House File 2736 - Introduced HOUSE FILE BY COMMITTEE ON ECONOMIC GROWTH (SUCCESSOR TO HF 2497) Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to economic development by creating a bioscience 2 funding board and bioscience fund, providing tax incentives 3 under the high quality job creation Act, and providing an 4 exempt activity for foreign corporations, and including 5 effective and retroactive applicability date provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 5331HV 81 8 tm/cf/24 PAG LIN 1 1 Section 1. NEW SECTION. 15E.361 BIOSCIENCE FUNDING BOARD 1 2 == BIOSCIENCE FUND. 1 3 1. A bioscience funding board is established for purposes 1 4 of funding bioscience=related projects. The board shall award 1 5 financial assistance from moneys available in the bioscience 1 6 fund created in subsection 4. Financial assistance shall not 1 7 be used to pay the salary of a salaried employee, but may be 1 8 used to pay the salary of a contract employee provided the 1 9 employment contract is for not more than five years. 1 10 Financial assistance may only be used to partially fund an 1 11 endowed chair position if significant private contributions 1 12 are used to fund the position. 1 13 2. The board shall consist of the following members: 1 14 a. Three members of the state board of regents appointed 1 15 by the governor and confirmed by the senate pursuant to 1 16 section 2.32. 1 17 b. Three members of a single bioscience development 1 18 organization identified by the department pursuant to section 1 19 15G.111, subsection 2, appointed by the governor and confirmed 1 20 by the senate pursuant to section 2.32. 1 21 c. Three members appointed by the Iowa economic 1 22 development board and confirmed by the senate pursuant to 1 23 section 2.32. 1 24 d. One member selected by the members of the board who 1 25 shall serve as the president of the board. 1 26 3. The terms of the appointed members shall be staggered 1 27 as determined by the governor. A vacancy shall be filled by 1 28 the appointing authority. Members shall serve three=year 1 29 terms and may be reappointed. 1 30 4. A bioscience fund is created in the state treasury 1 31 under the control of the board and consisting of any moneys 1 32 appropriated by the general assembly and any other moneys 1 33 available to and obtained or accepted by the board for 1 34 placement in the fund. Payments of interest, repayments of 1 35 moneys loaned pursuant to this section, and recaptures of 2 1 loans shall be deposited in the fund. The fund shall be used 2 2 to provide grants, loans, forgivable loans, loan guarantees, 2 3 and other forms of assistance pursuant to subsection 1. 2 4 Moneys in the fund are not subject to section 8.33. 2 5 Notwithstanding section 12C.7, interest or earnings on moneys 2 6 in the fund shall be credited to the fund. The board shall 2 7 ensure that the fund is an ongoing, self=sustaining fund. 2 8 Sec. 2. Section 15.335A, Code Supplement 2005, is amended 2 9 by adding the following new subsection: 2 10 NEW SUBSECTION. 7. a. In calculating the annual wage, 2 11 including benefits, pursuant to subsection 1, the department 2 12 shall not require a certain wage level, without benefits, to 2 13 be met. 2 14 b. In calculating the value of benefits pursuant to 2 15 subsection 1, if an employer offers medical insurance under 2 16 both single and family coverage plans, the employer shall be 2 17 given credit for providing medical insurance under family 2 18 coverage plans to fifty percent of the number of new high= 2 19 quality jobs employees. 2 20 Sec. 3. Section 15G.112, subsection 1, Code Supplement 2 21 2005, is amended to read as follows: 2 22 1. In order to receive financial assistance from the 2 23 department from moneys appropriated from the grow Iowa values 2 24 fund, the average annual wage, including benefits, of new jobs 2 25 created must be equal to or greater than one hundred thirty 2 26 percent of the average county wage. The department shall not 2 27 require any other wage level to be met. For purposes of this 2 28 section, "average county wage" and "benefits" mean the same as 2 29 defined in section 15I.1. 2 30 Sec. 4. Section 15I.1, subsection 2, paragraph a, Code 2 31 Supplement 2005, is amended to read as follows: 2 32 a. Medical and dental insurance plans. If an employer 2 33 offers medical insurance under both single and family coverage 2 34 plans, the employer shall be given credit for providing 2 35 medical insurance under family coverage plans to the greater 3 1 of fifty percent of the new employees or the actual percentage 3 2 of new employees. 