Bill Text: IA SF575 | 2023-2024 | 90th General Assembly | Enrolled

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Bill Title: A bill for an act relating to the economic development authority, including renewable chemical production, workforce housing, and innovation fund tax credits, the Iowa wine, beer, and spirits promotion board, and the beer and liquor control fund, and including applicability provisions. (Formerly SF 408, SSB 1087.) Effective date: 07/01/2023. Applicability date: 06/30/2023, 07/01/2023.

Spectrum: Committee Bill

Status: (Passed) 2023-06-01 - Signed by Governor. S.J. 1088. [SF575 Detail]

Download: Iowa-2023-SF575-Enrolled.html

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Senate File 575 - Enrolled
Senate File 575
AN ACT
RELATING TO THE ECONOMIC DEVELOPMENT AUTHORITY, INCLUDING
RENEWABLE CHEMICAL PRODUCTION, WORKFORCE HOUSING, AND
INNOVATION FUND TAX CREDITS, THE IOWA WINE, BEER, AND
SPIRITS PROMOTION BOARD, AND THE BEER AND LIQUOR CONTROL
FUND, AND INCLUDING APPLICABILITY PROVISIONS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
DIVISION I
TAX CREDITS
Section 1. Section 15.119, subsection 2, paragraph h, Code
2023, is amended to read as follows:
h. The renewable chemical production tax credit program
administered pursuant to sections 15.315 through 15.322 . In
allocating tax credits pursuant to this subsection for the
fiscal year beginning July 1, 2021, and for each fiscal year
thereafter beginning before July 1, 2037 , the authority shall
not allocate more than five million dollars for purposes of
this paragraph. This paragraph is repealed July 1, 2030 2039 .
Sec. 2. Section 15.316, subsection 3, Code 2023, is amended
to read as follows:
3. “Building block chemical” means a molecule converted
from biomass feedstock as a first product or a secondarily

Senate File 575, p. 2
derived product that can be further refined into a higher-value
chemical, material, or consumer product. “Building block
chemical” includes but is not limited to high-purity glycerol,
oleic acid, lauric acid, methanoic or formic acid, arabonic
acid, erythonic acid, glyceric acid, glycolic acid, lactic
acid, 3-hydroxypropionate, propionic acid, malonic acid,
serine, succinic acid, fumaric acid, malic acid, aspartic
acid, 3-hydroxybutyrolactone, acetoin, threonine, itaconic
acid, furfural, levulinic acid, glutamic acid, xylonic acid,
xylaric acid, xylitol, arabitol, citric acid, aconitic acid,
5-hydroxymethylfurfural, lysine, gluconic acid, glucaric acid,
sorbitol, gallic acid, ferulic acid, butyric acid, nonfuel
butanol, nonfuel ethanol, or such additional molecules as may
be included by the authority by rule after consultation with
appropriate experts from Iowa state university, including
but not limited to the Iowa state university center for
biorenewable chemicals.
Sec. 3. Section 15.318, subsection 1, Code 2023, is amended
by adding the following new paragraph:
NEW PARAGRAPH . f. All complete applications submitted
by eligible businesses shall be reviewed and scored on a
competitive basis by the authority pursuant to rules adopted
by the authority.
Sec. 4. Section 15.318, subsection 2, paragraphs c and d,
Code 2023, are amended to read as follows:
c. An eligible business shall fulfill all the requirements
of the program and the agreement before receiving the authority
issues the business a tax credit certificate or entering enters
into a subsequent agreement with the business under this
section . The authority may decline to enter into a subsequent
agreement with the business under this section or to issue a
tax credit if an agreement is not successfully fulfilled.
d. Upon establishing that all requirements of the program
and the agreement have been fulfilled, the authority shall
issue a tax credit and related tax credit certificate to the
eligible business stating the amount of renewable chemical
production tax credit the eligible business may claim.
Sec. 5. Section 15.318, subsection 3, paragraphs a, d, and

