House File 794 - Introduced
HOUSE FILE
BY COMMITTEE ON ECONOMIC
GROWTH
(SUCCESSOR TO HSB 137)
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to economic development, business, workforce, and
2 regulatory assistance and tax credits, and to state
3 developmental, research, and regulatory oversight, making
4 appropriations, and including effective date and applicability
5 provisions.
6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 DIVISION I
1 2 GROW IOWA VALUES FUND
1 3 Section 1. NEW SECTION. 15G.108 GROW IOWA VALUES FUND.
1 4 A grow Iowa values fund is created in the state treasury
1 5 under the control of the department of economic development
1 6 consisting of moneys appropriated to the department. Moneys
1 7 in the fund are not subject to section 8.33. Notwithstanding
1 8 section 12C.7, interest or earnings on moneys in the fund
1 9 shall be credited to the fund. The fund shall be administered
1 10 by the department, which shall make expenditures from the fund
1 11 consistent with this chapter and pertinent Acts of the general
1 12 assembly. Any financial assistance provided using moneys from
1 13 the fund may be provided over a period of time of more than
1 14 one year. Payments of interest, repayments of moneys loaned
1 15 pursuant to this chapter, and recaptures of grants or loans
1 16 shall be deposited in the fund.
1 17 DIVISION II
1 18 APPROPRIATIONS
1 19 Sec. 2. NEW SECTION. 15G.111 APPROPRIATIONS.
1 20 1. a. For the fiscal period beginning July 1, 2005, and
1 21 ending June 30, 2015, there is appropriated each fiscal year
1 22 from the grow Iowa values fund created in section 15G.108 to
1 23 the department of economic development thirty=five million
1 24 dollars for programs administered by the department of
1 25 economic development.
1 26 b. Each year that moneys are appropriated under this
1 27 subsection, the department shall allocate a percentage of the
1 28 moneys for each of the following types of activities:
1 29 (1) Business start=ups.
1 30 (2) Business expansion.
1 31 (3) Business modernization.
1 32 (4) Business attraction.
1 33 (5) Business retention.
1 34 (6) Marketing.
1 35 (7) Research and development.
2 1 c. The department shall require an applicant for moneys
2 2 appropriated under this subsection to include in the
2 3 application a statement regarding the intended return on
2 4 investment. A recipient of moneys appropriated under this
2 5 subsection shall annually submit a statement to the department
2 6 regarding the progress achieved on the intended return on
2 7 investment stated in the application. The department, in
2 8 cooperation with the department of revenue, shall develop a
2 9 method of identifying and tracking each new job created and
2 10 the leveraging of moneys through financial assistance from
2 11 moneys appropriated under this subsection. The department of
2 12 economic development shall identify research and development
2 13 activities funded through financial assistance from not more
2 14 than ten percent of the moneys appropriated under this
2 15 subsection, and, instead of determining return on investment
2 16 and job creation for the identified funding, determine the
2 17 potential impact on the state's economy.
2 18 d. The department may use moneys appropriated under this
2 19 subsection to procure technical assistance from either the
2 20 public or private sector, for information technology purposes,
2 21 for a statewide labor shed study, and for rail, air, or river
2 22 port transportation=related purposes. The use of moneys
2 23 appropriated for rail, air, or river port
2 24 transportation=related purposes must be directly related to an
2 25 economic development project and the moneys must be used to
2 26 leverage other financial assistance moneys.
2 27 e. Of the moneys appropriated under this subsection, the
2 28 department may use up to one and one=half percent for
2 29 administrative purposes.
2 30 f. The Iowa economic development board shall approve or
2 31 deny applications for financial assistance provided with
2 32 moneys appropriated under this subsection. In providing such
2 33 financial assistance, the board shall, whenever possible,
2 34 coordinate the assistance with other programs administered by
2 35 the department of economic development, including the
3 1 community economic betterment program established in section
3 2 15.317 and the value=added agricultural products and processes
3 3 financial assistance program established in section 15E.111.
3 4 g. It is the policy of this state to expand and stimulate
3 5 the state economy by advancing, promoting, and expanding
3 6 biotechnology industries in this state. To implement this
3 7 policy, the Iowa economic development board shall consider
3 8 providing assistance to projects that increase value=added
3 9 income to individuals or organizations involved in
3 10 agricultural business or biotechnology projects. Such a
3 11 project need not create jobs specific to the project site;
3 12 however, such a project must foster the knowledge and
3 13 creativity necessary to promote the state's agricultural
3 14 economy and to increase employment in urban and rural areas as
3 15 a result.
3 16 2. a. For the fiscal period beginning July 1, 2005, and
3 17 ending June 30, 2015, there is appropriated each fiscal year
3 18 from the grow Iowa values fund created in section 15G.108 to
3 19 the department of economic development five million dollars
3 20 for the following:
3 21 (1) For financial assistance to institutions of higher
3 22 learning under the control of the state board of regents and
3 23 to accredited private universities in this state for
3 24 infrastructure projects and programs needed to assist in the
3 25 implementation of activities under chapter 262B.
3 26 (2) For financial assistance to a single biosciences
3 27 development organization determined by the department to
3 28 possess expertise in promoting the area of bioscience
3 29 entrepreneurship. The organization must be composed of
3 30 representatives of both the public and the private sector and
3 31 shall be composed of subunits or subcommittees in the areas of
3 32 existing identified biosciences platforms, education and
3 33 workforce development, commercialization, communication,
3 34 policy and governance, and finance. Such financial assistance
3 35 shall be used for purposes of activities related to
4 1 biosciences and bioeconomy development under chapter 262B.
4 2 3. For the fiscal period beginning July 1, 2005, and
4 3 ending June 30, 2015, there is appropriated each fiscal year
4 4 from the grow Iowa values fund created in section 15G.108 to
4 5 the general fund of the state four million dollars for payment
4 6 of tax credits approved pursuant to section 404A.4 for
4 7 projects located in certified cultural and entertainment
4 8 districts.
4 9 4. For the fiscal period beginning July 1, 2005, and
4 10 ending June 30, 2015, there is appropriated each fiscal year
4 11 from the grow Iowa values fund created in section 15G.108 to
4 12 the department of economic development one million dollars for
4 13 purposes of providing financial assistance for projects in
4 14 targeted state parks and destination parks. The department of
4 15 natural resources shall submit a plan to the department of
4 16 economic development for the expenditure of moneys
4 17 appropriated under this subsection. The plan shall focus on
4 18 improving state parks, state banner parks, and destination
4 19 parks for economic development purposes. Based on the report
4 20 submitted, the department of economic development shall
4 21 provide financial assistance to the department of natural
4 22 resources for support of state parks, state banner parks, and
4 23 destination parks.
4 24 5. For the fiscal period beginning July 1, 2005, and
4 25 ending June 30, 2015, there is appropriated each fiscal year
4 26 from the grow Iowa values fund created in section 15G.108 to
4 27 the office of the treasurer of state one million dollars for
4 28 deposit in the Iowa cultural trust fund created in section
4 29 303A.4.
4 30 6. For the fiscal period beginning July 1, 2005, and
4 31 ending June 30, 2015, there is appropriated each fiscal year
4 32 from the grow Iowa values fund created in section 15G.108 to
4 33 the department of economic development seven million dollars
4 34 for deposit into the workforce training and economic
4 35 development funds of the community colleges created pursuant
5 1 to section 260C.18A.
5 2 7. For the fiscal period beginning July 1, 2005, and
5 3 ending June 30, 2015, there is appropriated each fiscal year
5 4 from the grow Iowa values fund created in section 15G.108 to
5 5 the general fund of the state four hundred thousand dollars
5 6 for payment of endow Iowa tax credits approved pursuant to
5 7 section 15E.305.
5 8 8. For the fiscal period beginning July 1, 2005, and
5 9 ending June 30, 2015, there is appropriated each fiscal year
5 10 from the grow Iowa values fund created in section 15G.108 to
5 11 the department of economic development one million dollars for
5 12 providing economic development region financial assistance
5 13 under section 15E.232, subsections 3, 4, 5, and 6, and under
5 14 section 15E.233.
5 15 9. For the fiscal period beginning July 1, 2005, and
5 16 ending June 30, 2015, there is appropriated each fiscal year
5 17 from the grow Iowa values fund created in section 15G.108 to
5 18 the general fund of the state two million dollars for payment
5 19 of economic development region revolving fund contribution tax
5 20 credits approved pursuant to section 15E.232.
