Policy Perspectives
March 20, 2016
Professional Developers of Iowa's Bill Tracker is HERE 
March Madness Begins
at the Iowa State Capitol

 
Monday, March 21st will mark the 71st Day of the 100-day scheduled legislative session, a mere four weeks away from target adjournment when legislative per diems end. Granted, the Legislature can (and often does) go over the deadline. However, there is typically an increased pressure to wrap up the session once the last scheduled day arrives.
 
On Wednesday, March 16th, the Revenue Estimating Conference (REC) met to make their predictions about state revenues. The verdict was that revenues for the state are UP slightly when compared to their December predictions - somewhere between $23M and $30M for FY2017, the fiscal year that begins July 1, 2016. Revenues being up means the Legislature is required to use those earlier December predictions (which means the budget "targets" we sent out a few issues ago will be the road map they use). The REC bottom line is that the Legislature and the Governor have about $300 million more they can allocate in this budget than the current fiscal year. A large portion of this increase is already spoken for through built-in increases, and any education funding increase will also take a large bite.
 
With the funnel deadlines reached and the new REC projections announced, the Legislature will likely kick into high gear this week and start to prepare and negotiate budget bills. As the budget bills start their journeys through the legislative process, the number of remaining policy bills will continue to get smaller as leaders in both chambers assess whether to pass certain bills or whether to throw them overboard for the year due to lack of bipartisan and/or bicameral support.
 
School funding, an issue that has been at the center of the legislature's discussion all session, remains unresolved. We keep hearing from different sources that the multiple sides have settled on 2.5% for next year's increase, however a bill to enact that level has yet to start moving through the process. Before the appropriations bills can be settled upon, school funding will need to be addressed (probably this week), since any adjustment in this particular funding item has a dramatic effect on the rest of the budget.
 
One contentious issue that was nailed down this past week was whether or not to update the Iowa tax code to reflect changes in the federal tax code. In the media, this issue is often referred to as "coupling" (meaning coupling with the federal tax code). The Legislature and the Governor were able to reach agreement on a proposal that would ensure $95 million in tax cuts take effect this year. In order to gain agreement, the legislation also clarifies the intent of a sales tax exemption for materials that are used in manufacturing (known as "consumables.") The exemption was enacted by the Governor over the interim using a rule change, but many legislators argued at the time that the change should have been voted upon by the Legislature.

The Latest on TIF
Thank you to those of you that answered the call and weighed in with legislators about the TIF Bill (formerly HSB 639, now HF 2435).  Since the last edition of Policy Perspectives, the bill was passed by the House Ways & Means Committee, as predicted.  However, the full Iowa House has not yet taken up HF 2435. 

We're hoping that, if PDI members continue to call and email their House members, that HF 2435 will simply stay where it is on the House Calendar and the session will wrap up without further action.  Please take some time to reach out to your House member and let them know you would prefer to see no more action taken on TIF legislation this year. 

Not sure who represents you in the Iowa House?  Click HERE.
 


Renewable Chemical Production Tax Credit 

The Renewable Chemical Production Tax Credit (SF 2285) legislation took two more significant steps forward on March 16th - passage in the full Senate, 46-3, and unanimous passage by the House Ways & Means Committee - and is now one step away from a trip to the Governor's Desk for his signature.  You may recall that last year the bill was unable to gain traction in the Senate, so supporters breathed a sigh of relief this year watching the 46-3 vote come together.  We anticipate the full House will take up and pass SF 2285 in the days ahead.
 
SF 2285, the Renewable Chemical Production Tax Credit bill, passing the Iowa Senate, 46-3, on March 16th, 2016.

Legislative Forums
Advocate with your State Senator and Representative!! Please follow that link below to find out where legislative forums are occurring in your area!!
 
 
If you know of other legislative forums that do not appear on this list, let us know at info@ialobby.com!
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Bills Being Tracked for PDI

Below is a table of the bills we are tracking for you. Please be sure to check the "Bill Tracker" link at the top and bottom of this message to see a more current version.

