House Study Bill 591 - Introduced SENATE/HOUSE FILE _____ BY (PROPOSED ECONOMIC DEVELOPMENT AUTHORITY BILL) A BILL FOR An Act relating to economic development and the use of tax 1 revenues and other funds by affecting programs, tax 2 incentives, and project completion and other assistance 3 administered by the economic development authority, by 4 diverting franchise tax revenues and withholding tax 5 payments for such programs, incentives, and assistance, 6 by abolishing the film tax credit program, by replacing 7 references to the economic development fund and financial 8 assistance program, and by providing spending authority, 9 by providing for properly related matters, and including 10 effective date and retroactive and other applicability 11 provisions. 12 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 13 TLSB 5347DP (25) 84 ad/sc

S.F. _____ H.F. _____ DIVISION I 1 HIGH QUALITY JOBS PROGRAM AND RELATED ASSISTANCE AND PROGRAMS 2 Section 1. Section 15.327, subsections 2, 5, 7, 8, 10, 12, 3 and 13, Code Supplement 2011, are amended to read as follows: 4 2. “Benefit” has the same meaning as defined in section 5 15G.101 means nonwage compensation provided to an employee . 6 Benefits typically include medical and dental insurance 7 plans, pension, retirement, and profit-sharing plans, child 8 care services, life insurance coverage, vision insurance 9 coverage, disability insurance coverage, and any other nonwage 10 compensation as determined by the board. 11 5. “Created job” has the same meaning as defined in section 12 15G.101 means a new, permanent, full-time equivalent position 13 added to a business’s payroll in excess of the business’s base 14 employment level . 15 7. “Fiscal impact ratio” has the same meaning as defined 16 in section 15G.101 means a ratio calculated by estimating the 17 amount of taxes to be received from a business by the state 18 and dividing the estimate by the estimated cost to the state 19 of providing certain project completion assistance and tax 20 incentives to the business, reflecting a ten-year period and 21 expressed in terms of current dollars . For purposes of the 22 program, “fiscal impact ratio” does not include taxes received 23 by political subdivisions. 24 8. “Maintenance period completion date” has the same meaning 25 as defined in section 15G.101 means the date on which the 26 maintenance period ends . 27 10. “Project completion date” has the same meaning as 28 defined in section 15G.101 means the date by which a recipient 29 of project completion assistance has agreed to meet all the 30 terms and obligations contained in an agreement with the 31 authority . 32 12. “Qualifying wage threshold” has the same meaning as 33 defined in section 15G.101 means the laborshed wage for an 34 eligible business . 35 -1- LSB 5347DP (25) 84 ad/sc 1/ 33

S.F. _____ H.F. _____ 13. “Retained job” has the same meaning as defined in 1 section 15G.101 means a full-time equivalent position, in 2 existence at the time an employer applies for financial 3 assistance which remains continuously filled and which is at 4 risk of elimination if the project for which the employer is 5 seeking assistance does not proceed . 6 Sec. 2. Section 15.327, Code Supplement 2011, is amended by 7 adding the following new subsections: 8 NEW SUBSECTION . 1A. “Base employment level” means the 9 number of full-time equivalent positions at a business, 10 as established by the authority and a business using the 11 business’s payroll records, as of the date a business applies 12 for incentives or project completion assistance under the 13 program. 14 NEW SUBSECTION . 2A. “Business engaged in disaster recovery” 15 means a business located in an area declared a disaster area 16 by a federal official, that has sustained substantial physical 17 damage, that has closed as the result of a natural disaster, 18 and that has a plan for reopening that includes employing a 19 substantial number of the employees the business employed 20 before the natural disaster occurred. 21 NEW SUBSECTION . 6A. “Financial assistance” means assistance 22 provided only from the funds, rights, and assets legally 23 available to the authority pursuant to this chapter and 24 includes but is not limited to assistance in the form of 25 grants, loans, forgivable loans, and royalty payments. 26 NEW SUBSECTION . 7A. “Full-time equivalent position” means 27 a non-part-time position for the number of hours or days per 28 week considered to be full-time work for the kind of service 29 or work performed for an employer. Typically, a full-time 30 equivalent position requires two thousand eighty hours of work 31 in a calendar year, including all paid holidays, vacations, 32 sick time, and other paid leave. 33 NEW SUBSECTION . 7B. “Fund” means a fund created pursuant 34 to section 15.335B. 35 -2- LSB 5347DP (25) 84 ad/sc 2/ 33