5 21 10. Notwithstanding section 8.33, moneys that remain
5 22 unexpended at the end of a fiscal year shall not revert to any
5 23 fund but shall remain available for expenditure for the
5 24 designated purposes during the succeeding fiscal year.
5 25 DIVISION III
5 26 IOWA ECONOMIC DEVELOPMENT BOARD
5 27 Sec. 3. Section 15.103, Code 2005, is amended to read as
5 28 follows:
5 29 15.103 ECONOMIC DEVELOPMENT BOARD.
5 30 1. a. The Iowa economic development board is created,
5 31 consisting of eleven voting members appointed by the governor
5 32 and seven ex officio nonvoting members. The ex officio
5 33 nonvoting members are four legislative members; one president,
5 34 or the president's designee, of the university of northern
5 35 Iowa, the university of Iowa, or Iowa state university of
6 1 science and technology designated by the state board of
6 2 regents on a rotating basis; and one president, or the
6 3 president's designee, of a private college or university
6 4 appointed by the Iowa association of independent colleges and
6 5 universities; and one superintendent, or the superintendent's
6 6 designee, of a community college, appointed by the Iowa
6 7 association of community college presidents. The legislative
6 8 members are two state senators, one appointed by the president
6 9 of the senate, after consultation with the majority leader of
6 10 the senate, and one appointed by the minority leader of the
6 11 senate, after consultation with the president of the senate,
6 12 from their respective parties; and two state representatives,
6 13 one appointed by the speaker and one appointed by the minority
6 14 leader of the house of representatives from their respective
6 15 parties. Not more than six of the voting members shall be
6 16 from the same political party. The secretary of agriculture
6 17 or the secretary's designee shall be one of the voting
6 18 members. The governor shall appoint the remaining ten voting
6 19 members of the board for a term of four years beginning and
6 20 ending as provided by section 69.19, subject to confirmation
6 21 by the senate, and the governor's appointments shall include
6 22 persons knowledgeable of the various elements of the
6 23 department's responsibilities.
6 24 b. Each of the following areas of expertise shall be
6 25 represented by at least one member of the board who has
6 26 professional experience in that area of expertise:
6 27 (1) Finance, insurance, or investment banking.
6 28 (2) Advanced manufacturing.
6 29 (3) Statewide agriculture.
6 30 (4) Life sciences.
6 31 (5) Small business development.
6 32 (6) Information technology.
6 33 (7) Economics.
6 34 (8) Labor.
6 35 (9) Marketing.
7 1 (10) Entrepreneurship.
7 2 c. At least nine members of the board shall be actively
7 3 employed in the private, for=profit sector of the economy.
7 4 2. A vacancy on the board shall be filled in the same
7 5 manner as regular appointments are made for the unexpired
7 6 portion of the regular term.
7 7 3. The board shall meet in May of each year for the
7 8 purpose of electing one of its voting members as chairperson
7 9 and one of its voting members as vice chairperson. However,
7 10 the chairperson and the vice chairperson shall not be from the
7 11 same political party. The board shall meet at the call of the
7 12 chairperson or when any six members of the board file a
7 13 written request with the chairperson for a meeting. Written
7 14 notice of the time and place of each meeting shall be given to
7 15 each member of the board. A majority of the voting members
7 16 constitutes a quorum.
7 17 4. Members of the board, the director, and other employees
7 18 of the department shall be allowed their actual and necessary
7 19 expenses incurred in the performance of their duties. All
7 20 expenses shall be paid from appropriations for those purposes
7 21 and the department is subject to the budget requirements of
7 22 chapter 8. Each member of the board may also be eligible to
7 23 receive compensation as provided in section 7E.6.
7 24 5. If a member of the board has an interest, either direct
7 25 or indirect, in a contract to which the department is or is to
7 26 be a party, the interest shall be disclosed to the board in
7 27 writing and shall be set forth in the minutes of a meeting of
7 28 the board. The member having the interest shall not
7 29 participate in action by the board with respect to the
7 30 contract. This paragraph does not limit the right of a member
7 31 of the board to acquire an interest in bonds, or limit the
7 32 right of a member to have an interest in a bank or other
7 33 financial institution in which the funds of the department are
7 34 deposited or which is acting as trustee or paying agent under
7 35 a trust indenture to which the department is a party.
8 1 6. As part of the organizational structure of the
8 2 department, the board shall establish a due diligence
8 3 committee and a loan and credit guarantee committee composed
8 4 of members of the board. The committees shall serve in an
8 5 advisory capacity to the board and shall carry out any duties
8 6 assigned by the board in relation to programs administered by
8 7 the department.
8 8 7. For the transitional period beginning July 1, 2005, and
8 9 ending June 30, 2006, the composition of the voting members of
8 10 the board shall be determined by the governor and shall be
8 11 composed of members of the department of economic development
8 12 in existence on June 30, 2005, and members of the grow Iowa
8 13 values board as it existed on June 15, 2004. During the
8 14 transitional period stated in this subsection, the
8 15 requirements of subsection 1, paragraphs "a" and "b", shall
8 16 not apply. This subsection is repealed June 30, 2006.
8 17 Sec. 4. Section 15.104, Code 2005, is amended by adding
8 18 the following new subsection:
8 19 NEW SUBSECTION. 9. By January 15 of each year, submit a
8 20 report to the general assembly and the governor that
8 21 delineates expenditures made under each component of the grow
8 22 Iowa values fund. In addition, the department shall provide
8 23 in the report the following information regarding each
8 24 business finance project and in the aggregate for projects
8 25 funded during the previous fiscal year:
8 26 a. The number of jobs created as of the time of reporting.
8 27 b. The average wage of the jobs created as of the time of
8 28 reporting.
8 29 c. The amount of capital investment invested as of the
8 30 time of reporting.
8 31 d. The location.
8 32 e. The amount, if any, of private and local government
8 33 moneys expended as of the time of reporting.
8 34 DIVISION IV
8 35 REGULATORY ASSISTANCE
9 1 Sec. 5. NEW SECTION. 15E.19 REGULATORY ASSISTANCE.
9 2 1. The department of economic development shall coordinate
9 3 all regulatory assistance for the state of Iowa. Each state
9 4 agency administering regulatory programs for business shall
9 5 maintain a coordinator within the office of the director or
9 6 the administrative division of the state agency. Each
9 7 coordinator shall do all of the following:
9 8 a. Serve as the state agency's primary contact for
9 9 regulatory affairs with the department of economic
9 10 development.
9 11 b. Provide information regarding regulatory requirements
9 12 to businesses and represent the state agency to the private
9 13 sector.
9 14 c. Monitor permit applications and provide timely permit
9 15 status information to the department of economic development.
9 16 d. Require regulatory staff participation in negotiations
9 17 and discussions with businesses.
9 18 e. Notify the department of economic development regarding
9 19 proposed rulemaking activities that impact a regulatory
9 20 program and any subsequent changes to a regulatory program.
9 21 2. The department of economic development shall, in
9 22 consultation with the coordinators described in this section,
9 23 examine, and to the extent permissible, assist in the
9 24 implementation of methods, including the possible
9 25 establishment of an electronic database, to streamline the
9 26 process for issuing permits to business.
9 27 3. By January 15 of each year, the department of economic
9 28 development shall submit a written report to the general
9 29 assembly regarding the provision of regulatory assistance by
9 30 state agencies, including the department's efforts, and its
9 31 recommendations and proposed solutions, to streamline the
9 32 process of issuing permits to business.
9 33 DIVISION V
9 34 ECONOMIC DEVELOPMENT REGIONS
9 35 Sec. 6. NEW SECTION. 15E.21 IOWA BUSINESS CENTERS.
10 1 1. The department shall establish an Iowa business center
10 2 program for purposes of locating Iowa business centers in the
10 3 state. Such centers may be located in areas of the state that
10 4 are not served by a business accelerator or any similar type
10 5 entity that assists start=up businesses. The department shall
10 6 partner with another entity focusing on economic growth to
10 7 establish an Iowa business center. Operational duties of a
10 8 center shall be determined pursuant to a memorandum of
10 9 agreement between the department and the other entity. The
10 10 memorandum of agreement shall also contain a description of
10 11 core services to be provided by the center and the
10 12 responsibilities of the entities entering into the agreement.
10 13 A center shall coordinate the intake of any person or business
10 14 seeking business related assistance from a state entity.