3 3 Sec. 5. Section 422.34A, Code 2005, is amended by adding 3 4 the following new subsection: 3 5 NEW SUBSECTION. 8. Storing tangible personal property in 3 6 a warehouse located in Iowa which is not owned by the 3 7 corporation provided that none of the goods are delivered or 3 8 shipped so as to be included in the gross sales of the 3 9 corporation within this state as provided in section 422.33, 3 10 subsection 2, paragraph "b", subparagraph (6). 3 11 Sec. 6. EFFECTIVE AND RETROACTIVE APPLICABILITY DATE. 3 12 1. Section 2 of this Act, being deemed of immediate 3 13 importance, takes effect upon enactment and applies 3 14 retroactively to June 9, 2005. 3 15 2. Section 5 of this Act, being deemed of immediate 3 16 importance, takes effect upon enactment and applies 3 17 retroactively to January 1, 2006, for tax years beginning on 3 18 or after that date. 3 19 EXPLANATION 3 20 This bill relates to economic development by creating a 3 21 bioscience funding board and bioscience fund, providing tax 3 22 incentives under the high quality job creation Act, and 3 23 providing an income tax exempt activity for foreign 3 24 corporations. 3 25 The bill establishes a bioscience funding board for 3 26 purposes of funding bioscience=related projects. The bill 3 27 provides that the board shall award financial assistance from 3 28 moneys in the bioscience fund. The bill prohibits the use of 3 29 financial assistance for paying the salary of a salaried 3 30 employee, but allows the use of paying the salary of certain 3 31 contract employees. The bill allows financial assistance to 3 32 be used to partially fund an endowed chair position only if 3 33 significant private contributions are used to fund the 3 34 position. The bill creates a bioscience fund in the state 3 35 treasury under the control of the board and consisting of any 4 1 moneys appropriated by the general assembly and any other 4 2 moneys available to and obtained or accepted by the board for 4 3 placement in the fund. 4 4 In determining eligibility for tax incentives under the 4 5 high quality job creation Act, a calculation of the annual 4 6 wage, including benefits, of new high=quality jobs created 4 7 must be performed. The bill provides that, in making the 4 8 calculation, the department shall not require a certain wage 4 9 level, without benefits, to be met. The bill provides that, 4 10 in making a calculation of the value of benefits, if an 4 11 employer offers medical insurance under both single and family 4 12 coverage plans, the employer shall be given credit for 4 13 providing medical insurance under family coverage plans to 50 4 14 percent of the number of new high=quality jobs employees. 4 15 This provision of the bill takes effect upon enactment and 4 16 applies retroactively to June 9, 2005. 4 17 Currently, in order to receive financial assistance from 4 18 the department of economic development from moneys 4 19 appropriated from the grow Iowa values fund, the average 4 20 annual wage, including benefits, of new jobs created must be 4 21 equal to or greater than 130 percent of the average county 4 22 wage. The bill prohibits the department from requiring any 4 23 other wage level to be met. 4 24 Currently, under the wage=benefits tax credit program, the 4 25 term "benefits" is defined to include certain benefits, one of 4 26 which is medical and dental insurance plans. The bill 4 27 provides that if an employer offers medical insurance under 4 28 both single and family coverage plans, the employer shall be 4 29 given credit for providing medical insurance under family 4 30 coverage plans to the greater of 50 percent of the new 4 31 employees or the actual percentage of new employees. 4 32 The bill provides that a foreign corporation shall not be 4 33 considered doing business in this state or deriving income 4 34 from sources within this state for the purposes of corporate 4 35 income tax liability by the storing of tangible personal 5 1 property in a warehouse located in Iowa which is not owned by 5 2 the corporation provided that none of the goods are delivered 5 3 or shipped so as to be included in the gross sales of the 5 4 corporation within this state due to being delivered or 5 5 shipped to a purchaser within this state. This provision 5 6 takes effect upon enactment and applies retroactively to 5 7 January 1, 2006. 5 8 LSB 5331HV 81 5 9 tm:rj/cf/24.1