Bill Text: IA HSB204 | 2019-2020 | 88th General Assembly | Introduced

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Bill Title: A bill for an act creating an empower rural Iowa Act to provide incentives for broadband and workforce housing, and including applicability provisions.

Spectrum: Committee Bill

Status: (N/A - Dead) 2019-04-10 - Committee report, recommending amendment and passage. H.J. 811. [HSB204 Detail]

Download: Iowa-2019-HSB204-Introduced.html

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House Study Bill 204 - Introduced
SENATE/HOUSE FILE _____
BY (PROPOSED GOVERNOR BILL)
A BILL FOR
An Act creating an empower rural Iowa Act to provide incentives
for broadband and workforce housing, and including
applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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DIVISION I
TITLE OF ACT
Section 1. TITLE OF ACT. This Act shall be known and may be
cited as the “Empower Rural Iowa Act”.
DIVISION II
BROADBAND
Sec. 2. Section 8B.1, Code 2019, is amended by adding the
following new subsection:
NEW SUBSECTION . 4A. “Facilitate” means a communication
service provider’s ability to provide broadband service at
or above the download and upload speeds identified by the
office by rule to a home, farm, school, or business within a
commercially reasonable time and at a commercially reasonable
price upon request by a consumer.
Sec. 3. Section 8B.1, subsection 12, Code 2019, is amended
to read as follows:
12. “Targeted service area” means a United States census
bureau census block located in this state, including any crop
operation located within the census block, within which no
communications service provider offers or facilitates broadband
service at or above twenty-five megabits per second of download
speed and three megabits per second of upload speed as of July
1, 2015 the download and upload speeds identified by the office
by rule as of the date identified by the office by rule, which
speeds and date may be updated by the office periodically as
the office deems appropriate .
Sec. 4. Section 8B.10, subsection 1, Code 2019, is amended
to read as follows:
1. The determination of whether a communications service
provider offers or facilitates broadband service meeting the
download or upload speeds specified in the definition of
targeted service area in section 8B.1 identified by the office
by rule shall be determined or ascertained by reference to
broadband availability maps or data sources that are widely
accepted for accuracy and available for public review and
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comment and that are identified by the office by rule.
Sec. 5. Section 8B.11, subsection 1, Code 2019, is amended
to read as follows:
1. The office shall administer a broadband grant program to
award grants to communications service providers that reduce
or eliminate targeted service areas by installing broadband
infrastructure that facilitates broadband service at or above
the download and upload speeds identified by the office by rule
in targeted service areas in accordance with this section .
Sec. 6. Section 8B.11, subsection 2, paragraph c, Code 2019,
is amended to read as follows:
c. Notwithstanding section 8.33 , moneys in the fund
that remain unencumbered or unobligated at the close of the
fiscal year shall not revert but shall remain available for
expenditure for the purposes designated until the close of
the succeeding fiscal year three years following the last
day of the fiscal year in which the funds were originally
appropriated .
Sec. 7. Section 8B.11, subsection 3, Code 2019, is amended
to read as follows:
3. Communications service providers may apply to the office
for a grant pursuant to this section for the installation of
broadband infrastructure that facilitates broadband service
at or above twenty-five megabits per second of download speed
and three megabits per second of upload speed the download and
upload speeds identified by the office by rule in targeted
service areas. The office shall include representatives from
schools, communities, agriculture, industry, and other areas
as appropriate to review and recommend grant awards. The
office shall conduct an open application review process and
include a public internet site for applications, results, and
performance.
Sec. 8. Section 8B.11, subsection 4, paragraph b, Code 2019,
is amended to read as follows:
b. Except as otherwise provided in this section , the The
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office shall not evaluate applications based on the office’s
knowledge of the applicant except for the broadband grants in
a fair and unbiased manner, and may consider any information
obtained by the office outside of the application process in
addition to information provided in the an application.
