S.F. _____ H.F. _____ DIVISION I 1 INVESTMENT TAX CREDITS 2 Section 1. Section 15E.43, subsection 1, paragraph b, Code 3 2014, is amended to read as follows: 4 b. A tax credit shall be allowed only for an investment made 5 in the form of cash to purchase equity in a qualifying business 6 or in a community-based seed capital fund. A taxpayer that has 7 received a tax credit for an investment in a community-based 8 seed capital fund shall not claim the tax credit prior to the 9 third tax year following the tax year in which the investment 10 is made. Any tax credit in excess of the taxpayer’s liability 11 for the tax year may be credited to the tax liability for the 12 following five years or until depleted, whichever is earlier. 13 A tax credit shall not be carried back to a tax year prior to 14 the tax year in which the taxpayer redeems the tax credit. 15 Sec. 2. Section 15E.44, subsection 1, Code 2014, is amended 16 to read as follows: 17 1. In order for an equity investment to qualify for a 18 tax credit, the business in which the equity investment is 19 made shall, within one hundred twenty days of the date of 20 the first investment, notify the authority of the names, 21 addresses, shares issued, consideration paid for the shares, 22 and the amount of any tax credits, of all shareholders who 23 may initially qualify for the tax credits , and the earliest 24 year in which the tax credits may be redeemed . The list 25 of shareholders who may qualify for the tax credits shall 26 be amended as new equity investments are sold or as any 27 information on the list shall change. 28 Sec. 3. Section 15E.44, subsection 2, paragraph f, Code 29 2014, is amended to read as follows: 30 f. The business shall have secured , within twenty-four 31 months following the first date on which the equity investments 32 qualifying for tax credits have been made, total equity 33 or financing, near equity financing , binding investment 34 commitments, or some combination thereof, equal to at least two 35 -1- LSB 5291XD (9) 85 ad/sc 1/ 9

S.F. _____ H.F. _____ hundred fifty thousand dollars. 1 Sec. 4. Section 15E.45, subsection 3, paragraph a, 2 subparagraph (3), Code 2014, is amended by striking the 3 subparagraph and inserting in lieu thereof the following: 4 (3) Any other information required by the authority. 5 Sec. 5. Section 15E.45, subsection 6, Code 2014, is amended 6 to read as follows: 7 6. In the event that a community-based seed capital 8 fund fails to meet or maintain any requirement set forth in 9 this section , or in the event that at least thirty-three 10 percent of the invested capital of the community-based seed 11 capital fund has not been invested in one or more separate 12 qualifying businesses, measured at the end of the forty-eighth 13 thirty-sixth month after commencing the fund’s investing 14 activities, the authority shall rescind any tax credit 15 certificates issued to limited partners or members and shall 16 notify the department of revenue that it has done so, and the 17 tax credit certificates shall be null and void. However, a A 18 community-based seed capital fund may apply to the authority 19 for a one-year waiver of the requirements of this subsection . 20 Sec. 6. RETROACTIVE APPLICABILITY. This division of this 21 Act applies retroactively to January 1, 2014, for tax years 22 beginning and investments made on or after that date. 23 DIVISION II 24 TARGETED SMALL BUSINESS ASSISTANCE 25 Sec. 7. 2013 Iowa Acts, chapter 13, section 10, subsections 26 1 and 2, are amended to read as follows: 27 1. Upon repeal of the targeted small business financial 28 assistance program established in section 15.247 , the authority 29 shall transfer all unencumbered and unobligated moneys accruing 30 to the authority pursuant to existing agreements to a fund 31 established by the authority in the state treasury under 32 the control of the authority pursuant to section 15.106A, 33 subsection 1, paragraph “o”, to be used for the purposes of 34 providing assistance to targeted small businesses pursuant to 35 -2- LSB 5291XD (9) 85 ad/sc 2/ 9