S.F. _____ H.F. _____ NEW SUBSECTION . 7C. “Laborshed wage” means the wage level 1 represented by those wages within two standard deviations 2 from the mean wage within the laborshed area in which the 3 eligible business is located, as calculated by the authority, 4 by rule, using the most current covered wage and employment 5 data available from the department of workforce development for 6 the laborshed area. 7 NEW SUBSECTION . 7D. “Maintenance period” means the period 8 of time between the project completion date and the maintenance 9 period completion date. 10 NEW SUBSECTION . 8A. “Necessary physical infrastructure 11 project” means a project that creates necessary infrastructure 12 for economic success throughout Iowa, provides the foundation 13 for the creation of jobs, and involves the investment of 14 a substantial amount of capital. Physical infrastructure 15 projects include but are not limited to projects involving 16 any mode of transportation; public works and utilities such 17 as sewer, water, power, or telecommunications; physical 18 improvements that mitigate, prevent, or eliminate environmental 19 contamination; and other similar projects deemed to be physical 20 infrastructure by the authority. 21 NEW SUBSECTION . 9A. “Program support” means the services 22 necessary for the efficient administration of this part, 23 including the delivery of program services to eligible 24 businesses. “Program support” may include the administrative 25 costs of providing project assistance, conducting a statewide 26 laborshed study in coordination with the department of 27 workforce development, outreach to business and marketing of 28 programs, the procurement of technical assistance, and the 29 implementation of information technology. 30 NEW SUBSECTION . 9B. “Project completion assistance” means 31 financial assistance or technical assistance provided to 32 an eligible business in order to facilitate the start-up, 33 location, or expansion of the business in this state and 34 provided in an expedient manner to ensure the successful 35 -3- LSB 5347DP (25) 84 ad/sc 3/ 33

S.F. _____ H.F. _____ completion of the start-up, location, or expansion project. 1 NEW SUBSECTION . 10A. “Project completion period” means the 2 period of time between the date financial assistance is awarded 3 and the project completion date. 4 Sec. 3. Section 15.329, subsection 1, unnumbered paragraph 5 1, Code Supplement 2011, is amended to read as follows: 6 To be eligible to receive incentives or assistance 7 under this part, a business shall meet all of the following 8 requirements: 9 Sec. 4. Section 15.329, subsection 1, paragraph c, 10 subparagraphs (1) and (2), Code Supplement 2011, are amended 11 to read as follows: 12 (1) If the business is creating jobs, the business shall 13 demonstrate that the jobs will pay at least one hundred percent 14 of the qualifying wage threshold at the start of the project 15 completion period, at least one hundred thirty twenty percent 16 of the qualifying wage threshold by the project completion 17 date, and at least one hundred thirty twenty percent of 18 the qualifying wage threshold until the maintenance period 19 completion date. 20 (2) If the business is retaining jobs, the business 21 shall demonstrate that the jobs retained will pay at least 22 one hundred thirty twenty percent of the qualifying wage 23 threshold throughout both the project completion period and the 24 maintenance period. 25 Sec. 5. Section 15.329, subsection 2, Code Supplement 2011, 26 is amended by striking the subsection. 27 Sec. 6. Section 15.330, Code Supplement 2011, is amended to 28 read as follows: 29 15.330 Agreement. 30 A business shall enter into an agreement with the authority 31 specifying the requirements that must be met to confirm 32 eligibility pursuant to this part. The authority shall may 33 consult with the community during negotiations relating to the 34 agreement. The agreement shall contain, at a minimum, the 35 -4- LSB 5347DP (25) 84 ad/sc 4/ 33

