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House Study Bill 178 - IntroducedA Bill ForAn Act 1relating to affordable housing, disaster housing
2assistance, and redevelopment tax credits by creating an
3Iowa housing tax credit program, modifying distribution of
4real estate transfer taxes, modifying workforce housing tax
5incentives, including a downtown loan guarantee program,
6creating a disaster housing recovery assistance program and
7an eviction prevention program, providing for a fee, and
8including effective date and applicability provisions.
9BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1DIVISION I
2IOWA HOUSING TAX CREDIT PROGRAM
3 Section 1. NEW SECTION. 16.37A Definitions.
4For purposes of this section and sections 16.37B through
516.37G, unless the context otherwise requires:
61. “Compliance period” means the period of fifteen years
7beginning with the first taxable year of the credit period.
82. “Credit period” means the period of ten tax years
9beginning with the tax year in which a qualified development
10is placed in service and the Iowa housing tax credit may be
11claimed. If a qualified development consists of more than
12one building, the qualified development is placed in service
13in the tax year in which the last building of the qualified
14development is placed in service.
153. “Department” means the Iowa department of revenue.
164. “Qualified allocation plan” means the qualified
17allocation plan adopted by the authority pursuant to section
1842(m) of the Internal Revenue Code.
195. “Qualified basis” means the qualified basis determined
20under section 42(c)(1) of the Internal Revenue Code.
216. “Qualified development” means a qualified low-income
22housing project under section 42(g) of the Internal Revenue
23Code that is financed with tax-exempt bonds, pursuant to
24section 42(i)(2) of the Internal Revenue Code, and located in
25this state.
267. “Taxpayer” means an individual, a person, firm,
27corporation, or other entity that owns an interest, direct
28or indirect, in a qualified development and who claims a tax
29credit under section 16.37C.
30 Sec. 2. NEW SECTION. 16.37B Application — review —
31authorization.
321. The authority shall develop a system for the application,
33review, and authorization of Iowa housing tax credits awarded
34pursuant to this part and shall control the issuance of all tax
35credit certificates to taxpayers pursuant to this part.
-1- 12. Applications for Iowa housing tax credits shall be
2accepted during an application period established by the
3authority.
43. The authority may authorize the tax credit if all of the
5following conditions are satisfied:
6a. The tax credit certificate is issued to a taxpayer who
7has an ownership interest in the qualified development.
8b. The tax credit amount is allocated pursuant to a
9qualified allocation plan.
10c. The tax credit is necessary for the financial feasibility
11of the qualified development.
12d. The amount of the tax credit allocated to an owner
13does not exceed thirty percent of the qualified basis of the
14qualified development.
15e. The qualified development is the subject of a recorded
16restrictive covenant requiring that, for the compliance period
17or for a longer period agreed to by the authority and the
18owner of the qualified development, the development shall be
19maintained and operated as a qualified development and shall be
20in compliance with Tit.VIII of the federal Civil Rights Act of
211968, as amended.
224. Upon review of an application, the authority may approve
23the qualified development for the tax credit program provided
24in section 16.37C, and issue a tax credit certificate stating
25the amount of the tax credit the authority determines the
26taxpayer is eligible to claim for each year of the credit
27period.
285. Unless otherwise provided in this section or the context
29clearly requires otherwise, the authority shall determine
30eligibility for a credit and allocate credits in accordance
31with the standards and requirements set forth in section 42 of
32the Internal Revenue Code.
336. An applicant that is unsuccessful in receiving a tax
34credit award during an application period may make additional
35applications during subsequent application periods. Such
-2-1applicants shall be required to submit a new application which
2shall be reviewed in the same manner as other applications in
3that application period.
4 Sec. 3. NEW SECTION. 16.37C Iowa housing tax credits —
5limits.
61. An Iowa housing tax credit shall be allowed against
7the taxes imposed in chapter 422, subchapters II, III, and V,
8and in chapter 432, and against the moneys and credits tax
9imposed in section 533.329, in the amount determined by the
10authority pursuant to this part. Any tax credit in excess of
11the taxpayer’s liability for the tax year is not refundable but
12may be credited to the tax liability for the following five
13years or until depleted, whichever is earlier.
142. An individual may claim a tax credit under this section
15of a partnership, limited liability company, S corporation,
16estate, or trust electing to have income taxed directly to
17the individual. The amount claimed by the individual shall
18be based upon the pro rata share of the individual’s earnings
19from the partnership, limited liability company, S corporation,
20estate, or trust.
213. In any calendar year, the aggregate amount of all tax
22credits allocated by the authority shall not exceed fifteen
23million dollars, plus the sum of the following amounts:
24a. The total of all unallocated tax credits, if any, for the
25preceding calendar years.
26b. The total amount of all previously allocated tax credits
27that have been recaptured, revoked, canceled, or otherwise
28recovered by the authority.
294. a. To claim a tax credit under this section, a taxpayer
30shall include one or more tax credit certificates issued by the
31authority with the taxpayer’s tax return.
32b. The tax credit certificate shall contain the taxpayer’s
33name, address, tax identification number, the amount of the
34credit including the amount the authority determines the
35taxpayer is eligible to claim for each year of the credit
-3-1period, the name of the qualified development, any other
2information required by the department of revenue, and a place
3for the name and tax identification number of a transferee and
4the amount of the tax credit being transferred.
5c. Tax credit certificates issued under this section may
6be transferred to any person or entity. Within ninety days
7of transfer, the transferee shall submit the transferred tax
8credit certificate to the authority along with a statement
9containing the transferee’s name, tax identification number,
10and address, the denomination that each replacement tax credit
11certificate is to carry, and any other information required by
12the department of revenue.
13d. Within thirty days of receiving the transferred tax
14credit certificate and the transferee’s statement, the
15authority shall issue one or more replacement tax credit
16certificates to the transferee. Each replacement tax credit
17certificate must contain the information required for the
18original tax credit certificate and must have the same
19expiration date that appeared in the transferred tax credit
20certificate. Tax credit certificate amounts of less than the
21minimum amount established by rule of the authority shall not
22be transferable.
23e. A tax credit shall not be claimed by a transferee
24under this section until a replacement tax credit certificate
25identifying the transferee as the proper holder has been
26issued. The transferee may use the amount of the tax credit
27transferred against the taxes imposed in chapter 422,
28subchapters II, III, and V, and in chapter 432, and against the
29moneys and credits tax imposed in section 533.329, for any tax
30year the original transferor could have claimed the tax credit.
31Any consideration received for the transfer of the tax credit
32shall not be included as income under chapter 422, subchapters
33II, III, and V. Any consideration paid for the transfer of the
34tax credit shall not be deducted from income under chapter 422,
35subchapters II, III, and V.
-4-1 Sec. 4. NEW SECTION. 16.37D Recapture.
21. As of the last day of any tax year during the compliance
3period, if the amount of the qualified basis of a qualified
4development owned by a taxpayer claiming the credit is less
5than the amount of the qualified basis as of the last day of the
6immediately preceding tax year, the amount of the taxpayer’s
7liability under chapter 422, subchapter II, III, or V, chapter
8432, or section 533.329, as applicable, shall be increased by
9the recapture amount determined using the method under section
1042(j) of the Internal Revenue Code.
112. If a recapture event occurs, the taxpayer shall include
12the recaptured proportion of the credit on the return submitted
13for the tax year in which the recapture event is identified.
14 Sec. 5. NEW SECTION. 16.37E Compliance monitoring.
15The authority shall monitor and oversee compliance with
16sections 16.37A through 16.37D and shall report specific
17occurrences of noncompliance to the department.
18 Sec. 6. NEW SECTION. 16.37F Report to the general assembly.
19On or before January 31 of each year, the authority shall
20submit to the general assembly a report that includes all of
21the following:
221. A statement of the number of qualified developments for
23which the authority issued tax certificates the prior year.
242. A description of each qualified development for which the
25authority issued a tax certificate the prior year, including
26the geographic location of the development, the household type
27and any specific demographic information available concerning
28the residents intended to be served by the development,
29the income levels of residents intended to be served by the
30development, and the rents or set-asides authorized for each
31development.
32 Sec. 7. NEW SECTION. 16.37G Rules.
33The authority and the department shall adopt rules pursuant
34to chapter 17A as necessary for the implementation and
35administration of this part.
-5-1 Sec. 8. NEW SECTION. 422.10C Iowa housing tax credit.
2The taxes imposed under this subchapter, less the credits
3allowed under section 422.12, shall be reduced by an Iowa
4housing tax credit allowed under section 16.37C.
5 Sec. 9. Section 422.33, Code 2021, is amended by adding the
6following new subsection:
7 NEW SUBSECTION. 17. The taxes imposed under this subchapter
8shall be reduced by an Iowa housing tax credit as allowed under
9section 16.37C.
10 Sec. 10. Section 422.60, Code 2021, is amended by adding the
11following new subsection:
12 NEW SUBSECTION. 14. The taxes imposed under this subchapter
13shall be reduced by an Iowa housing tax credit as allowed under
14section 16.37C.
15 Sec. 11. NEW SECTION. 432.12N Iowa housing tax credit.
16The taxes imposed under this chapter shall be reduced by an
17Iowa housing tax credit allowed under section 16.37C.
18 Sec. 12. Section 533.329, subsection 2, Code 2021, is
19amended by adding the following new paragraph:
20 NEW PARAGRAPH. l. The moneys and credits tax imposed under
21this section shall be reduced by an Iowa housing tax credit
22allowed under section 16.37C.
23 Sec. 13. CODE EDITOR DIRECTIVE. The Code editor shall
24designate sections 16.37A through 16.37G, as enacted by
25this division of this Act, as a new part within chapter 16,
26subchapter VII, and may redesignate the new and preexisting
27parts, replace references to sections 16.37A through 16.37G
28with references to the new part, and correct internal
29references as necessary, including references in subchapter or
30part headnotes.
31 Sec. 14. EFFECTIVE DATE. This division of this Act takes
32effect January 1, 2022.
33 Sec. 15. APPLICABILITY. This division of this Act applies
34to tax years beginning on or after January 1, 2022.
35DIVISION II
-6-1HOUSING TRUST FUND
2 Sec. 16. Section 428A.8, subsection 3, Code 2021, is amended
3by striking the subsection.
4DIVISION III
5WORKFORCE HOUSING TAX INCENTIVES
6 Sec. 17. Section 15.119, subsection 2, paragraph g, Code
72021, is amended to read as follows:
8g. (1) The workforce housing tax incentives program
9administered pursuant to sections 15.351 through 15.356.
10In allocating tax credits pursuant to this subsection, the
11authority shall not allocate more than twenty-five million
12dollars for purposes of this paragraph. Of the moneys
13allocated under this paragraph, ten million dollars shall be
14reserved for allocation to qualified housing projects in small
15cities, as defined in section 15.352, that are registered on
16or after July 1, 2017.
17(2) (a) Notwithstanding subparagraph (1), in allocating
18tax credits pursuant to this subsection for each fiscal
19year of the period beginning July 1, 2021, and ending June
2030, 2024, the authority shall not allocate more than fifty
21million dollars for purposes of this paragraph. Of the moneys
22allocated under this paragraph for each fiscal year of the
23period beginning July 1, 2021, and ending June 30, 2024, twenty
24million dollars shall be reserved for allocation to qualified
25housing projects in small cities, as defined in section 15.352,
26that are registered on or after July 1, 2017.