Bill# Title Status
HF2111 
Abandoned Building Program
Summary | Details 
House Appropriations Committee 
 
Makes changes to city eligibility requirements for receipt of abandoned building program funding assistance.
HF2242 
Workforce Housing Tax Incentives Program
Summary | Details 
House Ways & Means Committee 
 
Increases to $25 million from $20 million the maximum amount of tax credits that the economic development authority may annually allocate to the workforce housing tax incentives program.
HF2260 
SAVE Fund Extension
Summary | Details 
House Ways & Means Committee 
 
Extends the Secure an Advanced Vision for Education (SAVE) fund to January 1, 2050.
HF2352 
Water Service Taxation
Summary | Details 
House Ways & Means Committee 
 
Exempts water service by a utility from the state sales tax. Creates a state excise tax on water utility sales. Allows counties to impose a local water service tax.
HF2382 
SAVE Fund
Summary | Details 
House Ways & Means Committee 
 
Extends the state sales tax of 6% until January 1, 2050, to support the Secure and Advanced Vision for Education (SAVE) fund, and modifies use of SAVE revenues to include water quality initiatives.
HF2392 
Academic/Career Guidance & CTE Programs
Summary | Details 
Senate Floor
 
Modifies provisions relating to a student plan for progress toward high school graduation, which each eighth grade student enrolled in a school district must complete. Modifies provisions related to career and technical education.
HF2412 
Economic Development Authority
Summary | Details 
House Ways & Means Committee 
 
Makes changes to programs and duties of the Economic Development Authority. Modifies life cycle cost analysis provisions relating to public facilities, makes technical changes pertaining to the high quality jobs program, modifies economic development authority assistance provisions under the business outreach program, modifies provisions concerning enterprise zones, and transfers certain duties to the authority under the historic preservation and cultural entertainment district tax credit program.
HF2433 
Tax Coupling and Sales Tax (Consumables) Changes
Summary | Details 
Sent to Governor 
 
Makes several changes to state taxation.
HF2435 
TIF Changes
Summary | Details 
House Floor
 
This bills makes a number of changes to tax increment financing.
HF2438 
High Quality Jobs Program & Chemical Production Tax Credit Program
Summary | Details 
House Ways & Means Committee 
 
Relates to the administration of programs by the Economic Development Authority (EDA) by modifying the high quality jobs program and creating a renewable chemical production tax credit program.
HF628 
Tax Increment Financing (TIF) Changes
Summary | Details 
House Ways & Means Committee 
 
Bans the use of TIF for public buildings, limits existing TIF's without an end date by ratcheting up the base by 7.5 percent per year, limits new TIF districts to 20 years. 
HF656 
IEDA Tax Credits - Renewable Chemical
Summary | Details 
Senate Ways & Means Committee 
 
Makes changes to the administration of tax credits by the Iowa Economic Development Authority.
HJR2008 
Manufacturing Sales and Use Tax Exemptions
Summary | Details 
House Ways & Means Committee 
 
Nullifies several Department of Revenue administrative rules and amendments relating to the manufacturing sales and use tax exemptions.
HR102 
ISBDC and 2016 Award Winners Recognition
Summary | Details 
Adopted
 
Recognizes Iowa Small Business Development Centers and honors 2016 award winners.
HSB256 
IWILL, Formula Changes, AMT
Summary | Details 
House Ways & Means Committee 
 
Implements the 3/8 cent sales tax increase for the Natural Resources and Outdoor Recreation Trust Fund.  Also contains significant changes to the Trust Fund's voter-approved funding formula and creates an Iowa Alternative Minimum Tax (AMT).
SF2005 
Property Tax Revenue from Wind Energy
Summary | Details 
Senate Ways & Means Committee 
 
Authorizes municipalities to provide for the division of property tax revenue (tax increment financing) collected against wind energy conversion property located within an urban renewal area.
SF2006 
Property Taxes for Wind Energy
Summary | Details 
Senate Ways & Means Committee 
 
