House File 339 - Reprinted HOUSE FILE 339 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HSB 84) (As Amended and Passed by the House April 25, 2019 ) A BILL FOR An Act relating to programs administered by the economic 1 development authority, including tax credits for equity 2 investments in qualifying businesses or innovation funds, 3 tax incentives for eligible businesses in rural communities, 4 and including effective date provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 HF 339 (2) 88 ko/jh/md
H.F. 339 Section 1. Section 15.102, Code 2019, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 08. “Rural community” means any city 3 located in this state with a population of thirty thousand 4 or less in a county with a population of fifty thousand or 5 less. A rural community located in more than one county shall 6 be considered to be located in the county having the greatest 7 taxable base within the city. 8 Sec. 2. Section 15.119, subsection 2, paragraphs d and e, 9 Code 2019, are amended to read as follows: 10 d. The tax credits for investments in qualifying businesses 11 issued pursuant to section 15E.43 . In allocating tax credits 12 pursuant to this subsection , the authority shall allocate at 13 least two million and not more than four million dollars for 14 purposes of this paragraph, unless the authority determines 15 that the tax credits awarded will be less than that amount. 16 e. The tax credits for investments in an innovation fund 17 pursuant to section 15E.52 . In allocating tax credits pursuant 18 to this subsection , the authority shall allocate at least six 19 million and not more than eight million dollars for purposes of 20 this paragraph, unless the authority determines that the tax 21 credits awarded will be less than that amount. 22 Sec. 3. Section 15.119, Code 2019, is amended by adding the 23 following new subsection: 24 NEW SUBSECTION . 2A. On or before June 30 of each year, 25 the authority shall determine the amount of tax credits that 26 shall be issued pursuant to sections 15E.43 and 15E.52 for 27 the following fiscal year. In allocating the amount of tax 28 credits authorized pursuant to subsection 1 among the programs 29 specified in subsection 2, the aggregate amount allocated by 30 the authority for purposes of subsection 2, paragraphs “d” and 31 “e” , shall not exceed ten million dollars. 32 Sec. 4. Section 15.335A, subsection 1, unnumbered paragraph 33 1, Code 2019, is amended to read as follows: 34 Tax Except as provided in subsection 1A, tax incentives are 35 -1- HF 339 (2) 88 ko/jh/md 1/ 5
H.F. 339 available to eligible businesses as provided in this section 1 subsection . The incentives are based upon the number of jobs 2 created or retained that pay at least one hundred twenty 3 percent of the qualifying wage threshold and the amount of the 4 qualifying investment made according to the following schedule: 5 Sec. 5. Section 15.335A, Code 2019, is amended by adding the 6 following new subsection: 7 NEW SUBSECTION . 1A. Tax incentives are available to 8 eligible businesses in rural communities as provided in this 9 subsection. The incentives are based upon the number of 10 jobs created or retained that pay at least one hundred ten 11 percent of the qualifying wage threshold and the amount of the 12 qualifying investment made according to the following schedule: 13 a. The number of jobs is zero and economic activity is 14 furthered by the qualifying investment and the amount of the 15 qualifying investment is one of the following: 16 (1) Less than fifty thousand dollars, then the tax incentive 17 is the investment tax credit of up to two percent. 18 (2) At least fifty thousand dollars but less than two 19 hundred fifty thousand dollars, then the tax incentives are the 20 investment tax credit of up to two percent and the sales tax 21 refund. 22 (3) At least two hundred fifty thousand dollars, then the 23 tax incentives are the investment tax credit of up to two 24 percent, the sales tax refund, and the additional research and 25 development tax credit. 26 b. The number of jobs is one but not more than five and the 27 amount of the qualifying investment is one of the following: 28 (1) Less than fifty thousand dollars, then the tax incentive 29 is the investment tax credit of up to three percent. 30 (2) At least fifty thousand dollars but less than two 31 hundred fifty thousand dollars, then the tax incentives are the 32 investment tax credit of up to three percent and the sales tax 33 refund. 34 (3) At least two hundred fifty thousand dollars, then the 35 -2- HF 339 (2) 88 ko/jh/md 2/ 5
