Iowa House Bill HSB305

Iowa 2025-2026 Regular Session

• Introduced: 3/6/25
• Refer: 3/6/25

Caption

A bill for an act relating to matters under the purview of the Iowa economic development authority, including tax credit limits, targeted jobs tax credits, and the major economic growth attraction program; creation of the business incentives for growth program, the seed investor tax credit program, the Iowa film production incentive program, the research and development tax credit program, and the sustainable aviation fuel production tax credit program; elimination of the high quality jobs program, the investments in qualifying businesses tax credit, employer child care tax credits, assistive device tax credits, endow Iowa tax credits, and research activities tax credits; and including effective date provisions and criminal penalties.

Impact

The bill proposes the repeal of several existing tax credit programs, including the High Quality Jobs Program and the Endow Iowa Tax Credit, which has raised concerns among various stakeholders about potential impacts on job creation and local community support. By eliminating these established programs, the legislation aims to centralize and streamline incentive offerings under the new BIG program, but risks leaving certain businesses without the support they previously relied on. As a result, discussions around the bill have highlighted significant contention over its potential effects on different sectors and communities.

Summary

House Study Bill 305 addresses a wide array of issues related to economic development in Iowa by proposing significant changes to the existing tax credit programs and initiating new incentive structures. A key feature of the bill is the establishment of the Business Incentives for Growth (BIG) program aimed at providing tax incentives to eligible businesses which meet specific qualifications. This new initiative is designed to stimulate job growth and economic activity in the state, notably targeting sectors with higher resource consumption.

Contention

Critics of HSB305 have expressed fears that the repeal of established programs could harm job retention and economic stability within the state. Opponents argue that the new tax incentives may not adequately replace the benefits provided by the repealed programs. They emphasize that the legislation's focused approach could overlook the diverse needs of various localized economies that thrived under the previous tax regimes. Proponents, however, argue that the streamlined structure will ultimately create a more competitive climate conducive to attracting new businesses.