House File 2770 - Introduced
HOUSE FILE
BY COMMITTEE ON WAYS AND MEANS
(SUCCESSOR TO HF 2736)
(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 5331HZ 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 and contributions from foreign governments are used to fund
1 13 the position. Not more than twenty=five percent of the cost
1 14 of funding an endowed chair position shall be paid with
1 15 financial assistance awarded from the bioscience fund. Not
1 16 more than twenty=five percent of all moneys deposited into the
1 17 bioscience fund may be used for financial assistance to fund
1 18 endowed chair positions.
1 19 2. The board shall consist of the following members:
1 20 a. Three members of the state board of regents appointed
1 21 by the governor and confirmed by the senate pursuant to
1 22 section 2.32.
1 23 b. Three members of a single bioscience development
1 24 organization identified by the department pursuant to section
1 25 15G.111, subsection 2, appointed by the governor and confirmed
1 26 by the senate pursuant to section 2.32.
1 27 c. Three members appointed by the Iowa economic
1 28 development board and confirmed by the senate pursuant to
1 29 section 2.32.
1 30 d. One member selected by the members of the board who
1 31 shall serve as the president of the board.
1 32 3. The terms of the appointed members shall be staggered
1 33 as determined by the governor. A vacancy shall be filled by
1 34 the appointing authority. Members shall serve three=year
1 35 terms and may be reappointed.
2 1 4. A bioscience fund is created in the state treasury
2 2 under the control of the board and consisting of any moneys
2 3 appropriated by the general assembly and any other moneys
2 4 available to and obtained or accepted by the board for
2 5 placement in the fund. Payments of interest, repayments of
2 6 moneys loaned pursuant to this section, and recaptures of
2 7 loans shall be deposited in the fund. The fund shall be used
2 8 to provide grants, loans, forgivable loans, loan guarantees,
2 9 and other forms of assistance pursuant to subsection 1.
2 10 Moneys in the fund are not subject to section 8.33.
2 11 Notwithstanding section 12C.7, interest or earnings on moneys
2 12 in the fund shall be credited to the fund. The board shall
2 13 ensure that the fund is an ongoing, self=sustaining fund.
2 14 As a condition of the receipt of moneys from the fund, the
2 15 department shall require recipients to enter into agreements
2 16 specifying compliance reporting requirements. If a recipient
2 17 of moneys from the fund fails to comply with a reporting
2 18 requirement or does not meet other compliance requirements in
2 19 an agreement, the recipient is subject to repayment of all or
2 20 a portion of the moneys received. An agreement between the
2 21 department and a recipient shall specify the method for
2 22 determining the amount of moneys which will be repaid in the
2 23 event of failure to comply with the requirements of an
2 24 agreement.
2 25 Sec. 2. Section 15.335A, Code Supplement 2005, is amended
2 26 by adding the following new subsection:
2 27 NEW SUBSECTION. 7. a. In calculating the annual wage,
2 28 including benefits, pursuant to subsection 1, the department
2 29 shall not require a certain wage level, without benefits, to
2 30 be met.
2 31 b. In calculating the value of benefits pursuant to
2 32 subsection 1, if an employer offers medical insurance under
2 33 both single and family coverage plans, the employer shall be
2 34 given credit for providing medical insurance under family
2 35 coverage plans to fifty percent of the number of new high=
3 1 quality jobs employees.
3 2 Sec. 3. Section 15G.112, subsection 1, Code Supplement
3 3 2005, is amended to read as follows:
3 4 1. In order to receive financial assistance from the
3 5 department from moneys appropriated from the grow Iowa values
3 6 fund, the average annual wage, including benefits, of new jobs
3 7 created must be equal to or greater than one hundred thirty
3 8 percent of the average county wage. The department shall not
3 9 require any other wage level to be met. For purposes of this
3 10 section, "average county wage" and "benefits" mean the same as
3 11 defined in section 15I.1.
3 12 Sec. 4. Section 15I.1, subsection 2, paragraph a, Code
3 13 Supplement 2005, is amended to read as follows:
3 14 a. Medical and dental insurance plans. If an employer
3 15 offers medical insurance under both single and family coverage
3 16 plans, the employer shall be given credit for providing
3 17 medical insurance under family coverage plans to the greater
3 18 of fifty percent of the new employees or the actual percentage
3 19 of new employees.
3 20 Sec. 5. Section 422.34A, Code 2005, is amended by adding
3 21 the following new subsection:
3 22 NEW SUBSECTION. 8. Utilizing a distribution facility
3 23 within this state, owning or leasing property at a
3 24 distribution facility within this state that is used at or
3 25 distributed from the distribution facility, or selling
3 26 property shipped or distributed from a distribution facility.