27(b) This subparagraph is repealed July 1, 2024.
28 Sec. 18. Section 15.353, subsection 3, Code 2021, is amended
29to read as follows:
303. a. Except as provided in paragraph “b”, the The average
31dwelling unit cost does not exceed two hundred thousand dollars
32per dwelling unit an amount determined by the authority by
33rule. In determining the average dwelling unit cost the
34authority shall consider, at a minimum, building materials,
35labor, site development, and land or property acquisition
-7-1costs.
2b. (1) The average dwelling unit cost does not exceed
3two hundred fifty thousand dollars per dwelling unit if the
4project involves the rehabilitation, repair, redevelopment,
5or preservation of property described in section 404A.1,
6subsection 8, paragraph “a”.
7(2) The average dwelling unit cost for the project does not
8exceed two hundred fifteen thousand dollars per dwelling unit
9if the project is located in a small city.
10 Sec. 19. Section 15.354, subsection 3, paragraph d, Code
112021, is amended to read as follows:
12d. Upon completion of a housing project, an a housing
13business shall submit all of the following to the authority:
14(1) Anexamination of the project in accordance with the
15American institute of certified public accountants’ statements
16on standards for attestation engagements, completed by a
17certified public accountant authorized to practice in this
18state, shall be submitted to the authority.
19(2) A statement of the final amount of qualifying new
20investment for the housing project.
21(3) Any information the authority deems necessary to ensure
22compliance with the agreement signed by the housing business
23pursuant to paragraph “a”, the requirements of this part,
24and rules the authority and the department of revenue adopt
25pursuant to section 15.356.
26 Sec. 20. Section 15.354, subsection 3, paragraph e,
27subparagraph (1), Code 2021, is amended to read as follows:
28(1) Upon review of the examination, and verification of
29the amount of the qualifying new investment, and review of
30any other information submitted pursuant to paragraph “d”,
31subparagraph (3), the authority may notify the housing business
32of the amount that the housing business may claim as a refund
33of the sales and use tax under section 15.355, subsection 2,
34and may issue a tax credit certificate to the housing business
35stating the amount of workforce housing investment tax credits
-8-1under section 15.355, subsection 3, the eligible housing
2business may claim. The sum of the amount that the housing
3business may claim as a refund of the sales and use tax and
4the amount of the tax credit certificate shall not exceed the
5amount of the tax incentive award.
6 Sec. 21. Section 15.354, subsection 6, paragraphs b and c,
7Code 2021, are amended to read as follows:
8b. Notwithstanding subsection 1, the authority may accept
9applications for disaster recovery housing projects on a
10continuous basis establish a disaster recovery application
11period following the declaration of a major disaster by the
12president of the United States for a county in Iowa.
13c. Notwithstanding subsection 2, paragraphs “a”, “b”, and
14“d”, upon Upon review of a housing business’s application,
15and scoring of all applications received during a disaster
16recovery application period, the authority may make a tax
17incentive award to a disaster recovery housing project. The
18tax incentive award shall represent the maximum amount of tax
19incentives that the disaster recovery housing project may
20qualify for under the program. In determining a tax incentive
21award, the authority shall not use an amount of project costs
22that exceeds the amount included in the application of the
23housing business. Tax incentive awards shall be approved by
24the director of the authority.
25 Sec. 22. Section 15.355, subsection 2, Code 2021, is amended
26to read as follows:
272. A housing business may claim a refund of the sales and
28use taxes paid under chapter 423 that are directly related to
29a housing project and specified in the agreement. The refund
30available pursuant to this subsection shall be as provided in
31section 15.331A, excluding subsection 2, paragraph “c”, of
32that section. For purposes of the program, the term “project
33completion”, as used in section 15.331A, shall mean the date
34on which the authority notifies the department of revenue that
35all applicable requirements of an the agreement entered into
-9-1pursuant to section 15.354, subsection 3, paragraph “a”, and
2all applicable requirements of this part, including the rules
3the authority and the department of revenue adopted pursuant to
4section 15.356, are satisfied.
5DIVISION IV
6downtown LOAN GUARANTEE PROGRAM
7 Sec. 23. NEW SECTION. 15.431 Downtown loan guarantee
8program.
91. The economic development authority, in partnership with
10the Iowa finance authority, shall establish and administer a
11downtown loan guarantee program to encourage Iowa downtown
12businesses and banks to reinvest and reopen following the
13COVID-19 pandemic.
142. In order for a loan to be guaranteed, all of the
15following conditions must be true:
16a. The loan finances an eligible downtown resource center
17community catalyst building remediation grant project or main
18street Iowa challenge grant within a designated district.
19b. The loan finances a rehabilitation project, or finances
20acquisition or refinancing costs associated with the project.
21c. At least twenty-five percent of the project costs are
22used for construction on the project or renovation.
23d. The project includes a housing component.
24e. The loan is used for construction of the project,
25permanent financing of the project, or both.
26f. A federally insured financial lending institution issued
27the loan.
28g. The loan does not reimburse the borrower for working
29capital, operations, or similar expenses.
30h. The project meets downtown resource center and main
31street Iowa design review.
323. a. For a loan amount less than or equal to five hundred
33thousand dollars, the economic development authority may
34guarantee up to fifty percent of the loan amount.
35b. For a loan amount greater than five hundred thousand
-10-1dollars, the economic development authority may provide a
2maximum loan guarantee of up to two hundred fifty thousand
3dollars.
44. A project loan must be secured by a mortgage against the
5project property.
65. The economic development authority may guarantee loans
7for up to five years. The economic development authority
8may extend the loan guarantee for an additional five years
9if an underwriting review finds that an extension would be
10beneficial.
116. The lender shall pay an annual loan guarantee fee as set
12forth by rule.
137. The economic development authority reserves the right
14to deny a loan guarantee for unreasonable bank loan fees or
15interest rate.
168. The loan must not be insured or guaranteed by another
17local, state, or federal guarantee program.
189. The loan guarantee is not transferable if the loan or the
19project is sold or transferred.
2010. In the event of a loss due to default, the loan
21guarantee proportionally pays the guarantee percentage of the
22loss to the lender.
2311. Moneys for the program may consist of any moneys
24appropriated by the general assembly for purposes of this
25section, and any other moneys that are lawfully available to
26the authority, including moneys transferred or deposited from
27other funds created pursuant to section 15.106A, subsection 1,
28paragraph “o”.
29DIVISION V
30Disaster Recovery Housing Assistance Program and Fund
31 Sec. 24. NEW SECTION. 16.57A Transfer of unobligated or
32unencumbered funds — report.
331. Notwithstanding any other provision of law to the
34contrary, the authority may transfer any unobligated and
35unencumbered moneys in any revolving loan program fund created
-11-1pursuant to section 16.46, 16.47, 16.48, or 16.49, for deposit
2in the disaster recovery housing assistance fund created in
3section 16.57B.
42. Notwithstanding section 8.39, and any other law to
5the contrary, with the prior written consent and approval of
6the governor, the executive director of the authority may
7transfer any unobligated and unencumbered moneys in any fund
8created pursuant to section 16.5, subsection 1, paragraph
9“s”, for deposit in the disaster recovery housing assistance
10fund created in section 16.57B. The prior written consent and
11approval of the director of the department of management shall
12not be required to transfer the unobligated and unencumbered
13moneys.
143. Notwithstanding section 8.39, and any other law to the
15contrary, with the prior written approval of the governor, the
16director of the economic development authority may transfer
17any unobligated and unencumbered moneys in any fund created
18pursuant to section 15.106A, subsection 1, paragraph “o”,
19for deposit in the disaster recovery housing assistance fund
20created in section 16.57B.
214. Any transfer made under this section shall be reported in
22the same manner as provided in section 8.39, subsection 5.
23 Sec. 25. NEW SECTION. 16.57B Disaster recovery housing
24assistance program — fund.
251. Definitions. As used in this section, unless the context
26otherwise requires:
27a. “Disaster-affected home” means any of the following:
28(1) A primary residence that is destroyed or damaged due
29to a natural disaster that occurs on or after the effective
30date of this division of this Act, and the primary residence is
31located in a county that is the subject of a state of disaster
32emergency proclamation by the governor that authorizes disaster
33recovery housing assistance.
34(2) A primary residence that is destroyed or damaged due to
35a natural disaster that occurred on or after March 12, 2019,
-12-1but before the effective date of this division of this Act, and
2is located in a county that has been declared a major disaster
3by the president of the United States on or after March 12,
42019, but before the effective date of this division of this
5Act, and is located in a county where individuals are eligible
6for federal individual assistance.
7b. “Fund” means the disaster recovery housing assistance
8fund.
9c. “Local program administrator” means any of the following:
10(1) The cities of Ames, Cedar Falls, Cedar Rapids, Council
11Bluffs, Davenport, Des Moines, Dubuque, Iowa City, Waterloo,
12and West Des Moines.
13(2) A council of governments whose territory includes at
14least one county that is the subject of a state of disaster
15emergency proclamation by the governor that authorizes disaster
16recovery housing assistance or the eviction prevention program
17under section 16.57C on or after the effective date of this
18division of this Act.
19(3) A community action agency as defined in section 216A.91
20and whose territory includes at least one county that is the
21subject of a state of disaster emergency proclamation by the
22governor that authorizes disaster recovery housing assistance
23or the eviction prevention program under section 16.57C on or
24after the effective date of this division of this Act.
25(4) A qualified local organization or governmental entity
26as determined by rules adopted by the authority.
27d. “Program” means the disaster recovery housing assistance
28program.
29e. “Replacement housing” means housing purchased
30by a homeowner or leased by a renter needed to replace
31a disaster-affected home that is destroyed or damaged
32beyond reasonable repair as determined by a local program
33administrator.
34f. “State of disaster emergency” means the same as described
35in section 29C.6, subsection 1.
-13- 12. Fund.
2a. (1) A disaster recovery housing assistance fund is
3created within the authority. The moneys in the fund shall be
4used by the authority for the development and operation of a
5forgivable loan and grant program for homeowners and renters
6with disaster-affected homes, and for the eviction prevention
7program pursuant to section 16.57C.
8(2) Notwithstanding section 12C.7, subsection 2, interest
9or earnings on moneys deposited in the fund shall be credited
10to the fund. Notwithstanding section 8.33, moneys credited to
11the fund shall not revert at the close of a fiscal year.
12b. Moneys transferred by the authority for deposit in the
13fund, moneys appropriated to the fund, and any other moneys
14available to and obtained or accepted by the authority for
15placement in the fund shall be deposited in the fund.
16c. The authority shall not use more than five percent of
17the moneys in the fund on July 1 of a fiscal year for purposes
18of administrative costs and other program support during the
19fiscal year.
203. Program.
21a. The authority shall establish and administer a disaster
22recovery housing assistance program and shall use moneys in
23the fund to award forgivable loans to eligible homeowners and
24grants to eligible renters of disaster-affected homes. Moneys
25in the fund may be expended following a state of disaster
26emergency proclamation by the governor pursuant to section
2729C.6 that authorizes disaster recovery housing assistance.
28b. The authority may enter into an agreement with one or
29more local program administrators to administer the program.
304. Registration required. To be considered for a forgivable
31loan or grant under the program, a homeowner or renter must
32register for the disaster case management program established
33pursuant to section 29C.20B. The disaster case manager may
34refer the homeowner or renter to the appropriate local program
35administrator.