S.F. _____ H.F. _____ following provisions: 1 1. A business that is approved to receive incentives 2 or assistance under this part shall, for the length of the 3 agreement, certify annually to the authority the compliance of 4 the business with the requirements of the agreement. If the 5 business receives a local property tax exemption, the business 6 shall also certify annually to the community the compliance of 7 the business with the requirements of the agreement. 8 2. The repayment of incentives or financial assistance 9 by the business if the business does not meet any of the 10 requirements of this part or the resulting agreement. 11 3. If a business that is approved to receive incentives 12 or assistance under this part experiences a layoff within the 13 state or closes any of its facilities within the state, the 14 authority shall have the discretion to reduce or eliminate 15 some or all of the incentives or assistance . If a business 16 has received incentives or assistance under this part and 17 experiences a layoff within the state or closes any of its 18 facilities within the state, the business may be subject to 19 repayment of all or a portion of the incentives or financial 20 assistance that it has received. 21 4. A project completion date, a maintenance period 22 completion date, the number of jobs to be created or retained, 23 or certain other terms and obligations described in section 24 15G.112, subsection 1 , paragraph “d” , as the authority 25 deems necessary in order to make the requirements in project 26 agreements uniform. The authority, with the approval of 27 the board, may adopt rules as necessary for making such 28 requirements uniform. Such rules shall be in compliance with 29 the provisions of this part and with the provisions of chapter 30 15G . 31 5. The amount and type of project completion assistance to 32 be provided under section 15.335B. 33 6. The amount of matching funds to be received by a business 34 from a city or county. The authority shall adopt by rule a 35 -5- LSB 5347DP (25) 84 ad/sc 5/ 33

S.F. _____ H.F. _____ formula for determining the amount of matching funds required 1 under the program. 2 7. The business shall not have closed or substantially 3 reduced operations in one area of this state and relocated 4 substantially the same operations in a community in another 5 area of this state. However, this paragraph shall not be 6 construed to prohibit a business from expanding its operation 7 in a community if existing operations of a similar nature in 8 this state are not closed or substantially reduced. 9 8. The proposed project shall not negatively impact other 10 businesses in competition with the business being considered 11 for assistance. The authority shall make a good-faith effort 12 to identify existing Iowa businesses within an industry in 13 competition with the business being considered for incentives 14 or assistance. The authority shall make a good-faith effort 15 to determine the probability that the proposed incentives or 16 assistance will displace employees of the existing businesses. 17 In determining the impact on businesses in competition with the 18 business being considered for incentives or assistance, jobs 19 created or retained as a result of other jobs being displaced 20 elsewhere in the state shall not be considered direct jobs 21 created or retained. 22 9. A report submitted to the authority with its application 23 describing all violations of environmental law or worker 24 safety law within the last five years. If, upon review of the 25 application, the authority finds that a business has a record 26 of violations of the law, statutes, rules, or regulations that 27 tends to show a consistent pattern, the authority shall not 28 provide incentives or assistance to the business unless the 29 authority finds either that the violations did not seriously 30 affect public health, public safety, or the environment, or, 31 if such violations did seriously affect public health, public 32 safety, or the environment, that mitigating circumstances were 33 present. 34 10. That the business shall only employ individuals legally 35 -6- LSB 5347DP (25) 84 ad/sc 6/ 33

S.F. _____ H.F. _____ authorized to work in this state. In addition to any and 1 all other applicable penalties provided by current law, all 2 or a portion of the incentives or assistance received under 3 this part by a business that is found to knowingly employ 4 individuals not legally authorized to work in this state is 5 subject to recapture by the authority or by the department of 6 revenue. 7 11. Any terms deemed necessary by the authority to effect 8 compliance with the eligibility requirements of section 15.329. 9 Sec. 7. NEW SECTION . 15.330A Maintenance of agreements. 10 1. An eligible business receiving incentives or assistance 11 under this part shall meet all terms and obligations in an 12 agreement by the project completion date, but the board may 13 for good cause extend the project completion date or otherwise 14 amend an agreement. 15 2. During the maintenance period an eligible business 16 receiving incentives or assistance under this part shall 17 continue to comply with the terms and obligations of an 18 agreement entered into pursuant to section 15.330. 19 3. The authority may enforce the terms of an agreement as 20 necessary and appropriate. 21 Sec. 8. NEW SECTION . 15.331 Withholding tax payment 22 diversion. 23 1. If the authority enters into an agreement pursuant to 24 this part, or pursuant to chapter 15E, division XVIII, for 25 any of the incentives or assistance provided under this part, 26 the authority and the eligible business may agree to credit a 27 portion of the payments required under section 422.16 to the 28 authority as provided in this section. 29 2. a. An eligible business entering into a withholding 30 agreement with the authority pursuant to this section shall 31 remit the total amount of withholding payments due pursuant to 32 section 422.16 to the department of revenue. 33 b. The department of revenue shall quarterly deposit in a 34 fund created pursuant to section 15.106A an amount equal to two 35 -7- LSB 5347DP (25) 84 ad/sc 7/ 33

