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House File 785 - IntroducedA Bill ForAn Act 1relating to rural economic development by providing tax
2incentives for high-quality jobs in rural communities.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 15.102, Code 2019, is amended by adding
2the following new subsection:
3 NEW SUBSECTION. 08. “Rural community” means any city
4located in this state with a population of thirty thousand
5or less in a county with a population of fifty thousand or
6less. A rural community located in more than one county shall
7be considered to be located in the county having the greatest
8taxable base within the city.
9 Sec. 2. Section 15.335A, subsection 1, unnumbered paragraph
101, Code 2019, is amended to read as follows:
11Tax Except as provided in subsection 1A, tax incentives are
12available to eligible businesses as provided in this section
13 subsection. The incentives are based upon the number of jobs
14created or retained that pay at least one hundred twenty
15percent of the qualifying wage threshold and the amount of the
16qualifying investment made according to the following schedule:
17 Sec. 3. Section 15.335A, Code 2019, is amended by adding the
18following new subsection:
19 NEW SUBSECTION. 1A. Tax incentives are available to
20eligible businesses in rural communities as provided in this
21subsection. The incentives are based upon the number of
22jobs created or retained that pay at least one hundred ten
23percent of the qualifying wage threshold and the amount of the
24qualifying investment made according to the following schedule:
25a. The number of jobs is zero and economic activity is
26furthered by the qualifying investment and the amount of the
27qualifying investment is one of the following:
28(1) Less than fifty thousand dollars, then the tax incentive
29is the investment tax credit of up to two percent.
30(2) At least fifty thousand dollars but less than two
31hundred fifty thousand dollars, then the tax incentives are the
32investment tax credit of up to two percent and the sales tax
33refund.
34(3) At least two hundred fifty thousand dollars, then the
35tax incentives are the investment tax credit of up to two
-1-1percent, the sales tax refund, and the additional research and
2development tax credit.
3b. The number of jobs is one but not more than five and the
4amount of the qualifying investment is one of the following:
5(1) Less than fifty thousand dollars, then the tax incentive
6is the investment tax credit of up to three percent.
7(2) At least fifty thousand dollars but less than two
8hundred fifty thousand dollars, then the tax incentives are the
9investment tax credit of up to three percent and the sales tax
10refund.
11(3) At least two hundred fifty thousand dollars, then the
12tax incentives are the investment tax credit of up to three
13percent, the sales tax refund, and the additional research and
14development tax credit.
15c. The number of jobs is six but not more than ten and the
16amount of the qualifying investment is one of the following:
17(1) Less than fifty thousand dollars, then the tax incentive
18is the investment tax credit of up to four percent.
19(2) At least fifty thousand dollars but less than two
20hundred fifty thousand dollars, then the tax incentives are the
21investment tax credit of up to four percent and the sales tax
22refund.
23(3) At least two hundred fifty thousand dollars, then the
24tax incentives are the investment tax credit of up to four
25percent, the sales tax refund, and the additional research and
26development tax credit.
27d. The number of jobs is eleven but not more than fifteen
28and the amount of the qualifying investment is one of the
29following:
30(1) Less than fifty thousand dollars, then the tax incentive
31is the investment tax credit of up to five percent.
32(2) At least fifty thousand dollars but less than two
33hundred fifty thousand dollars, then the tax incentives are the
34investment tax credit of up to five percent and the sales tax
35refund.
-2- 1(3) At least two hundred fifty thousand dollars, then the
2tax incentives are the investment tax credit of up to five
3percent, the sales tax refund, and the additional research and
4development tax credit.
5e. The number of jobs is sixteen or more and the amount of
6the qualifying investment is one of the following:
7(1) Less than fifty thousand dollars, then the tax incentive
8is the investment tax credit of up to six percent.
9(2) At least fifty thousand dollars but less than two
10hundred fifty thousand dollars, then the tax incentives are the
11investment tax credit of up to six percent and the sales tax
12refund.
