 -3- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 3/ 72

d. The business incentives for growth program administered 1 pursuant to subchapter II, part 33. In allocating tax credits 2 pursuant to this subsection for the fiscal year beginning July 3 1, 2026, and for each fiscal year thereafter, the authority 4 shall not allocate more than fifty million dollars for purposes 5 of this paragraph. 6 e. (1) The high quality jobs program administered pursuant 7 to chapter 15, subchapter II, part 13, and the business 8 incentives for growth program administered pursuant to chapter 9 15, subchapter II, part 33. In allocating tax credits pursuant 10 to this subsection, the authority shall allocate fifty million 11 dollars in the aggregate for purposes of this paragraph, by 12 allocating tax credits to the high quality jobs program prior 13 to January 1, 2026, and by allocating the remaining tax credits 14 to the business incentives for growth program on or after 15 January 1, 2026. 16 (2) This paragraph is repealed July 1, 2026. 17 4. 3. The authority shall submit to the department of 18 revenue on or before August 15 of each year a report on the tax 19 credits allocated pursuant to this section and the tax credits 20 awarded under each of the programs described in subsection 2 . 21 DIVISION II 22 ECONOMIC DEVELOPMENT PROGRAMS —— TAX CREDIT LIMITS 23 CONFORMING CHANGES 24 Sec. 2. Section 15.293A, subsection 6, Code 2025, is amended 25 to read as follows: 26 6. The amount of tax credits that may be awarded by the 27 board shall be subject to the limitation in section 15.119 28 Except as provided in section 15.293B, subsection 6, the board 29 shall not award in any one fiscal year an amount of tax credits 30 that exceeds fifteen million dollars . 31 Sec. 3. Section 15.293B, subsection 6, Code 2025, is amended 32 to read as follows: 33 6. a. (1) Tax credits revoked under subsection 3 including 34 tax credits revoked up to five years prior to July 1, 2021, and 35 -4- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 4/ 72

tax credits not awarded under subsection 4 or 5 , may be awarded 1 in the next annual application period established in subsection 2 1 , paragraph “c” . 3 (2) Any amount of tax credits authorized and awarded during 4 a fiscal year which are irrevocably declined by the awarded 5 investor on or before June 30 of the immediately succeeding 6 fiscal year may be awarded in the next annual application 7 period established in subsection 1, paragraph “c” . 8 b. Tax credits awarded pursuant to paragraph “a” shall not 9 be counted against the limit under section 15.119, subsection 3 10 15.293A, subsection 6 . 11 Sec. 4. Section 15.318, subsection 3, paragraph e, Code 12 2025, is amended to read as follows: 13 e. In each fiscal year beginning on or after July 1, 2023 14 2025 , and ending on or before June 30, 2036, the authority may 15 award an amount of tax credits under the program not to exceed 16 the maximum aggregate amount allocated in determined by the 17 board pursuant to section 15.119, subsection 2, paragraph “h” 18 “b” . 19 Sec. 5. Section 15.354, subsection 2, paragraph a, Code 20 2025, is amended to read as follows: 21 a. All completed applications shall be reviewed and 22 scored on a competitive basis by the authority pursuant to 23 rules adopted by the authority. In scoring applications, the 24 authority may award additional points for all of the following: 25 (1) A housing project located in a community where no 26 housing project has been awarded a tax incentive under the 27 program in the immediately preceding three application periods. 28 (2) A housing project located in a community where a recent 29 or planned business expansion, or a new business, has received 30 a tax incentive or financial assistance under the high quality 31 jobs program administered pursuant to subchapter II, part 13, 32 the major economic growth attraction program administered 33 pursuant to subchapter II, part 32, or the business incentives 34 for growth program administered pursuant to subchapter II, part 35 -5- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 5/ 72