S.F. _____ H.F. _____ and one-half percent of the gross wages paid by the eligible 1 business to each employee holding a created or retained job 2 covered by an agreement entered into pursuant to this part or 3 chapter 15E, division XVIII. Moneys to be deposited pursuant 4 to this paragraph shall not be paid to the authority until 5 the correct amounts have been verified by the department of 6 revenue. 7 3. Withholding payments shall be deposited pursuant to this 8 section by the department of revenue for each employee holding 9 a created or retained job for the duration of the agreement 10 between the eligible business and the authority. 11 4. The authority and the eligible business shall provide 12 to the department of revenue any information necessary to 13 correctly process the diversion of withholding tax payments 14 pursuant to this section. 15 5. An employee holding a created or retained job shall 16 receive full credit for the amount withheld as provided in 17 section 422.16. 18 6. If a portion of the employee’s gross wages are subject 19 to a withholding credit diversion under chapter 260E, chapter 20 260G, or section 403.19A, or a supplemental withholding credit 21 diversion under section 15E.197, when a withholding credit 22 diversion under this section is agreed to, then the withholding 23 payments shall be credited in the following order of priority: 24 a. First, the withholding payments to be credited pursuant 25 to chapters 260E and 260G and section 15E.197. 26 b. Second, the withholding payments to be credited pursuant 27 to this section. 28 c. Third, the withholding payments to be credited pursuant 29 to section 403.19A. 30 7. If a withholding agreement is entered into pursuant 31 to this section before a withholding agreement under chapter 32 260E or 260G, or section 15E.197 or 403.19A, the withholding 33 payments shall be credited in the order in which the agreements 34 are entered into. 35 -8- LSB 5347DP (25) 84 ad/sc 8/ 33

S.F. _____ H.F. _____ 8. The authority, in conjunction with the department of 1 revenue, shall adopt rules for the implementation of this 2 section. 3 Sec. 9. Section 15.335A, subsection 1, unnumbered paragraph 4 1, Code Supplement 2011, is amended to read as follows: 5 Tax incentives are available to eligible businesses as 6 provided in this section . The incentives are based upon the 7 number of jobs created or retained that pay at least one 8 hundred thirty twenty percent of the qualifying wage threshold 9 as computed pursuant to section 15G.112, subsection 4 , and 10 the amount of the qualifying investment made according to the 11 following schedule: 12 Sec. 10. Section 15.335A, subsection 2, paragraphs b, c, 13 f, and g, Code Supplement 2011, are amended by striking the 14 paragraphs. 15 Sec. 11. Section 15.335A, subsections 3 through 5, Code 16 Supplement 2011, are amended to read as follows: 17 3. A community may apply to the economic development 18 authority for a project-specific waiver from the qualifying 19 wage threshold requirement provided in subsection 1 in order to 20 seek tax incentives for an eligible business. The authority 21 may grant a project-specific waiver from the qualifying 22 wage threshold requirement in subsection 1 for the remainder 23 of a calendar year , based on county wage or regional wage 24 calculations brought forth by the applicant county including 25 but not limited to any of the following: 26 a. The county wage calculated without wage data from 27 the business in the county employing the greatest number of 28 full-time employees if the community meets the requirements of 29 an economically distressed community pursuant to 15.335C . 30 b. The regional wage calculated without wage data from up to 31 two adjacent counties. 32 c. The county wage calculated without wage data from the 33 largest city in the county. 34 d. A qualifying wage guideline for a specific project based 35 -9- LSB 5347DP (25) 84 ad/sc 9/ 33

