The proposed bill establishes the Iowa Rural Development Tax Credit Program, designed to encourage capital contributions to certified rural business growth funds for investment in qualified businesses. It introduces new definitions for key terms such as "affiliate," "authority," "credit-eligible capital contribution," and "qualified business," and outlines the application process for rural business growth funds. The economic development authority will begin accepting applications on January 7, 2026, and will review them on a first-come, first-served basis. Applicants must provide detailed documentation, including revenue impact assessments and signed affidavits from investors committing to capital contributions, while adhering to maximum limits on eligible investments.

The bill also details the issuance of tax credit certificates to investors, equating the tax credit to the investor's contribution, and includes provisions for revocation and recapture of tax credits if growth funds do not meet investment requirements. It specifies that tax credits are non-refundable and cannot be transferred, with the authority required to notify growth funds of any issues before revocation or recapture occurs. Additionally, growth funds must submit annual reports and can apply for program exit after five years, provided there are no revoked or recaptured tax credits. The authority is responsible for adopting rules for the program's implementation and ensuring compliance with investment requirements, ultimately aiming to foster economic growth in Iowa's rural areas.

Statutes affected:
Introduced: 15.512, 15.513