10 15 2. a. For the fiscal period beginning July 1, 2005, and
10 16 ending June 30, 2015, there is appropriated to the department
10 17 of economic development each fiscal year fifty thousand
10 18 dollars from the rural enterprise fund. Moneys appropriated
10 19 under this paragraph shall be used for purposes of supporting
10 20 Iowa business centers in rural areas of the state. The
10 21 department shall provide financial assistance to such offices
10 22 after the department and the entity operating the center enter
10 23 into a memorandum of agreement for the operation of the
10 24 center.
10 25 b. For the fiscal period beginning July 1, 2005, and
10 26 ending June 30, 2015, there is appropriated to the department
10 27 of economic development each fiscal year fifty thousand
10 28 dollars from the grow Iowa values fund created in section
10 29 15G.108. Moneys appropriated under this paragraph shall be
10 30 used for purposes of supporting Iowa business centers in any
10 31 part of the state. The department shall provide financial
10 32 assistance to such offices after the department and the entity
10 33 operating the center enter into a memorandum of agreement for
10 34 the operation of the center.
10 35 Sec. 7. NEW SECTION. 15E.231 ECONOMIC DEVELOPMENT
11 1 REGIONS.
11 2 1. In order for an economic development region to receive
11 3 moneys from the grow Iowa values fund created in section
11 4 15G.108, an economic development region's regional development
11 5 plan must be approved by the department. An economic
11 6 development region shall consist of not less than three
11 7 counties. An economic development region shall establish a
11 8 focused economic development effort that shall include a
11 9 regional development plan relating to one or more of the
11 10 following areas:
11 11 a. Regional marketing strategies.
11 12 b. Development of the information solutions sector.
11 13 c. Development of the advanced manufacturing sector.
11 14 d. Development of the life sciences and biotechnology
11 15 sector.
11 16 e. Development of the insurance or financial services
11 17 sector.
11 18 f. Physical infrastructure including, but not limited to,
11 19 horizontal infrastructure, water and sewer infrastructure, and
11 20 telecommunications infrastructure.
11 21 g. Entrepreneurship.
11 22 2. An economic development region may create an economic
11 23 development region revolving fund as provided in section
11 24 15E.232.
11 25 Sec. 8. NEW SECTION. 15E.232 ECONOMIC DEVELOPMENT REGION
11 26 REVOLVING FUNDS == TAX CREDITS.
11 27 1. An economic development region may create an economic
11 28 development region revolving fund.
11 29 2. a. A nongovernmental entity making a contribution to
11 30 an economic development region revolving fund, except those
11 31 described in paragraph "b", may claim a tax credit equal to
11 32 twenty percent of the amount contributed to the revolving
11 33 fund. The tax credit shall be allowed against taxes imposed
11 34 in chapter 422, divisions II, III, and V, and in chapter 432,
11 35 and against the moneys and credits tax imposed in section
12 1 533.24. An individual may claim under this subsection the tax
12 2 credit of a partnership, limited liability company, S
12 3 corporation, estate, or trust electing to have income taxed
12 4 directly to the individual. The amount claimed by the
12 5 individual shall be based upon the pro rata share of the
12 6 individual's earnings from the partnership, limited liability
12 7 company, S corporation, estate, or trust. Any tax credit in
12 8 excess of the taxpayer's liability for the tax year may be
12 9 credited to the tax liability for the following ten years or
12 10 until depleted, whichever occurs first. A tax credit shall
12 11 not be carried back to a tax year prior to the tax year in
12 12 which the taxpayer redeems the tax credit. A tax credit under
12 13 this section is not transferable.
12 14 b. Subject to the provisions of paragraph "c", an
12 15 organization exempt from federal income tax pursuant to
12 16 section 501(c) of the Internal Revenue Code making a
12 17 contribution to an economic development region revolving fund,
12 18 shall be paid from the general fund of the state an amount
12 19 equal to twenty percent of such contributed amount within
12 20 thirty days after the end of the fiscal year during which the
12 21 contribution was made.
12 22 c. The total amount of tax credits and payments to
12 23 contributors, referred to as the credit amount, authorized
12 24 during a fiscal year shall not exceed two million dollars plus
12 25 any unused credit amount carried over from previous years.
12 26 Any credit amount which remains unused for a fiscal year may
12 27 be carried forward to the succeeding fiscal year. The maximum
12 28 credit amount that may be authorized in a fiscal year for
12 29 contributions made to a specific economic development region
12 30 revolving fund is equal to two million dollars plus any unused
12 31 credit amount carried over from previous years divided by the
12 32 number of economic development region revolving funds existing
12 33 in the state.
12 34 d. The department of economic development shall administer
12 35 the authorization of tax credits under this section and
13 1 payments to contributors described in paragraph "b" and shall,
13 2 in cooperation with the department of revenue, adopt rules
13 3 pursuant to chapter 17A necessary for the administration of
13 4 this section.
13 5 3. An economic development region may apply for financial
13 6 assistance from the grow Iowa values fund to assist with the
13 7 installation of physical infrastructure needs including, but
13 8 not limited to, horizontal infrastructure, water and sewer
13 9 infrastructure, and telecommunications infrastructure, related
13 10 to the development of fully served business and industrial
13 11 sites by one or more of the region's economic development
13 12 partners or for the installation of infrastructure related to
13 13 a new business location or expansion. In order to receive
13 14 financial assistance pursuant to this subsection, the economic
13 15 development region must demonstrate all of the following:
13 16 a. The ability to provide matching moneys on a basis of a
13 17 one dollar contribution of local matching moneys for every two
13 18 dollars received from the grow Iowa values fund.
13 19 b. The commitment of the specific business partner
13 20 including, but not limited to, a letter of intent defining a
13 21 capital commitment or a percentage of equity.
13 22 c. That all other funding alternatives have been
13 23 exhausted.
13 24 4. The department may establish and administer a regional
13 25 economic development revenue sharing pilot project for one or
13 26 more regions. The department shall take into consideration
13 27 the geographical dispersion of the pilot projects. The
13 28 department shall provide technical assistance to the regions
13 29 participating in a pilot project.
13 30 5. An economic development region may apply for financial
13 31 assistance from the grow Iowa values fund to assist an
13 32 existing business threatened with closure due to a potential
13 33 consolidation to an out=of=state location. The economic
13 34 development region may apply for financial assistance from the
13 35 grow Iowa values fund for the purchase, rehabilitation, or
14 1 marketing of a building that has become available due to the
14 2 closing of an existing business due to a consolidation to an
14 3 out=of=state location. In order to receive financial
14 4 assistance under this subsection, an economic development
14 5 region must demonstrate the ability to provide local matching
14 6 moneys on a basis of a one dollar contribution of local moneys
14 7 for every three dollars received from the grow Iowa values
14 8 fund.
14 9 6. An economic development region may apply for financial
14 10 assistance from the grow Iowa values fund to establish and
14 11 operate an entrepreneurial initiative. In order to receive
14 12 financial assistance under this subsection, an economic
14 13 development region must demonstrate the ability to provide
14 14 local matching moneys on a basis of a one dollar contribution
14 15 of local moneys for every two dollars received from the grow
14 16 Iowa values fund.
14 17 7. a. An economic development region may apply for
14 18 financial assistance from the grow Iowa values fund to
14 19 establish and operate a business succession assistance program
14 20 for the region.
14 21 b. In order to receive financial assistance under this
14 22 subsection, an economic development region must demonstrate
14 23 the ability to provide local matching moneys on a basis of a
14 24 one dollar contribution of local moneys for every two dollars
14 25 received from the grow Iowa values fund.
14 26 8. An economic development region may apply for financial
14 27 assistance from the grow Iowa values fund to implement
14 28 economic development initiatives that are either unique to the
14 29 region or innovative in design and implementation. In order
14 30 to receive financial assistance under this subsection, an
14 31 economic development region must demonstrate the ability to
14 32 provide local matching moneys on a one=to=one basis.
14 33 9. Financial assistance under subsections 5, 6, 7, 8, and
14 34 9, and section 15E.233 shall be limited to a total of two
14 35 million dollars each fiscal year for the fiscal period
15 1 beginning July 1, 2005, and ending June 30, 2010.
15 2 Sec. 9. NEW SECTION. 15E.233 ECONOMIC ENTERPRISE AREAS.
15 3 1. An economic development region may apply to the
15 4 department for approval to be designated as an economic
15 5 enterprise area based on criteria provided in subsection 3.
15 6 The department shall approve no more than ten regions as
15 7 economic enterprise areas.
15 8 2. a. An approved economic enterprise area may apply to
15 9 the department for financial assistance from the grow Iowa
15 10 values fund for up to seven hundred fifty thousand dollars
15 11 over a five=year period for any of the following purposes:
15 12 (1) Economic development=related strategic planning and
15 13 marketing for the region as a whole.