S.F. _____ H.F. _____ subsection subsections 3 and 4 of this section of this Act. 1 2. Loan payments or repayments and recaptures of principal, 2 interest, or other moneys accruing to the authority on or after 3 June 30, 2013, pursuant to an agreement under section 15.247 , 4 shall be transferred to a fund established by the authority in 5 the state treasury under the control of the authority pursuant 6 to section 15.106A, subsection 1, paragraph “o”, to be used 7 for the purposes of providing assistance to targeted small 8 businesses pursuant to subsection subsections 3 and 4 of this 9 section of this Act. 10 Sec. 8. 2013 Iowa Acts, chapter 13, section 10, subsection 11 3, paragraph c, is amended to read as follows: 12 c. The authority shall, upon completion of the initial 13 performance period and the other applicable terms of the 14 agreement with the microloan service provider, submit a report 15 to the general assembly and the governor’s office describing 16 the results achieved by the service provider and shall make 17 recommendations as to whether the state should continue to 18 provide funds for future fiscal years for the purpose of 19 providing financial and technical assistance to targeted 20 small businesses through the services of a microloan service 21 provider. The report shall also include the results achieved 22 by the program established to assist entities in developing a 23 statewide initiative designed to increase the number of female 24 entrepreneurs in the state pursuant to subsection 4. 25 Sec. 9. 2013 Iowa Acts, chapter 13, section 10, is amended 26 by adding the following new subsection: 27 NEW SUBSECTION . 4. a. From the moneys transferred pursuant 28 to subsections 1 and 2, the authority may use amounts not 29 allocated for purposes of subsection 3 for purposes of this 30 subsection. 31 b. The authority may establish a program to assist one 32 or more private sector entities in implementing a multiyear 33 statewide initiative designed to increase the number of female 34 entrepreneurs in the state. Such an initiative shall target 35 -3- LSB 5291XD (9) 85 ad/sc 3/ 9

S.F. _____ H.F. _____ at least ten communities around the state, both urban and 1 rural, for training and discussion on the personal, legal, 2 and financial aspects of starting and operating a small 3 business. The initiative shall also provide for individual 4 mentoring, access to matched savings accounts intended to be 5 used for the start or expansion of a small business by a female 6 entrepreneur, and specialized topical workshops useful to 7 female entrepreneurs. 8 c. A targeted small business owned, operated, and actively 9 managed by one or more women that is receiving assistance under 10 subsection 3 is also eligible to receive assistance under this 11 subsection. 12 d. The program established pursuant to this subsection shall 13 be implemented, to the extent practicable, in a manner that 14 complements the program established pursuant to subsection 3. 15 Results achieved by the program established pursuant to this 16 subsection shall be included in the report prepared pursuant to 17 subsection 3. 18 Sec. 10. EFFECTIVE UPON ENACTMENT. This Act, being deemed 19 of immediate importance, takes effect upon enactment. 20 DIVISION III 21 STRATEGIC INFRASTRUCTURE PROGRAM 22 Sec. 11. Section 15.311, Code 2014, is amended to read as 23 follows: 24 15.311 Title. 25 This part shall be known as the “Iowa Strategic Investment 26 Fund” Infrastructure” program. 27 Sec. 12. Section 15.313, subsection 1, Code 2014, is amended 28 to read as follows: 29 1. a. An Iowa strategic investment fund is created The 30 authority shall establish a fund pursuant to section 15.106A, 31 subsection 1, paragraph “o” , for purposes of financing 32 strategic infrastructure projects as described in this 33 section. A fund established for purposes of this section may 34 be administered as a revolving fund consisting and may consist 35 -4- LSB 5291XD (9) 85 ad/sc 4/ 9

