Issues

  • Business Climate
  • Economic Growth


    • — Enhance Iowa's business environment

    To maintain and enhance Iowa's attractiveness to current and potential businesses, it is essential that Iowa do what is possible to lower the cost to businesses and employees.

    Specifically, the Alliance:

    * Supports the state's Right-to-Work Law and opposes any legislation that would negatively impact those laws.
    * Supports Iowa's statute for workers' compensation regarding injuries on the job.
    * Opposes mandating prevailing wage rates for public construction projects, which would significantly increase the cost of such projects.

    Taking away these protections could significantly impact the ability to attract a skilled workforce and/or impair business expansion and job creation in the state. For example, many national economic development consultants report that the lack of Right-to-Work laws in other states is often a deal breaker for companies considering business relocation.


  • Property Tax Reform


    • — Provide tax relief for commercial and industrial properties

    Property taxes are very uncompetitive for commercial and industrial properties in Iowa. According to the most recent 50-State Property Tax Comparison Study, Iowa's urban commercial property tax rates are the fifth highest in the nation, with rural commercial property tax rates similarly ranking among the top ten highest.* Iowa's industrial property tax rates are not much better, ranking 15th highest in the U.S for both rural and urban areas. Meanwhile, neighboring states, including Minnesota, South Dakota and Nebraska, are enjoying more competitive commercial and industrial property tax rates.

    Delaying reforms to Iowa's property tax system is intensifying the tax burden on commercial and industrial payers. Iowa's commercial and industrial property owners are taxed on 100 percent of their assessed value, while residential property owners pay taxes on approximately 46 percent of their assessed value due to an assessment limitation (rollback). This disparity between tax classes is placing too much burden on commercial and industrial taxpayers, making it difficult for municipalities, counties and schools to keep pace with growth.

    The residential property tax rollback is based on an outdated system of linking residential values with agricultural productivity, rather than taxing based on true market values. Eliminating this agricultural link would allow local governments to decide how to tax commercial and industrial properties to gain the best advantage for business expansion and new business recruitment – thus expanding the job base, tax base and commercial/industrial and residential growth of a community.

    *Source: Iowa Taxpayers Association, 2006 Report


  • Income Tax


    • — Simplify the income tax system

    The Alliance continues to call for simplification and overall reform of the state income tax formula. Publications and statistical data used in marketing Iowa continue to show a skewed view of the true income tax liability of companies and individuals by showing the combined rate of tax. Although these publications may include a small asterisk to signify the deductibility of federal income taxes on state income tax returns, this is mostly overlooked by those looking to invest in Iowa.

    The Alliance believes the state should flatten and adjust the current income tax structure to a two-tiered system. This change would allow the state to maintain its income tax revenue stream while eliminating the confusion in marketing our state.


  • Tax Increment Financing (TIF)


    • — Preserve TIF as an economic development tool

    The Alliance supports Tax Increment Financing laws that have made cities and communities more competitive for business and industrial growth. TIF districts stimulate an increase in the tax base for the long term and allow communities to compete for jobs, sales tax and tourism dollars. Any change in the current TIF legislation would further erode the tools local communities use to compete for business growth.

  • Community Revitalization
  • Destination Attraction Fund


    • — Continue funding and remove cap on Destination Attraction Fund

    A matching fund supporting visionary community projects or destination attractions is important to grow local economies, attract visitors and retain businesses and workers for those businesses. Some funding is currently available through Iowa's Community Attraction and Tourism (CAT) Program.

    The Vision Iowa Board has the ability to fund up to 50% of a project's total cost. The Board may make a multiyear commitment to a project up to a maximum of only $4 million in any one fiscal year that funding is available.
    This cap is limiting the program's impact and should be removed.


  • Brownfield Redevelopment Program


    • — Fund the Iowa Brownfield Redevelopment Program at $3 million per year

    Communities are in need of readily accessible funding for environmental site investigations prior to acquiring nuisance Brownfield sites or Brownfield sites that are preventing future redevelopment investment. These investigation funds must be open to use on soil and water contaminant discovery as well as asbestos and lead based paint inventories that are required to understand pre-demolition liabilities. Asbestos abatement and demolition costs associated with Brownfield sites most often exceed contaminant remediation costs.
    Over the past three years, the state Brownfield Redevelopment Program fund has been substantially cut to $500,000 per year; well below the needs of both large and small communities across this state. The Alliance asks that the Iowa Brownfield Redevelopment Program be funded at its original level of $3 million per year.


