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HF 1040

A bill for an act relating to and making appropriations for the economic development of the state, including to the economic development authority, Iowa finance authority, department of workforce development, and state board of regents and certain regents institutions, and eliminating the repeal of the housing renewal pilot program.

2025-2026 Regular Session

Funds Iowa EDA for economic development, tourism, and workforce initiatives, with goals to grow economy and population, plus rules on work eligibility and prohibitions on geotherma

Explanation of vote.
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Bill Summary · HF 1040

Summary — HF 1040 (as amended by H-1327)

Status: Introduced May 5, 2025; Amendment H‑1327 adopted May 13, 2025; Explanation of vote recorded June 27, 2025.

Main purpose

HF 1040 is an FY 2025–2026 appropriations bill that funds state economic development activities. It sets goals and accountability expectations for the Iowa Economic Development Authority (EDA), provides targeted appropriations and program direction for economic development, tourism, and related programs, and (per the bill title) removes the scheduled repeal of the housing renewal pilot program.

Key policy and program provisions

  • Establishes FY2025‑26 goals for the EDA: expand the state economy, increase Iowans’ wealth, and grow the state population. Directs the EDA to prioritize market‑viable business activity, entrepreneurship, statewide economic growth, business recruitment/retention, and coordination with other agencies.
  • Directs EDA actions to: support community development, infrastructure readiness, tourism public‑private partnerships, and review state laws for impacts on workforce retention and business recruitment.
  • Allows EDA to use appropriations to:
    • Transfer funds to a strategic infrastructure financing fund (sec. 15.313).
    • Provide grants to community entities for workforce recruitment efforts targeting former residents and former in‑state students.
    • Provide assistance to early‑stage companies established by women entrepreneurs.
    • Fund grants/loans/forgivable loans for advanced research and commercialization in value‑added agriculture, advanced technology, and biotechnology.
  • Prohibits use of these appropriated moneys for projects that install geothermal systems to melt snow/ice from streets or sidewalks.

Financial details (selected)

  • General Fund appropriation to the Economic Development Authority: $12,921,510 for FY2025‑26, and authorization for up to 112.50 FTE positions.
  • World Food Prize: $500,000 (in lieu of the standing appropriation).
  • Assistance to Iowa’s councils of governments: $350,000.
  • Tourism office (advertising/implementation of EDA tourism strategic plan): $1,050,000.
  • Unexpended balances for the main EDA appropriation do not revert at fiscal year close; they remain available through the succeeding fiscal year.

Eligibility, restrictions, and accountability

  • Businesses receiving job‑creation assistance must ensure new/retained positions are filled only by U.S. citizens residing in the U.S. or persons authorized to work under federal law (including lawful permanent residents).
  • Vendors and assisted businesses must provide periodic assurances; funds may be recaptured if a recipient knowingly employs persons not authorized to work.
  • Full‑time positions supported by the appropriation may be funded from these or other EDA receipts (including federal funds).

Who is affected

  • Iowa Economic Development Authority (primary recipient/implementer).
  • Businesses and vendors seeking EDA financial assistance.
  • Local governments, councils of governments, tourism organizations, community development entities, women entrepreneurs, research/agritech/biotech startups.
  • World Food Prize and tourism promotion entities.
  • (Per bill title) the housing renewal pilot program and entities participating in that pilot.

Procedural/timeline notes

  • Introduced and placed on the Appropriations calendar May 5, 2025.
  • Amendment H‑1293 was filed May 8 and failed (yeas 29, nays 62).
  • Amendment H‑1327 was filed and adopted May 13, 2025; H‑1327 is the operative amendment reflected here.
  • Senate file substitution (SF 645) noted May 13; an Explanation of Vote was recorded June 27, 2025.

Considerations

  • The bill combines program direction with dollar appropriations and includes both programmatic prohibitions (e.g., geothermal snow‑melt systems) and workforce eligibility conditions tied to immigration/work authorization.
  • Final fiscal and program effects depend on implementation details and any additional appropriations in other divisions of the bill not shown in the excerpt.

Compiled from official sources — confirm details with the bill’s official record.

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