Senate File 575, p. 3
e, Code 2023, are amended to read as follows:
a. The maximum amount of tax credit that the authority may
be issued issue under section 15.319 to an eligible business
for the production of renewable chemicals in a calendar year
shall not exceed the following:
(1) In the case of an eligible business that has been in
operation in the state for five years or less at the time of
application, is one million dollars.
(2) In the case of an eligible business that has been in
operation in the state for more than five years at the time of
application, five hundred thousand dollars.
d. An The authority shall not issue an eligible business
shall not receive more than five tax credits credit
certificates under the program.
e. The authority shall issue tax credits under the program
on a first-come, first-served basis until the maximum amount of
tax credits allocated pursuant to section 15.119, subsection
2 , paragraph “h” , is reached. The authority shall maintain a
list of successful applicants under the program, so that if the
maximum aggregate amount of tax credits is reached in a given
fiscal year, eligible businesses that successfully applied
but for which tax credits were not issued shall be placed on
a wait list in the order the eligible businesses applied and
shall be given priority for receiving tax credits in succeeding
fiscal years. Placement on a wait list pursuant to this
paragraph shall not constitute a promise binding the state.
The availability of a tax credit and issuance of a tax credit
certificate pursuant to this subsection in a future fiscal year
is contingent upon the availability of tax credits in that
particular fiscal year. In each fiscal year beginning on or
after July 1, 2023, and ending on or before June 30, 2036, the
authority may award an amount of tax credits under the program
not to exceed the maximum aggregate amount allocated in section
15.119, subsection 2, paragraph “h” .
Sec. 6. Section 15.319, subsection 1, Code 2023, is amended
to read as follows:
1. An eligible business that has entered into an agreement
pursuant to section 15.318 may claim a tax credit in an amount
equal to the product of five cents multiplied by the number

Senate File 575, p. 4
of pounds of renewable chemicals produced in this state from
biomass feedstock by the eligible business during the calendar
year in excess of the eligible business’s pre-eligibility
production threshold. However, an eligible business shall
not receive a tax credit for the production of a secondarily
derived building block chemical if that chemical is also the
subject of a credit at the time of production as a first
product. The renewable chemical production tax credit shall
not be available for any renewable chemical produced before the
2017 calendar year or after the 2026 2035 calendar year.
Sec. 7. Section 15.320, subsection 1, Code 2023, is amended
to read as follows:
1. For purposes of this section , “successful tax credit
applicant” includes, with respect to each calendar year, an
eligible business that was issued a tax credit certificate for
production of renewable chemicals during that calendar year ,
and an eligible business that successfully applied for a tax
credit for the production of renewable chemicals during that
calendar year, but was not issued a tax credit and was instead
placed on a wait list pursuant to section 15.318, subsection
3 , paragraph “e” .
Sec. 8. Section 15.320, subsection 2, Code 2023, is amended
by striking the subsection and inserting in lieu thereof the
following:
2. By January 31 of each year, the board, in cooperation
with the department of revenue, shall submit to the general
assembly and to the governor a report describing the activities
of the program for the most recent calendar year for which the
tax credit application period has ended pursuant to section
15.318, subsection 1, paragraph “d” . The report shall, at a
minimum, include the following information:
a. The aggregate number of pounds, and a list of each type,
of renewable chemicals produced in Iowa by all successful
tax credit applicants during the calendar year prior to the
calendar year for which the successful applicants first applied
for a tax credit under the program.
b. The aggregate number of pounds, and a list of each type,
of renewable chemicals produced in Iowa by all successful tax
credit applicants during each calendar year.

Senate File 575, p. 5
c. The number of employees located in Iowa of all successful
tax credit applicants during the calendar year prior to the
calendar year for which the successful applicants first applied
for a tax credit under the program.
d. The number of employees located in Iowa of all successful
tax credit applicants during each calendar year.
e. For each eligible business issued a renewable chemical
production tax credit during each calendar year:
(1) The identity of the eligible business.
(2) The amount of the tax credit.
(3) The manner in which the eligible business first
qualified as an eligible business under section 15.317,
subsection 4, whether by organizing, expanding, or locating in
the state.
f. The total amount of all renewable chemical production tax
credits claimed during each calendar year, and the portion of
the claims issued as a refund.
Sec. 9. Section 15.320, subsection 3, Code 2023, is amended
to read as follows:
3. To protect the presumption of confidentiality
established in section 15.318, subsection 5 , the board shall
report all information in an aggregate form to prevent,
as much as possible, information being attributable to any
particular eligible business, except as provided in subsection
2 , paragraph “k” “e” .
Sec. 10. Section 15.322, Code 2023, is amended to read as
follows:
15.322 Future repeal.
Section 15.315 , 15.316 , 15.317 , 15.318 , 15.319 , 15.320 ,
15.321 , and this section , are repealed July 1, 2030 2039 .
Sec. 11. Section 15.353, subsection 2, paragraph d, Code
2023, is amended to read as follows:
d. For a housing project located in a small city that
meets program requirements under subsection 1 , paragraph “a” ,
development Construction of new dwelling units at a greenfield
site.
Sec. 12. Section 15E.52, subsection 5, paragraph b, Code
2023, is amended by striking the paragraph.
Sec. 13. Section 15E.52, subsection 8, Code 2023, is amended