S.F. _____ H.F. _____ upon unusual economic circumstances present in the city or 1 county. 2 e. The annualized, average hourly wage paid by all 3 businesses in the county located outside the largest city of 4 the county. 5 f. The annualized, average hourly wage paid by all 6 businesses other than the largest employer in the entire 7 county. 8 4. Each calendar year, the authority shall not approve 9 more than three million six hundred thousand dollars worth of 10 investment tax credits for projects with qualifying investments 11 of less than one million dollars. 12 5. 4. The authority shall negotiate the amount of 13 tax incentives provided to an applicant under the program 14 in accordance with this section and section 15G.112 , as 15 applicable . 16 Sec. 12. NEW SECTION . 15.335B Assistance for certain 17 programs and projects. 18 1. a. Under the authority provided in section 15.106A, 19 there shall be established one or more funds within the state 20 treasury, under the control of the authority, to be used for 21 purposes of this section. 22 b. A fund established for purposes of this section shall 23 consist of the moneys deposited by the department of revenue 24 pursuant to sections 15.331 and 422.64. 25 c. Interest or earnings on moneys deposited in a fund to be 26 used for the purposes of this section, and all repayments or 27 recaptures of the assistance provided under this section, shall 28 accrue to the authority and shall be used for purposes of this 29 section, notwithstanding section 12C.7. Moneys in a fund are 30 not subject to section 8.33. 31 2. a. Moneys deposited pursuant to subsection 1 shall be 32 allocated by the authority in appropriate amounts to be used 33 for the following purposes: 34 (1) For providing project completion assistance to eligible 35 -10- LSB 5347DP (25) 84 ad/sc 10/ 33

S.F. _____ H.F. _____ businesses under this part and for program support of such 1 assistance. 2 (2) For providing economic development region financial 3 assistance under section 15E.232, subsections 1, 3, 4, 5, and 4 6. 5 (3) For providing financial assistance for business 6 accelerators pursuant to section 15E.351. 7 (4) For deposit in the innovation and commercialization 8 fund created pursuant to section 15.412. 9 (5) For providing financial assistance to businesses or 10 communities engaged in necessary physical infrastructure 11 projects. 12 (6) For providing financial assistance to businesses 13 engaged in disaster recovery. 14 (7) For providing financial assistance to Iowa’s councils 15 of governments. 16 b. Each fiscal year, the authority shall estimate the 17 amount of revenues available for purposes of this section and 18 shall develop a budget appropriate for the expenditure of the 19 revenues available. 20 3. In providing assistance under this section, the 21 authority shall make a determination as to the amount and 22 type of assistance that is most appropriate for facilitating 23 the successful completion of an eligible business’s project. 24 Before making such a determination, the authority shall do all 25 of the following: 26 a. Consider a business’s eligibility for the tax incentives 27 available under section 15.335A and ensure that the amount of 28 assistance to be provided appropriately complements the amount 29 and type of tax incentives to be provided. 30 b. Consider the amount of private sector investment to be 31 leveraged by the project, including the eligible business’s 32 equity investment, debt financing, and any venture capital or 33 foreign investment available, and make a good-faith effort to 34 provide only the amount of incentives and assistance necessary 35 -11- LSB 5347DP (25) 84 ad/sc 11/ 33

S.F. _____ H.F. _____ to facilitate the project’s successful completion. 1 c. Consider the amount and type of the local community 2 match. The authority may provide assistance to an early-stage 3 business in a high-growth industry regardless of the amount of 4 local match involved. 5 d. Calculate the fiscal impact ratio of the project and use 6 it to guide the provision of incentives and assistance under 7 this part. 8 e. Evaluate the quality of the project based on the factors 9 described in section 15.329, subsection 5, and any other 10 relevant factors. 11 f. Ensure that the combined amount of incentives and 12 assistance are appropriate to the size of the project, to 13 the value of the project, to the fiscal impact ratio of the 14 project, and to any other relevant factors. 15 4. Each eligible business receiving assistance under this 16 section shall enter into an agreement with the authority and 17 the agreement shall meet the requirements of sections 15.330 18 and 15.330A. 19 Sec. 13. NEW SECTION . 15.335C Economically distressed 20 areas. 21 1. a. Notwithstanding section 15.329, subsection 1, 22 paragraph “c” , the authority may provide tax incentives or 23 project completion assistance under this part to an eligible 24 business paying less than one hundred twenty percent of the 25 qualifying wage threshold if that business is located in an 26 economically distressed area. 27 b. A business in an economically distressed area receiving 28 incentives or assistance pursuant to this section shall be 29 required to pay at least one hundred percent of the qualifying 30 wage threshold. 31 2. For purposes of this section, “economically distressed 32 area” means a county that ranks among the bottom twenty-five of 33 all Iowa counties, as measured by one of the following: 34 a. Average monthly unemployment level for the most recent 35 -12- LSB 5347DP (25) 84 ad/sc 12/ 33

