Bill Summary – FastDemocracy

House File 2292 - Introduced
                                  HOUSE FILE 2292
                                  BY COMMITTEE ON ECONOMIC
                                      GROWTH
                                  (SUCCESSOR TO HSB 540)
                            A BILL FOR
An Act related to matters under the purview of the economic
  development authority including the high quality jobs
  program, the Iowa energy center, and the workforce housing
  tax incentive program, and including effective date and
  retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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    Section 1. Section 15.108, subsection 9, paragraph g, Code
 2022, is amended to read as follows:
    g. Administer the Iowa energy center established in section
 15.120. This paragraph “g” is repealed July 1, 2022 2027.
    Sec. 2. Section 15.120, subsection 1, Code 2022, is amended
 by adding the following new paragraph:
    NEW PARAGRAPH. h. To support research and development of
 strategies for carbon management.
    Sec. 3. Section 15.120, subsection 5, Code 2022, is amended
 to read as follows:
    5. This section is repealed July 1, 2022 2027.
    Sec. 4. Section 15.335C, subsection 2, Code 2022, is amended
 to read as follows:
    2. For purposes of this section, “economically distressed
 area” means a county that ranks among the bottom thirty-three of
 all Iowa counties, as measured by one meets at least three of
 the following criteria:
    a. Average The county ranks among the thirty-three Iowa
 counties with the highest average monthly unemployment level
 rates for the most recent twelve-month period based on the
 applicable local area unemployment statistics produced by the
 United States department of labor, bureau of labor statistics.
    b. Average The county ranks among the thirty-three Iowa
 counties with the highest average annualized unemployment
 level rates for the most recent five-year period based on the
 applicable local area unemployment statistics produced by the
 United States department of labor, bureau of labor statistics.
    c. The county ranks among the thirty-three Iowa counties
 with the lowest annual average weekly wages based on the most
 recent quarterly census of employment and wages published
 by the United States department of labor, bureau of labor
 statistics.
    d. The county ranks among the thirty-three Iowa counties
 with the highest family poverty rates based on the most recent
 American community survey five-year estimate released by the
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 United States census bureau.
    e. The county ranks among the thirty-three Iowa counties
 with the highest percentage population loss. Percentage
 population loss shall be calculated by comparing the most
 recent population estimate produced by the United States
 census bureau to the most recent decennial census released
 by the United States census bureau, except for a calendar
 year in which the decennial census data is released, then the
 percentage population loss shall be calculated by comparing the
 population in the decennial census released that calendar year
 to the population in decennial census released ten years prior.
    f. The county ranks among the thirty-three Iowa counties
 with the highest percentage of persons sixty-five years of age
 or older based on the most recent American community survey
 released by the United States census bureau.
    Sec. 5. Section 15.335C, Code 2022, is amended by adding the
 following new subsection:
    NEW SUBSECTION. 3. The authority may designate a county
 that does not meet at least three of the criteria in subsection
 2 as an economically distressed area under this section if
 a business located in the county experiences a layoff or a
 closure that has a significant impact on a community within the
 county. The authority shall adopt rules to establish a process
 for designating a county an economically distressed area under
 this subsection.
    Sec. 6. Section 15.352, subsection 10, Code 2022, is amended
 to read as follows:
    10. “Small city” means any of the following:
    a. Any city or township located in this state, except those
 located wholly within one or more of the eleven most populous
 counties in the state, as determined by either the most recent
 population estimates issued estimate produced by the United
 States bureau of census or the most recent decennial census
 released by the United States bureau of census.
    b. Any city or township located wholly within one or more of
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 the eleven most populous counties in the state, as determined
 pursuant to paragraph “a”, and that meets all of the following
 requirements:
    (1) The city or township has a population less than or equal
 to two thousand five hundred as determined by either the most
 recent population estimate produced by the United States bureau
 of census or the most recent decennial census released by the
 United States bureau of census.
    (2) The city or township had population growth of less
 than thirty percent as calculated by comparing the population
 in the most recent decennial census released by the United
 States census bureau to the population in the decennial census
 released ten years prior.