Authorizes municipalities to provide for the division of property tax revenue (tax increment financing) collected against property located within an urban renewal area.
SF2018 
Urban Renewal Law
Summary | Details 
Senate Ways & Means Committee 
 
Prohibits urban renewal plans and projects from using TIF revenues for a tax-exempt public building.
SF2067 
Residential Metered Water
Summary | Details 
Senate Ways & Means Committee 
 
Exempts from the state sales tax the sales price from the sale or furnishing of water to residential customers and creates state and local residential water excise taxes.
SF2102 
Drug Prescribing and Dispensing Information Program
Summary | Details 
Sent to Governor
 
Requires the Board of Pharmacy to implement improvements to facilitate secure access to the Iowa Prescription Monitoring Program through electronic health and pharmacy information systems.
SF2154 
Economic Development Authority
Summary | Details 
House Floor
 
Makes changes to programs and duties of the Economic Development Authority.
SF2179 
High Quality Jobs Program & Chemical Production Tax Credit Program
Summary | Details 
Senate Ways & Means Committee 
 
Permits the Economic Development Authority to provide additional tax incentives to businesses using apprenticeship training program contractors and subcontractors for projects in which qualifying investments are made under the high quality jobs program.
SF2212 
Sales Tax Rebate
Summary | Details 
Senate Ways & Means Committee 
 
Modifies the rebate of state sales tax to the owner or operator of a baseball and softball tournament facility and movie site.
SF2229 
Community Catalyst Building Remediation Program
Summary | Details 
House Floor
 
Creates a community catalyst building remediation fund for the remediation of underutilized buildings.
SF2246 
Water Quality Initiative
Summary | Details 
Senate Appropriations Committee 
 
Redirects wagering tax receipts from the Vision Iowa fund to the water quality initiative fund beginning in FY2017-2018.  Makes an appropriation of $30.4 million from the general fund for FY 2015-2016 to the state bond repayment fund.
SF2280 
Enhance Iowa
Summary | Details 
Senate Appropriations Committee 
 
Creates Enhance Iowa Board, establishes Enhance Iowa Fund, and establishes sports tourism program.
SF2300 
High Quality Jobs Program & Chemical Production Tax Credit Program
Summary | Details 
House Floor
 
Relates to the administration of programs by the economic development authority (EDA) by modifying the high quality jobs program and creating a renewable chemical production tax credit program.
SSB1272 
Iowa Water & Land Legacy (IWILL)
Summary | Details 
Senate Ways & Means Committee 
 
Raises the state's sales tax to fund the Natural Resources and Outdoor Recreation Trust Fund.
SSB3051 
Governor's Transportation Budget
Summary | Details 
Senate Appropriations Committee 
 
Governor's Transportation Budget.
SSB3080 
Solar Energy Tax Credits
Summary | Details 
Senate Ways & Means Committee 
 
Increases the amount of business and residential solar energy tax credits that may be claimed annually.
SSB3162 
Governor's Infrastructure Funding Bill.
Summary | Details 
Senate Appropriations Committee 
 
Governor's infrastructure funding bill.
SSB3163 
Construction Equipment Sales Tax
Summary | Details 
Senate Ways & Means Committee 
 
Provides that the purchase of construction equipment for a subsequent lease or rental that will qualify for the construction equipment exemption will only fail to qualify for the sale-for-resale exemption if the sale is to a nonqualified dealer. 
SSB3169 
Energy Efficiency Improvement District
Summary | Details 
Senate Ways & Means Committee 
 
Authorizes one or more counties and one or more cities within those counties to create an energy efficiency improvement district to finance energy efficiency improvement projects for the benefit of property within the district.
SSB3170 
Tax Exemptions for Broadband Infrastructure
Summary | Details 
Senate Ways & Means Committee 
 
Establishes a property tax exemption for the value of certain broadband infrastructure used to deliver internet service to the public.
    




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