Sec. 9. Section 8B.11, subsections 7 and 8, Code 2019, are
amended to read as follows:
7. The office shall not award a grant pursuant to this
section on or after July 1, 2020 2025 .
8. The office shall may adopt rules pursuant to chapter 17A
interpreting this chapter or necessary for administering this
chapter , including but not limited to rules relating to the
broadband grant program process, management, and measurements
as deemed necessary by the office.
Sec. 10. Section 427.1, subsection 40, paragraphs a and b,
Code 2019, are amended to read as follows:
a. The owner of broadband infrastructure shall be entitled
to an exemption from taxation to the extent provided in this
subsection for assessment years beginning before January 1,
2022 2027 . For the purposes of Unless the context otherwise
requires, the words and phrases used in this subsection ,
“broadband infrastructure” and “targeted service area” mean the
same as shall have the same meaning as the words and phrases
used in chapter 8B, including but not limited to the words and
phrases defined in section 8B.1 .
b. The exemption shall apply to the installation of
broadband infrastructure that facilitates broadband service
at or above twenty-five megabits per second of download speed
and three megabits per second of upload speed the download and
upload speeds identified by the office of the chief information
officer by rule commenced and completed on or after July 1,
2015, and before July 1, 2020 2025 , in a targeted service area,
and used to deliver internet services to the public. A person
claiming an exemption under this subsection shall certify to
the local assessor prior to commencement of the installation
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that the broadband installation of broadband infrastructure
will take place facilitate broadband service at or above the
download and upload speeds identified by the office of the
chief information officer by rule within a targeted service
area and shall specify the current number of homes, farms,
schools, and businesses in the targeted service area that were
offered broadband service and the download and upload speeds
available prior to the broadband infrastructure installation
for which the exemption is claimed and the number of homes,
farms, schools, and businesses in the targeted service area
that will be offered broadband service and the download
and upload speeds that will be available as a result of
installation of the broadband infrastructure for which the
exemption is claimed.
Sec. 11. Section 427.1, subsection 40, paragraph f,
subparagraph (1), subparagraph division (d), Code 2019, is
amended to read as follows:
(d) Certification from the office of the chief information
officer pursuant to section 8B.10 that the installation is
being performed or was completed will facilitate broadband
service at or above the download and upload speeds identified
by the office of the chief information officer by rule in
a targeted service area. Certification from the office of
the chief information officer that broadband infrastructure
installed in a targeted service area facilitates broadband
service at or above twenty-five megabits per second of download
speed and three megabits per second of upload speed.
DIVISION III
WORKFORCE HOUSING TAX INCENTIVE PROGRAM
Sec. 12. Section 15.119, subsection 2, paragraph g, Code
2019, is amended to read as follows:
g. The workforce housing tax incentives program administered
pursuant to sections 15.351 through 15.356 . In allocating
tax credits pursuant to this subsection , the authority shall
not allocate more than twenty twenty-five million dollars for
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purposes of this paragraph. Of the moneys allocated under
this paragraph, five ten million dollars shall be reserved for
allocation to qualified housing projects in small cities, as
defined in section 15.352 , that are registered on or after July
1, 2017.
Sec. 13. Section 15.352, subsection 10, Code 2019, is
amended to read as follows:
10. “Small city” means any city or township located in this
state, except those located wholly within one or more of the
eleven most populous counties in the state, as determined by
the most recent federal decennial census population estimates
issued by the United States bureau of census . For the purposes
of this part, a small city that is located in more than one
county shall be considered to be located in the county having
the greatest taxable base within the small city.
Sec. 14. Section 15.354, subsection 1, paragraph a, Code
2019, is amended to read as follows:
a. A housing business seeking workforce housing tax
incentives provided in section 15.355 shall make application to
the authority in the manner prescribed by the authority. The
authority may accept applications on a continuous basis during
one or more annual application periods to be determined by the
authority by rule .
