House File 670 - Introduced



                                    HOUSE FILE       
                                    BY  COMMITTEE ON ECONOMIC GROWTH

                                    (SUCCESSOR TO HSB 53)


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

                                      A BILL FOR

  1 An Act relating to the transferability of eligible housing
  2    business tax credits for new housing investment under the
  3    enterprise zone program.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  5 TLSB 1871HV 81
  6 tm/gg/14

PAG LIN



  1  1    Section 1.  Section 15E.193B, subsection 8, unnumbered
  1  2 paragraph 1, Code 2005, is amended to read as follows:
  1  3    The amount of the tax credits determined pursuant to
  1  4 subsection 6, paragraph "a", for each project shall be
  1  5 approved by the department of economic development.  The
  1  6 department shall utilize the financial information required to
  1  7 be provided under subsection 5, paragraph "e", to determine
  1  8 the tax credits allowed for each project.  In determining the
  1  9 amount of tax credits to be allowed for a project, the
  1 10 department shall not include the portion of the project cost
  1 11 financed through federal, state, and local government tax
  1 12 credits, grants, and forgivable loans.  Upon approving the
  1 13 amount of the tax credit, the department of economic
  1 14 development shall issue a tax credit certificate to the
  1 15 eligible housing business.  An eligible housing business or
  1 16 transferee shall not claim the tax credit unless a tax credit
  1 17 certificate issued by the department of economic development
  1 18 is attached to the taxpayer's return for the tax year for
  1 19 which the tax credit is claimed.  The tax credit certificate
  1 20 shall contain the taxpayer's name, address, tax identification
  1 21 number, the amount of the tax credit, and other information
  1 22 required by the department of revenue.  The tax credit
  1 23 certificate shall be transferable if the housing development
  1 24 is located in a brownfield site as defined in section 15.291,
  1 25 if the housing development is located in a blighted area as
  1 26 defined in section 403.17, or if low=income housing tax
  1 27 credits authorized under section 42 of the Internal Revenue
  1 28 Code are used to assist in the financing of the housing
  1 29 development.  Not more than three million dollars worth of tax
  1 30 credits for housing developments that are located in a
  1 31 brownfield site as defined in section 15.291 or housing
  1 32 developments located in a blighted area as defined in section
  1 33 403.17 shall be transferred in one calendar year.  If the
  1 34 transfer of more than three million dollars of such tax
  1 35 credits are applied for in a calendar year, tax credit
  2  1 certificates for transfers shall be issued on a pro rata
  2  2 basis.  Tax credit certificates issued under this chapter may
  2  3 be transferred to any person or entity.  Within ninety days of
  2  4 transfer, the transferee must submit the transferred tax
  2  5 credit certificate to the department of economic development
  2  6 along with a statement containing the transferee's name, tax
  2  7 identification number, and address, and the denomination that
  2  8 each replacement tax credit certificate is to carry and any
  2  9 other information required by the department of revenue.
  2 10 Within thirty days of receiving the transferred tax credit
  2 11 certificate and the transferee's statement, the department of
  2 12 economic development shall issue one or more replacement tax
  2 13 credit certificates to the transferee.  Each replacement
  2 14 certificate must contain the information required to receive
  2 15 the original certificate and must have the same expiration
  2 16 date that appeared in the transferred tax credit certificate.
  2 17 Tax credit certificate amounts of less than the minimum amount
  2 18 established by rule of the department of economic development
  2 19 shall not be transferable.  A tax credit shall not be claimed
  2 20 by a transferee under subsection 6, paragraph "a", until a
  2 21 replacement tax credit certificate identifying the transferee
  2 22 as the proper holder has been issued.
  2 23    Sec. 2.  APPLICABILITY.  This Act shall apply to transfers
  2 24 of tax credit certificates for projects that begin on or after
  2 25 July 1, 2005.
  2 26                           EXPLANATION
  2 27    This bill relates to the transferability of eligible
  2 28 housing business tax credits for new housing investment under
  2 29 the enterprise zone program.
  2 30    An eligible housing business under the enterprise zone
  2 31 program may receive a tax credit of up to 10 percent of the
  2 32 new investment which is directly related to the building or
  2 33 rehabilitating of a minimum of four single=family homes
  2 34 located in that part of a city or county in which there is a
  2 35 designated enterprise zone or one multiple=dwelling unit
  3  1 building containing three or more individual dwelling units
  3  2 located in that part of a city or county in which there is a
  3  3 designated enterprise zone.  Currently, the tax credits are
  3  4 transferable if low=income housing tax credits authorized
  3  5 under section 42 of the Internal Revenue Code are used to
  3  6 assist in the financing of the housing development.  The bill
  3  7 provides that not more than $3 million worth of tax credits
  3  8 are transferable if the housing development is located in a
  3  9 brownfield site or if the housing development is located in a
  3 10 blighted area.  The bill provides that if the transfer of more
  3 11 than $3 million worth of tax credits are applied for in a
  3 12 calendar year, the tax credit certificates shall be issued on
  3 13 a pro rata basis.
  3 14    The bill applies to transfers of tax credits for projects
  3 15 that begin on or after July 1, 2005.
  3 16 LSB 1871HV 81
  3 17 tm:nh/gg/14