HF 617 (LSB 1605YH (6) 91)

HOUSE FILE 617

BY  SIEGRIST, TUREK, SIECK, and KAUFMANN

A BILL FOR

An Act modifying public improvements relating to housing and residential development in urban renewal areas, and including effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 403.17, subsection 14, Code 2025, is amended to read as follows:
   14.  “Low or and moderate income families” means those families, including single person households, earning no more than eighty percent of the higher of the median family income of the county or the statewide nonmetropolitan area as determined by the latest United States department of housing and urban development, section 8 income guidelines.
    Sec. 2.  Section 403.22, subsection 1, Code 2025, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  d.  (1)  (a)  For projects subject to paragraph “a”, if the public improvement project is related to housing and residential development in an economic development area containing property that has been located entirely within the corporate limits of a city for twenty years or more, the amount to be provided for low and moderate income family housing for such projects shall not be less than an amount equal to twenty percent of the original project cost, subject to further reduction as provided in this subsection.
   (b)  In addition, notwithstanding subsection 5, the division of the revenue under section 403.19 for each project under this paragraph “d” shall be limited to tax collections for twenty fiscal years beginning with the second fiscal year after the year in which the municipality first certifies to the county auditor the amount of any loans, advances, indebtedness, or bonds which qualify for payment from the division of the revenue in connection with the project.
   (2)  For projects under this paragraph, “low and moderate income family housing” includes housing that meets the requirements of section 15.353.
    Sec. 3.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 4.  APPLICABILITY.  This Act applies to revenues divided for projects approved on or after the effective date of this Act.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   Under current law, any urban renewal area established upon the determination that the area is an economic development area, a division of revenue (tax increment financing) shall not be allowed for the purpose of providing or aiding in the provision of public improvements related to housing and residential development, unless the municipality assures that the project will include assistance for low and moderate income family housing.
   This bill expands assistance to low and moderate income family housing by specifying that in a city with a population of more than 15,000, for projects in an urban renewal area containing property that has been located entirely within the corporate limits of a city for 20 or more years, the low and moderate income family housing assistance for such projects shall not be less than an amount equal to 20 percent of the original project cost instead of the current law minimum of 10 percent.
   The bill also extends the division of the revenue for such projects to tax collections for 20 fiscal years instead of the current law maximum of 10 years.
   For such projects under the new requirements in the bill, the bill also specifies that “low and moderate income family housing” includes housing that meets the requirements of Code section 15.353 (workforce housing). 
   The bill also modifies the defined term “low or moderate income families” in Code chapter 403 to “low and moderate income families” to align with the terminology usage within the Code chapter.
   The bill takes effect upon enactment and applies to revenues divided for projects approved on or after the effective date of the bill.