Sec. 15. Section 15.354, subsection 2, Code 2019, is amended
to read as follows:
2. Registration. Application review —— tax incentive award.
a. All completed applications shall be reviewed and scored
on a competitive basis by the authority pursuant to rules
adopted by the authority.
a. b. Upon review of the application, the authority
may register the housing project under the program. If the
authority registers the housing project, the authority shall
make a preliminary determination as to the amount of tax
incentives for which the housing project qualifies and scoring
of all applications received during an application period, the
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authority may make a tax incentive award to a housing project,
which tax incentive award shall represent the maximum amount of
tax incentives the housing project may qualify for under the
program . In determining a tax incentive award, the authority
shall not use an amount of project costs that exceeds the
amount included in the application of the housing business.
Tax incentive awards shall be approved by the director of the
authority.
b. c. After registering the housing project making a
tax incentive award , the authority shall notify the housing
business of successful registration under the program its tax
incentive award . The notification shall include the amount
of tax incentives under section 15.355 for which the housing
business has received preliminary approval an award and a
statement that the amount is a preliminary determination only
housing business has no right to receive a tax incentive
certificate or claim a tax incentive until all requirements
of the program, including all requirements imposed by the
agreement entered into pursuant to subsection 3, are satisfied .
The amount of tax credits included on a tax credit certificate
issued pursuant to this section , or a claim for refund of sales
and use taxes, shall be contingent upon completion of the all
requirements in subsection 3 .
d. An applicant that does not receive a tax incentive award
during an application period may make additional applications
during subsequent application periods. Such applicant shall be
required to submit a new application and shall be competitively
reviewed and scored in the same manner as other applicants in
that application period.
Sec. 16. Section 15.354, subsection 3, paragraphs a and e,
Code 2019, are amended to read as follows:
a. Upon successful registration of receipt of a tax
incentive award by the housing project, the housing business
shall enter into an agreement with the authority for the
successful completion of all requirements of the program. The
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agreement shall identify the tax incentive award amount, the
tax incentive award date, the project completion deadline, and
the total costs of the housing project.
e. (1) Upon review of the examination and verification
of the amount of the qualifying new investment, the authority
may notify the housing business of the amount that the housing
business may claim as a refund of the sales and use tax under
section 15.355, subsection 2, and may issue a tax credit
certificate to the housing business stating the amount of
workforce housing investment tax credits under section 15.355 ,
subsection 3, the eligible housing business may claim. The
sum of the amount that the housing business may claim as a
refund of the sales and use tax and the amount of the tax credit
certificate shall not exceed the amount of the tax incentive
award.
(2) If upon review of the examination in subparagraph
(1) the authority determines that a housing project has
incurred project costs in excess of the amount submitted in the
application made pursuant to subsection 1 and identified in the
agreement , the authority shall do one of the following:
(a) If the project costs do not cause the housing project’s
average dwelling unit cost to exceed the applicable maximum
amount authorized in section 15.353, subsection 3 , the
authority may consider the agreement fulfilled and may issue a
tax credit certificate.
(b) If the project costs cause the housing project’s
average dwelling unit cost to exceed the applicable maximum
amount authorized in section 15.353, subsection 3 , but does not
cause the average dwelling unit cost to exceed one hundred ten
percent of such applicable maximum amount, the authority may
consider the agreement fulfilled and may issue a tax credit
certificate. In such case, the authority shall reduce the tax
incentive award and the corresponding amount of tax incentives
the eligible housing project may claim under section 15.355,
subsections 2 and 3 , by the same percentage that the housing
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project’s average dwelling unit cost exceeds the applicable
maximum amount under section 15.353, subsection 3 , and such
tax incentive reduction shall be reflected on the tax credit
certificate. If the authority issues a certificate pursuant
to this subparagraph division, the department of revenue
shall accept the certificate notwithstanding that the housing
project’s average dwelling unit costs exceeds the maximum
amount specified in section 15.353, subsection 3 .