33. 1 Sec. 6. Section 15.354, subsection 4, Code 2025, is amended 2 by striking the subsection and inserting in lieu thereof the 3 following: 4 4. Maximum tax incentives amount. 5 a. (1) In the fiscal year beginning July 1, 2025, and 6 ending June 30, 2026, the authority shall not award an amount 7 of tax credits in excess of thirty-nine million five hundred 8 thousand dollars. 9 (2) In the fiscal year beginning July 1, 2026, and ending 10 June 30, 2027, the authority shall not award an amount of tax 11 credits in excess of thirty-six million five hundred thousand 12 dollars. 13 (3) In the fiscal year beginning July 1, 2027, and for each 14 fiscal year thereafter, the authority shall not award an amount 15 of tax credits in excess of thirty-five million dollars. 16 b. Of the tax credits allocated under paragraph “a” , fifty 17 percent of the allocation available in each fiscal year shall 18 be reserved for allocation to qualified housing projects in 19 small cities. 20 c. Notwithstanding paragraph “b” , if the sum of the amount 21 of tax incentives awarded in a given fiscal year for housing 22 projects located in small cities based on the authority’s 23 review and scoring of applications does not exceed the amount 24 reserved for housing projects located in small cities pursuant 25 to paragraph “b” , the authority may award the remaining amount 26 of tax incentives reserved for housing projects located in 27 small cities to other housing projects during that same fiscal 28 year. 29 d. Tax credits revoked by the authority or irrevocably 30 declined by a housing business before June 30 of the fiscal 31 year following the award may be awarded during the fiscal year 32 the revocation or declination occurs. Tax credits awarded 33 pursuant to this paragraph shall not be counted against the tax 34 credit limit established in paragraph “a” . 35 -6- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 6/ 72

e. The maximum aggregate amount of tax incentives that 1 may be awarded and issued under section 15.355 to a housing 2 business for a housing project shall not exceed one million 3 dollars. 4 f. If a housing business qualifies for a higher amount 5 of tax incentives under section 15.355 than is allowed by 6 the limitation imposed in paragraph “e” , the authority and 7 the housing business may negotiate an apportionment of the 8 reduction in tax incentives between the sales tax refund 9 provided in section 15.355, subsection 2, and the workforce 10 housing investment tax credits provided in section 15.355, 11 subsection 3, provided the total aggregate amount of tax 12 incentives after the apportioned reduction does not exceed the 13 amount in paragraph “e” . 14 g. The authority shall issue tax incentives under the 15 program on a first-come, first-served basis until the maximum 16 amount of tax incentives allowed under paragraph “a” is reached. 17 Sec. 7. Section 15.354, subsection 6, paragraph d, Code 18 2025, is amended to read as follows: 19 d. The authority shall administer tax credit allocations 20 for disaster recovery housing projects separately from the 21 general allocation and separately from the allocation reserved 22 for small cities in section 15.119, subsection 2, paragraph 23 “g” . The authority shall issue tax incentives under the 24 program for disaster recovery housing projects on a first-come, 25 first-served basis until the maximum amount of tax incentives 26 allocated under section 15.119, subsection 5 , is reached. The 27 authority shall maintain a list of disaster recovery housing 28 projects awarded tax incentives under the program, so that if 29 the maximum aggregate amount of tax incentives allocated for 30 disaster recovery housing projects under the program is reached 31 in a given fiscal year, such disaster recovery housing projects 32 that were completed but for which tax incentives were not 33 issued shall be placed on a wait list in the order the disaster 34 recovery housing projects were awarded tax incentives pursuant 35 -7- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 7/ 72

to paragraph “c” , and shall be given priority for receiving 1 tax incentives in succeeding fiscal years maximum tax credit 2 amounts specified in section 15.354, subsection 4, paragraphs 3 “a” and “b” . 4 DIVISION III 5 BUSINESS INCENTIVES FOR GROWTH PROGRAM 6 Sec. 8. NEW SECTION . 15.111 Assistance for certain programs 7 and projects. 8 1. a. Under the authority provided in section 15.106A, 9 there shall be established one or more funds within the state 10 treasury, under the control of the authority, to be used for 11 purposes of this section. 12 b. A fund established for purposes of this section shall 13 consist of any moneys appropriated to the authority for 14 purposes of this section, or moneys otherwise accruing to 15 the authority and deposited in the fund for purposes of this 16 section. 17 c. Interest or earnings on moneys in a fund used for the 18 purposes of this section, and all repayments or recaptures of 19 the assistance provided under this section, shall accrue to 20 the authority and shall be used for purposes of this section, 21 notwithstanding section 12C.7. Moneys in a fund are not 22 subject to section 8.33. 23 2. a. The moneys in a fund established for purposes of 24 this section, as described in subsection 1, shall be allocated 25 by the authority in appropriate amounts to be used for the 26 following purposes: 27 (1) For program support. For purposes of this subparagraph, 28 “program support” means the services necessary for the efficient 29 administration of a program administered by the authority, 30 including but not limited to administrative costs, conducting a 31 statewide laborshed study in coordination with the department 32 of workforce development, outreach to business and marketing 33 programs, the procurement of technical assistance, and the 34 implementation of information technology. 35 -8- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 8/ 72

