Senate File 2179 - Introduced SENATE FILE 2179 BY COMMITTEE ON ECONOMIC GROWTH (SUCCESSOR TO SSB 3095) A BILL FOR An Act related to the high quality jobs program by allowing 1 additional tax incentives for businesses that use 2 contractors and subcontractors operating or participating 3 in an apprenticeship program and including applicability 4 provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 5483SV (1) 86 aw/sc

S.F. 2179 Section 1. Section 15.335A, subsection 1, unnumbered 1 paragraph 1, Code 2016, is amended to read as follows: 2 Tax incentives are available to eligible businesses as 3 provided in this section . The incentives under this subsection 4 are based upon the number of jobs created or retained that pay 5 at least one hundred twenty percent of the qualifying wage 6 threshold and the amount of the qualifying investment made 7 according to the following schedule: 8 Sec. 2. Section 15.335A, Code 2016, is amended by adding the 9 following new subsection: 10 NEW SUBSECTION . 1A. a. In addition to the tax incentives 11 available under subsection 1, an additional investment tax 12 credit of up to two percent, as provided in this subsection, 13 is available to an eligible business if the eligible business 14 contracts with contractors or subcontractors who operate or 15 participate in any apprenticeship program for the construction 16 or equipping of a facility of the business. 17 b. The amount of the additional investment tax credit shall 18 be calculated as follows: 19 (1) For an eligible business that directs seventy percent 20 of the amount of the qualifying investment to contractors and 21 subcontractors described in paragraph “a” , an additional credit 22 of up to one and four-tenths percent. 23 (2) For each percentage point that the amount of 24 the qualifying investment directed to contractors and 25 subcontractors described in paragraph “a” exceeds seventy 26 percent, the additional investment tax credit rate under 27 subparagraph (1) shall be increased by up to two one-hundredths 28 of one percent, such that an eligible business that directs one 29 hundred percent of the amount of the qualifying investment to 30 contractors and subcontractors described in paragraph “a” may 31 receive an additional credit of up to two percent. 32 Sec. 3. Section 15.335A, subsection 2, Code 2016, is amended 33 by adding the following new paragraph: 34 NEW PARAGRAPH . 0b. “Apprenticeship program” means the same 35 -1- LSB 5483SV (1) 86 aw/sc 1/ 2

S.F. 2179 as defined in section 15B.2. 1 Sec. 4. APPLICABILITY. This Act applies to businesses that 2 receive an award of tax incentives under section 15.335A on or 3 after July 1, 2016. 4 EXPLANATION 5 The inclusion of this explanation does not constitute agreement with 6 the explanation’s substance by the members of the general assembly. 7 This bill permits the economic development authority 8 (authority) to provide additional tax incentives to businesses 9 using apprenticeship training program contractors and 10 subcontractors for projects in which qualifying investments are 11 made under the high quality jobs program. 12 Under the bill, the authority is permitted to provide an 13 additional investment tax credit to a business if the business 14 contracts with a contractor or subcontractor who operates or 15 participates in an apprenticeship program for the construction 16 or equipping of a facility of the business. 17 Under the bill, if an eligible business directs 70 percent 18 of the qualifying investment to qualifying contractors 19 or subcontractors, the business is eligible to receive an 20 additional investment tax credit of up to 1.40 percent. 21 If an eligible business directs more than 70 percent of 22 the qualifying investment to qualifying contractors or 23 subcontractors, the additional investment tax credit available 24 shall increase 0.02 percent above the 1.40 percent base for 25 each one percentage point increase to the percent of the 26 qualifying investment directed to qualifying contractors 27 or subcontractors. Under the bill, therefore, an eligible 28 business that directs 100 percent of the qualifying investment 29 to qualifying contractors or subcontractors is eligible to 30 receive an additional investment tax credit of up to 2 percent. 31 The bill applies to businesses that receive an award of tax 32 incentives under the high quality jobs program on or after July 33 1, 2016. 34 -2- LSB 5483SV (1) 86 aw/sc 2/ 2