-14- 15. Homeowners.
2a. To be eligible for a forgivable loan under the program,
3all of the following requirements shall apply:
4(1) The homeowner’s disaster-affected home must have
5sustained damage greater than the damage that is covered by the
6homeowner’s property and casualty insurance policy insuring the
7home plus any other state or federal disaster-related financial
8assistance that the homeowner is eligible to receive.
9(2) A local program administrator must either deem the
10disaster-affected home suitable for rehabilitation or damaged
11beyond reasonable repair.
12(3) The disaster-affected home is not eligible for buyout by
13the county or city where the disaster-affected home is located,
14or the disaster-affected home is eligible for a buyout by the
15county or city where the disaster-affected home is located, but
16the homeowner is requesting a forgivable loan for the repair
17or rehabilitation of the homeowner’s disaster-affected home in
18lieu of a buyout.
19(4) Assistance under the program must not duplicate
20benefits provided by any local, state, or federal disaster
21recovery assistance program.
22b. If a homeowner is referred to the authority or to a
23local program administrator by the disaster case manager of the
24homeowner, the authority may award a forgivable loan to the
25eligible homeowner for any of the following purposes:
26(1) Repair or rehabilitation of the disaster-affected home.
27(2) (a) Down payment assistance on the purchase of
28replacement housing, and the cost of reasonable repairs to be
29performed on the replacement housing to render the replacement
30housing decent, safe, sanitary, and in good repair.
31(b) Replacement housing shall not be located in a
32one-hundred-year floodplain.
33(c) For purposes of this subparagraph, “decent, safe,
34sanitary, and in good repair” means the same as described in 24
35C.F.R.§5.703.
-15- 1c. The authority shall determine the interest rate for the
2forgivable loan.
3d. If a homeowner who has been awarded a forgivable loan
4sells a disaster-affected home or replacement housing for which
5the homeowner received the forgivable loan prior to the end
6of the loan term, the remaining principal on the forgivable
7loan shall be due and payable pursuant to rules adopted by the
8authority.
96. Renters.
10a. To be eligible for a grant under the program, all of the
11following requirements shall apply:
12(1) A local program administrator either deems
13the disaster-affected home of the renter suitable for
14rehabilitation but unsuitable for current short-term
15habitation, or the disaster-affected home is damaged beyond
16reasonable repair.
17(2) Assistance under the program must not duplicate
18benefits provided by any local, state, or federal disaster
19recovery assistance program.
20b. If a renter is referred to the authority or to a local
21program administrator by the disaster case manager of the
22renter, the authority may award a grant to the eligible renter
23to provide short-term financial assistance for the payment of
24rent for replacement housing.
257. Report. On or before January 31 of each year, the
26authority shall submit a report to the general assembly
27that identifies all of the following for the calendar year
28immediately preceding the year of the report:
29a. The date of each state of disaster emergency proclamation
30by the governor that authorized disaster recovery housing
31assistance under this section.
32b. The total number of forgivable loans and grants awarded.
33c. The total number of forgivable loans, and the amount of
34each loan awarded for repair or rehabilitation.
35d. The total number of forgivable loans, and the amount of
-16-1each loan, awarded for down payment assistance on the purchase
2of replacement housing and the cost of reasonable repairs to be
3performed on the replacement housing to render the replacement
4housing decent, safe, sanitary, and in good repair.
5e. The total number of grants, and the amount of each grant,
6awarded for rental assistance.
7f. The total number of forgivable loans and grants awarded
8in each county in which at least one homeowner or renter has
9been awarded a forgivable loan or grant.
10g. Each local program administrator involved in the
11administration of the program.
12h. The total amount of forgivable loan principal repaid.
13 Sec. 26. NEW SECTION. 16.57C Eviction prevention program.
141. a. “Eligible renter” means a renter whose income meets
15the qualifications of the program, who is at risk of eviction,
16and who resides in a county that is the subject of a state of
17disaster emergency proclamation by the governor that authorizes
18the eviction prevention program.
19b. “Eviction prevention partner” means a qualified local
20organization or governmental entity as determined by rule by
21the authority.
222. The authority shall establish and administer an eviction
23prevention program. Under the eviction prevention program,
24the authority shall award grants to eligible renters and to
25eviction prevention partners for purposes of this section.
26Grants may be awarded upon a state of disaster emergency
27proclamation by the governor that authorizes the eviction
28prevention program. Eviction prevention assistance shall be
29paid out of the fund established in section 16.57B.
303. a. Grants awarded to eligible renters pursuant to this
31section shall be used for short-term financial rent assistance
32to keep eligible renters in the current residences of such
33renters.
34b. Grants awarded to eviction prevention partners pursuant
35to this section shall be used to pay for rent or services
-17-1provided to eligible renters for the purpose of preventing the
2eviction of eligible renters.
34. The authority may enter into an agreement with one or
4more local program administrators to administer the program.
5 Sec. 27. NEW SECTION. 16.57D Rules.
6The authority shall adopt rules pursuant to chapter 17A to
7implement and administer this part, including rules to do all
8of the following:
91. Establish the maximum forgivable loan and grant amounts
10awarded under the program.
112. Establish the terms of any forgivable loan provided under
12the program.
133. Income qualifications of eligible renters in the
14eviction prevention program.
15 Sec. 28. CODE EDITOR DIRECTIVE. The Code editor shall
16designate sections 16.57A through 16.57D, as enacted by
17this division of this Act, as a new part within chapter 16,
18subchapter VIII, and may redesignate the new and preexisting
19parts, replace references to sections 16.57A through 16.57D
20with references to the new part, and correct internal
21references as necessary, including references in subchapter or
22part headnotes.
23 Sec. 29. EFFECTIVE DATE. This division of this Act, being
24deemed of immediate importance, takes effect upon enactment.
25DIVISION VI
26BROWNFIELDS AND GRAYFIELDS
27 Sec. 30. Section 15.119, subsection 3, Code 2021, is amended
28to read as follows:
293. In allocating the amount of tax credits authorized
30pursuant to subsection 1 among the programs specified in
31subsection 2, the authority shall not allocate more than ten
32 twenty million dollars for purposes of subsection 2, paragraph
33“f”.
34 Sec. 31. Section 15.293A, subsection 8, Code 2021, is
35amended to read as follows:
-18- 18. This section is repealed on June 30, 2021 2031.
2 Sec. 32. Section 15.293B, Code 2021, is amended by adding
3the following new subsection:
4 NEW SUBSECTION. 5A. a. Tax credits revoked under
5subsection 3 including tax credits revoked up to five years
6prior to the effective date of this Act, and tax credits
7not awarded under subsection 4 or 5, may be awarded in the
8next annual application period established in subsection 1,
9paragraph “c”.
10b. Tax credits awarded pursuant to paragraph “a” shall not
11be counted against the limit under section 15.119, subsection
123.
13 Sec. 33. Section 15.293B, subsection 7, Code 2021, is
14amended to read as follows:
157. This section is repealed on June 30, 2021 2031.
16 Sec. 34. EFFECTIVE DATE. The following, being deemed of
17immediate importance, take effect upon enactment:
181. The section of this division of this Act amending section
1915.293A, subsection 8.
202. The section of this division of this Act amending section
2115.293B, subsection 7.
22EXPLANATION
23The inclusion of this explanation does not constitute agreement with
24the explanation’s substance by the members of the general assembly.
25This bill relates to affordable housing, disaster housing
26assistance, and redevelopment tax credits by creating an
27Iowa housing tax credit program, modifying distribution of
28real estate transfer taxes, modifying workforce housing tax
29incentives, and creating a disaster housing recovery assistance
30program, modifying redevelopment tax credits, and including
31effective date and applicability provisions.
32IOWA HOUSING TAX CREDIT PROGRAM. The bill creates an Iowa
33housing tax credit program available against the individual and
34corporate income taxes, franchise tax, insurance premium tax,
35and moneys and credits tax.
-19- 1The bill requires the Iowa finance authority (authority) to
2develop a system for the application, review, and authorization
3of Iowa housing tax credits. A tax credit may be claimed by
4a taxpayer for a “qualified development” defined to mean a
5qualified low-income housing project under section 42(g) of the
6Internal Revenue Code that is financed by tax-exempt bonds.
7An Iowa housing tax credit may be authorized by the authority
8if all of the following apply: the tax credit is issued to
9a taxpayer who has an ownership interest in the qualified
10development; the tax credit amount is allocated pursuant to
11a qualified allocation plan adopted by the authority; the
12tax credit is necessary for the financial feasibility of the
13qualified development; the amount of the tax credit allocated
14to an owner does not exceed 30 percent of the qualified basis
15of the qualified development; and the qualified development is
16the subject of a recorded restrictive covenant requiring the
17qualified development be maintained and operated as a qualified
18development for a certain number of years.
19The amount of an Iowa housing tax credit award is determined
20by the authority and may be claimed during the credit period
21(10 years), and any credit in excess of the taxpayer’s
22liability for the tax year is not refundable but may be
23credited to the tax liability for the following five years.
24In any calendar year, the bill limits the aggregate amount
25of the tax credit to $15 million plus the sum of the total of
26unallocated tax credits from the preceding calendar year and
27the previously allocated tax credits that have been revoked,
28canceled, or recaptured.
29A taxpayer shall claim the credit by including one or more
30tax certificates issued by the authority with the taxpayer’s
31return. The bill allows a tax credit certificate to be
32transferred to any person or entity. The bill requires the
33transferee to submit the transferred tax credit certificate to
34the authority within 90 days of the transfer, and requires the
35authority to issue a replacement tax credit certificate within
-20-130 days of receiving the transferred tax credit certificate.
2The bill allows the authority to recapture tax credit
3amounts from previously issued tax credits. The bill provides
4that if on the last day of a taxable year during the compliance
5period (15 years) the amount of the qualified basis of a
6qualified development owned by a taxpayer claiming the credit
7is less than the amount of the qualified basis as of the last
8day of the immediately preceding tax year, then the amount of
9the taxpayer’s liability shall be increased by the recapture
10amount determined using the method under section 42(j) of the
11Internal Revenue Code. If a recapture event occurs, the bill
12requires the taxpayer to include the recaptured amount on the
13return submitted for the tax year in which the recapture event
14is identified.
15The bill requires the authority to submit a report to the
16general assembly by January 31 each year, detailing the Iowa
17housing tax credit program. The division takes effect January
181, 2022, and applies to tax years beginning on or after that
19date.
20HOUSING TRUST FUND. Currently, the treasurer of state
21transfers 30 percent of real estate transfer tax receipts
22received by the treasurer of state to the housing trust fund up
23to $3 million. The bill removes the $3 million cap placed on
24the transfer of the real estate transfer tax receipts to the
25housing trust fund by the treasurer of state.
26WORKFORCE HOUSING TAX INCENTIVES. Code section 15.119 sets
27an aggregate tax credit amount limit for certain economic
28development programs. Under current law, workforce housing
29tax incentive programs administered under Code sections 15.351
30through 15.356 shall not be allocated more than $25 million
31in tax credits, and of the tax credits allocated to these
32programs, $10 million of the tax credits is reserved for
33allocation to qualified housing projects in small cities. The
34bill increases the workforce housing tax credit allocations
35from $25 million to $50 million. Of the moneys allocated
-21-1to workforce housing tax credits, the bill increases the tax
2credits reserved for qualified housing projects in small
3cities from $10 million to $20 million. The increased amounts
4for workforce housing and small city tax credit allocations
5established in the bill are repealed July 1, 2024.