(2) For deposit in the innovation and commercialization 1 development fund created pursuant to section 15.412. 2 (3) For providing financial assistance to businesses 3 engaged in disaster recovery. For purposes of this 4 subparagraph, “business engaged in disaster recovery” means 5 a business located in an area declared a disaster area by a 6 federal official, that has sustained physical damage, has 7 closed as a result of a natural disaster, and has a plan for 8 reopening that includes employing a substantial number of the 9 employees the business employed before the natural disaster 10 occurred. 11 (4) For deposit in the entrepreneur investment awards 12 program fund pursuant to section 15E.363. 13 (5) For deposit in a fund created for purposes of the 14 strategic infrastructure program established pursuant to 15 section 15.313. 16 (6) For deposit in the nuisance property remediation fund 17 established pursuant to section 15.338. 18 (7) For deposit in the community catalyst building 19 remediation fund established pursuant to section 15.231. 20 (8) For providing financial assistance to eligible 21 businesses for the business incentives for growth program 22 pursuant to section 15.504. 23 b. Each fiscal year, the authority shall estimate the 24 amount of revenues available for purposes of this section and 25 shall develop a budget appropriate for the expenditure of the 26 revenues available. 27 Sec. 9. NEW SECTION . 15.502 Short title. 28 This part shall be known and may be cited as the “Business 29 Incentives for Growth Program” or “BIG Program” . 30 Sec. 10. NEW SECTION . 15.503 Definitions. 31 As used in this part, unless the context otherwise requires: 32 1. “Base employment level” means the number of full-time 33 equivalent positions at a business, as established by the 34 authority and the business using the business’s payroll 35 -9- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 9/ 72

records, as of the date the business applies for tax incentives 1 under the program. 2 2. “Benefits” means nonwage compensation provided to an 3 employee. “Benefits” include medical and dental insurance, a 4 pension, a retirement plan, a profit-sharing plan, child care, 5 life insurance, vision insurance, and disability insurance. 6 3. “Community” means a city, county, or entity established 7 pursuant to chapter 28E. 8 4. “Contract completion” means the date of completion of 9 the terms of a contract between a contractor and an eligible 10 business. 11 5. “Contractor” means a person that has executed a contract 12 with an eligible business for the provision of property, 13 materials, or services for the construction or equipping of a 14 facility that is part of the eligible business’s project. 15 6. “Created jobs” or “create jobs” means new, permanent, 16 full-time equivalent positions added to an eligible business’s 17 payroll, at the location of the eligible business’s project, in 18 excess of the eligible business’s base employment level. 19 7. “Data center business” means the same as defined in 20 section 423.3, subsection 95. 21 8. “Eligible business” means a business that meets the 22 requirements of section 15.504. 23 9. “Full-time equivalent position” means a non-part-time 24 position for the number of hours or days per week considered 25 to be full-time work for the kind of service or work performed 26 for an employer. Typically, a full-time equivalent position 27 requires two thousand eighty hours of work in a calendar year, 28 including all paid holidays, vacations, sick time, and other 29 paid leave. 30 10. “Program” means the business incentives for growth 31 program. 32 11. “Project” means an activity or set of activities 33 directly related to the start-up, location, modernization, or 34 expansion of an eligible business and proposed in an eligible 35 -10- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 10/ 72

