House File 254 - IntroducedA Bill ForAn Act 1authorizing a property tax exemption for certain
2property used for shared services and business assistance
3and including applicability provisions.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1   Section 1.  Section 427.1, Code 2019, is amended by adding
2the following new subsection:
3   NEW SUBSECTION.  42.  Business incubator property.
   4a.  The property owned or leased and operated by a local or
5regional economic development organization and used solely as a
6business incubator.
   7b.  For purposes of this subsection:
   8(1)  “Business incubator” means a facility in which space is
9leased to small businesses and that provides shared services
10and business assistance to such businesses to improve their
11chances of success. The services provided may include but are
12not limited to receptionist, copying, computer, telephone,
13secretarial, and meeting services. The assistance provided
14may include but is not limited to advice concerning marketing
15plans, business plans, accounting, and administration.
   16(2)  “Local or regional economic development organization”
17means a private, nonprofit organization, as recognized by the
18internal revenue service, whose primary purposes are to develop
19the economy of its area and to provide assistance to businesses
20in that area.
   21(3)  “Small business” means the same as defined in section
22422.35, subsection 6, paragraph “c”.
   23c.  Claims for the exemption under this subsection must be
24filed with the assessor not later than February 1 of the year
25for which the exemption is requested on forms to be prescribed
26by the director of revenue. Upon the filing and allowance
27of the claim, the claim shall be allowed on the property for
28successive years without further filing as long as the property
29continues to qualify for the exemption. When the property is
30sold or transferred, the county recorder shall provide notice
31of the transfer to the assessor. The notice shall describe the
32property transferred and the name of the person to whom title
33to the property is transferred.
34   Sec. 2.  IMPLEMENTATION OF ACT.  Section 25B.7 shall not
35apply to the property tax exemption enacted in this Act.
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1   Sec. 3.  APPLICABILITY.  This Act applies to assessment years
2beginning on or after January 1, 2020.
3EXPLANATION
4The inclusion of this explanation does not constitute agreement with
5the explanation’s substance by the members of the general assembly.
   6This bill establishes a property tax exemption for property
7owned or leased and operated by a local or regional economic
8development organization, as defined in the bill, and used
9solely as a business incubator. The bill defines “business
10incubator” to mean a facility in which space is leased to small
11businesses, as defined to mean the same as Code section 422.35,
12and that provides shared services and business assistance
13to such businesses to improve their chances of success.
14The services provided may include but are not limited to
15receptionist, copying, computer, telephone, secretarial, and
16meeting services. The assistance provided may include but is
17not limited to advice concerning marketing plans, business
18plans, accounting, and administration.
   19The bill makes inapplicable Code section 25B.7. Code
20section 25B.7 provides that for a property tax credit or
21exemption enacted on or after January 1, 1997, if a state
22appropriation made to fund the credit or exemption is not
23sufficient to fully fund the credit or exemption, the political
24subdivision shall be required to extend to the taxpayer only
25that portion of the credit or exemption estimated by the
26department of revenue to be funded by the state appropriation.
   27The bill applies to assessment years beginning on or after
28January 1, 2020.
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md/jh