15 14 (2) Economic development of fully=served business sites.
15 15 (3) The construction of speculative buildings on a fully
15 16 served lot.
15 17 (4) The rehabilitation of an existing building to
15 18 marketable standards.
15 19 b. In order to receive financial assistance under this
15 20 subsection, an economic enterprise area must demonstrate the
15 21 ability to provide local matching moneys on a basis of a one
15 22 dollar contribution of local moneys for every three dollars
15 23 received from the grow Iowa values fund.
15 24 3. An economic enterprise area shall consist of at least
15 25 one county containing no city with a population of more than
15 26 twenty=three thousand five hundred and shall meet at least two
15 27 of the following criteria:
15 28 a. A per capita income of eighty percent or less than the
15 29 national average.
15 30 b. A household median income of eighty percent or less
15 31 than the national average.
15 32 c. Twenty=five percent or more of the population of the
15 33 economic enterprise area with an income level of one hundred
15 34 fifty percent or less of the United States poverty level as
15 35 defined by the most recently revised poverty income guidelines
16 1 published by the United States department of health and human
16 2 services.
16 3 d. A population density in the economic enterprise area of
16 4 less than ten people per square mile.
16 5 e. A loss of population as shown by the 2000 certified
16 6 federal census when compared with the 1990 certified federal
16 7 census.
16 8 f. An unemployment rate greater than the national rate of
16 9 unemployment.
16 10 g. More than twenty percent of the population of the
16 11 economic enterprise area consisting of people over the age of
16 12 sixty=five.
16 13 Sec. 10. NEW SECTION. 15E.351 BUSINESS ACCELERATORS.
16 14 1. The department shall establish and administer a
16 15 business accelerator program to provide financial assistance
16 16 for the establishment and operation of a business accelerator
16 17 for technology=based, value=added agricultural, information
16 18 solutions, or advanced manufacturing start=up businesses or
16 19 for a satellite of an existing business accelerator. The
16 20 program shall be designed to foster the accelerated growth of
16 21 new and existing businesses through the provision of technical
16 22 assistance. The department shall use moneys appropriated to
16 23 the department from the grow Iowa values fund to provide
16 24 financial assistance under this section.
16 25 2. In determining whether a business accelerator qualifies
16 26 for financial assistance, the department must find that a
16 27 business accelerator meets all of the following criteria:
16 28 a. The business accelerator must be a not=for=profit
16 29 organization affiliated with an area chamber of commerce, a
16 30 community or county organization, or economic development
16 31 region.
16 32 b. The geographic area served by a business accelerator
16 33 must include more than one county.
16 34 c. The business accelerator must possess the ability to
16 35 provide service to a specific type of business as well as to
17 1 meet the broad=based needs of other types of start=up
17 2 entrepreneurs.
17 3 d. The business accelerator must possess the ability to
17 4 market business accelerator services in the region and the
17 5 state.
17 6 e. The business accelerator must possess the ability to
17 7 communicate with and cooperate with other business
17 8 accelerators and similar service providers in the state.
17 9 f. The business accelerator must possess the ability to
17 10 engage various funding sources for start=up entrepreneurs.
17 11 g. The business accelerator must possess the ability to
17 12 communicate with and cooperate with various entities for
17 13 purposes of locating suitable facilities for clients of the
17 14 business accelerator.
17 15 h. The business accelerator must possess the willingness
17 16 to accept referrals from the department of economic
17 17 development.
17 18 3. In determining whether a business accelerator qualifies
17 19 for financial assistance, the department may consider any of
17 20 the following:
17 21 a. The business experience of the business accelerator's
17 22 professional staff.
17 23 b. The business plan review capacity of the business
17 24 accelerator's professional staff.
17 25 c. The business accelerator's professional staff with
17 26 demonstrated disciplines in all aspects of business
17 27 experience.
17 28 d. The business accelerator's professional staff with
17 29 access to external service providers including legal,
17 30 accounting, marketing, and financial services.
17 31 4. In order to receive financial assistance under this
17 32 section, the financial assistance recipient must demonstrate
17 33 the ability to provide matching moneys on a basis of a two
17 34 dollar contribution of recipient moneys for every one dollar
17 35 received in financial assistance.
18 1 Sec. 11. NEW SECTION. 422.11K ECONOMIC DEVELOPMENT
18 2 REGION REVOLVING FUND TAX CREDIT.
18 3 The taxes imposed under this division, less the credits
18 4 allowed under sections 422.12 and 422.12B, shall be reduced by
18 5 an economic development region revolving fund contribution tax
18 6 credit authorized pursuant to section 15E.232.
18 7 Sec. 12. Section 422.33, Code 2005, is amended by adding
18 8 the following new subsection:
18 9 NEW SUBSECTION. 17. The taxes imposed under this division
18 10 shall be reduced by an economic development region revolving
18 11 fund contribution tax credit authorized pursuant to section
18 12 15E.232.
18 13 Sec. 13. Section 422.60, Code 2005, is amended by adding
18 14 the following new subsection:
18 15 NEW SUBSECTION. 9. The taxes imposed under this division
18 16 shall be reduced by an economic development region revolving
18 17 fund contribution tax credit authorized pursuant to section
18 18 15E.232.
18 19 Sec. 14. NEW SECTION. 432.12F ECONOMIC DEVELOPMENT
18 20 REGION REVOLVING FUND CONTRIBUTION TAX CREDITS.
18 21 The tax imposed under this chapter shall be reduced by an
18 22 economic development region tax credit authorized pursuant to
18 23 section 15E.232.
18 24 Sec. 15. Section 533.24, Code 2005, is amended by adding
18 25 the following new subsection:
18 26 NEW SUBSECTION. 6. The moneys and credits tax imposed
18 27 under this section shall be reduced by an economic development
18 28 region revolving fund contribution tax credit authorized
18 29 pursuant to section 15E.232.
18 30 DIVISION VI
18 31 CULTURAL AND ENTERTAINMENT DISTRICTS
18 32 Sec. 16. NEW SECTION. 303.3B CULTURAL AND ENTERTAINMENT
18 33 DISTRICTS.
18 34 1. The department of cultural affairs shall establish and
18 35 administer a cultural and entertainment district certification
19 1 program. The program shall encourage the growth of
19 2 communities through the development of areas within a city or
19 3 county for public and private uses related to cultural and
19 4 entertainment purposes.
19 5 2. A city or county may create and designate a cultural
19 6 and entertainment district subject to certification by the
19 7 department of cultural affairs, in consultation with the
19 8 department of economic development. A cultural and
19 9 entertainment district is encouraged to include a unique form
19 10 of transportation within the district and for transportation
19 11 between the district and recreational trails. A cultural and
19 12 entertainment district certification shall remain in effect
19 13 for ten years following the date of certification. Two or
19 14 more cities or counties may apply jointly for certification of
19 15 a district that extends across a common boundary. Through the
19 16 adoption of administrative rules, the department of cultural
19 17 affairs shall develop a certification application for use in
19 18 the certification process. The provisions of this subsection
19 19 relating to the adoption of administrative rules shall be
19 20 construed narrowly.
19 21 3. The department of cultural affairs shall encourage
19 22 development projects and activities located in certified
19 23 cultural and entertainment districts through incentives under
19 24 cultural grant programs pursuant to section 303.3, chapter
19 25 303A, and any other grant programs.
19 26 DIVISION VII
19 27 REHABILITATION PROJECT TAX CREDITS
19 28 Sec. 17. Section 404A.4, subsection 4, Code 2005, is
19 29 amended to read as follows:
19 30 4. The total amount of tax credits that may be approved
19 31 for a fiscal year under this chapter shall not exceed two
19 32 million four hundred thousand dollars. Each fiscal year, the
19 33 department of cultural affairs shall allocate at least four
19 34 hundred thousand dollars worth of tax credits for
19 35 rehabilitation projects which have a total project cost of
20 1 under two hundred thousand dollars each. For the fiscal years
20 2 period beginning July 1, 2005, and July 1, 2006 and ending
20 3 June 30, 2015, an additional five hundred thousand four
20 4 million dollars of tax credits may be approved each fiscal
20 5 year for purposes of projects located in cultural and
20 6 entertainment districts certified pursuant to section 303.3B.
