House Study Bill 504 - Introduced SENATE/HOUSE FILE _____ BY (PROPOSED DEPARTMENT OF ECONOMIC DEVELOPMENT BILL) A BILL FOR An Act relating to economic development including changes 1 to the administration of certain economic development 2 programs and to the terms served by members of the economic 3 development board and including effective date provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 5159DP (11) 83 tw/nh

S.F. _____ H.F. _____ DIVISION I 1 MISCELLANEOUS PROGRAM CHANGES 2 Section 1. Section 15.335A, subsection 1, paragraph e, Code 3 Supplement 2009, is amended to read as follows: 4 e. The number of jobs is sixteen but not more than thirty or 5 more and the amount of the qualifying investment is one of the 6 following: 7 (1) Less than one hundred thousand dollars, then the tax 8 incentive is the investment tax credit of up to five percent. 9 (2) At least one hundred thousand dollars but less than 10 five hundred thousand dollars, then the tax incentives are the 11 investment tax credit of up to five percent and the sales tax 12 refund. 13 (3) At least five hundred thousand dollars, then the 14 tax incentives are the investment tax credit of up to five 15 percent, the sales tax refund, and the additional research and 16 development tax credit. 17 Sec. 2. Section 15.411, subsection 6, Code Supplement 2009, 18 is amended to read as follows: 19 6. The department shall, upon board approval, establish 20 and administer a targeted industries internship program for 21 students of Iowa community colleges, private colleges, or 22 institutions of higher learning under the control of the 23 state board of regents Iowa students . For purposes of this 24 subsection, “Iowa student” means a student of an Iowa community 25 college, private college, or institution of higher learning 26 under the control of the state board of regents, or a student 27 who graduated from high school in Iowa but now attends an 28 institution of higher learning outside the state of Iowa. The 29 purpose of the program is to link Iowa students to small and 30 medium sized Iowa firms in the targeted industries through 31 internship opportunities. An Iowa employer may receive 32 financial assistance in an amount of one dollar for every 33 two dollars paid by the employer to an intern. The amount 34 of financial assistance shall not exceed three thousand one 35 -1- LSB 5159DP (11) 83 tw/nh 1/ 4

S.F. _____ H.F. _____ hundred dollars for any single internship, or nine thousand 1 three hundred dollars for any single employer. In order to be 2 eligible to receive financial assistance under this subsection, 3 the employer must have five hundred or fewer employees and 4 must be engaged in a targeted industry. The department shall 5 encourage youth who reside in economically distressed areas, 6 youth adjudicated to have committed a delinquent act, and youth 7 transitioning out of foster care to participate in the targeted 8 industries internship program. 9 Sec. 3. Section 15G.111, subsection 5, paragraph c, Code 10 Supplement 2009, is amended to read as follows: 11 c. The state board of regents shall annually prepare a 12 report for submission to the governor, the general assembly, 13 the department, and the legislative services agency regarding 14 the activities, projects, and programs funded with moneys 15 allocated under this subsection. The report shall be provided 16 in an electronic format and shall include a list of metrics and 17 criteria mutually agreed to in advance by the board of regents 18 and the department. The metrics and criteria shall allow the 19 governor’s office, the general assembly, and the department 20 to quantify and evaluate the progress of the board of regents 21 institutions with regard to their activities, projects, 22 and programs in the areas of technology commercialization, 23 entrepreneurship, regional development, and market research. 24 Sec. 4. EFFECTIVE UPON ENACTMENT. The following provision 25 of this division of this Act, being deemed of immediate 26 importance, takes effect upon enactment: 27 1. Section 1 of this Act amending section 15.335A. 28 DIVISION II 29 ECONOMIC DEVELOPMENT BOARD 30 Sec. 5. Section 15.103, subsection 1, paragraph a, Code 31 Supplement 2009, is amended to read as follows: 32 a. The Iowa economic development board is created, 33 consisting of fifteen voting members appointed by the governor 34 and seven ex officio, nonvoting members. The ex officio, 35 -2- LSB 5159DP (11) 83 tw/nh 2/ 4

S.F. _____ H.F. _____ nonvoting members are four legislative members; one president, 1 or the president’s designee, of the university of northern 2 Iowa, the university of Iowa, or Iowa state university of 3 science and technology designated by the state board of regents 4 on a rotating basis; and one president, or the president’s 5 designee, of a private college or university appointed by the 6 Iowa association of independent colleges and universities; 7 and one superintendent, or the superintendent’s designee, of 8 a community college, appointed by the Iowa association of 9 community college presidents. The legislative members are two 10 state senators, one appointed by the president of the senate 11 after consultation with the majority leader of the senate, 12 and one appointed by the minority leader of the senate from 13 their respective parties; and two state representatives, one 14 appointed by the speaker and one appointed by the minority 15 leader of the house of representatives from their respective 16 parties. Not more than eight of the voting members shall 17 be from the same political party. Beginning with the first 18 appointment to the board made after July 1, 2005, at least one 19 voting member shall have been less than thirty years of age 20 at the time of appointment. The governor shall appoint the 21 voting members of the board for a term to staggered terms of 22 four years beginning and ending as provided by section 69.19, 23 subject to confirmation by the senate, and the governor’s 24 appointments shall include persons knowledgeable of the various 25 elements of the department’s responsibilities. 26 Sec. 6. ECONOMIC DEVELOPMENT BOARD MEMBER TERMS. 27 Notwithstanding the four-year term required by section 15.103 28 for members of the economic development board, and in order to 29 ensure that members of the board serve staggered terms, of the 30 fifteen members initially appointed after the effective date of 31 this Act, the governor shall appoint seven members to terms of 32 two years and eight members to terms of four years. 33 Sec. 7. EFFECTIVE UPON ENACTMENT. This division of this 1 Act, being deemed of immediate importance, takes effect upon 2 -3- LSB 5159DP (11) 83 tw/nh 3/ 4

S.F. _____ H.F. _____ enactment. 3 EXPLANATION 4 This bill makes miscellaneous changes to certain economic 5 development programs and staggers the terms served by members 6 of the economic development board. 7 Currently, the tax incentives for the high quality jobs 8 program do not allow incentives for a business creating 31 or 9 more jobs unless that business invests $10 million or more. 10 The bill adjusts the program’s incentive schedule to allow 11 incentives to be provided to businesses investing less than $10 12 million provided they create at least 16 jobs. 13 The department of economic development currently operates a 14 targeted industries internship program for students attending 15 an institution of higher learning in Iowa. The bill allows 16 students who graduated from an Iowa high school, but now 17 attend an institution of higher learning in another state, to 18 participate in the program. 19 Currently, the board of regents must prepare an annual 20 report for the governor, the general assembly, the department, 21 and the legislative services agency regarding the activities, 22 projects, and programs funded with the $5 million received 23 by the regents as part of the annual grow Iowa values 24 appropriation. The bill directs the board of regents and the 25 department to mutually agree on certain metrics and criteria 26 for evaluating the success of the activities, projects, and 27 programs funded with those moneys, particularly as they relate 28 to the areas of technology commercialization, entrepreneurship, 29 regional development, and market research. 30 Currently, the economic development board’s 15 members 31 appointed by the governor all serve four-year terms that expire 32 on the same date. The bill provides for the staggering of 33 these terms, and, since the terms of the current board members 34 expire on April 30, 2010, the bill takes effect upon enactment. 35 -4- LSB 5159DP (11) 83 tw/nh 4/ 4