(c) If the project costs cause the housing project’s
average dwelling unit cost to exceed one hundred ten percent
of the applicable maximum amount authorized in section 15.353,
subsection 3 , the authority shall determine the eligible
housing business to be in default under the agreement , shall
revoke the tax incentive award, and shall not issue a tax
credit certificate. The housing business shall not be allowed
a refund of sales and use tax under section 15.355, subsection
2.
Sec. 17. Section 15.354, subsection 4, Code 2019, is amended
by striking the subsection and inserting in lieu thereof the
following:
4. Maximum tax incentives amount.
a. (1) For fiscal years beginning on or after July 1, 2019,
the authority shall not award in any fiscal year an amount of
tax incentives for housing projects located in small cities, or
for other housing projects, in excess of the amounts allocated
for each category in section 15.119, subsection 2, paragraph
“g” . This paragraph “a” applies to housing projects awarded tax
incentives pursuant to subsection 2 on or after July 1, 2019,
and to housing projects registered prior to July 1, 2019, under
section 15.354, subsection 2, Code 2019.
(2) Notwithstanding subparagraph (1), and section 15.119,
subsection 2, paragraph “g” , if the sum of the amount of tax
incentives applied for in valid applications submitted in a
given fiscal year beginning on or after July 1, 2019, for
housing projects located in small cities, plus the amount
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of tax incentives eligible for issuance to housing projects
located in small cities that were registered prior to July
1, 2019, under section 15.354, subsection 2, Code 2019, does
not exceed the amount reserved for housing projects located
in small cities pursuant to section 15.119, subsection 2,
paragraph “g” , the authority may award the remaining amount of
tax incentives reserved for housing projects located in small
cities to other housing projects during that same fiscal year.
(3) Notwithstanding subparagraph (1), and section 15.119,
subsection 2, paragraph “g” , the authority may award during a
fiscal year an aggregate amount of tax incentives to housing
projects located in small cities that is less than the amount
reserved for allocation to small cities under section 15.119,
subsection 2, paragraph “g” , provided the difference between
the amount of the small city reservation and the aggregate
amount actually awarded to small cities during that fiscal year
is awarded during that same fiscal year to housing projects
registered prior to July 1, 2018.
b. With regard to a housing project registered prior to
July 1, 2019, a tax incentive shall be considered awarded for
purposes of paragraph “a” when the authority enters into an
agreement with the housing business for that housing project
as provided under section 15.354, subsection 3, Code 2019.
Notwithstanding any provision of law to the contrary, a housing
business shall have no right to enter into an agreement with
the authority for a housing project registered prior to July 1,
2019, until the authority allocates an amount of tax incentives
to the housing project and notifies the housing business
that the authority is prepared to execute the agreement
and make a tax incentive award for the housing project. A
housing business shall have no right to receive a tax credit
certificate or claim a tax incentive for a housing project
registered prior to July 1, 2019, until the housing business
enters into an agreement with the authority.
c. In making tax incentive awards during any fiscal year
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in which there are housing projects registered prior to July
1, 2019, which are eligible to receive tax incentives under
the program, the authority shall give priority in making tax
incentive awards to housing projects registered prior to July
1, 2019. The authority shall create and maintain a wait list
of housing projects registered prior to July 1, 2019, and such
housing projects shall be placed on the wait list in the order
the housing projects were registered.
d. The maximum aggregate amount of tax incentives that
may be awarded and issued under section 15.355 to a housing
business for a housing project shall not exceed one million
dollars.
e. If a housing business qualifies for a higher amount
of tax incentives under section 15.355 than is allowed by
the limitation imposed in paragraph “d” , the authority and
the housing business may negotiate an apportionment of the
reduction in tax incentives between the sales tax refund
provided in section 15.355, subsection 2, and the workforce
housing investment tax credits provided in section 15.355,
subsection 3, provided the total aggregate amount of tax
incentives after the apportioned reduction does not exceed the
amount in paragraph “d” .