6The bill strikes the requirement that the average dwelling
7unit costs of a proposed housing development not exceed certain
8dollar amounts per dwelling unit in order to receive workforce
9housing tax incentives. The bill allows the authority to set
10the average dwelling unit costs by rule as a requirement for a
11project to receive workforce housing tax incentives, based upon
12building materials, labor, site development, and acquisition
13costs.
14Currently, upon completion of a housing project, a housing
15business (housing developer, contractor, or nonprofit that
16completes a housing project) submits an examination of the
17project in accordance with the American institute of certified
18public accountants to the authority. In addition to an
19examination by certified public accountants, the bill requires
20the housing business to submit the following to the authority
21upon completion of a housing project: a statement of the
22final amount of the qualifying new investment for the housing
23project and any information the authority deems necessary to
24ensure compliance with the agreement between the authority and
25the housing business including any rules the authority and the
26department of revenue adopt pursuant to Code section 15.356.
27The bill also requires the authority to review the information
28submitted by the housing business prior to notifying the
29housing business of tax incentive awards.
30The bill permits the authority to establish a disaster
31housing recovery period following the declaration of a major
32disaster by the president of the United States. Currently, the
33authority may accept applications for disaster recovery housing
34projects on a continuous basis.
35DOWNTOWN LOAN GUARANTEE PROGRAM. The bill creates a
-22-1downtown loan guarantee program to be administered by the
2economic development authority and the Iowa finance authority.
3The purpose of the program is to encourage downtown businesses
4and banks to reinvest and reopen following the COVID-19
5pandemic.
6In order for a loan to be guaranteed under the program,
7numerous conditions apply, including the following: the loan
8finances an eligible downtown resources center community
9catalyst building remediation grant project or main street
10Iowa challenge grant within a designated district; the loan
11finances a rehabilitation project or acquisition or refinancing
12costs associated with the project; 25 percent of the project
13cost is used for construction on the project or renovation;
14the financed project includes a housing component; the loan is
15used for the construction or permanent financing of a project;
16a federally insured financial lending institution issued the
17loan; the loan does not reimburse the borrower for working
18capital or operations; and the project meets certain design
19reviews.
20The bill requires the loan to be secured by a mortgage
21against the project property, prohibits the loan guarantee to
22be transferred, and charges the lender an annual loan guarantee
23fee as set forth by rule.
24The bill limits the amount of the loan guarantee as follows:
25for a loan amount of less than or equal to $500,000, the loan
26guarantee shall not exceed 50 percent of the loan; for a loan
27amount greater than $500,000, the authority may provide a
28maximum loan guarantee of up to $250,000.
29The authority may guarantee the loan for up to five years,
30which may be extended by the authority for an additional five
31years. The authority may also deny a loan guarantee for any
32unreasonable bank loan fees or interest rate.
33In the event of a loss due to default, the bill requires the
34loan guarantee to proportionally pay the guarantee percentage
35of the loss to the lender.
-23- 1Moneys available for the program may consist of moneys
2appropriated for use in the program, and any other moneys that
3are lawfully available to the economic development authority,
4including moneys transferred or deposited from other funds
5created pursuant to Code section 15.106A(1)(o).
6DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — TRANSFERS.
7 The bill permits the authority to transfer unobligated moneys
8in Code section 16.46 (senior living revolving loan program
9fund), 16.47 (home and community-based services revolving loan
10program fund), 16.48 (transitional housing revolving loan
11program fund), or 16.49 (community housing and services for
12persons with disabilities revolving loan program fund) to the
13disaster recovery housing assistance fund created in the bill.
14After the prior written consent and approval of the
15governor, the bill permits the executive director of the Iowa
16finance authority to transfer any unobligated moneys in any
17fund created pursuant to Code section 16.5(1)(s), for deposit
18in the fund. The bill waives the prior written consent and
19approval of the director of the department of management to
20transfer the unobligated moneys.
21After prior written approval of the governor, the bill
22permits the director of the Iowa economic development authority
23to transfer any unobligated and unencumbered moneys in any fund
24created pursuant to Code section 15.106A(1)(o), for deposit in
25the fund.
26The bill requires any transfer to be reported to the
27legislative fiscal committee of the legislative council on a
28monthly basis.
29DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — FUND. The
30bill creates a disaster recovery housing assistance fund
31(fund) within the authority. The purpose of the fund is for
32the development and operation of a forgivable loan and grant
33program for homeowners and renters with disaster-affected
34homes, and for an eviction prevention program created in the
35bill. The bill prohibits the authority from using more than
-24-15 percent of the moneys in the fund on July 1 of a fiscal year
2for purposes of administrative costs and other program support
3during the fiscal year.
4The bill directs the authority to establish and administer
5a disaster recovery assistance program (program) and to
6use the moneys in the fund to provide forgivable loans to
7eligible homeowners and grants to eligible renters with
8disaster-affected homes. “Disaster-affected home” is defined
9in the bill as a primary residence that is destroyed or damaged
10due to a natural disaster that occurs on or after the effective
11date of the division, and that is located in a county that due
12to the natural disaster is the subject of a state of disaster
13emergency proclamation by the governor that authorizes disaster
14recovery housing assistance; or a primary residence that is
15destroyed or damaged due to a natural disaster that occurred
16on or after March 12, 2019, but before the effective date of
17the division, and is located in a county that has been declared
18a major disaster by the president of the United States on or
19after March 12, 2019, but before the effective date of the
20division, and is located in a county where individuals are
21eligible for federal individual assistance.
22The authority may enter into an agreement with one or
23more local program administrators to administer the program
24and moneys in the fund may be expended following a state of
25disaster emergency proclamation by the governor that authorizes
26disaster recovery housing assistance or the eviction prevention
27program. “Local program administrator” is defined in the bill
28as cities of Ames, Cedar Falls, Cedar Rapids, Council Bluffs,
29Davenport, Des Moines, Dubuque, Iowa City, Waterloo, and West
30Des Moines; a council of governments whose territory includes
31at least one county that is the subject of the state of
32disaster emergency proclamation by the governor that authorizes
33disaster recovery housing assistance or the eviction prevention
34program; a community action agency as defined in Code section
35216A.91 and whose territory includes at least one county that
-25-1is the subject of the state of disaster emergency proclamation
2by the governor that authorizes disaster recovery housing
3assistance or the eviction prevention program; or a qualified
4local organization or governmental entity as determined by rule
5by the authority.
6To be considered for a forgivable loan or grant under the
7program, the homeowner or renter must register for the disaster
8case management program established pursuant to Code section
929C.20B. The disaster case manager may refer the homeowner or
10renter to the appropriate local program administrator.
11DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — HOMEOWNERS.
12 To be eligible for a forgivable loan under the program,
13the bill requires a homeowner to own a disaster-affected
14home located in a county that has been proclaimed a state
15of disaster emergency by the governor; the home must have
16sustained damage greater than the damage that is covered by the
17homeowner’s property and casualty insurance policy insuring the
18home plus any other state or federal disaster-related financial
19assistance that the homeowner is eligible to receive; an
20administrator must deem the home suitable for rehabilitation or
21damaged beyond reasonable repair; if the homeowner is seeking
22a forgivable loan for the repair or rehabilitation of the
23homeowner’s disaster-affected home, the home cannot be proposed
24for buyout by the county or city in which the home is located,
25or the disaster-affected home is eligible for a buyout, but
26the homeowner is requesting a forgivable loan for the repair
27or rehabilitation of the homeowner’s disaster-affected home
28in lieu of a buyout; and the assistance does not duplicate
29benefits provided by other disaster assistance programs.
30If a homeowner is referred to an administrator by the
31homeowner’s case manager, the bill allows the authority to
32award a forgivable loan to the eligible homeowner for repair
33or rehabilitation of the disaster-affected home, or for down
34payment assistance on the purchase of replacement housing,
35and the cost of reasonable repairs to be performed on the
-26-1replacement housing to render it decent, safe, sanitary, and
2in good repair. Replacement housing purchased by a homeowner
3cannot be located in a 100-year floodplain. “Decent, safe,
4sanitary, and in good repair” is defined in the bill to mean
5the same as described in 24 C.F.R.§5.703. “Replacement
6housing” is defined in the bill as housing purchased by a
7homeowner to replace a disaster-affected home that is destroyed
8or damaged beyond reasonable repair as determined by a local
9program administrator.
10The authority shall determine the interest rate for the
11forgivable loan.
12If a homeowner who has been awarded a forgivable loan sells
13a disaster-affected home or replacement housing for which the
14homeowner received the forgivable loan prior to the end of the
15loan term, the remaining principal on the forgivable loan shall
16be due and payable.
17DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — RENTERS.
18 To be eligible for a grant under the program, the bill
19requires the local program administrator to either deem
20the disaster-affected home of the renter suitable for
21rehabilitation but unsuitable for current short-term
22habitation, or damaged beyond reasonable repair; and the
23assistance does not duplicate benefits provided by any other
24disaster assistance program.
25DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — REPORT. The
26bill requires the authority to annually submit a report to
27the general assembly detailing the disaster recovery housing
28assistance program.
29EVICTION PREVENTION PROGRAM. The bill requires the
30authority to establish and administer an eviction prevention
31program. Under the eviction prevention program, the authority
32awards grants from the disaster recovery housing assistance
33fund to eligible renters and eviction prevention partners.
34Grants may be awarded upon a state of disaster emergency
35proclamation by the governor that authorizes the eviction
-27-1prevention program. The bill defines “eligible renter” to mean
2a renter whose income meets the qualifications of the program,
3who is at risk of eviction, and who resides in a county that
4is the subject of a state of disaster emergency proclamation
5by the governor that also authorizes the eviction prevention
6program. The bill defines “eviction prevention partner” to
7mean a qualified local organization or governmental entity as
8determined by rule by the authority.
9The bill requires grants awarded to eligible renters to be
10used for short-term financial rent assistance to keep eligible
11renters in the current residence of the renter. Grants awarded
12to eviction prevention partners are to be used to pay for rent
13or services provided to eligible renters for the purpose of
14preventing the eviction of eligible renters.
15DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — RULES. The
16authority shall adopt rules pursuant to Code chapter 17A to
17implement and administer the program including establishing
18the maximum forgivable loan and grant amounts, the terms of
19forgivable loans, and income qualifications of eligible renters
20in the eviction prevention program.
21BROWNFIELD REDEVELOPMENT PROGRAM. Current law provides
22that the economic development authority (authority) cannot
23allocate more than $10 million in tax credits in a fiscal year
24to the brownfield redevelopment program (brownfields). The
25division increases the maximum allocation to $20 million. The
26division provides that tax credits that are not awarded or
27that are revoked (including revoked within the previous five
28years) under brownfields may be awarded during the next annual
29application period, and those tax credits do not count against
30the $20 million tax credit maximum. Under current law, Code
31section 15.293A, redevelopment tax credits, is repealed on June
3230, 2021. The division changes the repeal date to June 30,
332031, and the repeal date is effective upon enactment of the
34division. Under current law, Code section 15.293B, related to
35the application, review, registration, and authorization of
-28-1projects awarded tax credits under brownfields is repealed on
2June 30, 2021. The division changes the repeal date to June
330, 2031, and the repeal date is effective upon enactment of
4the division.
