Bill Text: IA HF473 | 2013-2014 | 85th General Assembly | Introduced
Bill Title: A bill for an act relating to the requirements and administration of the targeted jobs withholding credit pilot project and including applicability provisions. (Formerly HSB 168) (See Cmte. Bill HF 616)
Spectrum: Committee Bill
Status: (Introduced - Dead) 2013-12-31 - END OF 2013 ACTIONS [HF473 Detail]
Download: Iowa-2013-HF473-Introduced.html
House
File
473
-
Introduced
HOUSE
FILE
473
BY
COMMITTEE
ON
ECONOMIC
GROWTH
(SUCCESSOR
TO
HSB
168)
A
BILL
FOR
An
Act
relating
to
the
requirements
and
administration
of
the
1
targeted
jobs
withholding
credit
pilot
project
and
including
2
applicability
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
TLSB
2325HV
(2)
85
md/sc
H.F.
473
Section
1.
Section
403.19A,
subsection
1,
paragraphs
c,
e,
1
f,
and
g,
Code
2013,
are
amended
to
read
as
follows:
2
c.
“Employer”
means
a
business
creating
or
retaining
3
targeted
jobs
in
an
urban
renewal
area
of
a
pilot
project
city
4
pursuant
to
a
withholding
agreement.
5
e.
“Qualifying
investment”
means
a
capital
investment
6
in
real
property
including
the
purchase
price
of
land
and
7
existing
buildings,
site
preparation,
building
construction,
8
and
long-term
lease
costs.
“Qualifying
investment”
also
means
a
9
capital
investment
in
depreciable
assets.
For
purposes
of
this
10
paragraph,
“long-term
lease
costs”
means
those
costs
incurred
or
11
expected
to
be
incurred
under
a
lease
during
the
duration
of
a
12
withholding
agreement.
13
f.
“Targeted
job”
means
a
job
in
a
business
which
is
or
14
will
be
located
in
an
urban
renewal
area
of
a
pilot
project
15
city
that
pays
a
wage
at
least
equal
to
the
countywide
average
16
wage.
“Targeted
job”
includes
new
or
retained
jobs
from
Iowa
17
business
expansions
or
retentions
within
the
city
limits
of
the
18
pilot
project
city
and
those
jobs
resulting
from
established
19
out-of-state
businesses,
as
defined
by
the
economic
development
20
authority,
moving
to
or
expanding
in
Iowa.
21
g.
“Withholding
agreement”
means
the
agreement
between
a
22
pilot
project
city
,
the
economic
development
authority,
and
23
an
employer
concerning
the
targeted
jobs
withholding
credit
24
authorized
in
subsection
3
.
25
Sec.
2.
Section
403.19A,
subsection
1,
Code
2013,
is
amended
26
by
adding
the
following
new
paragraph:
27
NEW
PARAGRAPH
.
0f.
“Retained
job”
means
a
full-time
28
equivalent
position
in
existence
at
the
time
an
employer
29
applies
to
the
authority
for
approval
of
a
withholding
30
agreement
and
which
remains
continuously
filled
and
which
is
31
at
risk
of
elimination
if
the
project
for
which
the
employer
32
is
seeking
assistance
under
the
withholding
agreement
does
not
33
proceed.
34
Sec.
3.
Section
403.19A,
subsection
3,
paragraphs
a,
b,
c,
35
-1-
LSB
2325HV
(2)
85
md/sc
1/
8
H.F.
473
and
f,
Code
2013,
are
amended
to
read
as
follows:
1
a.
A
pilot
project
city
may
provide
by
ordinance
resolution
2
for
the
deposit
into
a
designated
account
in
the
special
3
withholding
project
fund
described
in
section
403.19,
4
subsection
2
,
of
the
targeted
jobs
withholding
credit
described
5
in
this
section
.
The
targeted
jobs
withholding
credit
shall
6
be
based
upon
the
wages
paid
to
employees
pursuant
to
a
7
withholding
agreement.
8
b.
An
amount
equal
to
three
percent
of
the
gross
wages
paid
9
by
an
employer
to
each
employee
under
a
withholding
agreement
10
shall
be
credited
from
the
payment
made
by
the
employer
11
pursuant
to
section
422.16
.
If
the
amount
of
the
withholding
12
by
the
employer
is
less
than
three
percent
of
the
gross
wages
13
paid
to
the
employees
covered
by
the
withholding
agreement,
14
the
employer
shall
receive
a
credit
against
other
withholding
15
taxes
due
by
the
employer
or
may
carry
the
credit
forward
for
16
up
to
ten
years
or
until
depleted,
whichever
is
the
earlier.
