Economic Growth – Week of February 18, 2011

STAFF CONTACT:     Sue Foecke

SF 71 – CAT and RECAT Waivers for local matching

SF 178 – Redevelopment Tax Credits and Community Partnership Program Appropriation

COMMITTEE ACTION:

SF 71 provides for matching waivers for applicants under the Community Attraction and Tourism Program (CAT) and the River Enhancement Community Attraction and Tourism Program (RECAT). In 2009, the Legislature passed Senate File 336 providing for waivers for applicants under CAT and RECAT for matching funds requirements if the applicants are located in declared disaster areas (governor or federal official declared). Senate File 336 was only applicable for the dates of July 1, 2009, and June 30, 2010 (Fiscal Year 2010). In order to extend the availability of waivers, Senate File 71 puts the waiver requirements into Iowa Code, allows for current and future disasters to apply for a waiver within two years of the date the disaster declaration was issued and the applicant shall demonstrate that a waiver is necessary. In committee, an amendment was adopted to allow applicants in disaster declared areas of 2008 until June 30, 2013, to apply for a waiver, other disaster-related applicants will still have only two years to apply for the waiver. In the bill, the applicant has to demonstrate that a waiver is necessary as a result of the natural disaster. The board may grant a waiver for all or a portion of the amount requested. [2/10: short form]

SF 178 requires the Department of Economic Development (IDED) to allocate at least $5 million of tax credits for the purposes of the Redevelopment Tax Credits program. The Redevelopment Tax Credit is available to taxpayers that invest in redeveloping a brownfield or grayfield site. The tax credits are placed under the Department’s current aggregate tax credit limitation of $120 million. In addition, the bill appropriates $200,000 from the general fund for the Community Partnership Program to support deconstruction, renovation or removal of derelict buildings in communities of 5,000 or less. An amendment adopted in committee clarifies the definition of “qualifying investment.” In addition, the amendment allows IDED to provide information on alternative forms of assistance to participants in the brownfield redevelopment program and provides that IDED may require certain additional information of applicants. The amendment makes changes to the administration of the program. The amendment specifies a detailed process for verification of eligibility, including the registration of projects, the review of applications, and the issuance of letters containing preliminary approval for an amount and audit of a project to IDED before a tax credit certificate may be issued. [2/15: short form, Greiner “no”, Hatch excused]