S.F. 297 DIVISION I 1 CONTRACT ADMINISTRATION 2 Section 1. Section 15.106B, subsection 4, paragraph c, Code 3 2013, is amended to read as follows: 4 c. (1) The authority shall not enter into a contract for 5 services, including a contract executed pursuant to subsection 6 2 , paragraph “d” , that exceeds two years in duration. 7 (2) Notwithstanding subparagraph (1), the authority may 8 enter into a contract that exceeds two years for the operation 9 of a federal EB-5 immigrant investor regional center. 10 Sec. 2. Section 15.329, subsection 2, Code 2013, is amended 11 to read as follows: 12 2. a. If the authority finds that a business has a 13 record of violations of the law, including but not limited to 14 antitrust, environmental , and worker safety statutes, rules, 15 and regulations, that over a period of time that tends to show 16 a consistent pattern or that establishes intentional, criminal, 17 or reckless conduct in violation of such laws , the business 18 shall not qualify for economic development assistance under 19 this part, unless except as provided in paragraph “b” . 20 b. If the authority finds that the violations described 21 in paragraph “a” did not seriously affect public health or , 22 public safety, or the environment, or if it did, the authority 23 finds that there were mitigating circumstances involved, the 24 business may qualify for economic development assistance under 25 this part, notwithstanding paragraph “a” . 26 c. In making the findings and determinations regarding 27 violations, mitigating circumstances, and whether the business 28 is disqualified for economic development assistance under this 29 part, the authority shall be exempt from chapter 17A . 30 Sec. 3. Section 15.330, unnumbered paragraph 1, Code 2013, 31 is amended to read as follows: 32 A business shall enter into an agreement with the authority 33 specifying the requirements that must be met to confirm 34 eligibility pursuant to this part and the requirements that 35 -1- LSB 1206SV (2) 85 ad/sc 1/ 5

S.F. 297 must be maintained throughout the period of the agreement 1 in order to retain the incentives or financial assistance 2 received . The authority shall consult with the community 3 during negotiations relating to the agreement. The agreement 4 shall contain, at a minimum, the following provisions: 5 Sec. 4. Section 15.330, subsection 2, Code 2013, is amended 6 to read as follows: 7 2. The repayment of incentives or financial assistance 8 by the business if the business does not meet any of the 9 requirements of this part or the resulting agreement. The 10 repayment of incentives pursuant to this subsection shall be 11 considered a tax payment due and payable to the department of 12 revenue by any taxpayer who has claimed such incentives, and 13 the failure to make such a repayment may be treated by the 14 department of revenue in the same manner as a failure to pay 15 the tax shown due or required to be shown due with the filing of 16 a return or deposit form. In addition, the county shall have 17 the authority to take action to recover the value of property 18 taxes not collected as a result of the exemption provided to 19 the business under this part. 20 DIVISION II 21 MICROENTERPRISES 22 Sec. 5. Section 15.102, subsections 5 and 9, Code 2013, are 23 amended by striking the subsections. 24 Sec. 6. REPEAL. Section 15.240, Code 2013, is repealed. 25 DIVISION III 26 BROADBAND ACCESS GOVERNING BOARD 27 Sec. 7. 2009 Iowa Acts, chapter 173, section 13, subsection 28 5, paragraphs b, c, and d, are amended by striking the 29 paragraphs. 30 DIVISION IV 31 INDUSTRIAL PROPERTY TAX EXEMPTION APPROVALS 32 Sec. 8. Section 427B.1, subsection 1, Code 2013, is amended 33 to read as follows: 34 1. A city council, or a county board of supervisors as 35 -2- LSB 1206SV (2) 85 ad/sc 2/ 5