H.F. 339 tax incentives are the investment tax credit of up to three 1 percent, the sales tax refund, and the additional research and 2 development tax credit. 3 c. The number of jobs is six but not more than ten and the 4 amount of the qualifying investment is one of the following: 5 (1) Less than fifty thousand dollars, then the tax incentive 6 is the investment tax credit of up to four percent. 7 (2) At least fifty thousand dollars but less than two 8 hundred fifty thousand dollars, then the tax incentives are the 9 investment tax credit of up to four percent and the sales tax 10 refund. 11 (3) At least two hundred fifty thousand dollars, then the 12 tax incentives are the investment tax credit of up to four 13 percent, the sales tax refund, and the additional research and 14 development tax credit. 15 d. The number of jobs is eleven but not more than fifteen 16 and the amount of the qualifying investment is one of the 17 following: 18 (1) Less than fifty thousand dollars, then the tax incentive 19 is the investment tax credit of up to five percent. 20 (2) At least fifty thousand dollars but less than two 21 hundred fifty thousand dollars, then the tax incentives are the 22 investment tax credit of up to five percent and the sales tax 23 refund. 24 (3) At least two hundred fifty thousand dollars, then the 25 tax incentives are the investment tax credit of up to five 26 percent, the sales tax refund, and the additional research and 27 development tax credit. 28 e. The number of jobs is sixteen or more and the amount of 29 the qualifying investment is one of the following: 30 (1) Less than fifty thousand dollars, then the tax incentive 31 is the investment tax credit of up to six percent. 32 (2) At least fifty thousand dollars but less than two 33 hundred fifty thousand dollars, then the tax incentives are the 34 investment tax credit of up to six percent and the sales tax 35 -3- HF 339 (2) 88 ko/jh/md 3/ 5
H.F. 339 refund. 1 (3) At least two hundred fifty thousand dollars, then the 2 tax incentives are the investment tax credit of up to six 3 percent, the sales tax refund, and the additional research and 4 development tax credit. 5 f. The number of jobs is thirty-one but not more than forty 6 and the amount of the qualifying investment is at least five 7 million dollars, then the tax incentives are the local property 8 tax exemption, the investment tax credit of up to seven 9 percent, the sales tax refund, and the additional research and 10 development tax credit. 11 g. The number of jobs is forty-one but not more than sixty 12 and the amount of the qualifying investment is at least five 13 million dollars, then the tax incentives are the local property 14 tax exemption, the investment tax credit of up to eight 15 percent, the sales tax refund, and the additional research and 16 development tax credit. 17 h. The number of jobs is sixty-one but not more than 18 eighty and the amount of the qualifying investment is at least 19 five million dollars, then the tax incentives are the local 20 property tax exemption, the investment tax credit of up to nine 21 percent, the sales tax refund, and the additional research and 22 development tax credit. 23 i. The number of jobs is eighty-one but not more than one 24 hundred and the amount of the qualifying investment is at least 25 five million dollars, then the tax incentives are the local 26 property tax exemption, the investment tax credit of up to ten 27 percent, the sales tax refund, and the additional research and 28 development tax credit. 29 j. The number of jobs is at least one hundred one and the 30 amount of the qualifying investment is at least ten million 31 dollars, then the tax incentives are the local property 32 tax exemption, the investment tax credit of up to eleven 33 percent, the sales tax refund, and the additional research and 34 development tax credit. 35 -4- HF 339 (2) 88 ko/jh/md 4/ 5
H.F. 339 Sec. 6. Section 15.335B, subsection 3, paragraph c, Code 1 2019, is amended to read as follows: 2 c. (1) Consider the amount and type of the local community 3 match . as follows: 4 (a) In a community with a population of less than five 5 thousand, a community match shall not be required. 6 (b) In a community with a population equal to or greater 7 than five thousand but less than fifteen thousand, a community 8 match of at least five percent of the projected funds to be 9 expended shall be required. 10 (c) In a community with a population equal to or greater 11 than fifteen thousand but less than thirty thousand, a 12 community match of at least ten percent of the projected funds 13 to be expended shall be required. 14 (d) In a community with a population equal to or greater 15 than thirty thousand, a community match of at least twenty 16 percent of the projected funds to be expended shall be 17 required. 18 (2) The Notwithstanding subparagraph (1), the authority may 19 provide assistance to an early-stage business in a high-growth 20 industry regardless of the amount of local match involved. 21 Sec. 7. EFFECTIVE DATE. This Act, being deemed of immediate 22 importance, takes effect upon enactment. 23 -5- HF 339 (2) 88 ko/jh/md 5/ 5