    Sec. 7. Section 15.352, Code 2022, is amended by adding the
 following new subsection:
    NEW SUBSECTION. 11. “Urban area” means any city or
 township, except for a small city, that is wholly located
 within one or more of the eleven most populous counties in
 the state, as determined by either the most recent population
 estimate produced by the United States bureau of census or the
 most recent decennial census released by the United States
 bureau of census.
    Sec. 8. Section 15.353, subsection 2, paragraph e, Code
 2022, is amended by striking the paragraph.
    Sec. 9. Section 15.353, subsection 3, Code 2022, is amended
 to read as follows:
    3. a. Except as provided in paragraph “b”, the average
 dwelling unit cost does not exceed two hundred thousand
 dollars per dwelling unit the maximum amount established by
 the board for each fiscal year for the applicable project
 type and project location. The board shall establish the
 maximum average dwelling unit cost for a project that includes
 single-family dwelling units that is located in a small city
 and for a project that includes single-family dwelling units
 that is located in an urban area. The board shall establish
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 the maximum average dwelling unit cost for a project that
 includes multiple dwelling unit buildings and is located
 in a small city and for a project that includes multiple
 dwelling unit buildings and is located in an urban area. In
 establishing each maximum average dwelling unit cost, the board
 shall primarily consider the most recent annual United States
 census bureau building permits survey and historical program
 data.
    b. (1) The average dwelling unit cost does not exceed two
 hundred fifty thousand dollars per dwelling unit if If the
 project involves the rehabilitation, repair, redevelopment,
 or preservation of property described in section 404A.1,
 subsection 8, paragraph “a”, the average dwelling unit cost
 shall not exceed one hundred twenty-five percent of the maximum
 average dwelling unit cost established by the board for the
 applicable project type and project location as provided in
 paragraph “a”.
    (2) The average dwelling unit cost for the project does not
 exceed two hundred fifteen thousand dollars per dwelling unit
 if the project is located in a small city.
    Sec. 10. Section 15.354, subsection 3, paragraph c,
 subparagraph (2), Code 2022, is amended to read as follows:
    (2) The authority may for good cause within the discretion
 of the authority extend a housing project’s completion
 deadline once by up to twelve months upon application by
 the housing business, which application shall be made prior
 to the expiration of the three-year completion deadline in
 subparagraph (1) in the manner and form prescribed by the
 authority. The authority may approve a second extension of
 up to twelve months if prior to the expiration of the first
 twelve-month extension the housing business applies and
 substantiates to the satisfaction of the authority that the
 second extension is warranted due to extenuating circumstances
 outside the control of the housing business. An application
 by a housing business shall be made in the manner and form
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 prescribed by the authority by rule.
    Sec. 11. Section 15.354, subsection 3, paragraph e,
 subparagraph (2), subparagraph divisions (b) and (c), Code
 2022, are amended to read as follows:
    (b) If the project costs cause the housing project’s average
 dwelling unit cost to exceed the applicable maximum amount
 authorized in section 15.353, subsection 3, but do not cause
 the average dwelling unit cost to exceed one hundred ten fifty
 percent of such applicable maximum amount, the authority may
 consider the agreement fulfilled and may issue a tax credit
 certificate. In such case, the authority shall reduce the tax
 incentive award and the corresponding amount of tax incentives
 the eligible housing project may claim under section 15.355,
 subsections 2 and 3, by the same percentage that the housing
 project’s average dwelling unit cost exceeds the applicable
 maximum amount under section 15.353, subsection 3, and such
 tax incentive reduction shall be reflected on the tax credit
 certificate. If the authority issues a certificate pursuant
 to this subparagraph division, the department of revenue
 shall accept the certificate notwithstanding that the housing
 project’s average dwelling unit costs exceed the maximum amount
 specified in section 15.353, subsection 3.
    (c) If the project costs cause the housing project’s average
 dwelling unit cost to exceed one hundred ten fifty percent of
 the applicable maximum amount authorized in section 15.353,
 subsection 3, the authority shall determine the eligible
 housing business to be in default under the agreement, shall
 revoke the tax incentive award, and shall not issue a tax
 credit certificate. The housing business shall not be allowed
 a refund of sales and use tax under section 15.355, subsection
 2.
    Sec. 12. EFFECTIVE DATE. This Act, being deemed of
 immediate importance, takes effect upon enactment.