17
The
employer
shall
remit
the
amount
of
the
credit
quarterly,
18
in
the
same
manner
as
withholding
payments
are
reported
to
19
the
department
of
revenue,
to
the
pilot
project
city
to
be
20
allocated
to
and
when
collected
paid
into
a
designated
account
21
in
the
special
withholding
project
fund
for
the
urban
renewal
22
area
in
which
the
targeted
jobs
are
located
project
.
All
23
amounts
so
deposited
shall
be
used
or
pledged
by
the
pilot
24
project
city
for
an
urban
renewal
a
project
related
to
the
25
employer
pursuant
to
the
withholding
agreement.
26
c.
(1)
The
pilot
project
city
and
the
economic
development
27
authority
shall
enter
into
a
withholding
agreement
with
each
28
employer
concerning
the
targeted
jobs
withholding
credit.
The
29
withholding
agreement
shall
provide
for
the
total
amount
of
30
withholding
credits
awarded
,
as
negotiated
by
the
economic
31
development
authority,
the
pilot
project
city,
and
the
32
employer
.
An
agreement
shall
not
provide
for
an
amount
of
33
withholding
credits
that
exceeds
the
amount
of
the
qualifying
34
investment
made
in
the
project.
An
agreement
shall
not
be
35
-2-
LSB
2325HV
(2)
85
md/sc
2/
8
H.F.
473
entered
into
by
a
pilot
project
city
with
a
business
currently
1
located
in
this
state
unless
the
business
either
creates
or
2
retains
ten
new
jobs
or
makes
a
qualifying
investment
of
at
3
least
five
hundred
thousand
dollars
within
the
urban
renewal
4
area
pilot
project
city
.
The
withholding
agreement
may
5
have
a
term
of
years
negotiated
by
the
economic
development
6
authority,
the
pilot
project
city,
and
the
employer,
of
up
7
to
ten
years.
A
withholding
agreement
specifying
a
term
of
8
years
or
a
total
amount
of
withholding
credits
shall
terminate
9
upon
the
expiration
of
the
term
of
years
specified
in
the
10
agreement
or
upon
the
award
of
the
total
amount
of
withholding
11
credits
specified
in
the
agreement,
whichever
occurs
first.
An
12
employer
shall
not
be
obligated
to
enter
into
a
withholding
13
agreement.
An
agreement
shall
not
be
entered
into
with
an
14
employer
not
already
located
in
a
pilot
project
city
when
15
another
Iowa
community
is
competing
for
the
same
project
and
16
both
the
pilot
project
city
and
the
other
Iowa
community
are
17
seeking
assistance
from
the
authority.
18
(2)
The
pilot
project
city
and
the
economic
development
19
authority
shall
not
enter
into
a
withholding
agreement
after
20
June
30,
2013
2018
.
21
(3)
The
employer,
in
conjunction
with
the
pilot
project
22
city
,
shall
provide
on
an
annual
basis
to
the
economic
23
development
authority
information
documenting
the
total
24
amount
of
payments
and
receipts
under
a
withholding
agreement,
25
including
all
agreements
with
an
employer
to
suspend,
abate,
26
exempt,
rebate,
refund,
or
reimburse
property
taxes,
to
provide
27
a
grant
for
property
taxes
paid
or
a
grant
not
related
to
28
property
taxes,
or
to
make
a
direct
payment
of
taxes,
with
29
moneys
in
the
special
withholding
project
fund.
The
economic
30
development
authority
shall
verify
the
information
provided
by
31
the
pilot
project
city
and
determine
whether
the
pilot
project
32
city
and
the
employer
are
in
compliance
with
this
section
and
33
the
rules
adopted
by
the
economic
development
authority
to
34
implement
this
section
.
35
-3-
LSB
2325HV
(2)
85
md/sc
3/
8
H.F.
473
(4)
The
economic
development
authority
board,
on
behalf
of
1
the
authority,
shall
have
the
authority
to
approve
or
deny
a
2
withholding
agreement
and
according
to
the
provisions
of
this
3
section.
Each
withholding
agreement,
and
the
total
amount
of
4
withholding
credits
allowed
under
the
withholding
agreement,
5
shall
be
approved
by
the
economic
development
authority
board
6
after
taking
into
account
the
incentives
or
assistance
received
7
by
or
to
be
received
by
the
employer
under
other
economic
8
development
programs.
The
economic
development
authority
9
board
shall
only
deny
an
agreement
if
the
agreement
fails
to
10
meet
the
requirements
of
this
paragraph
“c”
or
the
local
match
11
requirements
in
paragraph
“j”
,
or
if
an
employer
is
not
in
good
12
standing
as
to
prior
or
existing
agreements
with
the
economic
13
development
authority.