Sec. 18. Section 15.354, subsection 5, Code 2019, is amended
to read as follows:
5. Termination and repayment. The failure by a housing
business in completing a housing project to comply with any
requirement of this program or any of the terms and obligations
of an agreement entered into pursuant to this section may
result in the revocation, reduction, termination, or rescission
of the tax incentive award or the approved tax incentives and
may subject the housing business to the repayment or recapture
of tax incentives claimed under section 15.355 . The repayment
or recapture of tax incentives pursuant to this section shall
be accomplished in the same manner as provided in section
15.330, subsection 2 .
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Sec. 19. Section 15.355, subsection 2, Code 2019, is amended
to read as follows:
2. A housing business may claim a refund of the sales and
use taxes paid under chapter 423 that are directly related to
a housing project and specified in the agreement . The refund
available pursuant to this subsection shall be as provided in
section 15.331A , excluding subsection 2 , paragraph “c” , of
that section. For purposes of the program, the term “project
completion” , as used in section 15.331A , shall mean the date on
which the authority notifies the department of revenue that all
applicable requirements of an agreement entered into pursuant
to section 15.354 are satisfied.
Sec. 20. Section 15.355, subsection 3, paragraph a,
subparagraphs (1) and (2), Code 2019, are amended to read as
follows:
(1) For a housing project not located in a small city, ten
percent of the qualifying new investment of a housing project
specified in the agreement .
(2) For a housing project located in a small city, twenty
percent of the qualifying new investment of a housing project
specified in the agreement .
Sec. 21. APPLICABILITY.
1. Except as provided in subsection 2, this division of
this Act applies to housing projects awarded tax incentives by
the authority under the program on or after July 1, 2019, and
housing projects registered by the authority under the program
prior to July 1, 2019, shall be governed by sections 15.352,
15.354, and 15.355, Code 2019.
2. The provision of this division of this Act amending
section 15.354, subsection 4, applies to housing projects
registered by the authority under the program prior to July 1,
2019, and to housing projects awarded tax incentives by the
authority under the program on or after July 1, 2019.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
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the explanation’s substance by the members of the general assembly.
This bill relates to incentives for broadband and workforce
housing.
DIVISION I —— TITLE OF ACT. The bill provides that it may be
known and cited as the “Empower Rural Iowa Act”.
DIVISION II —— BROADBAND. Division II of the bill
modifies provisions applicable to the broadband grant program
administered by the office of the chief information officer
(OCIO) under Code chapter 8B, and the property tax exemption
for broadband infrastructure provided in Code section
427.1(40).
Current law requires the OCIO to administer a broadband
grant program to award grants to communications service
providers that reduce or eliminate targeted service areas,
as defined, by installing broadband infrastructure that
facilitates broadband service at or above 25 megabits per
second of download speed and 3 megabits per second of upload
speed as of July 1, 2015. The bill removes references to the
specified download and upload speeds and date throughout Code
chapter 8B and instead allows the OCIO to identify such speeds
and date by rule, which the OCIO may update from time to time as
it deems appropriate. The bill also provides a new definition
for “facilitate” in Code section 8B.1, as described in the
bill.
Current law allows unencumbered or unobligated moneys
remaining in the broadband grant fund at the close of the
fiscal year to remain available for use until the close of the
succeeding fiscal year. The bill instead provides that such
moneys shall remain available until three years following the
last day of the fiscal year in which the funds were originally
appropriated.
Current law requires the OCIO to evaluate applications for
broadband grants only pursuant to the information provided in
an application. The bill provides that the OCIO shall evaluate
applications for broadband grants in a fair and unbiased
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manner, and allows the OCIO to consider any information
obtained outside of the application process, in addition to
information provided in an application.
The bill extends the OCIO broadband grant program from July
1, 2020, to July 1, 2025.
Current law requires the OCIO to adopt rules related to the
broadband grant program. The bill instead provides the OCIO
with discretion to adopt rules deemed necessary to interpret or
administer Code chapter 8B, including but not limited to rules
relating to the broadband grant program.