20 7 Any of the additional tax credits allocated for projects
20 8 located in certified cultural and entertainment districts that
20 9 are not approved during a fiscal year may be carried over to
20 10 the succeeding fiscal year. The department of cultural
20 11 affairs shall establish by rule the procedures for the
20 12 application, review, selection, and awarding of certifications
20 13 of completion. The departments of economic development,
20 14 cultural affairs, and revenue shall each adopt rules to
20 15 jointly administer this subsection and shall provide by rule
20 16 for the method to be used to determine for which fiscal year
20 17 the tax credits are available.
20 18 DIVISION VIII
20 19 COMMERCIALIZATION
20 20 Sec. 18. Section 262B.1, Code 2005, is amended by striking
20 21 the section and inserting in lieu thereof the following:
20 22 262B.1 TITLE.
20 23 This chapter shall be known and may be cited as the
20 24 "Commercialization of Research for Iowa Act".
20 25 Sec. 19. Section 262B.2, Code 2005, is amended by striking
20 26 the section and inserting in lieu thereof the following:
20 27 262B.2 LEGISLATIVE INTENT.
20 28 It is the intent of the general assembly that the three
20 29 universities under the control of the state board of regents
20 30 have as part of their missions the use of their universities'
20 31 expertise to expand and stimulate economic growth across the
20 32 state. This activity may be accomplished through a wide
20 33 variety of partnerships, public and private joint ventures,
20 34 and cooperative endeavors, primarily, but not exclusively, in
20 35 the area of high technology, and may result in investments by
21 1 the private sector for commercialization of the technology and
21 2 job creation. It is imperative that whenever possible, the
21 3 investments and job creation be in Iowa but need not be in the
21 4 proximity of the universities. The purpose of the investments
21 5 and job creation shall be to expand and stimulate Iowa's
21 6 economy, increase the wealth of Iowans, and increase the
21 7 population of Iowa, which may be accomplished through research
21 8 conducted within the state that will competitively position
21 9 Iowa on an economic basis with other states and create high=
21 10 wage, high=growth employers and jobs. Accredited private
21 11 universities located in the state are encouraged to
21 12 incorporate the intent of this section into the mission of
21 13 their universities.
21 14 Sec. 20. Section 262B.3, Code 2005, is amended by striking
21 15 the section and inserting in lieu thereof the following:
21 16 262B.3 DUTIES AND RESPONSIBILITIES.
21 17 1. The state board of regents, as part of its mission and
21 18 strategic plan, shall establish mechanisms for the purpose of
21 19 carrying out the intent of this chapter. In addition to other
21 20 board initiatives, the board shall work with the department of
21 21 economic development, other state agencies, and the private
21 22 sector to facilitate the commercialization of research.
21 23 2. The state board of regents, in cooperation with the
21 24 department of economic development, shall implement this
21 25 chapter through any of the following activities:
21 26 a. Developing strategies to market and disseminate
21 27 information on university research for commercialization in
21 28 Iowa.
21 29 b. Evaluating university research for commercialization
21 30 potential, where relevant.
21 31 c. Developing a plan to improve private sector access to
21 32 the university licenses and patent information and the
21 33 transfer of technology from the university to the private
21 34 sector.
21 35 d. Identifying research and technical assistance needs of
22 1 existing Iowa businesses and start=up companies and
22 2 recommending ways in which the universities can meet these
22 3 needs.
22 4 e. Linking research and instruction activities to economic
22 5 development.
22 6 f. Reviewing and monitoring activities related to
22 7 technology transfer.
22 8 g. Coordinating activities to facilitate a focus on
22 9 research in the state's targeted industry clusters.
22 10 h. Surveying similar activities in other states and at
22 11 other universities.
22 12 i. Establishing a single point of contact to facilitate
22 13 commercialization of research.
22 14 j. Sustaining faculty and staff resources needed to
22 15 implement commercialization.
22 16 k. Implementing programs to provide public recognition of
22 17 university faculty and staff who demonstrate success in
22 18 technology transfer and commercialization.
22 19 l. Implementing rural entrepreneurial and regional
22 20 development assistance programs.
22 21 m. Providing market research ranging from early stage
22 22 feasibility to extensive market research.
22 23 n. Creating real or virtual research parks that may or may
22 24 not be located near universities, but with the goal of
22 25 providing economic stimulus to the entire state.
22 26 o. Capacity building in key biosciences platform areas.
22 27 p. Encouraging biosciences entrepreneurship by faculty.
22 28 q. Providing matching grants for joint biosciences
22 29 projects involving public and private entities.
22 30 r. Encouraging biosciences entrepreneurship by faculty
22 31 using faculty research and entrepreneurship grants.
22 32 s. Pursuing bioeconomy initiatives in key platform areas
22 33 as recommended by a consultant report on bioeconomy issues
22 34 contracted for by the department of economic development.
22 35 Sec. 21. Sections 262B.4, 262B.5, and 262B.12, Code 2005,
23 1 are repealed.
23 2 Sec. 22. STUDIES.
23 3 1. The state board of regents shall conduct a study to
23 4 determine the feasibility of establishing a graduate school in
23 5 western Iowa in cooperation with other public or private
23 6 institutions of higher learning. By December 15, 2005, the
23 7 board shall submit a report to the general assembly and the
23 8 governor regarding the findings and recommendations of the
23 9 study.
23 10 2. The state board of regents shall conduct a study
23 11 relating to cost=effective methods of recognizing the efforts
23 12 of faculty to achieve commercialization. By December 15,
23 13 2005, the board shall submit a report to the general assembly
23 14 and the governor regarding the findings and recommendations of
23 15 the study.
23 16 DIVISION IX
23 17 WORKFORCE TRAINING AND ECONOMIC DEVELOPMENT FUNDS
23 18 Sec. 23. Section 260C.18A, subsection 2, paragraph b, Code
23 19 2005, is amended to read as follows:
23 20 b. Projects in which an agreement between a community
23 21 college and a business meet all the requirements of the Iowa
23 22 jobs training Act under chapter 260F. However, projects
23 23 funded by moneys provided by a local workforce training and
23 24 economic development fund of a community college are not
23 25 subject to the maximum advance or award limitations contained
23 26 in section 260F.6, subsection 2, or the allocation limitations
23 27 contained in section 260F.8, subsection 1.
23 28 Sec. 24. Section 260C.18A, subsection 2, Code 2005, is
23 29 amended by adding the following new paragraph:
23 30 NEW PARAGRAPH. f. Training and retraining programs for
23 31 targeted industries as authorized in section 15.343,
23 32 subsection 2, paragraph "a".
23 33 Sec. 25. Section 260C.18A, subsection 5, Code 2005, is
23 34 amended by striking the subsection.
23 35 DIVISION X
24 1 LOAN AND CREDIT GUARANTEE PROGRAM
24 2 Sec. 26. Section 15E.224, subsections 1, 5, and 7, Code
24 3 2005, are amended to read as follows:
24 4 1. The department shall establish and administer a loan
24 5 and credit guarantee program. The department, pursuant to
24 6 agreements with financial institutions, shall provide loan and
24 7 credit guarantees, or other forms of credit guarantees for
24 8 qualified businesses and targeted industry businesses for
24 9 eligible project costs. The department may invest up to ten
24 10 percent of the assets of the loan and credit guarantee fund,
24 11 or five hundred thousand dollars, whichever is greater, to
24 12 provide loan and credit guarantees or other forms of credit
24 13 guarantees for eligible project costs to microenterprises
24 14 located in a municipality with a population under fifty
24 15 thousand that is not contiguous to a municipality with a
24 16 population of fifty thousand or more. For purposes of this
24 17 division, "microenterprise" means a business providing
24 18 services with five or fewer full=time equivalent employee
24 19 positions. A loan or credit guarantee provided under the
24 20 program may stand alone or may be used in conjunction with or
24 21 to enhance other loans or credit guarantees offered by
24 22 private, state, or federal entities. The department may
24 23 purchase insurance to cover defaulted loans meeting the
24 24 requirements of the program. However, the department shall not
24 25 in any manner directly or indirectly pledge the credit of the
24 26 state. Eligible project costs include expenditures for
24 27 productive equipment and machinery, working capital for
24 28 operations and export transactions, research and development,
24 29 marketing, and such other costs as the department may so
24 30 designate.
24 31 5. The department shall adopt a loan or credit guarantee
24 32 application procedure for a financial institution on behalf of
24 33 a qualified business, microenterprise, or targeted industry
24 34 business.
24 35 7. The department may adopt loan and credit guarantee
25 1 application procedures that allow a qualified business,
25 2 microenterprise, or targeted industry business to apply
25 3 directly to the department for a preliminary guarantee
25 4 commitment. A preliminary guarantee commitment may be issued
25 5 by the department subject to the qualified business,
25 6 microenterprise, or targeted industry business securing a
25 7 commitment for financing from a financial institution. The
25 8 application procedures shall specify the process by which a
25 9 financial institution may obtain a final loan and credit
25 10 guarantee.
