Economic Development - Iowa Chamber Alliance

Economic Development

Incentives work. Job-creating incentives help land projects, expand Iowa businesses, and create jobs. Economic development is highly competitive and the competition is no longer limited to the region, but with the entire country. In fact, Iowa finds itself in direct competition with many nation-states – each of whom has their own set of economic development tools and incentives – often backed with far more financial resources than Iowa has allocated.

Iowa must continue to provide valuable economic development tax credits and programs that complement proposed tax code reforms. These are essential in creating a competitive business environment which encourages existing and potential businesses to invest in Iowa.

Iowa has been nationally lauded for awarding tax credits as opposed to direct cash incentives. This ensures higher accountability where awardees only receive the financial benefit if they do what they are committed to do.

Existing Initiatives

The Iowa Chamber Alliance supports tax credits and programs that have a documented return on investment with clear objectives of growing the economy through capital investment, spurring higher wages, and creating quality jobs. These economic development tools fall under three general categories:

INNOVATION

  • Research Activities Credits: Companies must balance substantial financial risk with market profitability. The credit allows businesses to strategically plan for the long term – encouraging additional investment in their employees or new innovations.
  • Angel Investor Tax Credit: This credit encourages “angel investors” to make investments in start-up companies in Iowa, boosting new business and the general economy.

WORKFORCE

  • High Quality Jobs Credits: This tax credit acts as a key incentive for businesses that invest right here in the state and helps increase the availability of jobs essential to Iowa’s industries.
  • Workforce Housing Tax Credits: The program covers the basic needs of a community by providing quality affordable housing for its current and expanding workforce.
  • Iowa Jobs Training Programs (260E & 260F): Administered by one of Iowa’s 15 community colleges, these programs expand Iowa’s workforce through new employee training increasing the employees’ skill set and improving productivity for employers.

REVITALIZATION

  • Historic Preservation Credits: The tax credit aids in revitalizing and continuing the legacy of important properties that have made Iowa a thriving economy.
  • Redevelopment Tax Credits: Otherwise known as the “Brownfields/Grayfields Tax Credit,” this tax credit promotes investments in a community, which can increase general economic health by eliminating environmental hazards and cleaning up neighborhood eyesores.

Finally, local economic development tools, such as Tax Increment Financing, are critical and integral pieces of Iowa’s economic development efforts and generate a significant return on investment for the taxpayer dollars. The Alliance will vigorously work to ensure their continued strength, flexibility, and availability.

New Initiatives

An initiative centered on rural and small community economic development should be considered. Iowa’s demographic, geographic wealth distribution, and population trends all indicate the most rural areas and communities in Iowa are struggling. Current commodity prices and forecasts point toward continued difficulties in these areas. The Alliance proposes a review of existing incentives and programs that may be able to be coupled together and focused on rural economic development opportunities to help turn the trend.

 

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