SF 2406 (LSB 5450SV (1) 87)

SENATE FILE 2406

BY  COMMITTEE ON WAYS AND MEANS

(SUCCESSOR TO SF 2152)

A BILL FOR

An Act relating to the transferability of investment tax credits issued to eligible housing businesses under the enterprise zone program, including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  2014 Iowa Acts, chapter 1130, section 27, is amended to read as follows:
   SEC. 27.  INVESTMENT TAX CREDITS ISSUED TO ELIGIBLE HOUSING BUSINESSES UNDER THE ENTERPRISE ZONE PROGRAM —— TRANSFERABILITY.  Notwithstanding the requirement in section 15E.193B, subsection 8, Code 2014, that not more than three million dollars worth of tax credits for housing developments located in a brownfield site or a blighted area shall be eligible for transfer in a calendar year unless the eligible housing business is also eligible for low-income housing tax credits authorized under section 42 of the Internal Revenue Code, and notwithstanding the requirement in section 15E.193B, subsection 8, Code 2014, that the economic development authority shall not approve more than one million five hundred thousand dollars in tax credit certificates for transfer to any one eligible housing business located on a brownfield site or in a blighted area in a calendar year, all investment tax credits determined under section 15E.193B, subsection 6, paragraph “a”, Code 2014, for housing developments located on a brownfield site or in a blighted area may be approved by the economic development authority for transfer in calendar year 2014, or any subsequent calendar year, provided the eligible housing business was awarded the investment tax credit before the effective date of this section of this division of this Act and notifies the economic development authority, in writing, before July 1, 2014, of its intent to transfer such tax credits, or provided the eligible housing business was awarded the investment tax credit before July 1, 2015, for a housing development located in a blighted area and in a county with a total population of less than fifty thousand as determined by the most recent federal decennial census, and submits a written request for approval to transfer such tax credits to the economic development authority before October 31, 2017, and provided the eligible housing business and the related housing development meet all other applicable requirements under section 15E.193B, Code 2014. Notwithstanding any other provision of law to the contrary, a tax credit transferred pursuant to this section shall not be claimed by a transferee prior to January 1, 2016.
    Sec. 2.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 3.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to May 30, 2014.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the transferability of tax credits issued to housing businesses under the enterprise zone program, which the general assembly repealed in 2014. Investment tax credits issued under that prior program were transferable for housing developments located on brownfield sites or in blighted areas, but the economic development authority (authority) could only approve a maximum of $3 million worth of credits for transfer each calendar year, and no more than $1.5 million could be transferred to any one housing development during each calendar year. Prior law provided an exception to these transfer restrictions for certain housing developments, allowing any amount of the tax credits to be transferred during a calendar year.
   The bill provides another exception to the tax credit transfer restrictions described above. The bill provides that the full amount of tax credits awarded to an eligible housing business before July 1, 2015, may be transferred during a calendar year provided the housing development is located in a blighted area and in a county with a total population of less than 50,000, and provided the housing business submitted a written request to the authority seeking approval to transfer the tax credits prior to October 31, 2017.
   The bill takes effect upon enactment and applies retroactively to May 30, 2014.