House Study Bill 84

                                       SENATE/HOUSE FILE       
                                       BY  (PROPOSED DEPARTMENT OF
                                            ECONOMIC DEVELOPMENT BILL)


    Passed Senate, Date               Passed House,  Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to the enterprise zone program and including
  2    effective date provisions.
  3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  4 TLSB 1262DP 80
  5 tm/cl/14

PAG LIN

  1  1    Section 1.  Section 15E.192, subsection 3, paragraphs a and
  1  2 b, Code 2003, are amended to read as follows:
  1  3    a.  A county or city which meets the distress criteria
  1  4 provided in section 15E.194, Code 2001, may apply to the
  1  5 department for an area to be certified as an enterprise zone
  1  6 at any time prior to July December 1, 2003.  However, the
  1  7 total amount of land designated as enterprise zones under
  1  8 subsections 1 and 2, and any other enterprise zones certified
  1  9 by the department, excluding those approved pursuant to
  1 10 section 15E.194, subsection 4, shall not exceed in the
  1 11 aggregate one percent of the total county area.
  1 12    b.  An enterprise zone certified by the department pursuant
  1 13 to subsection 2 shall not be decertified or only be amended if
  1 14 the amendment consists of an area being added to the
  1 15 enterprise zone and the added area meets the criteria of
  1 16 section 15E.194, subsection 2.  An enterprise zone certified
  1 17 by the department pursuant to subsection 1 or 2 may be
  1 18 decertified; however, if a subsequent enterprise zone is
  1 19 designated, the expiration date of the subsequent enterprise
  1 20 zone shall be the same as the expiration date of the
  1 21 decertified enterprise zone.
  1 22    Sec. 2.  Section 15E.193, subsection 1, paragraph c, Code
  1 23 2003, is amended to read as follows:
  1 24    c.  Pays an average wage that is at or greater than ninety
  1 25 percent of the lesser of the average county wage or average
  1 26 regional wage, as determined by the department equal to or
  1 27 exceeds ninety percent of the average county wage as
  1 28 determined by the department of economic development, ninety
  1 29 percent of the average regional wage as determined by the
  1 30 department of economic development, or the annual wage cap as
  1 31 defined under the community economic betterment program,
  1 32 whichever is lowest.  However, the wage paid by the business
  1 33 shall not be less than seven dollars and fifty cents per hour.
  1 34    Sec. 3.  Section 15E.193, Code 2003, is amended by adding
  1 35 the following new subsection:
  2  1    NEW SUBSECTION.  4.  If a business that is approved to
  2  2 receive incentives or assistance provided under section
  2  3 15E.196 experiences a layoff within the state or closes any of
  2  4 its facilities within the state prior to receiving the
  2  5 incentives and assistance, the department may reduce or
  2  6 eliminate all or a portion of the incentives and assistance.
  2  7 If a business has received incentives or assistance under
  2  8 section 15E.196 and experiences a layoff within the state or
  2  9 closes any of its facilities within the state after receiving
  2 10 the incentives and assistance, the business may be subject to
  2 11 repayment of all or a portion of the incentives and assistance
  2 12 that it has received.
  2 13    Sec. 4.  Section 15E.193B, subsection 3, Code 2003, is
  2 14 amended to read as follows:
  2 15    3.  The single=family homes and dwelling units which are
  2 16 rehabilitated or constructed by the eligible housing business
  2 17 shall be modest homes or units but shall include the necessary
  2 18 amenities.  When completed and made available for occupancy,
  2 19 the single=family homes and dwelling units shall meet the
  2 20 United States department of housing and urban development's
  2 21 housing quality standards and local safety standards.
  2 22    Sec. 5.  Section 15E.193C, subsection 5, Code 2003, is
  2 23 amended to read as follows:
  2 24    5.  Prior to applying for receiving assistance under this
  2 25 section, an eligible development business shall enter into an
  2 26 agreement with at least one business for purposes of locating
  2 27 the business in all or a portion of the building space for a
  2 28 period of at least five years.  Nonretail businesses locating
  2 29 in a building space must create at least ten full=time
  2 30 positions, meet the criteria provided in section 15E.193,
  2 31 subsection 1, paragraphs "a", "b", and "c", and not share