Current Code section 427.1(40) provides owners of broadband
infrastructure an exemption from property tax under Code
chapter 427, for installations of broadband infrastructure
that facilitate broadband service at or above the download and
upload speeds specified in Code chapter 8B in targeted service
areas commenced and completed on or after July 1, 2015, and
before July 1, 2020, for assessment years beginning before
January 1, 2022.
The bill provides that the words and phrases used in Code
section 427.1(40) shall have the same meaning as used in
Code chapter 8B, including but not limited to the words and
phrases defined in Code section 8B.1. The bill extends the
property tax exemption for broadband infrastructure to apply
to installations commenced and completed on or after July 1,
2015, and before July 1, 2025, for assessment years beginning
before January 1, 2027. The bill removes references to the
specified download and upload speeds throughout Code section
427.1(40) and instead references the download and upload
speeds identified by the OCIO by rule. The bill requires a
person claiming an exemption to certify that the broadband
installation will facilitate broadband service within a
targeted service area at or above the download and upload
speeds identified by the OCIO.
DIVISION III —— WORKFORCE HOUSING TAX INCENTIVE PROGRAM.
Division III of the bill modifies the workforce housing tax
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incentives program.
BACKGROUND. Current law provides that the workforce housing
tax incentive program (program) administered by the economic
development authority (authority) makes tax incentives in the
form of investment tax credits and sales and use tax refunds
available to housing businesses that complete certain housing
projects in Iowa. In order to receive tax incentives, a
housing business must apply to the authority and have its
housing project registered by the authority, and then must
enter into an agreement with the authority (tax incentive
agreement) for the successful completion of all requirements
of the program. Current law requires a housing business to
complete its housing project within three years from the date
the housing project is registered by the authority. Upon
application by the housing business prior to expiration of the
three years, and at the authority’s discretion, a one-time,
12-month extension may be granted. If the housing project
is completed and properly examined by a certified public
accountant, and all other requirements of the tax incentive
agreement and the program are satisfied, the authority may
issue a tax credit certificate and the housing business may
claim the tax incentives for which it qualifies under the
program. Currently, the total tax incentives issued under the
program per fiscal year cannot exceed $20 million. Of that
$20 million annual cap, $5 million must be reserved for tax
incentives issued to housing projects located in small cities,
as defined under the program. The program also limits the
maximum amount of tax incentives that may be issued per housing
project to $1 million. Current law requires the authority
to issue tax incentives under the program on a first-come,
first-served basis, and in the event the total tax incentives
for all registered housing projects completed in a fiscal year
exceeds an annual cap, the authority is required to maintain a
wait list of completed housing projects, and give those housing
projects priority for being issued tax incentives in subsequent
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fiscal years.
BILL CHANGES. The bill amends current law relating to the
acceptance of housing project applications by the authority.
Current law states that the authority may accept applications
on a continuous basis. The bill requires the authority to
accept applications during one or more application periods, and
provides that housing project applications shall be reviewed
and scored on a competitive basis by the authority pursuant to
rules adopted by the authority.
The bill removes registration of housing projects from the
program, and provides that the authority may make tax incentive
awards to housing projects. Tax incentive awards shall be
subject to the approval of the director of the authority.
Applicants who do not receive a tax incentive award are
authorized under the bill to make additional applications for
that housing project during subsequent application periods. In
determining the tax incentive award of a particular housing
project, the bill prohibits the authority from using an amount
of housing project costs that exceeds the amount included in
the housing project application.
The bill requires the authority to notify the housing
business of its tax incentive award. The notification must
include a statement that the housing business has no right to
receive a tax incentive certificate or claim a tax incentive
until all requirements of the program and the tax incentive
agreement are satisfied.
The bill amends the requirements related to the tax
incentive agreement entered into by the authority and a housing
business to provide that such agreement shall identify the
tax incentive award amount, the tax incentive award date, the
project completion deadline, and the total costs of the housing
project.