The
authority
shall
have
the
authority
14
to
negotiate
a
withholding
agreement
and
may
suggest
changes
to
15
an
any
of
the
terms
of
the
agreement.
16
f.
If
the
economic
development
authority,
following
an
17
eighteen-month
performance
period
beginning
on
the
date
the
18
withholding
agreement
is
approved
by
the
authority
board,
19
determines
that
the
employer
ceases
to
meet
the
requirements
20
of
the
withholding
agreement
relating
to
retaining
jobs,
if
21
applicable
,
the
agreement
shall
be
terminated
by
the
economic
22
development
authority
and
the
pilot
project
city
and
any
23
withholding
credits
for
the
benefit
of
the
employer
shall
24
cease.
However,
in
regard
to
the
number
of
jobs
that
are
to
25
be
created
or
retained,
if
the
employer
has
met
the
number
of
26
jobs
to
be
created
or
retained
pursuant
to
the
withholding
27
agreement
and
subsequently
the
number
of
jobs
falls
below
the
28
required
level,
the
employer
shall
not
be
considered
as
not
29
meeting
the
job
requirement
until
eighteen
months
after
the
30
date
of
the
decrease
in
the
number
of
jobs
created
or
retained.
31
If
the
economic
development
authority,
following
a
three-year
32
performance
period
beginning
on
the
date
the
withholding
33
agreement
is
approved
by
the
authority
board,
determines
34
that
the
employer
has
not
or
is
incapable
of
meeting
the
35
-4-
LSB
2325HV
(2)
85
md/sc
4/
8
H.F.
473
requirements
of
the
withholding
agreement
relating
to
creating
1
jobs,
if
applicable,
or
the
requirement
of
the
withholding
2
agreement
relating
to
the
qualifying
investment
prior
to
the
3
end
of
the
withholding
agreement,
the
economic
development
4
authority
may
reduce
the
future
benefits
to
the
employer
under
5
the
agreement
or
negotiate
with
the
other
parties
to
terminate
6
the
agreement
early.
Notice
shall
be
provided
promptly
by
7
the
pilot
project
city
to
the
department
of
revenue
following
8
termination
of
a
withholding
agreement.
9
Sec.
4.
Section
403.19A,
subsection
3,
paragraph
d,
10
subparagraph
(1),
Code
2013,
is
amended
to
read
as
follows:
11
(1)
A
copy
of
the
adopted
local
development
agreement
12
plan
of
between
the
pilot
project
city
and
the
employer
13
that
outlines
local
incentives
or
assistance
for
the
project
14
using
urban
renewal
or
urban
revitalization
incentives,
if
15
applicable
.
16
Sec.
5.
Section
403.19A,
subsection
3,
Code
2013,
is
amended
17
by
adding
the
following
new
paragraph:
18
NEW
PARAGRAPH
.
0f.
Pursuant
to
rules
adopted
by
the
19
economic
development
authority,
the
pilot
project
city
20
shall
provide
on
an
annual
basis
to
the
economic
development
21
authority
information
documenting
the
compliance
of
each
22
employer
with
each
requirement
of
the
withholding
agreement,
23
including
but
not
limited
to
the
number
of
jobs
created
or
24
retained
and
the
amount
of
investment
made
by
the
employer.
25
The
economic
development
authority
shall,
in
response
to
26
receiving
such
information
from
the
pilot
project
city,
assess
27
the
level
of
compliance
by
each
employer
and
provide
to
the
28
pilot
project
city
recommendations
for
either
maintaining
29
employer
compliance
with
the
withholding
agreement
or
30
terminating
the
agreement
for
noncompliance
under
paragraph
31
“f”
.
The
economic
development
authority
shall
also
provide
each
32
such
assessment
and
recommendation
report
to
the
department
of
33
revenue.
34
Sec.
6.
APPLICABILITY.
35
-5-
LSB
2325HV
(2)
85
md/sc
5/
8
H.F.
473
1.
Except
as
provided
in
subsection
2,
this
Act
applies
to
1
withholding
agreements
entered
into
on
or
after
the
effective
2
date
of
this
Act
and
withholding
agreements
entered
into
by
3
a
pilot
project
city
prior
to
the
effective
date
of
this
Act
4
shall
be
governed
by
section
403.19A,
Code
2013.
5
2.
The
section
of
this
Act
enacting
section
403.19A,
6
subsection
3,
paragraph
“0f”,
applies
to
withholding
agreements
7
entered
into
prior
to
the
effective
date
of
this
Act
or
entered
8
into
on
or
after
the
effective
date
of
this
Act.