business’s application to the program, that will accomplish the 1 goals of the program. 2 12. “Project completion date” means the date by which an 3 eligible business that has been approved by the authority to 4 participate in the program agrees to complete the terms and 5 conditions of the agreement under section 15.506. 6 13. “Project completion period” means the period of time 7 between the date the authority approves an eligible business to 8 participate in the program and the project completion date. 9 14. “Qualifying investment” means a capital investment 10 in real property, including the purchase price of the land 11 and existing buildings and structures, site preparation, 12 improvements to the real property, building construction, and 13 long-term lease costs. “Qualifying investment” also means 14 a capital investment in depreciable assets for use in the 15 operation of an eligible business. 16 15. “Qualifying wage threshold” means the mean wage level 17 represented by the wages within two standard deviations of 18 the mean wage within the laborshed area in which the eligible 19 business is located, as calculated by the authority by rule, 20 using the most current covered wage and employment data 21 available from the department of workforce development for the 22 laborshed area in which the eligible business is located. 23 16. “Retained job” means a full-time equivalent position 24 that is in existence at the time an eligible business applies 25 for the program that remains continuously filled, and that is 26 at risk of elimination if the proposed project for which the 27 eligible business is applying to the program does not proceed. 28 17. “Subcontractor” means a person that contracts with 29 a contractor for the provision of property, materials, or 30 services for the construction or equipping of a facility that 31 is part of an eligible business’s project. 32 18. “Tax incentives” means tax credits, tax refunds, or tax 33 exemptions authorized under the program by the authority for an 34 eligible business. 35 -11- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 11/ 72

Sec. 11. NEW SECTION . 15.504 Eligible business. 1 1. To be eligible to receive tax incentives under 2 the program, a business must meet all of the following 3 requirements: 4 a. The community in which the proposed project is located 5 must approve the project either by ordinance or resolution. 6 b. (1) The business must be primarily engaged in advanced 7 manufacturing, bioscience, insurance and finance, or technology 8 and innovation. The business shall not be a data center 9 business, a retail business, or a business where a cover charge 10 or membership requirement restricts certain individuals from 11 entering the business. 12 (2) Factors the authority shall consider to determine if 13 a business is primarily engaged in advanced manufacturing, 14 biosciences, insurance and finance, or technology and 15 innovation shall include but are not limited to all of the 16 following: 17 (a) The business’s North American industry classification 18 system code. 19 (b) The business’s main sources of revenue. 20 (c) The business’s customer base. 21 c. (1) The business must not be solely relocating 22 operations from one area of the state to another area of 23 the state. A proposed project that does not create jobs or 24 involve a substantial amount of new capital investment shall 25 be presumed to be a relocation of operations. For purposes of 26 this subparagraph, the authority shall consider a letter from 27 the affected local community’s government officials supporting 28 the business’s move away from the affected local community 29 in making a determination whether the business is solely 30 relocating operations. 31 (2) This paragraph shall not be construed to prohibit 32 a business from expanding the business’s operations in a 33 community if the business has similar operations in this state 34 that are not closing or undergoing a substantial reduction in 35 -12- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 12/ 72

operations. 1 d. The business must offer comprehensive benefits to each 2 full-time equivalent employee employed at the project. The 3 authority may adopt rules under chapter 17A to determine the 4 procedure for establishing requirements for comprehensive 5 benefits. 6 e. (1) The business must not have a record of violations of 7 the law or of rules, including but not limited to antitrust, 8 environmental, trade, or worker safety, that over a period of 9 time show a consistent pattern or that establish the business’s 10 intentional, criminal, or reckless conduct in violation of such 11 laws or rules. 12 (2) If the authority determines that the business has a 13 record of violations described in subparagraph (1), and the 14 authority finds that the violations did not seriously affect 15 public health, public safety, or the environment, the business 16 may be eligible to qualify for the program. 17 (3) If the authority determines that the business has 18 a record of violations described in subparagraph (1), and 19 the authority finds that there were mitigating circumstances 20 related to the violations, the business may be eligible to 21 qualify for the program. 22 (4) In making determinations and findings under 23 subparagraphs (2) and (3), and making a determination whether a 24 business is disqualified from the program, the authority shall 25 be exempt from chapter 17A. 26 2. In determining if a business is eligible to participate 27 in the program, the authority shall consider a variety of 28 factors, including but not limited to all of the following: 29 a. The impact of the business’s proposed project on 30 businesses that are in competition with the business. 31 The authority shall make a good-faith effort to identify 32 existing Iowa businesses in competition with the business 33 being considered for the program. The authority shall make 34 a good-faith effort to determine the probability that any 35 -13- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 13/ 72