S.F. _____ H.F. _____ twelve-month period. 1 b. Average annualized unemployment level for the most recent 2 five-year period. 3 Sec. 14. Section 15A.7, subsection 3, Code Supplement 2011, 4 is amended to read as follows: 5 3. That the employer shall agree to pay wages for the jobs 6 for which the credit is taken of at least the county wage or 7 the regional laborshed wage, as calculated by the authority 8 pursuant to section 15G.112 15.327 , subsection 3 , whichever 9 is lower 7C . Eligibility for the supplemental credit shall 10 be based on a one-time determination of starting wages by the 11 community college. 12 Sec. 15. Section 15E.193, subsection 1, paragraph b, 13 subparagraph (1), Code Supplement 2011, is amended to read as 14 follows: 15 (1) The business shall provide a sufficient package of 16 benefits to each employee holding a created or retained job. 17 For purposes of this paragraph, “created job” and “retained job” 18 have the same meaning as defined in section 15G.101 15.327 . 19 Sec. 16. Section 15E.193, subsection 1, paragraphs c and d, 20 Code Supplement 2011, are amended to read as follows: 21 c. The business shall pay a wage that is at least ninety 22 percent of the qualifying wage threshold. For purposes of this 23 paragraph, “qualifying wage threshold” has the same meaning as 24 defined in section 15G.101 15.327 . 25 d. Creates or retains at least ten full-time equivalent 26 positions and maintains them until the maintenance period 27 completion date. For purposes of this paragraph, “maintenance 28 period completion date” and “full-time equivalent position” have 29 the same meanings as defined in section 15G.101 15.327 . 30 Sec. 17. Section 15E.231, unnumbered paragraph 1, Code 31 Supplement 2011, is amended to read as follows: 32 In order for an economic development region to receive 33 moneys under the economic development financial assistance 34 program established in section 15G.112 assistance pursuant to 35 -13- LSB 5347DP (25) 84 ad/sc 13/ 33

S.F. _____ H.F. _____ section 15.335B , an economic development region’s regional 1 development plan must be approved by the authority. An 2 economic development region shall consist of not less than 3 three counties, unless two contiguous counties have a combined 4 population of at least three hundred thousand based on the 5 most recent federal decennial census. An economic development 6 region shall establish a focused economic development effort 7 that shall include a regional development plan relating to one 8 or more of the following areas: 9 Sec. 18. Section 15E.232, subsections 1, 3, 4, 5, and 6, 10 Code Supplement 2011, are amended to read as follows: 11 1. An economic development region may apply for financial 12 assistance from the economic development a fund established 13 pursuant to section 15.335B to assist with the installation 14 of physical infrastructure needs including, but not limited 15 to, horizontal infrastructure, water and sewer infrastructure, 16 and telecommunications infrastructure, related to the 17 development of fully served business and industrial sites by 18 one or more of the region’s economic development partners 19 or for the installation of infrastructure related to a 20 new business location or expansion. In order to receive 21 financial assistance pursuant to this subsection , the economic 22 development region must demonstrate all of the following: 23 a. The ability to provide matching moneys on a basis of a 24 one dollar contribution of local matching moneys for every two 25 dollars received from the economic development fund. 26 b. The commitment of the specific business partner 27 including, but not limited to, a letter of intent defining a 28 capital commitment or a percentage of equity. 29 c. That all other funding alternatives have been exhausted. 30 3. An economic development region may apply for financial 31 assistance from the economic development a fund established 32 pursuant to section 15.335B to assist an existing business 33 threatened with closure due to a potential consolidation to an 34 out-of-state location. The economic development region may 35 -14- LSB 5347DP (25) 84 ad/sc 14/ 33