9
EXPLANATION
10
This
bill
modifies
the
targeted
jobs
withholding
tax
credit
11
program,
which
is
a
pilot
program
enacted
in
2006
to
allow
12
the
diversion
of
withholding
funds
paid
by
an
employer
to
be
13
matched
by
a
designated
pilot
project
city
to
create
economic
14
incentives
that
can
be
directed
toward
businesses
located
15
within
urban
renewal
areas
in
the
city
pursuant
to
the
terms
of
16
a
withholding
agreement
with
a
business
and
after
approval
of
17
the
agreement
by
the
Iowa
economic
development
authority.
18
The
bill
removes
the
requirement
that
an
employer
that
is
a
19
party
to
a
withholding
agreement
with
a
pilot
project
city
be
20
located
in
an
urban
renewal
area.
The
bill
removes
a
similar
21
requirement
relating
to
the
definition
of
targeted
job.
The
22
bill
makes
corresponding
changes
to
Code
section
403.19A
to
23
reflect
the
removal
of
the
urban
renewal
area
requirement,
24
including
providing
that
the
targeted
jobs
withholding
credits
25
be
deposited
in
a
withholding
project
fund
rather
than
the
26
special
fund
established
for
urban
renewal
purposes.
27
The
bill
allows
a
pilot
project
city
to
provide
for
the
28
deposit
of
the
amount
of
the
targeted
jobs
withholding
credit
29
into
the
city’s
withholding
project
fund
by
resolution,
rather
30
than
by
ordinance.
31
The
bill
provides
a
definition
of
long-term
lease
costs
as
32
part
of
the
definition
of
qualifying
investment
under
the
pilot
33
program
and
provides
a
definition
of
retained
job.
34
Under
current
law,
a
pilot
project
city
may
not
enter
into
a
35
-6-
LSB
2325HV
(2)
85
md/sc
6/
8
H.F.
473
withholding
agreement
after
June
30,
2013.
The
bill
adds
the
1
economic
development
authority
to
the
list
of
required
parties
2
to
a
withholding
agreement
and
prohibits
a
pilot
project
city
3
and
the
economic
development
authority
from
entering
into
a
4
withholding
agreement
after
June
30,
2018.
The
bill
specifies
5
subject
areas
of
a
withholding
agreement
that
may
be
negotiated
6
by
the
parties
and
provides
that
a
withholding
agreement
that
7
specifies
a
term
of
years
or
a
total
amount
of
withholding
8
credits
shall
terminate
upon
expiration
of
the
term
of
years
9
or
upon
the
award
of
the
total
amount
of
withholding
credits,
10
whichever
occurs
first.
11
The
bill
requires
the
reporting
of
certain
withholding
12
agreement
payment
and
receipt
information
by
the
employer,
13
in
conjunction
with
the
pilot
project
city,
and
requires
the
14
economic
development
authority
to
verify
such
information
and
15
determine
whether
the
pilot
project
city
and
the
employer
are
16
in
compliance
with
Code
section
403.19A
and
rules
adopted
to
17
implement
that
Code
section.
18
The
bill
provides
that
the
economic
development
authority
19
board
approves
or
denies
a
withholding
agreement
on
behalf
of
20
the
authority
and
specifies
considerations
to
be
made
by
the
21
board
in
deciding
whether
to
approve
or
deny
a
withholding
22
agreement.
23
The
bill
establishes
an
18-month
performance
period
24
following
which
the
economic
development
authority
determines
25
compliance
with
the
job
retention
requirements
of
the
26
withholding
agreement,
if
applicable,
establishes
a
three-year
27
performance
period
following
which
the
authority
determines
28
compliance
with
the
job
creation
and
investment
requirements
29
of
the
withholding
agreement,
and
specifies
the
actions
to
30
be
taken
by
the
authority
and
the
pilot
project
city
after
a
31
determination
of
noncompliance.
32
Except
as
otherwise
provided
in
the
bill,
the
bill
applies
33
to
withholding
agreements
entered
into
by
a
pilot
project
city
34
on
or
after
the
effective
date
of
the
bill.
The
bill
provides
35
-7-
LSB
2325HV
(2)
85
md/sc
7/
8
H.F.
473
that
withholding
agreements
entered
into
by
a
pilot
project
1
city
prior
to
the
effective
date
of
the
bill
shall
be
governed
2
by
Code
section
403.19A,
Code
2013.
However,
the
section
of
3
the
bill
enacting
Code
section
403.19A(3)(0f),
relating
to
4
compliance
reporting,
applies
to
withholding
agreements
entered
5
into
prior
to,
on,
or
after
the
effective
date
of
the
bill.
6
-8-
LSB
2325HV
(2)
85
md/sc
8/
8