Senate File 575, p. 6
to read as follows:
8. The board shall not certify an innovation fund after June
30, 2023 2028 .
Sec. 14. Section 15E.52, subsection 10, paragraph b, Code
2023, is amended by striking the paragraph.
Sec. 15. Section 422.10B, Code 2023, is amended to read as
follows:
422.10B Renewable chemical production tax credit.
The taxes imposed under this subchapter , less the credits
allowed under section 422.12 , shall be reduced by a renewable
chemical production tax credit allowed under section 15.319 .
This section is repealed January 1, 2033 2041 .
Sec. 16. Section 422.33, subsection 22, Code 2023, is
amended to read as follows:
22. The taxes imposed under this subchapter shall be reduced
by a renewable chemical production tax credit allowed under
section 15.319 . This subsection is repealed January 1, 2033
2041 .
Sec. 17. APPLICABILITY.
1. The following apply to all applications submitted to the
renewable chemical production tax credit program on or after
July 1, 2023:
a. The section of this division of this Act amending section
15.316, subsection 3.
b. The section of this division of this Act amending section
15.318, subsection 1.
c. The section of this division of this Act amending section
15.318, subsection 3, paragraphs “a”, “d”, and “e”.
2. The following apply to all eligible businesses placed on
a wait list pursuant to section 15.318, subsection 3, paragraph
“e”, on or before June 30, 2023:
a. The portion of the section of this division of this Act
amending section 15.318, subsection 3, paragraph “e”.
b. The section of this division of this Act amending section
15.320, subsection 1.
3. The following applies to all applications submitted for
innovation fund tax credits, administered pursuant to section
15E.52, placed on a wait list pursuant to section 15E.52,
subsection 5, paragraph “b”:

Senate File 575, p. 7
The section of this division of this Act amending section
15E.52, subsection 5, paragraph “b”.
DIVISION II
IOWA WINE, BEER, AND SPIRITS PROMOTION BOARD
Sec. 18. Section 15E.116, Code 2023, is amended to read as
follows:
15E.116 Iowa wine , and beer , and spirits promotion board.
An Iowa wine , and beer , and spirits promotion board is
created. The board consists of three four members appointed
by the director of the economic development authority. Each
member shall serve a term of two years on the board. One member
shall represent the authority, one member shall represent the
Iowa wine makers, and one member shall represent the Iowa beer
makers , and one member shall represent Iowa distilleries . The
board shall advise the authority on the best means to promote
wine , and beer , and spirits made in Iowa.
Sec. 19. Section 15E.117, Code 2023, is amended to read as
follows:
15E.117 Promotion of Iowa wine , and beer , and spirits .
1. The economic development authority shall consult with
the Iowa wine , and beer , and spirits promotion board on the
best means to promote wine , and beer , and spirits made in Iowa.
2. The authority has shall have the authority to contract
with private persons for the promotion of beer , and wine , and
spirits made in Iowa.
3. Moneys appropriated to the authority pursuant to
sections 123.143 and 123.183 , and moneys transferred to the
authority pursuant to section 123.17, subsection 8A, may
be used by the authority for the purposes of this section ,
including administrative expenses incurred under this section .
Sec. 20. Section 123.17, Code 2023, is amended by adding the
following new subsection:
NEW SUBSECTION . 8A. After any transfers provided for in
subsections 3, 5, 6, 7, and 8 are made, and before any other
transfer to the general fund, the department shall transfer to
the economic development authority from the beer and liquor
control fund the lesser of two hundred fifty thousand dollars
or one percent of the gross sales of native distilled spirits
by all class “A” native distilled spirits license holders made

Senate File 575, p. 8
by the department for the purposes of promoting Iowa wine,
beer, and spirits.
______________________________ ______________________________
AMY SINCLAIR PAT GRASSLEY
President of the Senate Speaker of the House
I hereby certify that this bill originated in the Senate and
is known as Senate File 575, Ninetieth General Assembly.
______________________________
W. CHARLES SMITHSON
Secretary of the Senate
Approved _______________, 2023 ______________________________
KIM REYNOLDS
Governor