13(3) At least two hundred fifty thousand dollars, then the
14tax incentives are the investment tax credit of up to six
15percent, the sales tax refund, and the additional research and
16development tax credit.
17f. The number of jobs is thirty-one but not more than forty
18and the amount of the qualifying investment is at least two
19million dollars, then the tax incentives are the local property
20tax exemption, the investment tax credit of up to seven
21percent, the sales tax refund, and the additional research and
22development tax credit.
23g. The number of jobs is forty-one but not more than sixty
24and the amount of the qualifying investment is at least five
25million dollars, then the tax incentives are the local property
26tax exemption, the investment tax credit of up to eight
27percent, the sales tax refund, and the additional research and
28development tax credit.
29h. The number of jobs is sixty-one but not more than
30eighty and the amount of the qualifying investment is at least
31five million dollars, then the tax incentives are the local
32property tax exemption, the investment tax credit of up to nine
33percent, the sales tax refund, and the additional research and
34development tax credit.
35i. The number of jobs is eighty-one but not more than one
-3-1hundred and the amount of the qualifying investment is at least
2five million dollars, then the tax incentives are the local
3property tax exemption, the investment tax credit of up to ten
4percent, the sales tax refund, and the additional research and
5development tax credit.
6j. The number of jobs is at least one hundred one and the
7amount of the qualifying investment is at least ten million
8dollars, then the tax incentives are the local property
9tax exemption, the investment tax credit of up to eleven
10percent, the sales tax refund, and the additional research and
11development tax credit.
12 Sec. 4. Section 15.335B, subsection 3, paragraph c, Code
132019, is amended to read as follows:
14c. (1) Consider the amount and type of the local community
15match. as follows:
16(a) In a community with a population of less than five
17thousand, a community match shall not be required.
18(b) In a community with a population equal to or greater
19than five thousand but less than fifteen thousand, a community
20match of at least five percent of the projected funds to be
21expended shall be required.
22(c) In a community with a population equal to or greater
23than fifteen thousand but less than thirty thousand, a
24community match of at least ten percent of the projected funds
25to be expended shall be required.
26(d) In a community with a population equal to or greater
27than thirty thousand, a community match of at least twenty
28percent of the projected funds to be expended shall be
29required.
30(2) The Notwithstanding subparagraph (1), the authority may
31provide assistance to an early-stage business in a high-growth
32industry regardless of the amount of local match involved.
33EXPLANATION
34The inclusion of this explanation does not constitute agreement with
35the explanation’s substance by the members of the general assembly.
-4- 1This bill relates to rural economic development by providing
2tax incentives for high quality jobs in rural communities.
3The bill creates a system of tax incentives under the high
4quality jobs program for rural communities that is separate
5from the high quality jobs program incentives in current Code
6section 15.335A.
7The bill defines “rural community” to mean any city located
8in this state with a population of 30,000 or less in a county
9with a population of 50,000 or less. A rural community located
10in more than one county is considered to be located in the
11county having the greatest taxable base within the city.
12The tax incentives for an eligible business investing in a
13rural community varies under the bill based upon the number of
14jobs created or retained that pay at least 110 percent of the
15qualifying wage threshold and the qualifying investment made in
16the rural community by the eligible business.
17The bill modifies the considerations made by the economic
18development authority prior to providing assistance for
19programs and projects pursuant to Code section 15.335B. In
20providing such assistance for programs and projects the bill
21specifies the economic development authority shall consider
22the amount and type of the local community match as follows:
23in a community with a population of less than 5,000, a match
24is not required; if the population is equal to or greater than
255,000 but less than 15,000, a match of at least 5 percent
26of the projected funds to be expended is required; if the
27population is equal to or greater than 15,000 but less than
2830,000, a match of at least 10 percent of the projected funds
29to be expended is required; and if the population is equal to
30or greater than 30,000, a match of at least 20 percent of the
31projected funds to be expended is required.