S.F. _____ H.F. _____ apply for financial assistance from the economic development 1 fund for the purchase, rehabilitation, or marketing of a 2 building that has become available due to the closing of an 3 existing business due to a consolidation to an out-of-state 4 location. In order to receive financial assistance under this 5 subsection , an economic development region must demonstrate the 6 ability to provide local matching moneys on a basis of a one 7 dollar contribution of local moneys for every three dollars 8 received from the economic development fund. 9 4. An economic development region may apply for financial 10 assistance from the economic development a fund established 11 pursuant to section 15.335B to establish and operate an 12 entrepreneurial initiative. In order to receive financial 13 assistance under this subsection , an economic development 14 region must demonstrate the ability to provide local matching 15 moneys on a basis of a one dollar contribution of local moneys 16 for every two dollars received from the economic development 17 fund. 18 5. a. An economic development region may apply for 19 financial assistance from the economic development a fund 20 established pursuant to section 15.335B to establish and 21 operate a business succession assistance program for the 22 region. 23 b. In order to receive financial assistance under this 24 subsection , an economic development region must demonstrate 25 the ability to provide local matching moneys on a basis of a 26 one dollar contribution of local moneys for every two dollars 27 received from the economic development fund. 28 6. An economic development region may apply for financial 29 assistance from the economic development a fund established 30 pursuant to section 15.335B to implement economic development 31 initiatives that are either unique to the region or innovative 32 in design and implementation. In order to receive financial 33 assistance under this subsection , an economic development 34 region must demonstrate the ability to provide local matching 35 -15- LSB 5347DP (25) 84 ad/sc 15/ 33

S.F. _____ H.F. _____ moneys on a one-to-one basis. 1 Sec. 19. Section 15E.351, subsection 1, Code Supplement 2 2011, is amended to read as follows: 3 1. The economic development authority shall establish and 4 administer a business accelerator program to provide financial 5 assistance for the establishment and operation of a business 6 accelerator for technology-based, value-added agricultural, 7 information solutions, alternative and renewable energy 8 including the alternative and renewable energy sectors listed 9 in section 476.42, subsection 1 , paragraph “a” , subparagraph 10 (1), or advanced manufacturing start-up businesses or for a 11 satellite of an existing business accelerator. The program 12 shall be designed to foster the accelerated growth of new 13 and existing businesses through the provision of technical 14 assistance. The economic development authority may provide 15 financial assistance under this section from moneys allocated 16 for regional financial assistance for business accelerators 17 pursuant to section 15G.111 section 15.335B , subsection 9 2 . 18 Sec. 20. Section 159A.6B, subsection 2, Code Supplement 19 2011, is amended to read as follows: 20 2. The office may execute contracts in order to provide 21 technical support and outreach services for purposes of 22 assisting and educating interested persons as provided in this 23 section . The office may also contract with a consultant to 24 provide part or all of these services. The office may require 25 that a person receiving assistance pursuant to this section 26 contribute up to fifty percent of the amount required to 27 support the costs of contracting with the consultant to provide 28 assistance to the person. The office shall assist the person 29 in completing any technical information required in order 30 to receive assistance by the economic development authority 31 pursuant to the value-added agriculture component of the 32 economic development financial assistance program established 33 pursuant to section 15G.112 section 15.335B . 34 Sec. 21. Section 266.19, Code Supplement 2011, is amended 35 -16- LSB 5347DP (25) 84 ad/sc 16/ 33

S.F. _____ H.F. _____ to read as follows: 1 266.19 Renewable fuel —— assistance. 2 The university shall cooperate in assisting renewable fuel 3 production facilities supporting livestock operations managed 4 by persons receiving assistance pursuant to the value-added 5 agriculture component of the economic development financial 6 assistance program established in section 15G.112 section 7 15.335B . 8 Sec. 22. NEW SECTION . 422.64 Diversion of franchise tax 9 revenues. 10 1. During the period beginning January 1, 2012, and ending 11 December 31, 2021, a portion of the revenues arising from the 12 tax imposed in section 422.60 shall be deposited in a fund 13 established in the state treasury for use by the economic 14 development authority pursuant to section 15.335B, subsection 15 1. 16 2. The portion to be deposited for each calendar year shall 17 be as follows: 18 a. For the calendar year beginning January 1, 2012, the 19 portion is twenty-four million dollars. 20 b. For the calendar year beginning January 1, 2013, the 21 portion is twenty-two million five hundred thousand dollars. 22 c. For the calendar year beginning January 1, 2014, the 23 portion is twenty million dollars. 24 d. For the calendar year beginning January 1, 2015, the 25 portion is seventeen million five hundred thousand dollars. 26 e. For the calendar year beginning January 1, 2016, the 27 portion is fifteen million dollars. 28 f. For the calendar year beginning January 1, 2017, the 29 portion is twelve million five hundred thousand dollars. 30 g. For the calendar year beginning January 1, 2018, the 31 portion is ten million dollars. 32 h. For the calendar year beginning January 1, 2019, the 33 portion is seven million five hundred thousand dollars. 34 i. For the calendar year beginning January 1, 2020, the 35 -17- LSB 5347DP (25) 84 ad/sc 17/ 33