proposed tax incentives will displace employees of the 1 competing businesses. 2 b. The business’s proposed project’s economic impact on 3 the state. The authority shall place greater emphasis on 4 businesses and proposed projects that meet the following 5 requirements: 6 (1) The business has a high proportion of in-state 7 suppliers. 8 (2) The proposed project will diversify the state economy. 9 (3) The business has few in-state competitors. 10 (4) The proposed project has the potential to create jobs on 11 an ongoing basis, or will result in increased skills and wages 12 for employees of the eligible business. 13 (5) The proposed project has the potential to increase 14 productivity, efficiency, and competitiveness through adoption 15 and integration of smart technologies including specialized 16 hardware, software, or other equipment. 17 (6) The proposed project has the potential to increase the 18 state’s overall gross domestic product. 19 (7) Any other factors the authority deems relevant in 20 determining the economic impact of a proposed project. 21 Sec. 12. NEW SECTION . 15.505 Applications —— authorization 22 of tax credits and exemptions. 23 1. a. Applications for the program shall be submitted 24 to the authority in the form and manner prescribed by the 25 authority by rule. Each application must be accompanied by an 26 application fee in an amount determined by the authority by 27 rule. 28 b. For a proposed project that will result in elevated 29 water consumption by the business, the application shall be 30 accompanied by a water conservation and waste reduction plan, 31 and shall be submitted to the authority in the form and manner 32 prescribed by the authority by rule. 33 2. In determining the eligibility of a business to 34 participate in the program, the authority may engage outside 35 -14- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 14/ 72

experts to complete a technical, financial, or other review of 1 an application submitted by a business. 2 3. a. The authority and the board may negotiate with an 3 eligible business regarding the terms of, and the aggregate 4 value of, the tax incentives the eligible business may receive 5 under the program. The maximum aggregate value of the tax 6 incentives that any one eligible business may receive shall 7 not exceed five percent of the eligible business’s qualifying 8 investment, unless the eligible business’s project is located 9 in a rural county, in which case the maximum aggregate value 10 of tax incentives that any one eligible business may receive 11 shall not exceed seven and one-half percent of the eligible 12 business’s qualifying investment. For purposes of this 13 paragraph, “rural county” means a county in the state with a 14 population of twenty thousand or less based on the most recent 15 decennial census released by the United States census bureau. 16 b. The board may authorize any combination of tax incentives 17 available under the program for an eligible business. 18 4. The board shall not authorize an award under this part 19 before January 1, 2026. 20 Sec. 13. NEW SECTION . 15.506 Agreement. 21 1. An eligible business that is approved by the authority to 22 participate in the program shall enter into an agreement with 23 the authority that specifies the criteria for the successful 24 completion of all requirements of the program. The agreement 25 must contain, at a minimum, provisions related to all of the 26 following: 27 a. The eligible business must certify to the authority 28 annually that the business is in compliance with the agreement. 29 b. If the eligible business fails to comply with any 30 requirements of the program or the agreement, as determined 31 by the authority, the eligible business may be required to 32 repay any tax incentives the authority issued to the eligible 33 business. After a final determination by the authority, the 34 authority will notify the department of revenue of any required 35 -15- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 15/ 72

repayment of a tax incentive, which shall be considered a 1 tax payment due and payable to the department of revenue by 2 any taxpayer that claimed the tax incentive, and the failure 3 to make the repayment may be treated by the department of 4 revenue in the same manner as a failure to pay the tax shown 5 due, or required to be shown due, with the filing of a return 6 or deposit form. A county shall have the authority to take 7 action to recover the value of property taxes not collected as 8 a result of the exemption provided to the business under this 9 part. 10 c. If the eligible business undergoes a layoff or 11 permanently closes any of its facilities within the state, the 12 eligible business may be subject to all of the following: 13 (1) A reduction or elimination of some or all of the tax 14 incentives the authority issued to the eligible business. 15 (2) Repayment of any tax incentives that the business 16 has claimed, and payment of any penalties assessed by the 17 department of revenue. 18 d. The project completion date, the agreement end date, 19 the base employment level, any retained jobs, the number of 20 created jobs, the qualifying wage threshold that is applicable 21 to the project, the amount of qualifying investment, the 22 maximum aggregate value of the tax incentives authorized by the 23 board, and any other terms and obligations the authority deems 24 necessary or material to the determination of the business’s 25 eligibility for the program, or the aggregate value of tax 26 incentives approved by the board. 27 e. The eligible business shall only employ individuals 28 legally authorized to work in this state. If the eligible 29 business is found to knowingly employ individuals who are 30 not legally authorized to work in this state, in addition 31 to any penalties provided by law, all or a portion of any 32 tax incentives issued by the authority shall be subject 33 to repayment as described in section 15.506, subsection 1, 34 paragraph “b” . 35 -16- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 16/ 72