-29-jm/jh
2assistance, and redevelopment tax credits by creating an
3Iowa housing tax credit program, modifying distribution of
4real estate transfer taxes, modifying workforce housing tax
5incentives, including a downtown loan guarantee program,
6creating a disaster housing recovery assistance program and
7an eviction prevention program, providing for a fee, and
8including effective date and applicability provisions.
9BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1DIVISION I
2IOWA HOUSING TAX CREDIT PROGRAM
3 Section 1. NEW SECTION. 16.37A Definitions.
4For purposes of this section and sections 16.37B through
516.37G, unless the context otherwise requires:
61. “Compliance period” means the period of fifteen years
7beginning with the first taxable year of the credit period.
82. “Credit period” means the period of ten tax years
9beginning with the tax year in which a qualified development
10is placed in service and the Iowa housing tax credit may be
11claimed. If a qualified development consists of more than
12one building, the qualified development is placed in service
13in the tax year in which the last building of the qualified
14development is placed in service.
153. “Department” means the Iowa department of revenue.
164. “Qualified allocation plan” means the qualified
17allocation plan adopted by the authority pursuant to section
1842(m) of the Internal Revenue Code.
195. “Qualified basis” means the qualified basis determined
20under section 42(c)(1) of the Internal Revenue Code.
216. “Qualified development” means a qualified low-income
22housing project under section 42(g) of the Internal Revenue
23Code that is financed with tax-exempt bonds, pursuant to
24section 42(i)(2) of the Internal Revenue Code, and located in
25this state.
267. “Taxpayer” means an individual, a person, firm,
27corporation, or other entity that owns an interest, direct
28or indirect, in a qualified development and who claims a tax
29credit under section 16.37C.
30 Sec. 2. NEW SECTION. 16.37B Application — review —
31authorization.
321. The authority shall develop a system for the application,
33review, and authorization of Iowa housing tax credits awarded
34pursuant to this part and shall control the issuance of all tax
35credit certificates to taxpayers pursuant to this part.
-1- 12. Applications for Iowa housing tax credits shall be
2accepted during an application period established by the
3authority.
43. The authority may authorize the tax credit if all of the
5following conditions are satisfied:
6a. The tax credit certificate is issued to a taxpayer who
7has an ownership interest in the qualified development.
8b. The tax credit amount is allocated pursuant to a
9qualified allocation plan.
10c. The tax credit is necessary for the financial feasibility
11of the qualified development.
12d. The amount of the tax credit allocated to an owner
13does not exceed thirty percent of the qualified basis of the
14qualified development.
15e. The qualified development is the subject of a recorded
16restrictive covenant requiring that, for the compliance period
17or for a longer period agreed to by the authority and the
18owner of the qualified development, the development shall be
19maintained and operated as a qualified development and shall be
20in compliance with Tit.VIII of the federal Civil Rights Act of
211968, as amended.
224. Upon review of an application, the authority may approve
23the qualified development for the tax credit program provided
24in section 16.37C, and issue a tax credit certificate stating
25the amount of the tax credit the authority determines the
26taxpayer is eligible to claim for each year of the credit
27period.
285. Unless otherwise provided in this section or the context
29clearly requires otherwise, the authority shall determine
30eligibility for a credit and allocate credits in accordance
31with the standards and requirements set forth in section 42 of
32the Internal Revenue Code.
336. An applicant that is unsuccessful in receiving a tax
34credit award during an application period may make additional
35applications during subsequent application periods. Such
-2-1applicants shall be required to submit a new application which
2shall be reviewed in the same manner as other applications in
3that application period.
4 Sec. 3. NEW SECTION. 16.37C Iowa housing tax credits —
5limits.
61. An Iowa housing tax credit shall be allowed against
7the taxes imposed in chapter 422, subchapters II, III, and V,
8and in chapter 432, and against the moneys and credits tax
9imposed in section 533.329, in the amount determined by the
10authority pursuant to this part. Any tax credit in excess of
11the taxpayer’s liability for the tax year is not refundable but
12may be credited to the tax liability for the following five
13years or until depleted, whichever is earlier.
142. An individual may claim a tax credit under this section
15of a partnership, limited liability company, S corporation,
16estate, or trust electing to have income taxed directly to
17the individual. The amount claimed by the individual shall
18be based upon the pro rata share of the individual’s earnings
19from the partnership, limited liability company, S corporation,
20estate, or trust.
213. In any calendar year, the aggregate amount of all tax
22credits allocated by the authority shall not exceed fifteen
23million dollars, plus the sum of the following amounts:
24a. The total of all unallocated tax credits, if any, for the
25preceding calendar years.
26b. The total amount of all previously allocated tax credits
27that have been recaptured, revoked, canceled, or otherwise
28recovered by the authority.
294. a. To claim a tax credit under this section, a taxpayer
30shall include one or more tax credit certificates issued by the
31authority with the taxpayer’s tax return.
32b. The tax credit certificate shall contain the taxpayer’s
33name, address, tax identification number, the amount of the
34credit including the amount the authority determines the
35taxpayer is eligible to claim for each year of the credit
-3-1period, the name of the qualified development, any other
2information required by the department of revenue, and a place
3for the name and tax identification number of a transferee and
4the amount of the tax credit being transferred.
5c. Tax credit certificates issued under this section may
6be transferred to any person or entity. Within ninety days
7of transfer, the transferee shall submit the transferred tax
8credit certificate to the authority along with a statement
9containing the transferee’s name, tax identification number,
10and address, the denomination that each replacement tax credit
11certificate is to carry, and any other information required by
12the department of revenue.
13d. Within thirty days of receiving the transferred tax
14credit certificate and the transferee’s statement, the
15authority shall issue one or more replacement tax credit
16certificates to the transferee. Each replacement tax credit
17certificate must contain the information required for the
18original tax credit certificate and must have the same
19expiration date that appeared in the transferred tax credit
20certificate. Tax credit certificate amounts of less than the
21minimum amount established by rule of the authority shall not
22be transferable.
23e. A tax credit shall not be claimed by a transferee
24under this section until a replacement tax credit certificate
25identifying the transferee as the proper holder has been
26issued. The transferee may use the amount of the tax credit
27transferred against the taxes imposed in chapter 422,
28subchapters II, III, and V, and in chapter 432, and against the
29moneys and credits tax imposed in section 533.329, for any tax
30year the original transferor could have claimed the tax credit.
31Any consideration received for the transfer of the tax credit
32shall not be included as income under chapter 422, subchapters
33II, III, and V. Any consideration paid for the transfer of the
34tax credit shall not be deducted from income under chapter 422,
35subchapters II, III, and V.
-4-1 Sec. 4. NEW SECTION. 16.37D Recapture.
21. As of the last day of any tax year during the compliance
3period, if the amount of the qualified basis of a qualified
4development owned by a taxpayer claiming the credit is less
5than the amount of the qualified basis as of the last day of the
6immediately preceding tax year, the amount of the taxpayer’s
7liability under chapter 422, subchapter II, III, or V, chapter
8432, or section 533.329, as applicable, shall be increased by
9the recapture amount determined using the method under section
1042(j) of the Internal Revenue Code.
112. If a recapture event occurs, the taxpayer shall include
12the recaptured proportion of the credit on the return submitted
13for the tax year in which the recapture event is identified.
14 Sec. 5. NEW SECTION. 16.37E Compliance monitoring.
15The authority shall monitor and oversee compliance with
16sections 16.37A through 16.37D and shall report specific
17occurrences of noncompliance to the department.
18 Sec. 6. NEW SECTION. 16.37F Report to the general assembly.
19On or before January 31 of each year, the authority shall
20submit to the general assembly a report that includes all of
21the following:
221. A statement of the number of qualified developments for
23which the authority issued tax certificates the prior year.
242. A description of each qualified development for which the
25authority issued a tax certificate the prior year, including
26the geographic location of the development, the household type
27and any specific demographic information available concerning
28the residents intended to be served by the development,
29the income levels of residents intended to be served by the
30development, and the rents or set-asides authorized for each
31development.
32 Sec. 7. NEW SECTION. 16.37G Rules.
33The authority and the department shall adopt rules pursuant
34to chapter 17A as necessary for the implementation and
35administration of this part.
-5-1 Sec. 8. NEW SECTION. 422.10C Iowa housing tax credit.
2The taxes imposed under this subchapter, less the credits
3allowed under section 422.12, shall be reduced by an Iowa
4housing tax credit allowed under section 16.37C.
5 Sec. 9. Section 422.33, Code 2021, is amended by adding the
6following new subsection:
7 NEW SUBSECTION. 17. The taxes imposed under this subchapter
8shall be reduced by an Iowa housing tax credit as allowed under
9section 16.37C.
10 Sec. 10. Section 422.60, Code 2021, is amended by adding the
11following new subsection:
12 NEW SUBSECTION. 14. The taxes imposed under this subchapter
13shall be reduced by an Iowa housing tax credit as allowed under
14section 16.37C.
15 Sec. 11. NEW SECTION. 432.12N Iowa housing tax credit.
16The taxes imposed under this chapter shall be reduced by an
17Iowa housing tax credit allowed under section 16.37C.
18 Sec. 12. Section 533.329, subsection 2, Code 2021, is
19amended by adding the following new paragraph:
20 NEW PARAGRAPH. l. The moneys and credits tax imposed under
21this section shall be reduced by an Iowa housing tax credit
22allowed under section 16.37C.
23 Sec. 13. CODE EDITOR DIRECTIVE. The Code editor shall
24designate sections 16.37A through 16.37G, as enacted by
25this division of this Act, as a new part within chapter 16,
26subchapter VII, and may redesignate the new and preexisting
27parts, replace references to sections 16.37A through 16.37G
28with references to the new part, and correct internal
29references as necessary, including references in subchapter or
30part headnotes.
31 Sec. 14. EFFECTIVE DATE. This division of this Act takes
32effect January 1, 2022.
33 Sec. 15. APPLICABILITY. This division of this Act applies
34to tax years beginning on or after January 1, 2022.
35DIVISION II
-6-1HOUSING TRUST FUND
2 Sec. 16. Section 428A.8, subsection 3, Code 2021, is amended
3by striking the subsection.
4DIVISION III
5WORKFORCE HOUSING TAX INCENTIVES
6 Sec. 17. Section 15.119, subsection 2, paragraph g, Code
72021, is amended to read as follows:
8g. (1) The workforce housing tax incentives program
9administered pursuant to sections 15.351 through 15.356.
10In allocating tax credits pursuant to this subsection, the
11authority shall not allocate more than twenty-five million
12dollars for purposes of this paragraph. Of the moneys
13allocated under this paragraph, ten million dollars shall be
14reserved for allocation to qualified housing projects in small
15cities, as defined in section 15.352, that are registered on
16or after July 1, 2017.
17(2) (a) Notwithstanding subparagraph (1), in allocating
18tax credits pursuant to this subsection for each fiscal
19year of the period beginning July 1, 2021, and ending June
2030, 2024, the authority shall not allocate more than fifty
21million dollars for purposes of this paragraph. Of the moneys
22allocated under this paragraph for each fiscal year of the
23period beginning July 1, 2021, and ending June 30, 2024, twenty
24million dollars shall be reserved for allocation to qualified
25housing projects in small cities, as defined in section 15.352,
26that are registered on or after July 1, 2017.
27(b) This subparagraph is repealed July 1, 2024.