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2incentives for high-quality jobs in rural communities.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 15.102, Code 2019, is amended by adding
2the following new subsection:
3 NEW SUBSECTION. 08. “Rural community” means any city
4located in this state with a population of thirty thousand
5or less in a county with a population of fifty thousand or
6less. A rural community located in more than one county shall
7be considered to be located in the county having the greatest
8taxable base within the city.
9 Sec. 2. Section 15.335A, subsection 1, unnumbered paragraph
101, Code 2019, is amended to read as follows:
11Tax Except as provided in subsection 1A, tax incentives are
12available to eligible businesses as provided in this section
13 subsection. The incentives are based upon the number of jobs
14created or retained that pay at least one hundred twenty
15percent of the qualifying wage threshold and the amount of the
16qualifying investment made according to the following schedule:
17 Sec. 3. Section 15.335A, Code 2019, is amended by adding the
18following new subsection:
19 NEW SUBSECTION. 1A. Tax incentives are available to
20eligible businesses in rural communities as provided in this
21subsection. The incentives are based upon the number of
22jobs created or retained that pay at least one hundred ten
23percent of the qualifying wage threshold and the amount of the
24qualifying investment made according to the following schedule:
25a. The number of jobs is zero and economic activity is
26furthered by the qualifying investment and the amount of the
27qualifying investment is one of the following:
28(1) Less than fifty thousand dollars, then the tax incentive
29is the investment tax credit of up to two percent.
30(2) At least fifty thousand dollars but less than two
31hundred fifty thousand dollars, then the tax incentives are the
32investment tax credit of up to two percent and the sales tax
33refund.
34(3) At least two hundred fifty thousand dollars, then the
35tax incentives are the investment tax credit of up to two
-1-1percent, the sales tax refund, and the additional research and
2development tax credit.
3b. The number of jobs is one but not more than five and the
4amount of the qualifying investment is one of the following:
5(1) Less than fifty thousand dollars, then the tax incentive
6is the investment tax credit of up to three percent.
7(2) At least fifty thousand dollars but less than two
8hundred fifty thousand dollars, then the tax incentives are the
9investment tax credit of up to three percent and the sales tax
10refund.
11(3) At least two hundred fifty thousand dollars, then the
12tax incentives are the investment tax credit of up to three
13percent, the sales tax refund, and the additional research and
14development tax credit.
15c. The number of jobs is six but not more than ten and the
16amount of the qualifying investment is one of the following:
17(1) Less than fifty thousand dollars, then the tax incentive
18is the investment tax credit of up to four percent.
19(2) At least fifty thousand dollars but less than two
20hundred fifty thousand dollars, then the tax incentives are the
21investment tax credit of up to four percent and the sales tax
22refund.
23(3) At least two hundred fifty thousand dollars, then the
24tax incentives are the investment tax credit of up to four
25percent, the sales tax refund, and the additional research and
26development tax credit.
27d. The number of jobs is eleven but not more than fifteen
28and the amount of the qualifying investment is one of the
29following:
30(1) Less than fifty thousand dollars, then the tax incentive
31is the investment tax credit of up to five percent.
32(2) At least fifty thousand dollars but less than two
33hundred fifty thousand dollars, then the tax incentives are the
34investment tax credit of up to five percent and the sales tax
35refund.
-2- 1(3) At least two hundred fifty thousand dollars, then the
2tax incentives are the investment tax credit of up to five
3percent, the sales tax refund, and the additional research and
4development tax credit.
5e. The number of jobs is sixteen or more and the amount of
6the qualifying investment is one of the following:
7(1) Less than fifty thousand dollars, then the tax incentive
8is the investment tax credit of up to six percent.
9(2) At least fifty thousand dollars but less than two
10hundred fifty thousand dollars, then the tax incentives are the
11investment tax credit of up to six percent and the sales tax
12refund.