f. Any terms deemed necessary by the authority to effect the 1 eligible business’s ongoing compliance with section 15.504. 2 2. The business shall satisfy all applicable terms of 3 the agreement by the project completion date; however, the 4 board may for good cause extend the project completion date or 5 otherwise amend the terms of the agreement. The board shall 6 not amend the terms of the agreement to allow an increase in 7 the maximum aggregate value of the tax incentives authorized by 8 the board under section 15.505, subsection 3. 9 3. The eligible business shall comply with all applicable 10 terms of the agreement until the agreement end date. An 11 eligible business shall maintain the business’s base employment 12 level until the agreement end date. 13 4. The eligible business shall not assign the agreement 14 to another entity without the advance written approval of the 15 board. 16 5. The authority may enforce the terms of the agreement as 17 necessary and appropriate. 18 Sec. 14. NEW SECTION . 15.507 Sales and use tax refund. 19 1. An eligible business that has been issued a tax incentive 20 certificate under the program shall be entitled to a refund, 21 as negotiated under section 15.505, subsection 3, of the sales 22 and use taxes paid under chapter 423 for gas, electricity, 23 water, and sewer utility services, tangible personal property, 24 or on services rendered, furnished, or performed to or for 25 a contractor or subcontractor and used in the fulfillment 26 of a written contract for the construction or equipping of 27 a facility that is part of the eligible business’s project. 28 Taxes attributable to intangible property and furniture and 29 furnishings shall not be refunded. 30 2. To receive the sales and use tax refund, the eligible 31 business shall file a claim with the department of revenue as 32 follows: 33 a. The contractor or subcontractor shall state under oath, 34 on forms provided by the department of revenue, the amount of 35 -17- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 17/ 72

the sales of tangible personal property or services rendered, 1 furnished, or performed including water, sewer, gas, and 2 electric utility services upon which sales or use tax has been 3 paid during the period for which the refund is claimed, and 4 shall submit the forms to the eligible business before contract 5 completion. 6 b. The eligible business shall, no more frequently than 7 quarterly, submit an application to the department of revenue 8 for a refund of the amount of the sales and use taxes paid 9 pursuant to chapter 423 upon any tangible personal property, or 10 services rendered, furnished, or performed, including water, 11 sewer, gas, and electric utility services. The application 12 shall be submitted in the form and manner prescribed by the 13 department of revenue. The department of revenue shall audit 14 the application and, if approved, issue a warrant or warrants 15 to the eligible business in the amount of the sales or use tax 16 which has been paid to the state of Iowa under subsection 1. 17 The eligible business’s final application must be submitted to 18 the department of revenue within one year after the project 19 completion date. An application filed by the eligible business 20 in accordance with this section shall not be denied by reason 21 of a time limitation for filing a refund claim set forth in 22 section 423.47. 23 c. The refund shall be remitted by the department of 24 revenue to the eligible business as soon as practicable after 25 completion of the audit pursuant to paragraph “b” . Interest 26 shall not accrue on any part of the refund that has not yet been 27 remitted by the department of revenue to the eligible business. 28 3. A contractor or subcontractor that willfully makes a 29 false report of tax paid under this section is guilty of an 30 aggravated misdemeanor, and shall be liable for payment of the 31 tax and any applicable penalty and interest. 32 Sec. 15. NEW SECTION . 15.508 Qualifying investment tax 33 credit. 34 1. The authority may authorize a tax credit for an eligible 35 -18- HF 1054.2065 (2) 91 (amending this HF 1054 to CONFORM to SF 657) jm/jh 18/ 72