28 Sec. 18. Section 15.353, subsection 3, Code 2021, is amended
29to read as follows:
303. a. Except as provided in paragraph “b”, the The average
31dwelling unit cost does not exceed two hundred thousand dollars
32per dwelling unit an amount determined by the authority by
33rule. In determining the average dwelling unit cost the
34authority shall consider, at a minimum, building materials,
35labor, site development, and land or property acquisition
-7-1costs.
2b. (1) The average dwelling unit cost does not exceed
3two hundred fifty thousand dollars per dwelling unit if the
4project involves the rehabilitation, repair, redevelopment,
5or preservation of property described in section 404A.1,
6subsection 8, paragraph “a”.
7(2) The average dwelling unit cost for the project does not
8exceed two hundred fifteen thousand dollars per dwelling unit
9if the project is located in a small city.
10 Sec. 19. Section 15.354, subsection 3, paragraph d, Code
112021, is amended to read as follows:
12d. Upon completion of a housing project, an a housing
13business shall submit all of the following to the authority:
14(1) Anexamination of the project in accordance with the
15American institute of certified public accountants’ statements
16on standards for attestation engagements, completed by a
17certified public accountant authorized to practice in this
18state, shall be submitted to the authority.
19(2) A statement of the final amount of qualifying new
20investment for the housing project.
21(3) Any information the authority deems necessary to ensure
22compliance with the agreement signed by the housing business
23pursuant to paragraph “a”, the requirements of this part,
24and rules the authority and the department of revenue adopt
25pursuant to section 15.356.
26 Sec. 20. Section 15.354, subsection 3, paragraph e,
27subparagraph (1), Code 2021, is amended to read as follows:
28(1) Upon review of the examination, and verification of
29the amount of the qualifying new investment, and review of
30any other information submitted pursuant to paragraph “d”,
31subparagraph (3), the authority may notify the housing business
32of the amount that the housing business may claim as a refund
33of the sales and use tax under section 15.355, subsection 2,
34and may issue a tax credit certificate to the housing business
35stating the amount of workforce housing investment tax credits
-8-1under section 15.355, subsection 3, the eligible housing
2business may claim. The sum of the amount that the housing
3business may claim as a refund of the sales and use tax and
4the amount of the tax credit certificate shall not exceed the
5amount of the tax incentive award.
6 Sec. 21. Section 15.354, subsection 6, paragraphs b and c,
7Code 2021, are amended to read as follows:
8b. Notwithstanding subsection 1, the authority may accept
9applications for disaster recovery housing projects on a
10continuous basis establish a disaster recovery application
11period following the declaration of a major disaster by the
12president of the United States for a county in Iowa.
13c. Notwithstanding subsection 2, paragraphs “a”, “b”, and
14“d”, upon Upon review of a housing business’s application,
15and scoring of all applications received during a disaster
16recovery application period, the authority may make a tax
17incentive award to a disaster recovery housing project. The
18tax incentive award shall represent the maximum amount of tax
19incentives that the disaster recovery housing project may
20qualify for under the program. In determining a tax incentive
21award, the authority shall not use an amount of project costs
22that exceeds the amount included in the application of the
23housing business. Tax incentive awards shall be approved by
24the director of the authority.
25 Sec. 22. Section 15.355, subsection 2, Code 2021, is amended
26to read as follows:
272. A housing business may claim a refund of the sales and
28use taxes paid under chapter 423 that are directly related to
29a housing project and specified in the agreement. The refund
30available pursuant to this subsection shall be as provided in
31section 15.331A, excluding subsection 2, paragraph “c”, of
32that section. For purposes of the program, the term “project
33completion”, as used in section 15.331A, shall mean the date
34on which the authority notifies the department of revenue that
35all applicable requirements of an the agreement entered into
-9-1pursuant to section 15.354, subsection 3, paragraph “a”, and
2all applicable requirements of this part, including the rules
3the authority and the department of revenue adopted pursuant to
4section 15.356, are satisfied.
5DIVISION IV
6downtown LOAN GUARANTEE PROGRAM
7 Sec. 23. NEW SECTION. 15.431 Downtown loan guarantee
8program.
91. The economic development authority, in partnership with
10the Iowa finance authority, shall establish and administer a
11downtown loan guarantee program to encourage Iowa downtown
12businesses and banks to reinvest and reopen following the
13COVID-19 pandemic.
142. In order for a loan to be guaranteed, all of the
15following conditions must be true:
16a. The loan finances an eligible downtown resource center
17community catalyst building remediation grant project or main
18street Iowa challenge grant within a designated district.
19b. The loan finances a rehabilitation project, or finances
20acquisition or refinancing costs associated with the project.
21c. At least twenty-five percent of the project costs are
22used for construction on the project or renovation.
23d. The project includes a housing component.
24e. The loan is used for construction of the project,
25permanent financing of the project, or both.
26f. A federally insured financial lending institution issued
27the loan.
28g. The loan does not reimburse the borrower for working
29capital, operations, or similar expenses.
30h. The project meets downtown resource center and main
31street Iowa design review.
323. a. For a loan amount less than or equal to five hundred
33thousand dollars, the economic development authority may
34guarantee up to fifty percent of the loan amount.
35b. For a loan amount greater than five hundred thousand
-10-1dollars, the economic development authority may provide a
2maximum loan guarantee of up to two hundred fifty thousand
3dollars.
44. A project loan must be secured by a mortgage against the
5project property.
65. The economic development authority may guarantee loans
7for up to five years. The economic development authority
8may extend the loan guarantee for an additional five years
9if an underwriting review finds that an extension would be
10beneficial.
116. The lender shall pay an annual loan guarantee fee as set
12forth by rule.
137. The economic development authority reserves the right
14to deny a loan guarantee for unreasonable bank loan fees or
15interest rate.
168. The loan must not be insured or guaranteed by another
17local, state, or federal guarantee program.
189. The loan guarantee is not transferable if the loan or the
19project is sold or transferred.
2010. In the event of a loss due to default, the loan
21guarantee proportionally pays the guarantee percentage of the
22loss to the lender.
2311. Moneys for the program may consist of any moneys
24appropriated by the general assembly for purposes of this
25section, and any other moneys that are lawfully available to
26the authority, including moneys transferred or deposited from
27other funds created pursuant to section 15.106A, subsection 1,
28paragraph “o”.
29DIVISION V
30Disaster Recovery Housing Assistance Program and Fund
31 Sec. 24. NEW SECTION. 16.57A Transfer of unobligated or
32unencumbered funds — report.
331. Notwithstanding any other provision of law to the
34contrary, the authority may transfer any unobligated and
35unencumbered moneys in any revolving loan program fund created
-11-1pursuant to section 16.46, 16.47, 16.48, or 16.49, for deposit
2in the disaster recovery housing assistance fund created in
3section 16.57B.
42. Notwithstanding section 8.39, and any other law to
5the contrary, with the prior written consent and approval of
6the governor, the executive director of the authority may
7transfer any unobligated and unencumbered moneys in any fund
8created pursuant to section 16.5, subsection 1, paragraph
9“s”, for deposit in the disaster recovery housing assistance
10fund created in section 16.57B. The prior written consent and
11approval of the director of the department of management shall
12not be required to transfer the unobligated and unencumbered
13moneys.
143. Notwithstanding section 8.39, and any other law to the
15contrary, with the prior written approval of the governor, the
16director of the economic development authority may transfer
17any unobligated and unencumbered moneys in any fund created
18pursuant to section 15.106A, subsection 1, paragraph “o”,
19for deposit in the disaster recovery housing assistance fund
20created in section 16.57B.
214. Any transfer made under this section shall be reported in
22the same manner as provided in section 8.39, subsection 5.
23 Sec. 25. NEW SECTION. 16.57B Disaster recovery housing
24assistance program — fund.
251. Definitions. As used in this section, unless the context
26otherwise requires:
27a. “Disaster-affected home” means any of the following:
28(1) A primary residence that is destroyed or damaged due
29to a natural disaster that occurs on or after the effective
30date of this division of this Act, and the primary residence is
31located in a county that is the subject of a state of disaster
32emergency proclamation by the governor that authorizes disaster
33recovery housing assistance.
34(2) A primary residence that is destroyed or damaged due to
35a natural disaster that occurred on or after March 12, 2019,
-12-1but before the effective date of this division of this Act, and
2is located in a county that has been declared a major disaster
3by the president of the United States on or after March 12,
42019, but before the effective date of this division of this
5Act, and is located in a county where individuals are eligible
6for federal individual assistance.
7b. “Fund” means the disaster recovery housing assistance
8fund.
9c. “Local program administrator” means any of the following:
10(1) The cities of Ames, Cedar Falls, Cedar Rapids, Council
11Bluffs, Davenport, Des Moines, Dubuque, Iowa City, Waterloo,
12and West Des Moines.
13(2) A council of governments whose territory includes at
14least one county that is the subject of a state of disaster
15emergency proclamation by the governor that authorizes disaster
16recovery housing assistance or the eviction prevention program
17under section 16.57C on or after the effective date of this
18division of this Act.
19(3) A community action agency as defined in section 216A.91
20and whose territory includes at least one county that is the
21subject of a state of disaster emergency proclamation by the
22governor that authorizes disaster recovery housing assistance
23or the eviction prevention program under section 16.57C on or
24after the effective date of this division of this Act.
25(4) A qualified local organization or governmental entity
26as determined by rules adopted by the authority.
27d. “Program” means the disaster recovery housing assistance
28program.
29e. “Replacement housing” means housing purchased
30by a homeowner or leased by a renter needed to replace
31a disaster-affected home that is destroyed or damaged
32beyond reasonable repair as determined by a local program
33administrator.
34f. “State of disaster emergency” means the same as described
35in section 29C.6, subsection 1.
-13- 12. Fund.
2a. (1) A disaster recovery housing assistance fund is
3created within the authority. The moneys in the fund shall be
4used by the authority for the development and operation of a
5forgivable loan and grant program for homeowners and renters
6with disaster-affected homes, and for the eviction prevention
7program pursuant to section 16.57C.
8(2) Notwithstanding section 12C.7, subsection 2, interest
9or earnings on moneys deposited in the fund shall be credited
10to the fund. Notwithstanding section 8.33, moneys credited to
11the fund shall not revert at the close of a fiscal year.
12b. Moneys transferred by the authority for deposit in the
13fund, moneys appropriated to the fund, and any other moneys
14available to and obtained or accepted by the authority for
15placement in the fund shall be deposited in the fund.
16c. The authority shall not use more than five percent of
17the moneys in the fund on July 1 of a fiscal year for purposes
18of administrative costs and other program support during the
19fiscal year.
203. Program.
21a. The authority shall establish and administer a disaster
22recovery housing assistance program and shall use moneys in
23the fund to award forgivable loans to eligible homeowners and
24grants to eligible renters of disaster-affected homes. Moneys
25in the fund may be expended following a state of disaster
26emergency proclamation by the governor pursuant to section
2729C.6 that authorizes disaster recovery housing assistance.
28b. The authority may enter into an agreement with one or
29more local program administrators to administer the program.
304. Registration required. To be considered for a forgivable
31loan or grant under the program, a homeowner or renter must
32register for the disaster case management program established
33pursuant to section 29C.20B. The disaster case manager may
34refer the homeowner or renter to the appropriate local program
35administrator.
-14- 15. Homeowners.
