Economic Development - Iowa Chamber Alliance

Economic Development

Incentives are a central part of Iowa’s economic development success. Properly designed and responsible incentives, like those utilized in Iowa, help land projects, expand Iowa businesses, create jobs, and do all these things while ensuring transparency, accountability and a return on investment for Iowa taxpayers. Economic development is highly competitive and as Iowa continues to improve its business climate, prepare its workforce, and make its communities as attractive as possible, incentives are an integral part of economic development success.

Iowa must continue to provide valuable economic development tax credits and programs that complement Iowa’s tax code. The Iowa Chamber Alliance supports the regular, comprehensive review of all tax credits for usefulness, efficacy and return on investment. The Alliance opposes changes to or elimination of economic development-oriented tax credits without such a review.

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 and new innovations. The RAC has been a driver for job creation and wage growth.
  • Angel Investor Tax Credit: This credit encourages investments in start-up companies in Iowa, boosting new business and the general economy.
  • Renewable Fuels & Biochemicals: Iowa leads the nation in biofuel production and is well-positioned to lead in innovative bio-fuel and biochemical development.

Job Creation & Workforce

  • High Quality Jobs Credits: This tax program 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 financial incentives for the development of quality affordable housing for its current and expanding workforce. The Alliance supports expanding this credit by increasing the amount of money available to it and adjusting the thresholds for projects to reflect Iowa’s diverse communities and their specific workforce housing needs.
  • Iowa Jobs Training Programs (260E & 260F): Administered by Iowa’s 15 community colleges, these programs expand Iowa’s workforce through new employee training, increasing employee skills and improving productivity.

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 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

The Alliance supports the goals of the Reynolds-Gregg Administration’s Empower Rural Iowa Initiative focused on rural and small community economic development. Iowa’s demographic, geographic wealth distribution, and population trends all indicate the most rural areas and communities in Iowa are struggling economically. Current commodity prices, trade challenges and economic forecasts point toward continued difficulties in these areas of the state. The Alliance supports 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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