S.F. 297 authorized by section 427B.2 , may provide by ordinance for 1 a partial exemption from property taxation of the actual 2 value added to industrial real estate by the new construction 3 of industrial real estate, research-service facilities, 4 warehouses, distribution centers and the acquisition of or 5 improvement to machinery and equipment assessed as real estate 6 pursuant to section 427A.1, subsection 1 , paragraph “e” . “New 7 construction” means new buildings and structures and includes 8 new buildings and structures which are constructed as additions 9 to existing buildings and structures. “New construction” does 10 not include reconstruction of an existing building or structure 11 which does not constitute complete replacement of an existing 12 building or structure or refitting of an existing building or 13 structure, unless the reconstruction of an existing building 14 or structure is required due to economic obsolescence and the 15 reconstruction is necessary to implement recognized industry 16 standards for the manufacturing and processing of specific 17 products and the reconstruction is required for the owner 18 of the building or structure to continue to competitively 19 manufacture or process those products which determination shall 20 receive prior approval from the city council of the city or the 21 board of supervisors of the county upon the recommendation of 22 the economic development authority . The exemption shall also 23 apply to new machinery and equipment assessed as real estate 24 pursuant to section 427A.1, subsection 1 , paragraph “e” , unless 25 the machinery or equipment is part of the normal replacement 26 or operating process to maintain or expand the existing 27 operational status. “Research-service facilities” means a 28 building or group of buildings devoted primarily to research 29 and development activities, including , but not limited to , the 30 design and production or manufacture of prototype products for 31 experimental use, and corporate-research services which do not 32 have a primary purpose of providing on-site services to the 33 public. “Warehouse” means a building or structure used as a 34 public warehouse for the storage of goods pursuant to chapter 35 -3- LSB 1206SV (2) 85 ad/sc 3/ 5

S.F. 297 554, article 7 , except that it does not mean a building or 1 structure used primarily to store raw agricultural products 2 or from which goods are sold at retail. “Distribution center” 3 means a building or structure used primarily for the storage 4 of goods which are intended for subsequent shipment to retail 5 outlets. “Distribution center” does not mean a building or 6 structure used primarily to store raw agricultural products, 7 used primarily by a manufacturer to store goods to be used in 8 the manufacturing process, used primarily for the storage of 9 petroleum products, or used for the retail sale of goods. 10 EXPLANATION 11 This bill relates to the administration of duties and 12 programs of the economic development authority. 13 Division I of the bill makes an exception to the two-year 14 limitation on the length of a contract entered into by the 15 authority for the operation of a federal EB-5 immigrant 16 investor regional center. 17 Currently, a business is generally ineligible to receive 18 economic development assistance under the high quality jobs 19 program if the business has a record that tends to show 20 a consistent pattern of violations of the law, including 21 environmental and worker safety laws as well as violations 22 of related rules and regulations. The division adds that 23 a business is also ineligible for economic development 24 assistance if the business engages in a pattern of antitrust 25 violations or if a business’s conduct in violating any laws, 26 including environmental, worker safety, and antitrust laws is 27 intentional, criminal, or reckless. 28 Current law requires that an agreement under the high 29 quality jobs program for assistance or incentives entered into 30 between the authority and a business include requirements for a 31 business’s eligibility for the incentives or assistance. The 32 bill adds that the agreement must also include the requirements 33 that a business receiving incentives or assistance must 34 maintain throughout the period of the agreement. The authority 35 -4- LSB 1206SV (2) 85 ad/sc 4/ 5

S.F. 297 must ensure that a business only receives the incentives or 1 assistance if the business meets the initial eligibility 2 requirements and maintains the program requirements throughout 3 the agreement period. 4 Current law also provides that an agreement under the high 5 quality jobs program must include the repayment of incentives 6 or assistance by a business if a business does not meet 7 the requirements in statute or the agreement. The division 8 provides that the repayment of incentives, in this context, is 9 a tax payment due and payable to the department of revenue by 10 a taxpayer, and the taxpayer’s failure to make the repayment 11 may be treated by the department of revenue in the same manner 12 as a failure to pay the tax shown or required to be shown 13 due when filing a return or deposit form. The division also 14 authorizes the county to recover property taxes exempted under 15 the agreement. 16 Division II of the bill eliminates the community 17 microenterprise development organization grant program. 18 Division III of the bill eliminates the broadband access 19 governing board created in 2009 Iowa Acts. The governing 20 board was tasked with establishing a comprehensive plan for 21 the deployment and sustainability of high-speed broadband 22 access in areas capable of timely implementation of the 23 access, establishing a competitive process for the disbursement 24 of funds for such deployment and sustainability, making 25 recommendations to the general assembly, and establishing and 26 maintaining separate accounts for the use of certain proceeds. 27 Division IV of the bill relates to the economic development 28 authority’s approval of industrial property tax exemptions. 29 The division eliminates the requirement that the economic 30 development authority recommend prior approval of industrial 31 property tax exemptions by local governments. 32 -5- LSB 1206SV (2) 85 ad/sc 5/ 5