25 11 Sec. 27. Section 15E.225, subsection 3, Code 2005, is
25 12 amended to read as follows:
25 13 3. For a preliminary guarantee commitment, the department
25 14 may charge a qualified business, microenterprise, or targeted
25 15 industry business a preliminary guarantee commitment fee. The
25 16 application fee shall be in addition to any other fees charged
25 17 by the department under this section and shall not exceed one
25 18 thousand dollars for an application.
25 19 DIVISION XI
25 20 BUSINESS TAX CREDITS
25 21 Sec. 28. NEW SECTION. 15E.314 DEFINITIONS.
25 22 For purposes of this division, unless the context otherwise
25 23 requires:
25 24 1. "Average county wage" means the average hourly wage
25 25 calculated by the department which equals the lesser of the
25 26 following:
25 27 a. The average hourly wage paid by all businesses in the
25 28 entire county.
25 29 b. The average hourly wage paid by all businesses in the
25 30 county located outside the largest city of the county.
25 31 c. The average hourly wage paid by all businesses other
25 32 than the largest employer in the entire county.
25 33 2. a. "Qualified new job" means a job that meets all of
25 34 the following:
25 35 (1) Is a new full=time job that has not existed in the
26 1 business within the previous twelve months in the state.
26 2 (2) Is filled by a new employee for at least twelve
26 3 months.
26 4 (3) Is filled by a resident of the state.
26 5 (4) Is not created as a result of a change in ownership.
26 6 b. "Qualified new job" does not include any of the
26 7 following:
26 8 (1) A job previously filled by the same employee in the
26 9 state.
26 10 (2) A job that was relocated from another location in the
26 11 state.
26 12 (3) A job that is created as a result of a consolidation,
26 13 merger, or restructuring of a business entity if the job does
26 14 not represent a new job in the state.
26 15 3. "Retained qualified new job" means the continued
26 16 employment for another twelve months of the same employee in a
26 17 qualified new job.
26 18 Sec. 29. NEW SECTION. 15E.315 INCREASED EMPLOYMENT TAX
26 19 CREDIT.
26 20 1. a. Any nonretail business may claim a tax credit equal
26 21 to a percentage of the annual wages and benefits paid for a
26 22 qualified new job created by the location or expansion of the
26 23 business in the state. The tax credit shall be allowed
26 24 against taxes imposed under chapter 422, division II, III, or
26 25 V, and chapter 432. The percentage shall be equal to the
26 26 amount provided in subsection 2. Any tax credit in excess of
26 27 the tax liability for the tax year may be credited to the tax
26 28 liability for the following seven years or until depleted,
26 29 whichever occurs first.
26 30 b. If the business is a partnership, S corporation,
26 31 limited liability company, or estate or trust electing to have
26 32 the income taxed directly to the individual, an individual may
26 33 claim the tax credit allowed. The amount claimed by the
26 34 individual shall be based upon the pro rata share of the
26 35 individual's earnings of the partnership, S corporation,
27 1 limited liability company, or estate or trust.
27 2 2. The percentage of the wages and benefits paid for a
27 3 qualified new job is determined as follows:
27 4 a. If the hourly wage for the qualified new job equals at
27 5 least one hundred fifty percent of the average county wage,
27 6 twenty percent.
27 7 b. If the hourly wage for the qualified new job equals at
27 8 least one hundred forty percent but less than one hundred
27 9 fifty percent of the average county wage, seventeen percent.
27 10 c. If the hourly wage for the qualified new job equals at
27 11 least one hundred thirty percent but less than one hundred
27 12 forty percent of the average county wage, fourteen percent.
27 13 d. If the hourly wage for the qualified new job equals at
27 14 least one hundred twenty percent but less than one hundred
27 15 thirty percent of the average county wage, eleven percent.
27 16 e. If the hourly wage for the qualified new job equals at
27 17 least one hundred ten percent but less than one hundred twenty
27 18 percent of the average county wage, eight percent.
27 19 f. If the hourly wage for the qualified new job equals at
27 20 least one hundred percent but less than one hundred ten
27 21 percent of the average county wage, five percent.
27 22 g. If the hourly wage for the qualified new job equals
27 23 less than one hundred percent of the average county wage, zero
27 24 percent.
27 25 3. A qualified new job is entitled to the tax credit upon
27 26 the end of the twelfth month of the job having been filled.
27 27 Once a qualified new job is approved for a tax credit, tax
27 28 credits for the next four subsequent tax years may be approved
27 29 if the job continues to be filled and application is made as
27 30 provided in section 15E.316. The percentage determined under
27 31 subsection 2 for the first tax year shall continue to apply to
27 32 subsequent tax credits as the credits relate to that qualified
27 33 new job.
27 34 Sec. 30. NEW SECTION. 15E.316 TAX CREDIT CERTIFICATION
27 35 == CREDIT TRANSFER.
28 1 1. In order for a qualified new job or retained qualified
28 2 new job to be approved for an increased employment tax credit,
28 3 the business shall submit an application to the department
28 4 along with any other information required. Applications for
28 5 approval shall be on forms approved by the department.
28 6 2. Upon approval of a qualified new job, a certificate of
28 7 approval shall be obtained from the department. A certificate
28 8 of approval shall identify the business claiming the tax
28 9 credit under this division and the wage and benefit costs
28 10 incurred during the previous twelve months.
28 11 3. After verifying the eligibility for the tax credit, the
28 12 department, in consultation with the department of revenue,
28 13 shall issue an increased employment tax credit certificate of
28 14 approval to be attached to the person's tax return. The tax
28 15 credit certificate shall contain the taxpayer's name, address,
28 16 tax identification number, the date of the qualified new job,
28 17 the amount of credit, other information required by the
28 18 department of revenue, and a place for the name and tax
28 19 identification number of a transferee and the amount of the
28 20 tax credit being transferred.
28 21 4. The total amount of tax credits that may be approved
28 22 for a fiscal year under this division shall not exceed
28 23 thirteen million six thousand dollars. The department shall
28 24 establish by rule the procedures for the application, review,
28 25 selection, and awarding of certificates of approval. The
28 26 departments of economic development and revenue shall each
28 27 adopt rules to jointly administer this subsection and shall
28 28 provide by rule for the method to be used to determine for
28 29 which fiscal year the tax credits are available. If the
28 30 approved tax credits exceed the maximum amount that may be
28 31 approved for a fiscal year, each tax credit shall be prorated
28 32 and the taxpayer is entitled to that prorated amount, and the
28 33 taxpayer is not entitled to any unpaid portion of a tax credit
28 34 and is not entitled to carry forward or backward to another
28 35 tax year any unpaid portion of a tax credit.
29 1 5. Tax credit certificates issued under this division may
29 2 be transferred to any person or entity. Within ninety days of
29 3 transfer, the transferee must submit the transferred tax
29 4 credit certificate to the department of economic development
29 5 along with a statement containing the transferee's name, tax
29 6 identification number, and address, the denomination that each
29 7 replacement tax credit certificate is to carry, and any other
29 8 information required by the department of revenue. Within
29 9 thirty days of receiving the transferred tax credit
29 10 certificate and the transferee's statement, the department of
29 11 economic development shall issue one or more replacement tax
29 12 credit certificates to the transferee. Each replacement
29 13 certificate must contain the information required under
29 14 subsection 3 and must have the same expiration date that
29 15 appeared in the transferred tax credit certificate. Tax
29 16 credit certificate amounts of less than the minimum amount
29 17 established by rule of the department shall not be
29 18 transferable. A tax credit shall not be claimed by a
29 19 transferee under this division until a replacement tax credit
29 20 certificate identifying the transferee as the proper holder
29 21 has been issued.
29 22 The transferee may use the amount of the tax credit
29 23 transferred against the taxes imposed under chapter 422,
29 24 divisions II, III, and V, and chapter 432 for any tax year the
29 25 original transferor could have claimed the tax credit. Any
29 26 consideration received for the transfer of the tax credit
29 27 shall not be included as income under chapter 422, divisions
29 28 II, III, and V. Any consideration paid for the transfer of
29 29 the tax credit shall not be deducted from income under chapter
29 30 422, divisions II, III, and V.
29 31 Sec. 31. NEW SECTION. 15E.317 MONITORING OF JOB
29 32 CREATION.