S.F. _____ H.F. _____ of any money moneys appropriated by the general assembly for 1 that purpose purposes of this section and any other moneys 2 that are lawfully available to and obtained or accepted by 3 the authority , from the federal government or private sources 4 for placement in the fund including moneys transferred or 5 deposited from other funds created pursuant to section 15.106A, 6 subsection 1, paragraph “o” . 7 b. Notwithstanding section 8.33 , moneys in the strategic 8 investment a fund established for purposes of this section 9 at the end of each fiscal year shall not revert to any other 10 fund but shall remain in the strategic investment fund for 11 expenditure for subsequent fiscal years. 12 c. Moneys in a fund established for purposes of this section 13 may be transferred to other funds created pursuant to section 14 15.106A, subsection 1, paragraph “o” . 15 Sec. 13. Section 15.313, subsection 2, unnumbered paragraph 16 1, Code 2014, is amended to read as follows: 17 The assets of the fund program shall be used by the authority 18 to assist in provide financial assistance for strategic 19 infrastructure projects that are intended to lead to relocation 20 or expansion projects for existing businesses as well as 21 entrepreneurial start-up and expansion projects financial 22 assistance for new businesses . Moneys in the fund shall 23 be used for projects designed to meet any of the following 24 purposes: 25 Sec. 14. Section 15.313, subsection 2, paragraphs a, b, c, 26 d, e, and f, Code 2014, are amended by striking the paragraphs. 27 Sec. 15. Section 15.313, subsection 3, Code 2014, is amended 28 by striking the subsection and inserting in lieu thereof the 29 following: 30 3. For purposes of this section, unless the context 31 otherwise requires: 32 a. “Financial assistance” means the same as defined in 33 section 15.102. 34 b. “Strategic infrastructure” means projects that develop 35 -5- LSB 5291XD (9) 85 ad/sc 5/ 9

S.F. _____ H.F. _____ commonly utilized assets that provide an advantage to one 1 or more private sector entities or that create necessary 2 physical infrastructure in the state, and such projects are 3 not adequately provided by the public or private sectors. 4 Such projects may include vertical improvement developments, 5 facilities and equipment upgrades, or the redevelopment or 6 repurposing of underutilized property or other assets, provided 7 that each project is intended to attract additional public or 8 private sector investment and result in broad-based prosperity 9 in this state. 10 c. “Vertical improvement” means the same as defined in 11 section 15J.2. 12 Sec. 16. Section 15.313, Code 2014, is amended by adding the 13 following new subsection: 14 NEW SUBSECTION . 4. The authority shall adopt rules to 15 implement and administer this section. In adopting such rules, 16 the authority shall narrowly construe the provisions of this 17 section. 18 Sec. 17. Section 15.335B, subsection 2, paragraph a, Code 19 2014, is amended by adding the following new subparagraph: 20 NEW SUBPARAGRAPH . (7) For deposit in a fund created for 21 purposes of the strategic infrastructure program established 22 pursuant to section 15.313. 23 Sec. 18. Section 384.4, subsection 1, paragraph b, Code 24 2014, is amended by striking the paragraph. 25 Sec. 19. 2011 Iowa Acts, chapter 133, section 13A, as 26 enacted by 2013 Iowa Acts, chapter 142, section 7, is amended 27 to read as follows: 28 SEC. 13A. TRANSITION UPON REPEAL. 29 1. Any moneys in the economic development fund created 30 pursuant to section 15G.111, Code Supplement 2011 , that 31 remain unobligated on July 1, 2013, shall be transferred to 32 the rebuild Iowa infrastructure fund. The authority shall 33 provide notification to the department of management and to the 34 legislative services agency at the time of the transfer. 35 -6- LSB 5291XD (9) 85 ad/sc 6/ 9