S.F. _____ H.F. _____ portion is five million dollars. 1 j. For the calendar year beginning January 1, 2021, the 2 portion is two million five hundred thousand dollars. 3 Sec. 23. Section 455B.104, subsection 2, Code Supplement 4 2011, is amended to read as follows: 5 2. The department shall assist persons applying for 6 assistance to establish and operate renewable fuel production 7 facilities pursuant to the value-added agriculture component 8 of the economic development financial assistance program 9 established in section 15G.112 section 15.335B . 10 Sec. 24. Section 455B.433, Code Supplement 2011, is amended 11 to read as follows: 12 455B.433 Physical infrastructure assistance —— funding —— 13 liability. 14 1. The department of natural resources shall work in 15 conjunction with the economic development authority to identify 16 environmentally contaminated sites which qualify for the 17 infrastructure component of the economic development financial 18 assistance program established in section 15G.112 assistance 19 under section 15.335B as necessary physical infrastructure 20 projects . The department shall provide an assessment of the 21 site and shall provide any emergency response activities which 22 the department deems necessary. The department may take any 23 further action, including remediation of the site, that the 24 department deems to be appropriate and which promotes the 25 purposes of the necessary physical infrastructure component 26 project . 27 2. The department shall be reimbursed from the economic 28 development fund created in section 15G.111 by the economic 29 development authority for any costs incurred pursuant to this 30 section . 31 3. A person shall not have standing pursuant to section 32 455B.111 to commence a citizen suit which is based upon 33 property that is part of the infrastructure component of the 34 economic development financial assistance program established 35 -18- LSB 5347DP (25) 84 ad/sc 18/ 33

S.F. _____ H.F. _____ in section 15G.112 receiving assistance pursuant to section 1 15.335B as a necessary physical infrastructure project . 2 Sec. 25. RULES. The economic development authority shall 3 adopt rules for the implementation of this division of this 4 Act. 5 Sec. 26. EFFECTIVE UPON ENACTMENT. The following provision 6 or provisions of this division of this Act, being deemed of 7 immediate importance, take effect upon enactment: 8 1. The section of this division of this Act enacting section 9 15.331. 10 2. The section of this division of this Act enacting section 11 422.64. 12 Sec. 27. RETROACTIVE APPLICABILITY. 13 1. The provision or provisions of this division of this 14 Act enacting section 15.331 apply retroactively to agreements 15 entered into under the high quality jobs program or the 16 enterprise zones program on or after July 1, 2011, and to 17 awards of incentives or assistance made under those programs on 18 or after July 1, 2011. 19 2. The provision or provisions of this division of this Act 20 enacting section 422.64 apply retroactively to January 1, 2012. 21 DIVISION II 22 TARGETED INDUSTRIES PROGRAM 23 Sec. 28. Section 15.102, subsection 11, Code Supplement 24 2011, is amended to read as follows: 25 11. “Targeted industries” means the same as defined 26 in section 15.411, subsection 1 industries of advanced 27 manufacturing, biosciences, and information technology . 28 Sec. 29. Section 15.106B, subsection 2, paragraph d, 29 subparagraph (1), Code Supplement 2011, is amended by adding 30 the following new subparagraph division: 31 NEW SUBPARAGRAPH DIVISION . (g) Services related to 32 outreach and assistance to businesses for small business 33 innovation research and technology transfer pursuant to section 34 15.411, subsection 5. 35 -19- LSB 5347DP (25) 84 ad/sc 19/ 33