3 27 For purposes of this subsection, "distribution facility" means
3 28 an establishment where shipments of tangible personal property
3 29 are processed for delivery to customers. "Distribution
3 30 facility" does not include an establishment where retail sales
3 31 of tangible personal property or returns of such property are
3 32 undertaken with respect to retail customers on more than
3 33 twelve days a year except for a distribution facility which
3 34 processes customer sales orders by mail, telephone, or
3 35 electronic means, if the distribution facility also processes
4 1 shipments of tangible personal property to customers and if at
4 2 least seventy=five percent of the dollar amount of goods sold
4 3 through the distribution facility are sold to customers
4 4 outside this state.
4 5 Sec. 6. EFFECTIVE AND RETROACTIVE APPLICABILITY DATE.
4 6 1. Section 2 of this Act, being deemed of immediate
4 7 importance, takes effect upon enactment and applies
4 8 retroactively to June 9, 2005.
4 9 2. Section 5 of this Act, being deemed of immediate
4 10 importance, takes effect upon enactment and applies
4 11 retroactively to January 1, 2006, for tax years beginning on
4 12 or after that date.
4 13 EXPLANATION
4 14 This bill relates to economic development by creating a
4 15 bioscience funding board and bioscience fund, providing tax
4 16 incentives under the high quality job creation Act, and
4 17 providing an income tax exempt activity for foreign
4 18 corporations.
4 19 The bill establishes a bioscience funding board for
4 20 purposes of funding bioscience=related projects. The bill
4 21 creates a bioscience fund in the state treasury under the
4 22 control of the board and consisting of any moneys appropriated
4 23 by the general assembly and any other moneys available to and
4 24 obtained or accepted by the board for placement in the fund.
4 25 The bill provides that, as a condition of the receipt of
4 26 moneys from the fund, the department shall require recipients
4 27 to enter into agreements specifying compliance reporting
4 28 requirements and repayment terms for noncompliance. The bill
4 29 provides that the board shall award financial assistance from
4 30 moneys in the bioscience fund. The bill prohibits the use of
4 31 financial assistance for paying the salary of a salaried
4 32 employee, but allows the use of paying the salary of certain
4 33 contract employees. The bill allows financial assistance to
4 34 be used to partially fund an endowed chair position only if
4 35 significant private contributions and contributions from
5 1 foreign governments are used to fund the position. The bill
5 2 provides that not more than 25 percent of the cost of funding
5 3 an endowed chair position shall be paid with financial
5 4 assistance awarded from the bioscience fund and not more than
5 5 25 percent of all moneys deposited into the fund may be used
5 6 for financial assistance to fund endowed chair positions.
5 7 In determining eligibility for tax incentives under the
5 8 high quality job creation Act, a calculation of the annual
5 9 wage, including benefits, of new high=quality jobs created
5 10 must be performed. The bill provides that, in making the
5 11 calculation, the department shall not require a certain wage
5 12 level, without benefits, to be met. The bill provides that,
5 13 in making a calculation of the value of benefits, if an
5 14 employer offers medical insurance under both single and family
5 15 coverage plans, the employer shall be given credit for
5 16 providing medical insurance under family coverage plans to 50
5 17 percent of the number of new high=quality jobs employees.
5 18 This provision of the bill takes effect upon enactment and
5 19 applies retroactively to June 9, 2005.
5 20 Currently, in order to receive financial assistance from
5 21 the department of economic development from moneys
5 22 appropriated from the grow Iowa values fund, the average
5 23 annual wage, including benefits, of new jobs created must be
5 24 equal to or greater than 130 percent of the average county
5 25 wage. The bill prohibits the department from requiring any
5 26 other wage level to be met.
5 27 Currently, under the wage=benefits tax credit program, the
5 28 term "benefits" is defined to include certain benefits, one of
5 29 which is medical and dental insurance plans. The bill
5 30 provides that if an employer offers medical insurance under
5 31 both single and family coverage plans, the employer shall be
5 32 given credit for providing medical insurance under family
5 33 coverage plans to the greater of 50 percent of the new
5 34 employees or the actual percentage of new employees.
5 35 The bill provides that a foreign corporation shall not be
6 1 considered doing business in this state or deriving income
6 2 from sources within this state for the purposes of corporate
6 3 income tax liability by utilizing a distribution facility
6 4 within this state, owning or leasing property at a
6 5 distribution facility within this state that is used at or
6 6 distributed from the distribution facility, or selling
6 7 property shipped or distributed from a distribution facility.
6 8 This provision of the bill takes effect upon enactment and
6 9 applies retroactively to January 1, 2006.
6 10 LSB 5331HZ 81
6 11 tm:rj/cf/24