  • Entrepreneurship


    • — Create a culture of entrepreneurship in Iowa
    — Continue funding for research parks and regional business accelerators

    To accelerate business growth and vigorously participate in the dynamic global economy, Iowa's leaders must nurture entrepreneurial talent and venture capital in the state. In 2005, the Iowa Legislature funded the development of business accelerators to propel Iowa's entrepreneurial efforts by fostering the accelerated growth of new and existing businesses. Seven regional business accelerators have been licensed in Iowa, and the majority of them are already operational.

    Iowa's research parks and business accelerators offer technical assistance and mentoring to the state's high growth opportunity companies. Research parks and business accelerators provide the services of staff experienced in legal, accounting and marketing disciplines. These professionals help entrepreneurs navigate resources, strengthen their knowledge, improve skills, form strategic alliances and secure business capital – ultimately helping businesses take the next steps forward in moving their products to new or additional markets, becoming profitable and adding new jobs.

    The Alliance recommends continued financial support of research parks and regional business accelerators. At the same time, the Alliance recognizes that many other tools offer the potential for fostering entrepreneurship. Iowa's business organizations in partnership with the Department of Economic Development must further identify best practices, including strategies used in other states, then develop a comprehensive implementation plan and monitor its effectiveness.

  • Infrastructure
  • Road Use Tax Fund


    • — Revise the current Road Use Tax Fund formula
    — Implement TIME-21

    Continuous investment in Iowa's public roadway system is essential to support economic growth and help attract new businesses to the state. Recent studies project that the need to preserve and build new roads and bridges in Iowa will far exceed available revenues.* On a per capita basis, the current RUTF formula allocates the most dollars to the least traveled roads and the least dollars to more highly traveled roads. The Alliance recommends a more equitable funding formula so that a larger percentage of road use tax dollars would be allocated to the primary, state road system.

    While improvements were made to the RUTF funding formula in 2005 to factor in population when allocating dollars to farm-to-market and secondary roads, further revisions are needed to allocate more money for highly traveled primary roads.

    The Iowa Legislature established an additional funding formula in 2007 creating the TIME-21 (Transportation Investment Moves the Economy in the 21st Century) Fund. Revenue deposited into this fund would be divided among the state/primary road fund (60 percent), counties/secondary road fund (20 percent) and cities/street construction fund (20 percent).

    The Alliance supports the TIME-21 formula but believes current expenditures should be carefully scrutinized before considering revenue sources.

    *Source: Iowa Department of Transportation

  • Workforce
  • Workforce Development


    • — Implement 21st Century learning skills by setting statewide outcome based standards
    — Strengthen workforce training, retention and recruitment to meet future workforce needs

    For the State of Iowa to have a globally competitive economy, it must view workforce from a comprehensive perspective. Iowa's workforce needs must be addressed with long-term, multi-faceted policies at the local and regional levels including not only education, training and retraining of an existing workforce but also retention and recruitment. Statewide outcome based standards for 21st Century learning skills are needed.
    The Alliance supports performance standards established by the Institute for Tomorrow's Workforce in their 2005-2006 legislative report.

    The future of Iowa's workforce depends on education more than any other factor. Iowa's education system should include 21st Century learning standards, as well as basic skills. All students need to be provided with rigorous and measurable learning opportunities that provide a clear pathway to success and that meet the needs of the state and the nation. Today's competitive world marketplace requires our workers to excel in science, technology, engineering and mathematics (STEM), as well as other disciplines.
    Generating new interest among teachers and students for STEM-oriented curricula and related careers in Iowa is critically important.

    Graduation rates must be increased to meet the job demands. Additionally, employers must recognize that with appropriate on-the-job training, good workers who haven't completed their formal education can excel in certain positions. Funding should not be denied for approved training that is not taken for credit.

    Education and business must intensify their partnership so that education knows what skills are needed in the workforce and business knows what skills are being taught.

    Businesses should explore various ways to recruit personnel such as collaborating across company boundaries to funnel qualified job applicants into appropriate positions. Recruiting alone will not be sufficient.
    Collaboration between business and educational entities is necessary to bridge the workforce qualification gap.
    Such workforce development and education priorities are vital in a state whose population growth has been flat for a century, and whose population's most rapidly increasing age group is the one over age 85.
    Add to these factors projections that show Iowa employment opportunities among existing businesses exceed the number of persons projected to enter the state workforce, and the issue takes on critical significance.


  • Tell the Iowa Story


    • — Encourage the state and local communities to collaborate

    Iowa ranks high in quality of life and has many assets, but these must be marketed nationally. The state should partner with communities in their economic development efforts by marketing a positive, inviting image of Iowa through a well-funded strategic marketing plan. This marketing should be done regionally as well as statewide.

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