State of Iowa Incentive Programs:
The State of Iowa has many financial incentive programs available for businesses considering expanding or locating in Iowa. State assistance is provided in the form of loans and/or forgivable loans, based in part on job creation, capital investment, the ability to meet certain wage standards, quality of employment, and economic benefits for the state and local community.
The Quality Jobs Program (HQJ) is the state's premier financial assistance program designed to support innovation and job growth. Applications for this program are filed by cities, counties or community colleges on behalf of eligible businesses.
The High Quality Jobs program provides qualifying businesses tax credits to off-set the cost incurred to locate, expand or modernize an Iowa facility. To qualify for this very flexible assistance package that includes tax credits, exemptions and/ or refunds, a business must be a non-retail or non-service business and meet wage requirements.
The Targeted Jobs Withholding Tax Credit Pilot Program is a pilot program enacted in 2006 which allows the diversion of withholding funds paid by an employer to be matched by a designated "pilot" city to create economic incentives that can be directed toward the growth and expansion of targeted businesses located within a pilot city.
Job Creation, Retention and Enhancement Fund. This fund assists businesses who are creating new jobs by providing a direct or forgivable loan or through infrastructure projects. It also provides industry-driven training assistance.
Economic Development Set-Aside (EDSA) This program provides financial assistance to businesses and industries requiring assistance to create new job opportunities. Assistance is provided for new business start-ups, expansion of existing businesses, new capital investment, and/or the relocation of out-of-state businesses into Iowa. Assistance may be provided in the form of direct loans or forgivable loans.
Public Facilities Set-Aside (PFSA) This program provides financial assistance to cities for public infrastructure improvements that enable businesses to create new job opportunities. Projects that will create manufacturing jobs, add value to Iowa resources and/or increase out-of-state exports will be given priority. Eligible projects include adding or improving sanitary sewer systems, water systems, streets, roads, rail lines and storm sewers.
Career Link The Career Link program is an industry-driven training program that invests in projects that assist the underemployed and working poor to obtain the training and skills they need to move into available higher-skill, higher wage jobs. Economic development groups can assist business and industry by functioning as the administrative entity for the funds. Technical assistance is also provided to development organizations as groups structure worker retention, recruitment, and school-to-work activities to address labor force needs of the business community.
The Targeted Small Business (TSB) Program This program is designed to help women, minorities and disabled persons overcome major hurdles to starting or growing a small business in Iowa. Since its inception the TSB program has issued hundreds of loans to Iowa small business owners.
Angel Investor tax credits are offered to increase the availability and accessibility of venture capital, particularly for ventures at the seed capital investment stage. Two programs – the Qualifying Business tax credit and the Community-Based Seed Capital Fund tax credits – work together to encourage the creation of wealth through high-paid, new jobs while promoting industrial development and innovation. The total amount of tax credits available per fiscal year is $2 million.
The Innovation Fund Tax Credit program This program is aimed at stimulating venture capital investment in innovative Iowa businesses. Individual investors can receive tax credits equal to 25 percent of an equity investment in a certified Innovation Fund. In turn, those certified Innovation Funds will make investments in promising early-stage companies that have a principal place of business in the state of Iowa. Innovative businesses can include, but are not limited to, businesses engaged in advanced manufacturing, biosciences and information technology. The total amount of tax credits available for investment in Innovation Funds is $8 million per fiscal year.
The Iowa New Jobs Tax Credit is an Iowa corporate income tax credit and is available to a company that has entered into a New Jobs Training Agreement (260E) and expands their Iowa employment base by ten percent or more.
The Research Activities Credit is a refundable credit Iowa companies can earn for research and development investments. Iowa is one of only a few states to offer this kind of credit. A company must meet the qualifications of the Federal Research Activities Credit in order to be eligible for the credit in Iowa. Supplemental Research Activities Credits are available through the Enterprise Zone and High Quality Jobs programs.
The Export Trade Assistance Program (ETAP) The International Office at the Iowa Economic Development Authority offers financial assistance to eligible Iowa small companies to help companies market their products and services to a global audience. The program may reimburse eligible Iowa companies for up to 75 percent of defined international marketing expenditures in a qualifying trade show or IEDA trade mission held outside the U.S., to explore new markets or provide support to expand current markets.
Visit the Iowa Economic Development Authority Website for more information about any of these program.