Iowa’s four most populous counties — Polk, Linn, Scott and Johnson — would no longer receive state economic development funding under a bill that received its first legislative hearing on Wednesday.
House Study Bill 310 would imposes a three-year moratorium — beginning July 1 — on all tax incentives, loan programs and grant funds administered by the Iowa Economic Development Authority for projects in the four counties.
IEDA administers a range of programs to support economic development, job creation and community development through financial and technical assistance, with a focus on both rural and urban areas. Some programs work with businesses directly, while others work with local governments on community projects.
Opponents of the bill, including representatives from Professional Developers of Iowa, the Iowa Chamber Alliance and the Iowa Travel Industry Partners, argued the bill could hinder economic growth and regional development. Republican House lawmakers who represent rural communities said the bill aims to address economic disparities by focusing incentives on rural areas they say have been historically underserved.
“I think it's important to realize that everything we've been talking about and everything we've been doing in this building to revitalize rural Iowa has not worked,” said Rep. Derek Wulf, a Republican from Hudson, who chaired a subcommittee hearing on the bill Wednesday.
“It has not worked, folks, and what we need to do is have transformational change,” Wulf said during the legislative hearing. “Is this the perfect answer? I don't know. We'll continue to have that discussion, but something has to happen.”
Rep. John Wills, a Republican from Spirit Lake, argued rural areas need economic incentives while the foremost populous areas are already well-developed.
“I think that the rural areas are areas that need to have economic development,” Wills said. “I think that the four most popular populous areas of the state already have economic development, … and I don't think that that's going to stop just because we stopped economic incentives to go to those areas.
“I think that these areas have the infrastructure now. They have the sewer, they have electricity, they have the roads, they have everything that they need to continue to grow,” Wills continued. “What needs to happen for our rural areas to grow and advance is for economic incentives to be concentrated in those areas.”
The pair of Republicans moved the bill forward for further discussion by the full House tax policy Ways and Means Committee.
The City of Cedar Rapids, Linn County Board of Supervisors, Cedar Rapids Metro Economic Alliance and City of Des Moines are registered against the bill.
A representative for the Iowa Taxpayers Association said the group still was evaluating the bill and is concerned about fair treatment of taxpayers.
Roughly one-third of Iowans, or more than 1 million people, live in the four counties, which contribute 42 percent, or about $85 billion, of the total $200 billion value of all goods and services produced in the state, according to U.S. Department of Commerce and U.S. Census Bureau data.
The four counties also contribute about $1.5 billion of the $4.3 billion in state general fund revenue raised from personal income tax and $1.2 billion of the $2.8 billion in sales tax collected by the state in 2022, according to Iowa Department of Revenue data.
“If you look from 2011 to now, the spread (of IEDA financial assistance awards) is all across the board,” said Dustin Miller, executive director of the Iowa Chamber Alliance. “And in fact, the largest grouping is in cities (with populations) from 5,000 to 30,000 with 156 awards. Actually, the lowest amount of awards are in the larger communities. But to be fair, that those awards tend to be larger just because they're larger projects,” like the planned $750 million data center project in Cedar Rapids.
Miller told lawmakers the bill would harm areas of the state that are often “drivers” of the state’s economy that ultimately benefit surrounding counties. The alliance, which is registered against the bill, represents the state’s 16 largest chambers of commerce and economic development corporations.
House Study Bill 310 would imposes a three-year moratorium — beginning July 1 — on all tax incentives, loan programs and grant funds administered by the Iowa Economic Development Authority for projects in the four counties.
IEDA administers a range of programs to support economic development, job creation and community development through financial and technical assistance, with a focus on both rural and urban areas. Some programs work with businesses directly, while others work with local governments on community projects.
Opponents of the bill, including representatives from Professional Developers of Iowa, the Iowa Chamber Alliance and the Iowa Travel Industry Partners, argued the bill could hinder economic growth and regional development. Republican House lawmakers who represent rural communities said the bill aims to address economic disparities by focusing incentives on rural areas they say have been historically underserved.
“I think it's important to realize that everything we've been talking about and everything we've been doing in this building to revitalize rural Iowa has not worked,” said Rep. Derek Wulf, a Republican from Hudson, who chaired a subcommittee hearing on the bill Wednesday.
“It has not worked, folks, and what we need to do is have transformational change,” Wulf said during the legislative hearing. “Is this the perfect answer? I don't know. We'll continue to have that discussion, but something has to happen.”
Rep. John Wills, a Republican from Spirit Lake, argued rural areas need economic incentives while the foremost populous areas are already well-developed.
“I think that the rural areas are areas that need to have economic development,” Wills said. “I think that the four most popular populous areas of the state already have economic development, … and I don't think that that's going to stop just because we stopped economic incentives to go to those areas.
“I think that these areas have the infrastructure now. They have the sewer, they have electricity, they have the roads, they have everything that they need to continue to grow,” Wills continued. “What needs to happen for our rural areas to grow and advance is for economic incentives to be concentrated in those areas.”
The pair of Republicans moved the bill forward for further discussion by the full House tax policy Ways and Means Committee.
The City of Cedar Rapids, Linn County Board of Supervisors, Cedar Rapids Metro Economic Alliance and City of Des Moines are registered against the bill.
A representative for the Iowa Taxpayers Association said the group still was evaluating the bill and is concerned about fair treatment of taxpayers.
Largest counties contribute 42 percent of Iowa’s goods, services
Roughly one-third of Iowans, or more than 1 million people, live in the four counties, which contribute 42 percent, or about $85 billion, of the total $200 billion value of all goods and services produced in the state, according to U.S. Department of Commerce and U.S. Census Bureau data.
The four counties also contribute about $1.5 billion of the $4.3 billion in state general fund revenue raised from personal income tax and $1.2 billion of the $2.8 billion in sales tax collected by the state in 2022, according to Iowa Department of Revenue data.
“If you look from 2011 to now, the spread (of IEDA financial assistance awards) is all across the board,” said Dustin Miller, executive director of the Iowa Chamber Alliance. “And in fact, the largest grouping is in cities (with populations) from 5,000 to 30,000 with 156 awards. Actually, the lowest amount of awards are in the larger communities. But to be fair, that those awards tend to be larger just because they're larger projects,” like the planned $750 million data center project in Cedar Rapids.
Miller told lawmakers the bill would harm areas of the state that are often “drivers” of the state’s economy that ultimately benefit surrounding counties. The alliance, which is registered against the bill, represents the state’s 16 largest chambers of commerce and economic development corporations.
Lawmakers consider halting economic incentives to Iowa's most populous counties
Iowa’s four most populous counties – Polk, Linn, Scott and Johnson – would no longer receive state economic development funding under a bill advanced by House lawmakers Wednesday.
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