2a. To be eligible for a forgivable loan under the program,
3all of the following requirements shall apply:
4(1) The homeowner’s disaster-affected home must have
5sustained damage greater than the damage that is covered by the
6homeowner’s property and casualty insurance policy insuring the
7home plus any other state or federal disaster-related financial
8assistance that the homeowner is eligible to receive.
9(2) A local program administrator must either deem the
10disaster-affected home suitable for rehabilitation or damaged
11beyond reasonable repair.
12(3) The disaster-affected home is not eligible for buyout by
13the county or city where the disaster-affected home is located,
14or the disaster-affected home is eligible for a buyout by the
15county or city where the disaster-affected home is located, but
16the homeowner is requesting a forgivable loan for the repair
17or rehabilitation of the homeowner’s disaster-affected home in
18lieu of a buyout.
19(4) Assistance under the program must not duplicate
20benefits provided by any local, state, or federal disaster
21recovery assistance program.
22b. If a homeowner is referred to the authority or to a
23local program administrator by the disaster case manager of the
24homeowner, the authority may award a forgivable loan to the
25eligible homeowner for any of the following purposes:
26(1) Repair or rehabilitation of the disaster-affected home.
27(2) (a) Down payment assistance on the purchase of
28replacement housing, and the cost of reasonable repairs to be
29performed on the replacement housing to render the replacement
30housing decent, safe, sanitary, and in good repair.
31(b) Replacement housing shall not be located in a
32one-hundred-year floodplain.
33(c) For purposes of this subparagraph, “decent, safe,
34sanitary, and in good repair” means the same as described in 24
35C.F.R.§5.703.
-15- 1c. The authority shall determine the interest rate for the
2forgivable loan.
3d. If a homeowner who has been awarded a forgivable loan
4sells a disaster-affected home or replacement housing for which
5the homeowner received the forgivable loan prior to the end
6of the loan term, the remaining principal on the forgivable
7loan shall be due and payable pursuant to rules adopted by the
8authority.
96. Renters.
10a. To be eligible for a grant under the program, all of the
11following requirements shall apply:
12(1) A local program administrator either deems
13the disaster-affected home of the renter suitable for
14rehabilitation but unsuitable for current short-term
15habitation, or the disaster-affected home is damaged beyond
16reasonable repair.
17(2) Assistance under the program must not duplicate
18benefits provided by any local, state, or federal disaster
19recovery assistance program.
20b. If a renter is referred to the authority or to a local
21program administrator by the disaster case manager of the
22renter, the authority may award a grant to the eligible renter
23to provide short-term financial assistance for the payment of
24rent for replacement housing.
257. Report. On or before January 31 of each year, the
26authority shall submit a report to the general assembly
27that identifies all of the following for the calendar year
28immediately preceding the year of the report:
29a. The date of each state of disaster emergency proclamation
30by the governor that authorized disaster recovery housing
31assistance under this section.
32b. The total number of forgivable loans and grants awarded.
33c. The total number of forgivable loans, and the amount of
34each loan awarded for repair or rehabilitation.
35d. The total number of forgivable loans, and the amount of
-16-1each loan, awarded for down payment assistance on the purchase
2of replacement housing and the cost of reasonable repairs to be
3performed on the replacement housing to render the replacement
4housing decent, safe, sanitary, and in good repair.
5e. The total number of grants, and the amount of each grant,
6awarded for rental assistance.
7f. The total number of forgivable loans and grants awarded
8in each county in which at least one homeowner or renter has
9been awarded a forgivable loan or grant.
10g. Each local program administrator involved in the
11administration of the program.
12h. The total amount of forgivable loan principal repaid.
13 Sec. 26. NEW SECTION. 16.57C Eviction prevention program.
141. a. “Eligible renter” means a renter whose income meets
15the qualifications of the program, who is at risk of eviction,
16and who resides in a county that is the subject of a state of
17disaster emergency proclamation by the governor that authorizes
18the eviction prevention program.
19b. “Eviction prevention partner” means a qualified local
20organization or governmental entity as determined by rule by
21the authority.
222. The authority shall establish and administer an eviction
23prevention program. Under the eviction prevention program,
24the authority shall award grants to eligible renters and to
25eviction prevention partners for purposes of this section.
26Grants may be awarded upon a state of disaster emergency
27proclamation by the governor that authorizes the eviction
28prevention program. Eviction prevention assistance shall be
29paid out of the fund established in section 16.57B.
303. a. Grants awarded to eligible renters pursuant to this
31section shall be used for short-term financial rent assistance
32to keep eligible renters in the current residences of such
33renters.
34b. Grants awarded to eviction prevention partners pursuant
35to this section shall be used to pay for rent or services
-17-1provided to eligible renters for the purpose of preventing the
2eviction of eligible renters.
34. The authority may enter into an agreement with one or
4more local program administrators to administer the program.
5 Sec. 27. NEW SECTION. 16.57D Rules.
6The authority shall adopt rules pursuant to chapter 17A to
7implement and administer this part, including rules to do all
8of the following:
91. Establish the maximum forgivable loan and grant amounts
10awarded under the program.
112. Establish the terms of any forgivable loan provided under
12the program.
133. Income qualifications of eligible renters in the
14eviction prevention program.
15 Sec. 28. CODE EDITOR DIRECTIVE. The Code editor shall
16designate sections 16.57A through 16.57D, as enacted by
17this division of this Act, as a new part within chapter 16,
18subchapter VIII, and may redesignate the new and preexisting
19parts, replace references to sections 16.57A through 16.57D
20with references to the new part, and correct internal
21references as necessary, including references in subchapter or
22part headnotes.
23 Sec. 29. EFFECTIVE DATE. This division of this Act, being
24deemed of immediate importance, takes effect upon enactment.
25DIVISION VI
26BROWNFIELDS AND GRAYFIELDS
27 Sec. 30. Section 15.119, subsection 3, Code 2021, is amended
28to read as follows:
293. In allocating the amount of tax credits authorized
30pursuant to subsection 1 among the programs specified in
31subsection 2, the authority shall not allocate more than ten
32 twenty million dollars for purposes of subsection 2, paragraph
33“f”.
34 Sec. 31. Section 15.293A, subsection 8, Code 2021, is
35amended to read as follows:
-18- 18. This section is repealed on June 30, 2021 2031.
2 Sec. 32. Section 15.293B, Code 2021, is amended by adding
3the following new subsection:
4 NEW SUBSECTION. 5A. a. Tax credits revoked under
5subsection 3 including tax credits revoked up to five years
6prior to the effective date of this Act, and tax credits
7not awarded under subsection 4 or 5, may be awarded in the
8next annual application period established in subsection 1,
9paragraph “c”.
10b. Tax credits awarded pursuant to paragraph “a” shall not
11be counted against the limit under section 15.119, subsection
123.
13 Sec. 33. Section 15.293B, subsection 7, Code 2021, is
14amended to read as follows:
157. This section is repealed on June 30, 2021 2031.
16 Sec. 34. EFFECTIVE DATE. The following, being deemed of
17immediate importance, take effect upon enactment:
181. The section of this division of this Act amending section
1915.293A, subsection 8.
202. The section of this division of this Act amending section
2115.293B, subsection 7.
22EXPLANATION
23The inclusion of this explanation does not constitute agreement with
24the explanation’s substance by the members of the general assembly.
25This bill relates to affordable housing, disaster housing
26assistance, and redevelopment tax credits by creating an
27Iowa housing tax credit program, modifying distribution of
28real estate transfer taxes, modifying workforce housing tax
29incentives, and creating a disaster housing recovery assistance
30program, modifying redevelopment tax credits, and including
31effective date and applicability provisions.
32IOWA HOUSING TAX CREDIT PROGRAM. The bill creates an Iowa
33housing tax credit program available against the individual and
34corporate income taxes, franchise tax, insurance premium tax,
35and moneys and credits tax.
-19- 1The bill requires the Iowa finance authority (authority) to
2develop a system for the application, review, and authorization
3of Iowa housing tax credits. A tax credit may be claimed by
4a taxpayer for a “qualified development” defined to mean a
5qualified low-income housing project under section 42(g) of the
6Internal Revenue Code that is financed by tax-exempt bonds.
7An Iowa housing tax credit may be authorized by the authority
8if all of the following apply: the tax credit is issued to
9a taxpayer who has an ownership interest in the qualified
10development; the tax credit amount is allocated pursuant to
11a qualified allocation plan adopted by the authority; the
12tax credit is necessary for the financial feasibility of the
13qualified development; the amount of the tax credit allocated
14to an owner does not exceed 30 percent of the qualified basis
15of the qualified development; and the qualified development is
16the subject of a recorded restrictive covenant requiring the
17qualified development be maintained and operated as a qualified
18development for a certain number of years.
19The amount of an Iowa housing tax credit award is determined
20by the authority and may be claimed during the credit period
21(10 years), and any credit in excess of the taxpayer’s
22liability for the tax year is not refundable but may be
23credited to the tax liability for the following five years.
24In any calendar year, the bill limits the aggregate amount
25of the tax credit to $15 million plus the sum of the total of
26unallocated tax credits from the preceding calendar year and
27the previously allocated tax credits that have been revoked,
28canceled, or recaptured.
29A taxpayer shall claim the credit by including one or more
30tax certificates issued by the authority with the taxpayer’s
31return. The bill allows a tax credit certificate to be
32transferred to any person or entity. The bill requires the
33transferee to submit the transferred tax credit certificate to
34the authority within 90 days of the transfer, and requires the
35authority to issue a replacement tax credit certificate within
-20-130 days of receiving the transferred tax credit certificate.
2The bill allows the authority to recapture tax credit
3amounts from previously issued tax credits. The bill provides
4that if on the last day of a taxable year during the compliance
5period (15 years) the amount of the qualified basis of a
6qualified development owned by a taxpayer claiming the credit
7is less than the amount of the qualified basis as of the last
8day of the immediately preceding tax year, then the amount of
9the taxpayer’s liability shall be increased by the recapture
10amount determined using the method under section 42(j) of the
11Internal Revenue Code. If a recapture event occurs, the bill
12requires the taxpayer to include the recaptured amount on the
13return submitted for the tax year in which the recapture event
14is identified.
15The bill requires the authority to submit a report to the
16general assembly by January 31 each year, detailing the Iowa
17housing tax credit program. The division takes effect January
181, 2022, and applies to tax years beginning on or after that
19date.
20HOUSING TRUST FUND. Currently, the treasurer of state
21transfers 30 percent of real estate transfer tax receipts
22received by the treasurer of state to the housing trust fund up
23to $3 million. The bill removes the $3 million cap placed on
24the transfer of the real estate transfer tax receipts to the
25housing trust fund by the treasurer of state.
26WORKFORCE HOUSING TAX INCENTIVES. Code section 15.119 sets
27an aggregate tax credit amount limit for certain economic
28development programs. Under current law, workforce housing
29tax incentive programs administered under Code sections 15.351
30through 15.356 shall not be allocated more than $25 million
31in tax credits, and of the tax credits allocated to these
32programs, $10 million of the tax credits is reserved for
33allocation to qualified housing projects in small cities. The
34bill increases the workforce housing tax credit allocations
35from $25 million to $50 million. Of the moneys allocated
-21-1to workforce housing tax credits, the bill increases the tax
2credits reserved for qualified housing projects in small
3cities from $10 million to $20 million. The increased amounts
4for workforce housing and small city tax credit allocations
5established in the bill are repealed July 1, 2024.