    Sec. 13. RETROACTIVE APPLICABILITY. The following
 apply retroactively to July 1, 2021, to all eligible housing
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 businesses that the economic development authority has not
 notified of the amount that the housing business may claim
 as a refund of the sales and use tax under section 15.355,
 subsection 2, and all eligible housing businesses that the
 economic development authority has not issued a tax credit
 certificate stating the amount of workforce housing investment
 tax credits under section 15.355, subsection 3, the eligible
 housing business may claim:
    1. The section of this Act amending section 15.352,
 subsection 10.
    2. The section of this Act enacting section 15.352,
 subsection 11.
    3. The section of this Act amending section 15.353,
 subsection 2, paragraph “e”.
    4. The section of this Act amending section 15.353,
 subsection 3.
    5. The section of this Act amending section 15.354,
 subsection 3, paragraph “e”, subparagraph (2), subparagraph
 divisions (b) and (c).
                           EXPLANATION
         The inclusion of this explanation does not constitute agreement with
          the explanation’s substance by the members of the general assembly.
    This bill relates to matters under the purview of the
 economic development authority (authority) including the high
 quality jobs program, the Iowa energy center, and the workforce
 housing tax incentive program.
    Under current law, Code section 15.120, which establishes
 the Iowa energy center, is repealed on July 1, 2022. The bill
 extends the date to 2027. The bill requires the Iowa energy
 center to support research and development of strategies for
 carbon management.
    Under current law, for purposes of the high quality jobs
 program, a county is qualified as an economically distressed
 area if the county ranks among the bottom 33 of all Iowa
 counties, as measured by either the monthly unemployment level
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                                H.F. 2292
 for the most recent 12-month period, or the average annualized
 unemployment level for the most recent five-year period. Under
 the bill, a county qualifies as an economically distressed
 area if it meets at least three of the criteria detailed in
 the bill. The authority may designate a county that does
 not meet at least three of the criteria as an economically
 distressed area if a business located in the county experiences
 a layoff or a closure that has a significant impact on a
 community within the county. The authority shall adopt rules
 to establish a process for designating a county an economically
 distressed area under those circumstances.
    Under current law, for purposes of the workforce housing
 tax incentive program (program), a “small city” is defined
 as any city or township, except those located wholly within
 one or more of the 11 most populous counties in the state, as
 determined by the most recent population estimates issued by
 the United States bureau of census (census bureau). The bill
 defines “small city” as any city or township, except those
 located wholly within one or more of the 11 most populous
 counties, as determined by either the most recent population
 estimate or the most recent decennial census released by the
 census bureau; or any city or township located wholly within
 one or more of the 11 most populous counties in the state,
 that has a population less than or equal to 2,500, and that
 had population growth of less than 30 percent as calculated by
 comparing the population in the most recent decennial census to
 the population in the decennial census released 10 years prior.
    The bill defines “urban area” as any city or township, except
 for a small city, that is wholly located within one or more of
 the 11 most populous counties. “Urban area” is not defined for
 purposes of the program under current law.
    The bill removes new construction, rehabilitation, repair,
 or redevelopment of dwelling units in a distressed workforce
 housing community as an option for a proposed housing project
 (project) under the program. To receive workforce housing tax
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 incentives (tax incentives) under the program, a project cannot
 exceed a specific average dwelling unit cost (unit cost), which
 varies depending on the type of project and whether the project
 is located in a small city or an urban area, as determined by
 the authority board as detailed in the bill.
    Under current law, the authority may extend a project’s
 completion deadline under the program up to 12 months upon
 application by the housing business, which must be made prior
 to the expiration of the project’s three-year completion
 deadline. Under the bill, the authority may approve a second
 extension of up to 12 months if prior to the expiration of the
 first 12-month extension the housing business makes application
 and substantiates to the satisfaction of the authority that the
 extension is warranted due to extenuating circumstances outside
 the control of the housing business.
    Under current law, if the cost of a project causes a housing
 project’s average unit cost to exceed the authorized maximum
 amount, but does not cause the average unit cost to exceed
 110 percent of the maximum amount, the authority may issue
 a tax credit certificate (certificate). If the cost of the
 project cau