The bill provides that after review of the examination of
the housing project and verification of the qualifying new
investment, the authority may notify the housing business of
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the amount that the housing business may claim as a refund of
the sales and use tax under Code section 15.355(2) and may
issue a tax credit certificate to the housing business that
states the workforce housing investment tax credits that the
housing business may claim. The sum of the sales and use tax
refund and the amount of the workforce housing investment tax
credits cannot exceed the amount of the tax incentive award.
The bill also amends the definition of “small city” for
purposes of the program. Under current law, the definition of
“small city” includes any city or township not located within
the 11 most populous counties in the state. If a city is
located in more than one county, it is considered to be located
in the county having the greatest taxable base within the city.
Under the bill, “small city” includes any city or township
not located wholly within one or more of the 11 most populous
counties in the state, so that any city or township located
in whole or in part in one of the 88 least populated counties
in Iowa will qualify as a small city under the program. The
definition is also amended to provide that population is
computed using the most recent population estimates issued by
the United States census bureau, instead of the most recent
federal decennial census.
The bill amends requirements relating to the termination
and repayment of tax incentives for failure to comply with
the requirements of the program to provide that such failures
to comply may also result in the revocation of the tax
incentive award. Current law provides only for the reduction,
termination, or rescission of an approved tax incentive for
failure to comply with the requirements of the program.
The bill amends language relating to the calculation of the
amount of tax incentives for which a housing project qualifies.
Under current law, the amount of the sales and use tax refunds
is calculated using the taxes directly related to a housing
project, and the amount of the investment tax credits is
calculated using a percentage of the qualifying new investment
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of the housing project. The bill provides that these amounts
of taxes or qualifying new investment will only be used in the
tax incentive calculation to the extent they were specified in
the tax incentive agreement entered into by the authority and
the housing business.
The program changes described above apply to housing
projects that receive a tax incentive award on or after July 1,
2019. Housing projects registered prior to July 1, 2019, shall
be governed by current law.
The bill provides that the authority shall not award more
than $25 million in tax incentives each fiscal year beginning
on or after July 1, 2019, and $10 million of that total cap
shall be reserved each fiscal year for tax incentive awards
made to housing projects located in small cities. For housing
projects registered prior to July 1, 2019, the bill states that
a tax incentive will be considered awarded when the authority
enters into a tax incentive agreement for that housing project
as provided under current law, and the bill prohibits a housing
business from entering into a tax incentive agreement for such
a housing project until the authority allocates tax incentives
to that housing project and notifies the housing business that
the authority is prepared to execute a tax incentive agreement.
The bill also provides that a housing business shall have
no right to receive a tax credit certificate or claim a tax
incentive for a housing project registered prior to July 1,
2019, until the housing business enters into a tax incentive
agreement with the authority.
The bill provides two exceptions to the $10 million per year
tax incentive reservation for housing projects in small cities.
First, if the sum of the amount of tax incentive applications
received for housing projects in small cities during a fiscal
year, plus the amount of tax incentives eligible for issuance
during that same fiscal year to housing projects in small
cities registered prior to July 1, 2019, does not exceed $10
million, the authority may award the difference to other
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S.F. _____ H.F. _____
housing projects during that same fiscal year. Second, the
authority may award less than $10 million of tax incentives to
housing projects in small cities during a fiscal year if the
difference between the $10 million cap and the amount actually
awarded to housing projects in small cities is awarded during
the same fiscal year to housing projects registered prior to
July 1, 2018.
The bill provides that the authority shall give priority
in making tax incentive awards to housing projects registered
prior to July 1, 2019, and shall create a wait list of housing
projects registered prior to July 1, 2019, and place those
housing projects on the list in the order the projects were
registered.
The changes to the awarding and issuance of tax incentives
described above apply to housing projects registered prior
to July 1, 2019, and to housing projects that receive a tax
incentive award on or after July 1, 2019.
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