  2 32 common ownership or common management with the development
  2 33 business.  A development business shall receive a pro rata
  2 34 share of the total incentives and assistance available to the
  2 35 development business based on the percentage of the building
  3  1 that is leased to nonretail businesses.  The department shall
  3  2 determine the procedure for issuing the incentives and
  3  3 assistance on a pro rata basis.
  3  4    Sec. 6.  2002 Iowa Acts, chapter 1145, section 7, is
  3  5 amended to read as follows:
  3  6    SEC. 7.  Section 15E.192, subsection 4 3, paragraph a, Code
  3  7 2003, is amended by striking the paragraph.
  3  8    Sec. 7.  2002 Iowa Acts, chapter 1145, section 10,
  3  9 subsection 2, is amended to read as follows:
  3 10    2.  Section 7 of this Act, striking section 15E.192,
  3 11 subsection 4 3, paragraph "a", Code 2003, takes effect July
  3 12 December 1, 2003.
  3 13    Sec. 8.  EFFECTIVE DATE.  Sections 1, 6, and 7 of this Act,
  3 14 amending section 15E.192 and 2002 Iowa Acts, chapter 1145,
  3 15 being deemed of immediate importance, take effect upon
  3 16 enactment.
  3 17                           EXPLANATION
  3 18    This bill amends the enterprise zone program administered
  3 19 by the department of economic development.
  3 20    In 2002, the enterprise zone program was amended to change
  3 21 all references to the 1990 certified federal census to the
  3 22 2000 certified federal census and allowed counties and cities
  3 23 currently meeting the distress criteria based on the 1990
  3 24 census to continue to designate enterprise zones until July 1,
  3 25 2003.  The bill changes the July 1, 2003, deadline to December
  3 26 1, 2003, and makes conforming amendments to 2002 Iowa Acts,
  3 27 chapter 1145, which take effect upon enactment.
  3 28    Currently, the enterprise zone program prohibits an
  3 29 enterprise zone from being decertified or amended.  The bill
  3 30 provides that an enterprise zone designated by a city shall
  3 31 only be amended if the amendment consists of an area being
  3 32 added to the enterprise zone and the added area meets the
  3 33 distress criteria for cities.  The bill provides that an
  3 34 enterprise zone designated by a county or city may be
  3 35 decertified; however, if a subsequent enterprise zone is
  4  1 designated, the expiration date of the subsequent enterprise
  4  2 zone shall be the same as the expiration date of the
  4  3 decertified enterprise zone.  These provisions take effect
  4  4 upon enactment.
  4  5    The bill amends the wage requirements for an eligible
  4  6 business under the enterprise zone program.  The bill provides
  4  7 that a business must pay an average wage that is equal to or
  4  8 exceeds 90 percent of the average county wage as determined by
  4  9 the department of economic development, 90 percent of the
  4 10 average regional wage as determined by the department of
  4 11 economic development, or the annual wage cap, whichever is
  4 12 lowest.  A current Code provision remains unchanged that sets
  4 13 a wage rate floor of $7.50 per hour.
  4 14    The bill adds reduction and payback provisions to the
  4 15 enterprise zone program if a business that is approved to
  4 16 receive incentives or assistance or a business that has
  4 17 already received incentives or assistance experiences a layoff
  4 18 within the state or closes any of its facilities within the
  4 19 state.  The bill allows the department to reduce or eliminate
  4 20 incentives and assistance if the business has not yet received
  4 21 incentives and assistance and to require repayment if
  4 22 incentives and assistance have already been received.
  4 23    The bill amends the housing business portion of the
  4 24 enterprise zone program by striking a requirement that single=
  4 25 family homes and dwelling units which are rehabilitated or
  4 26 constructed by the eligible housing business must be modest
  4 27 homes or units.
  4 28    The bill amends the development business portion of the
  4 29 enterprise zone program by allowing an eligible development
  4 30 business to be approved under the program prior to entering
  4 31 into an agreement with at least one business for purposes of
  4 32 locating the business in all or a portion of the building
  4 33 space for a period of at least five years.  However, the bill
  4 34 requires the agreement to be entered into prior to the
  4 35 eligible development business receiving any assistance under
  5  1 the program.
  5  2 LSB 1262DP 80
  5  3 tm/cl/14.1