13(3) At least two hundred fifty thousand dollars, then the
14tax incentives are the investment tax credit of up to six
15percent, the sales tax refund, and the additional research and
16development tax credit.
17f. The number of jobs is thirty-one but not more than forty
18and the amount of the qualifying investment is at least two
19million dollars, then the tax incentives are the local property
20tax exemption, the investment tax credit of up to seven
21percent, the sales tax refund, and the additional research and
22development tax credit.
23g. The number of jobs is forty-one but not more than sixty
24and the amount of the qualifying investment is at least five
25million dollars, then the tax incentives are the local property
26tax exemption, the investment tax credit of up to eight
27percent, the sales tax refund, and the additional research and
28development tax credit.
29h. The number of jobs is sixty-one but not more than
30eighty and the amount of the qualifying investment is at least
31five million dollars, then the tax incentives are the local
32property tax exemption, the investment tax credit of up to nine
33percent, the sales tax refund, and the additional research and
34development tax credit.
35i. The number of jobs is eighty-one but not more than one
-3-1hundred and the amount of the qualifying investment is at least
2five million dollars, then the tax incentives are the local
3property tax exemption, the investment tax credit of up to ten
4percent, the sales tax refund, and the additional research and
5development tax credit.
6j. The number of jobs is at least one hundred one and the
7amount of the qualifying investment is at least ten million
8dollars, then the tax incentives are the local property
9tax exemption, the investment tax credit of up to eleven
10percent, the sales tax refund, and the additional research and
11development tax credit.
12 Sec. 4. Section 15.335B, subsection 3, paragraph c, Code
132019, is amended to read as follows:
14c. (1) Consider the amount and type of the local community
15match. as follows:
16(a) In a community with a population of less than five
17thousand, a community match shall not be required.
18(b) In a community with a population equal to or greater
19than five thousand but less than fifteen thousand, a community
20match of at least five percent of the projected funds to be
21expended shall be required.
22(c) In a community with a population equal to or greater
23than fifteen thousand but less than thirty thousand, a
24community match of at least ten percent of the projected funds
25to be expended shall be required.
26(d) In a community with a population equal to or greater
27than thirty thousand, a community match of at least twenty
28percent of the projected funds to be expended shall be
29required.
30(2) The Notwithstanding subparagraph (1), the authority may
31provide assistance to an early-stage business in a high-growth
32industry regardless of the amount of local match involved.
33EXPLANATION
34The inclusion of this explanation does not constitute agreement with
35the explanation’s substance by the members of the general assembly.
-4- 1This bill relates to rural economic development by providing
2tax incentives for high quality jobs in rural communities.
3The bill creates a system of tax incentives under the high
4quality jobs program for rural communities that is separate
5from the high quality jobs program incentives in current Code
6section 15.335A.
7The bill defines “rural community” to mean any city located
8in this state with a population of 30,000 or less in a county
9with a population of 50,000 or less. A rural community located
10in more than one county is considered to be located in the
11county having the greatest taxable base within the city.
12The tax incentives for an eligible business investing in a
13rural community varies under the bill based upon the number of
14jobs created or retained that pay at least 110 percent of the
15qualifying wage threshold and the qualifying investment made in
16the rural community by the eligible business.
17The bill modifies the considerations made by the economic
18development authority prior to providing assistance for
19programs and projects pursuant to Code section 15.335B. In
20providing such assistance for programs and projects the bill
21specifies the economic development authority shall consider
22the amount and type of the local community match as follows:
23in a community with a population of less than 5,000, a match
24is not required; if the population is equal to or greater than
255,000 but less than 15,000, a match of at least 5 percent
26of the projected funds to be expended is required; if the
27population is equal to or greater than 15,000 but less than
2830,000, a match of at least 10 percent of the projected funds
29to be expended is required; and if the population is equal to
30or greater than 30,000, a match of at least 20 percent of the
31projected funds to be expended is required.
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