6The bill strikes the requirement that the average dwelling
7unit costs of a proposed housing development not exceed certain
8dollar amounts per dwelling unit in order to receive workforce
9housing tax incentives. The bill allows the authority to set
10the average dwelling unit costs by rule as a requirement for a
11project to receive workforce housing tax incentives, based upon
12building materials, labor, site development, and acquisition
13costs.
14Currently, upon completion of a housing project, a housing
15business (housing developer, contractor, or nonprofit that
16completes a housing project) submits an examination of the
17project in accordance with the American institute of certified
18public accountants to the authority. In addition to an
19examination by certified public accountants, the bill requires
20the housing business to submit the following to the authority
21upon completion of a housing project: a statement of the
22final amount of the qualifying new investment for the housing
23project and any information the authority deems necessary to
24ensure compliance with the agreement between the authority and
25the housing business including any rules the authority and the
26department of revenue adopt pursuant to Code section 15.356.
27The bill also requires the authority to review the information
28submitted by the housing business prior to notifying the
29housing business of tax incentive awards.
30The bill permits the authority to establish a disaster
31housing recovery period following the declaration of a major
32disaster by the president of the United States. Currently, the
33authority may accept applications for disaster recovery housing
34projects on a continuous basis.
35DOWNTOWN LOAN GUARANTEE PROGRAM. The bill creates a
-22-1downtown loan guarantee program to be administered by the
2economic development authority and the Iowa finance authority.
3The purpose of the program is to encourage downtown businesses
4and banks to reinvest and reopen following the COVID-19
5pandemic.
6In order for a loan to be guaranteed under the program,
7numerous conditions apply, including the following: the loan
8finances an eligible downtown resources center community
9catalyst building remediation grant project or main street
10Iowa challenge grant within a designated district; the loan
11finances a rehabilitation project or acquisition or refinancing
12costs associated with the project; 25 percent of the project
13cost is used for construction on the project or renovation;
14the financed project includes a housing component; the loan is
15used for the construction or permanent financing of a project;
16a federally insured financial lending institution issued the
17loan; the loan does not reimburse the borrower for working
18capital or operations; and the project meets certain design
19reviews.
20The bill requires the loan to be secured by a mortgage
21against the project property, prohibits the loan guarantee to
22be transferred, and charges the lender an annual loan guarantee
23fee as set forth by rule.
24The bill limits the amount of the loan guarantee as follows:
25for a loan amount of less than or equal to $500,000, the loan
26guarantee shall not exceed 50 percent of the loan; for a loan
27amount greater than $500,000, the authority may provide a
28maximum loan guarantee of up to $250,000.
29The authority may guarantee the loan for up to five years,
30which may be extended by the authority for an additional five
31years. The authority may also deny a loan guarantee for any
32unreasonable bank loan fees or interest rate.
33In the event of a loss due to default, the bill requires the
34loan guarantee to proportionally pay the guarantee percentage
35of the loss to the lender.
-23- 1Moneys available for the program may consist of moneys
2appropriated for use in the program, and any other moneys that
3are lawfully available to the economic development authority,
4including moneys transferred or deposited from other funds
5created pursuant to Code section 15.106A(1)(o).
6DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — TRANSFERS.
7 The bill permits the authority to transfer unobligated moneys
8in Code section 16.46 (senior living revolving loan program
9fund), 16.47 (home and community-based services revolving loan
10program fund), 16.48 (transitional housing revolving loan
11program fund), or 16.49 (community housing and services for
12persons with disabilities revolving loan program fund) to the
13disaster recovery housing assistance fund created in the bill.
14After the prior written consent and approval of the
15governor, the bill permits the executive director of the Iowa
16finance authority to transfer any unobligated moneys in any
17fund created pursuant to Code section 16.5(1)(s), for deposit
18in the fund. The bill waives the prior written consent and
19approval of the director of the department of management to
20transfer the unobligated moneys.
21After prior written approval of the governor, the bill
22permits the director of the Iowa economic development authority
23to transfer any unobligated and unencumbered moneys in any fund
24created pursuant to Code section 15.106A(1)(o), for deposit in
25the fund.
26The bill requires any transfer to be reported to the
27legislative fiscal committee of the legislative council on a
28monthly basis.
29DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — FUND. The
30bill creates a disaster recovery housing assistance fund
31(fund) within the authority. The purpose of the fund is for
32the development and operation of a forgivable loan and grant
33program for homeowners and renters with disaster-affected
34homes, and for an eviction prevention program created in the
35bill. The bill prohibits the authority from using more than
-24-15 percent of the moneys in the fund on July 1 of a fiscal year
2for purposes of administrative costs and other program support
3during the fiscal year.
4The bill directs the authority to establish and administer
5a disaster recovery assistance program (program) and to
6use the moneys in the fund to provide forgivable loans to
7eligible homeowners and grants to eligible renters with
8disaster-affected homes. “Disaster-affected home” is defined
9in the bill as a primary residence that is destroyed or damaged
10due to a natural disaster that occurs on or after the effective
11date of the division, and that is located in a county that due
12to the natural disaster is the subject of a state of disaster
13emergency proclamation by the governor that authorizes disaster
14recovery housing assistance; or a primary residence that is
15destroyed or damaged due to a natural disaster that occurred
16on or after March 12, 2019, but before the effective date of
17the division, and is located in a county that has been declared
18a major disaster by the president of the United States on or
19after March 12, 2019, but before the effective date of the
20division, and is located in a county where individuals are
21eligible for federal individual assistance.
22The authority may enter into an agreement with one or
23more local program administrators to administer the program
24and moneys in the fund may be expended following a state of
25disaster emergency proclamation by the governor that authorizes
26disaster recovery housing assistance or the eviction prevention
27program. “Local program administrator” is defined in the bill
28as cities of Ames, Cedar Falls, Cedar Rapids, Council Bluffs,
29Davenport, Des Moines, Dubuque, Iowa City, Waterloo, and West
30Des Moines; a council of governments whose territory includes
31at least one county that is the subject of the state of
32disaster emergency proclamation by the governor that authorizes
33disaster recovery housing assistance or the eviction prevention
34program; a community action agency as defined in Code section
35216A.91 and whose territory includes at least one county that
-25-1is the subject of the state of disaster emergency proclamation
2by the governor that authorizes disaster recovery housing
3assistance or the eviction prevention program; or a qualified
4local organization or governmental entity as determined by rule
5by the authority.
6To be considered for a forgivable loan or grant under the
7program, the homeowner or renter must register for the disaster
8case management program established pursuant to Code section
929C.20B. The disaster case manager may refer the homeowner or
10renter to the appropriate local program administrator.
11DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — HOMEOWNERS.
12 To be eligible for a forgivable loan under the program,
13the bill requires a homeowner to own a disaster-affected
14home located in a county that has been proclaimed a state
15of disaster emergency by the governor; the home must have
16sustained damage greater than the damage that is covered by the
17homeowner’s property and casualty insurance policy insuring the
18home plus any other state or federal disaster-related financial
19assistance that the homeowner is eligible to receive; an
20administrator must deem the home suitable for rehabilitation or
21damaged beyond reasonable repair; if the homeowner is seeking
22a forgivable loan for the repair or rehabilitation of the
23homeowner’s disaster-affected home, the home cannot be proposed
24for buyout by the county or city in which the home is located,
25or the disaster-affected home is eligible for a buyout, but
26the homeowner is requesting a forgivable loan for the repair
27or rehabilitation of the homeowner’s disaster-affected home
28in lieu of a buyout; and the assistance does not duplicate
29benefits provided by other disaster assistance programs.
30If a homeowner is referred to an administrator by the
31homeowner’s case manager, the bill allows the authority to
32award a forgivable loan to the eligible homeowner for repair
33or rehabilitation of the disaster-affected home, or for down
34payment assistance on the purchase of replacement housing,
35and the cost of reasonable repairs to be performed on the
-26-1replacement housing to render it decent, safe, sanitary, and
2in good repair. Replacement housing purchased by a homeowner
3cannot be located in a 100-year floodplain. “Decent, safe,
4sanitary, and in good repair” is defined in the bill to mean
5the same as described in 24 C.F.R.§5.703. “Replacement
6housing” is defined in the bill as housing purchased by a
7homeowner to replace a disaster-affected home that is destroyed
8or damaged beyond reasonable repair as determined by a local
9program administrator.
10The authority shall determine the interest rate for the
11forgivable loan.
12If a homeowner who has been awarded a forgivable loan sells
13a disaster-affected home or replacement housing for which the
14homeowner received the forgivable loan prior to the end of the
15loan term, the remaining principal on the forgivable loan shall
16be due and payable.
17DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — RENTERS.
18 To be eligible for a grant under the program, the bill
19requires the local program administrator to either deem
20the disaster-affected home of the renter suitable for
21rehabilitation but unsuitable for current short-term
22habitation, or damaged beyond reasonable repair; and the
23assistance does not duplicate benefits provided by any other
24disaster assistance program.
25DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — REPORT. The
26bill requires the authority to annually submit a report to
27the general assembly detailing the disaster recovery housing
28assistance program.
29EVICTION PREVENTION PROGRAM. The bill requires the
30authority to establish and administer an eviction prevention
31program. Under the eviction prevention program, the authority
32awards grants from the disaster recovery housing assistance
33fund to eligible renters and eviction prevention partners.
34Grants may be awarded upon a state of disaster emergency
35proclamation by the governor that authorizes the eviction
-27-1prevention program. The bill defines “eligible renter” to mean
2a renter whose income meets the qualifications of the program,
3who is at risk of eviction, and who resides in a county that
4is the subject of a state of disaster emergency proclamation
5by the governor that also authorizes the eviction prevention
6program. The bill defines “eviction prevention partner” to
7mean a qualified local organization or governmental entity as
8determined by rule by the authority.
9The bill requires grants awarded to eligible renters to be
10used for short-term financial rent assistance to keep eligible
11renters in the current residence of the renter. Grants awarded
12to eviction prevention partners are to be used to pay for rent
13or services provided to eligible renters for the purpose of
14preventing the eviction of eligible renters.
15DISASTER RECOVERY HOUSING ASSISTANCE PROGRAM — RULES. The
16authority shall adopt rules pursuant to Code chapter 17A to
17implement and administer the program including establishing
18the maximum forgivable loan and grant amounts, the terms of
19forgivable loans, and income qualifications of eligible renters
20in the eviction prevention program.
21BROWNFIELD REDEVELOPMENT PROGRAM. Current law provides
22that the economic development authority (authority) cannot
23allocate more than $10 million in tax credits in a fiscal year
24to the brownfield redevelopment program (brownfields). The
25division increases the maximum allocation to $20 million. The
26division provides that tax credits that are not awarded or
27that are revoked (including revoked within the previous five
28years) under brownfields may be awarded during the next annual
29application period, and those tax credits do not count against
30the $20 million tax credit maximum. Under current law, Code
31section 15.293A, redevelopment tax credits, is repealed on June
3230, 2021. The division changes the repeal date to June 30,
332031, and the repeal date is effective upon enactment of the
34division. Under current law, Code section 15.293B, related to
35the application, review, registration, and authorization of
-28-1projects awarded tax credits under brownfields is repealed on
2June 30, 2021. The division changes the repeal date to June
330, 2031, and the repeal date is effective upon enactment of
4the division.
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