S.F. _____ H.F. _____ 2. Loan payments or repayments and recaptures of principal, 1 interest, or other moneys accruing to the authority on or after 2 July 1, 2013, pursuant to an agreement under chapter 15G, 3 subchapter I, shall be transferred by the authority to a fund 4 established by the authority in the state treasury pursuant to 5 section 15.106A, subsection 1, paragraph “o”. 6 3. The authority may use any moneys accruing pursuant to 7 subsection 2 for purposes of section 15.313. 8 Sec. 20. REPEAL. Section 15E.120, Code 2014, is repealed. 9 Sec. 21. RETROACTIVE APPLICABILITY. The section of this 10 Act amending 2011 Iowa Acts, chapter 133, section 13A, as 11 enacted by 2013 Iowa Acts, chapter 142, section 7, applies 12 retroactively to July 1, 2013. 13 EXPLANATION 14 The inclusion of this explanation does not constitute agreement with 15 the explanation’s substance by the members of the general assembly. 16 This bill relates to economic development programs by 17 modifying the administration of investment tax credits for 18 investments in community-based seed capital funds or qualifying 19 businesses, targeted small business assistance, and the 20 strategic investment fund and properly related matters. 21 Division I of the bill eliminates the prohibition on a 22 taxpayer claiming the investment tax credit for an equity 23 investment in a qualifying business earlier than the third 24 tax year following the tax year in which the investment was 25 made. The bill eliminates the 24-month requirement for a 26 qualifying business under the investment tax credits program 27 to secure total equity or near equity financing and adds 28 that a qualifying business may also use binding investment 29 commitments, or a combination of the equity and investment 30 commitments to demonstrate that it has met the requirement 31 in current Code to secure at least $250,000. The bill also 32 changes the date by which a community-based seed capital fund 33 must invest in a separate qualifying business from 48 months 34 after commencing the fund’s investing activities to 36 months 35 -7- LSB 5291XD (9) 85 ad/sc 7/ 9

S.F. _____ H.F. _____ after commencing the fund’s investing activities. 1 Division I applies retroactively to January 1, 2014, for tax 2 years beginning on or after that date and investments made on 3 or after that date. 4 Division II of the bill allows moneys transferred from the 5 targeted small business financial assistance program, which 6 was repealed in the 2013 legislative session, that are not 7 allocated for the procurement of a microloan service provider 8 to assist targeted small businesses to be used to establish a 9 program to assist one or more private entities in implementing 10 an initiative to increase the number of female entrepreneurs in 11 the state. A program created for this purpose must complement 12 the current microloan service provider program which provides 13 financial and technical assistance to targeted small businesses 14 at a discounted rate. A targeted small business that is owned, 15 operated, and managed by a woman and that is receiving the 16 services of a microloan service provider may also receive 17 assistance from the statewide initiative. 18 Division II takes effect upon enactment. 19 Division III of the bill makes changes to the strategic 20 investment fund program. The bill changes the name of the 21 program from the Iowa strategic investment fund program to the 22 Iowa strategic infrastructure program, and allows the authority 23 to establish a fund under its general authority for the purpose 24 of financing strategic infrastructure projects. 25 Under current law, a strategic investment fund is created 26 and the fund’s assets are required to be used for relocation or 27 expansion projects for existing businesses and entrepreneurial 28 start-up and expansion projects that meet purposes specified in 29 statute. The bill eliminates these provisions and requires the 30 fund created by the authority to be used to provide financial 31 assistance for relocation or expansion projects for existing 32 businesses as well as financial assistance for new businesses. 33 The bill also allows the moneys in the fund to be transferred 34 to other funds created by the authority, and allows the fund 35 -8- LSB 5291XD (9) 85 ad/sc 8/ 9

S.F. _____ H.F. _____ to receive transfers from other funds, generally, and from 1 a fund created under the high quality jobs program in Code 2 section 15.335B, specifically. The bill provides definitions 3 for “financial assistance”, “strategic infrastructure”, and 4 “vertical improvement”. 5 The bill repeals a provision relating to loan repayments 6 under the former Iowa community development loan program that 7 included a reference to the strategic investment fund. 8 The bill requires the authority to transfer loan payments 9 or repayments and recaptures of principal, interest, or other 10 moneys accruing to the authority as a result of an agreement 11 made pursuant to Code chapter 15G, subchapter I, the grow 12 Iowa financial assistance program, to a fund created by the 13 authority. This provision of the bill applies retroactively to 14 July 1, 2013. The bill allows the authority to use any moneys 15 transferred pursuant to this provision of the bill for purposes 16 of the strategic infrastructure program. 17 -9- LSB 5291XD (9) 85 ad/sc 9/ 9