29 33 1. The department shall develop definitions for the terms
29 34 "job creation" and "job retention" to measure and identify the
29 35 number of permanent, full=time positions which businesses
30 1 actually create and retain and which can be documented by
30 2 comparison of the payroll reports during the twenty=four=month
30 3 period before and after tax credits are earned.
30 4 2. A nonretail business that has created a qualified new
30 5 job for which a tax credit under this division is granted is
30 6 eligible to receive a tax credit for each of the four
30 7 subsequent tax years if the business retains the qualified new
30 8 job during each of the twelve months ending in each of the tax
30 9 years.
30 10 Sec. 32. NEW SECTION. 15E.318 OTHER INCENTIVES.
30 11 A nonretail business may receive other applicable federal,
30 12 state, and local incentives and tax credits in addition to
30 13 those provided in this division. However, a business which
30 14 has received a tax credit under this division shall not
30 15 receive any funds or incentives under the grow Iowa values
30 16 fund, if created.
30 17 Sec. 33. NEW SECTION. 422.11L INCREASED EMPLOYMENT TAX
30 18 CREDIT.
30 19 The taxes imposed under this division, less the credits
30 20 allowed under sections 422.12 and 422.12B, shall be reduced by
30 21 an increased employment tax credit authorized pursuant to
30 22 section 15E.315.
30 23 Sec. 34. Section 422.33, Code 2005, is amended by adding
30 24 the following new subsection:
30 25 NEW SUBSECTION. 18. The taxes imposed under this division
30 26 shall be reduced by an increased employment tax credit
30 27 authorized pursuant to section 15E.315.
30 28 Sec. 35. Section 422.60, Code 2005, is amended by adding
30 29 the following new subsection:
30 30 NEW SUBSECTION. 10. The taxes imposed under this division
30 31 shall be reduced by an increased employment tax credit
30 32 authorized pursuant to section 15E.315.
30 33 Sec. 36. NEW SECTION. 432.12G INCREASED EMPLOYMENT TAX
30 34 CREDIT.
30 35 The taxes imposed under this chapter shall be reduced by an
31 1 increased employment tax credit authorized pursuant to section
31 2 15E.315.
31 3 Sec. 37. EFFECTIVE AND APPLICABILITY DATE. This division
31 4 of this Act, being deemed of immediate importance, takes
31 5 effect upon enactment and applies to qualified new jobs
31 6 created on or after the effective date of this division of
31 7 this Act. This division of this Act applies to tax years
31 8 ending on or after the effective date of this division of this
31 9 Act.
31 10 EXPLANATION
31 11 This bill relates to economic development activities.
31 12 DIVISION I == This division of the bill creates the grow
31 13 Iowa values fund.
31 14 The division creates the grow Iowa values fund under the
31 15 control of the department of economic development and
31 16 consisting of moneys appropriated to the fund.
31 17 DIVISION II == This division of the bill appropriates
31 18 moneys from the grow Iowa values fund to various entities.
31 19 For the fiscal period beginning July 1, 2005, and ending
31 20 June 30, 2015, the division appropriates each fiscal year to
31 21 the department of economic development $35 million for
31 22 programs administered by the department of economic
31 23 development. The division provides for the allocation of
31 24 moneys appropriated for programs administered by the
31 25 department and for the use up to 1 and 1/2 percent of the
31 26 moneys appropriated to be used by the department for
31 27 administrative purposes.
31 28 For the fiscal period beginning July 1, 2005, and ending
31 29 June 30, 2015, the division appropriates each fiscal year to
31 30 the department of economic development $5 million for
31 31 financial assistance for institutions of higher learning under
31 32 the control of the state board of regents and for accredited
31 33 private institutions for infrastructure projects and programs
31 34 needed to assist in the implementation of activities under
31 35 Code chapter 262B and for financial assistance to a single
32 1 biosciences development organization.
32 2 For the fiscal period beginning July 1, 2005, and ending
32 3 June 30, 2015, the division appropriates each fiscal year to
32 4 the general fund of the state $4 million for payment of tax
32 5 credits approved for projects located in certified cultural
32 6 and entertainment districts.
32 7 For the fiscal period beginning July 1, 2005, and ending
32 8 June 30, 2015, the division appropriates each fiscal year to
32 9 the department of economic development $1 million for purposes
32 10 of providing financial assistance for projects in targeted
32 11 state parks and destination parks.
32 12 For the fiscal period beginning July 1, 2005, and ending
32 13 June 30, 2015, the division appropriates each fiscal year to
32 14 the office of the treasurer of state $1 million for deposit in
32 15 the Iowa cultural trust fund.
32 16 For the fiscal period beginning July 1, 2005, and ending
32 17 June 30, 2015, the division appropriates each fiscal year to
32 18 the department of economic development $7 million for deposit
32 19 into the workforce training and economic development funds of
32 20 the community colleges.
32 21 For the fiscal period beginning July 1, 2005, and ending
32 22 June 30, 2015, the division appropriates each fiscal year to
32 23 the general fund of the state $400,000 for payment of endow
32 24 Iowa tax credits.
32 25 For the fiscal period beginning July 1, 2005, and ending
32 26 June 30, 2015, the division appropriates each fiscal year to
32 27 the department of economic development $1 million for
32 28 providing economic development region financial assistance.
32 29 For the fiscal period beginning July 1, 2005, and ending
32 30 June 30, 2015, the division appropriates each fiscal year to
32 31 the general fund of the state $2 million for payment of
32 32 economic development region revolving fund contribution tax
32 33 credits.
32 34 The division provides that moneys that remain unexpended at
32 35 the end of a fiscal year shall not revert to any fund but
33 1 shall remain available for expenditure for the designated
33 2 purposes during the succeeding fiscal year.
33 3 DIVISION III == This division of the bill amends the Iowa
33 4 economic development board provisions. The bill also provides
33 5 areas of expertise that must be represented on the board by at
33 6 least one member each. The bill requires, as part of the
33 7 organizational structure of the department, that the board
33 8 establish a due diligence committee and a loan and credit
33 9 guarantee committee composed of members of the board. The
33 10 bill provides composition requirements for a transitional
33 11 period for the board beginning July 1, 2005, and ending June
33 12 30, 2006. The bill provides annual reporting requirements for
33 13 the board relating to expenditures under the grow Iowa values
33 14 fund.
33 15 DIVISION IV == This division of the bill requires the
33 16 department of economic development to coordinate all
33 17 regulatory assistance for the state of Iowa. Each state
33 18 agency administering regulatory programs for business shall
33 19 maintain a coordinator within the agency. The division
33 20 provides that the department of economic development shall, in
33 21 consultation with the coordinators, examine, and to the extent
33 22 permissible, assist in the implementation of methods,
33 23 including the possible establishment of an electronic
33 24 database, to streamline the process for issuing permits to
33 25 business. The division was previously enacted in 2003 and
33 26 then was stricken pursuant to Rants v. Vilsack, 684 N.W.2d
33 27 193.
33 28 DIVISION V == This division of the bill relates to Iowa
33 29 business centers, business accelerators, and economic
33 30 development regions, and provides for a tax credit.
33 31 The bill requires the department of economic development to
33 32 establish an Iowa business center program for purposes of
33 33 locating Iowa business centers in the state. The bill
33 34 provides that the department shall partner with another entity
33 35 focusing on economic growth to establish a center. The bill
34 1 provides that operational duties for a center shall be
34 2 determined pursuant to a memorandum of agreement. For the
34 3 fiscal period beginning July 1, 2005, and ending June 30,
34 4 2015, the bill appropriates $50,000 each fiscal year from the
34 5 rural enterprise fund to the department for purposes of
34 6 supporting centers in rural areas of the state. For the
34 7 fiscal period beginning July 1, 2005, and ending June 30,
34 8 2015, the bill appropriates $50,000 each fiscal year from the
34 9 grow Iowa values fund to the department for purposes of
34 10 supporting centers in any part of the state.
34 11 The division provides for the creation of economic
34 12 development regions. A regional development plan must be
34 13 approved by the department of economic development before the
34 14 region may receive moneys from the grow Iowa values fund.
34 15 Such regions may create economic development region revolving
34 16 funds.
34 17 The division provides that a nongovernmental entity making
34 18 a contribution to an economic development region revolving
34 19 fund may claim a tax credit equal to 20 percent of the amount
34 20 contributed to the revolving fund. The tax credit is allowed
34 21 against personal and corporate income tax, the franchise tax
34 22 for financial institutions, the insurance premium tax, and the
34 23 moneys and credits tax for credit unions. The division allows
34 24 an organization exempt from federal income tax pursuant to
34 25 section 501(c) of the Internal Revenue Code making a
34 26 contribution to an economic development region revolving fund
34 27 to be paid from the general fund of the state an amount equal
34 28 to 20 percent of such contributed amount within 30 days after
34 29 the end of the fiscal year during which the contribution was
34 30 made. The total amount of tax credits and payments to
34 31 contributors, referred to as the credit amount, authorized
34 32 during a fiscal year shall not exceed $2 million plus any
34 33 unused credit amount carried over from previous years. The
34 34 division provides that any credit amount which remains unused
34 35 for a fiscal year may be carried forward to the succeeding
35 1 fiscal year. The division provides that the maximum credit
35 2 amount that may be authorized in a fiscal year for
35 3 contributions made to a specific economic development region
35 4 revolving fund is equal to $2 million plus any unused credit
35 5 amount carried over from previous years divided by the number
35 6 of economic development region revolving funds existing in the
35 7 state.
35 8 The division provides that an economic development region
35 9 may apply for financial assistance from the grow Iowa values
35 10 fund to assist with physical infrastructure needs related to a
35 11 specific business partner, to assist an existing business
35 12 located in the region impacted by business consolidation
35 13 actions, to implement economic development initiatives unique
35 14 to the region, to implement innovative initiatives that do not
35 15 otherwise qualify for financial assistance, to establish and
35 16 operate an entrepreneurial initiative, and to establish and
35 17 operate a business succession assistance program. The
35 18 division allows the department to establish and administer a
35 19 regional economic development revenue sharing pilot project
35 20 for one or more regions. The division limits financial
35 21 assistance to economic development regions to a total of $2
35 22 million each fiscal year for the fiscal period beginning July
35 23 1, 2005, and ending June 30, 2010.
35 24 The division allows an economic development region to apply
35 25 to the department for approval to be designated as an economic
35 26 enterprise area based on criteria as determined by the
35 27 department. An economic enterprise area must consist of at
35 28 least one county containing no city with a population of more
35 29 than 23,500 meeting other certain distress criteria. The
35 30 division limits the number of economic enterprise areas to 10
35 31 regions. The division provides that an approved economic
35 32 enterprise area may apply for financial assistance from the
35 33 grow Iowa values fund of up to $750,000 over a five=year
35 34 period for certain economic development=related purposes for
35 35 the area.
36 1 The bill requires the department of economic development to
36 2 establish and administer a business accelerator program to
36 3 provide financial assistance for the establishment and
36 4 operation of a business accelerator for technology=based,
36 5 value=added agricultural, information solutions, or advanced
36 6 manufacturing start=up businesses or for a satellite of an
36 7 existing business accelerator. The bill provides certain
36 8 criteria that a business accelerator must meet in order to
36 9 receive financial assistance and other criteria that the
36 10 department may consider in determining financial assistance
36 11 awards.
36 12 DIVISION VI == This division of the bill relates to the
36 13 establishment of cultural and entertainment districts. The
36 14 cultural and entertainment district legislation was previously
36 15 enacted in 2003 and then stricken pursuant to Rants v.
36 16 Vilsack, 684 N.W.2d 193. The division allows a city or county
36 17 to create and designate a district subject to certification by
36 18 the department of cultural affairs, in consultation with the
36 19 department of economic development. The division provides
36 20 that a district is encouraged to include a unique form of
36 21 transportation within the district.
36 22 The division provides that district certification is for a
36 23 period of 10 years and allows for the certification of areas
36 24 that extend across boundaries of cities and counties. The
36 25 division provides that the department of cultural affairs
36 26 shall encourage development projects and activities located in
36 27 certified cultural and entertainment districts through
36 28 incentives under cultural grant programs and any other grant
36 29 programs.
36 30 DIVISION VII == This division of the bill relates to
36 31 rehabilitation project tax credits. The bill provides that,
36 32 each fiscal year, the department of cultural affairs shall
36 33 allocate at least $400,000 of the tax credits for
36 34 rehabilitation projects which have a total cost of under
36 35 $200,000 each. The division provides that, for the fiscal
37 1 period beginning July 1, 2005, and ending June 30, 2015, an
37 2 additional $4 million of the rehabilitation tax credits may be
37 3 approved each fiscal year for purposes of projects located in
37 4 certified cultural and entertainment districts.
37 5 DIVISION VIII == This division of the bill repeals and
37 6 strikes current Code chapter 262B and replaces it with
37 7 provisions relating to commercialization of research.
37 8 The bill requires that the state board of regents, as part
37 9 of its mission and strategic plan, establish mechanisms for
37 10 the purpose of carrying out commercialization activities. The
37 11 bill requires the board to work with the department of
37 12 economic development, other state agencies, and the private
37 13 sector to facilitate the commercialization of research. The
37 14 board, in cooperation with the department of economic
37 15 development, is required to implement various
37 16 commercialization=related activities.
37 17 The bill requires the state board of regents to conduct a
37 18 study to determine the feasibility of establishing a graduate
37 19 school in western Iowa in cooperation with other public or
37 20 private institutions of higher learning. The bill requires
37 21 the board to conduct a study relating to cost=effective
37 22 methods of recognizing the efforts of faculty to achieve
37 23 commercialization.
37 24 DIVISION IX == This division of the bill relates to
37 25 workforce training and economic development funds.
37 26 The bill provides that projects funded by moneys provided
37 27 by a local workforce training and economic development fund of
37 28 a community college and which meet the requirements of Code
37 29 chapter 260F are not subject to certain maximum advance or
37 30 award limitations contained in Code chapter 260F. The bill
37 31 provides that moneys in a local workforce training and
37 32 economic development fund may also be used for training and
37 33 retraining programs for targeted industries. The bill strikes
37 34 the June 30, 2010, repeal of the workforce training and
37 35 economic development funds.
38 1 DIVISION X == This division of the bill relates to the loan
38 2 and credit guarantee program.
38 3 The bill provides that the department of economic
38 4 development may invest up to 10 percent of the assets of the
38 5 loan and credit guarantee fund, or $500,000, whichever is
38 6 greater, to provide loan and credit guarantees or other forms
38 7 of credit guarantees for eligible project costs to
38 8 microenterprises located in a municipality with a population
38 9 under 50,000 that is not contiguous to a municipality with a
38 10 population of 50,000 or more. The bill defines a
38 11 microenterprise as a business providing services with five or
38 12 fewer full=time equivalent employee positions.
38 13 DIVISION XI == This division of the bill provides increased
38 14 employment tax credits under the individual and corporate
38 15 income taxes, franchise tax, and insurance premiums tax. The
38 16 amount of the tax credit equals a percentage of the wages and
38 17 benefits paid in the previous 12 months to the employee in a
38 18 qualified new job. The percentage varies with the maximum
38 19 being 20 percent if the hourly wage paid to the new employee
38 20 is at least 150 percent of the average county wage and the
38 21 minimum being 5 percent if the hourly wage equals the average
38 22 county wage. No tax credit is granted if the hourly wage is
38 23 less than the average county wage. The average county wage is
38 24 calculated by the department of economic development and
38 25 equals the lesser of the average county hourly wage paid by
38 26 all businesses and the average county hourly wage paid by all
38 27 businesses excluding businesses in the largest city or the
38 28 largest employer.
38 29 A qualified new job is not created if it involves the
38 30 rehiring of previously laid=off employees or results from a
38 31 relocation from another place in Iowa or a merger of
38 32 businesses located in Iowa.
38 33 Once a tax credit is granted for new employment, the
38 34 business may continue to receive for up to the next four tax
38 35 years a tax credit for retaining that new employee. The
39 1 business must reapply each year and establish by rule of the
39 2 department of economic development that it has retained the
39 3 new employee.
39 4 The division provides that a maximum of $13.006 million in
39 5 tax credits are to be awarded in a fiscal year. If there are
39 6 more claims for tax credits than the $13.006 million, each
39 7 claim will be reduced on a pro rata basis and that is all that
39 8 may be claimed by the taxpayer. The amount not awarded cannot
39 9 be carried forward. However, once a taxpayer has been awarded
39 10 the tax credit, if the credit exceeds the tax liability, the
39 11 excess may be carried forward up to seven years.
39 12 The division provides that retail businesses are not
39 13 eligible to receive tax credits for increased employment. The
39 14 tax credits may be transferred.
39 15 The division takes effect upon enactment and applies to
39 16 qualified new jobs created on or after the enactment date.
39 17 LSB 1809HV 81
39 18 tm:rj/cf/24