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1186XD

Economic Development Programs and Credits (1186XD) - Economic Development Authority

2025-2026 Regular Session

Bill 1186XD caps Iowa's tax credits at $170M, introduces new growth incentives, and eliminates outdated programs to boost economic growth and job creation.

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Bill Summary · 1186XD

Summary of Bill 1186XD: Economic Development Programs and Credits

Bill Number: 1186XD
Title: Economic Development Programs and Credits (1186XD) - Economic Development Authority
Introduced: November 18, 2025
Status: Proposed Bill

Purpose and Intent

The primary aim of Bill 1186XD is to reform and streamline various economic development programs administered by the Iowa Economic Development Authority (IEDA). This includes adjustments to tax credit limits, the introduction of new incentive programs, and the elimination of certain existing programs. The bill seeks to enhance economic growth and job creation in Iowa by focusing on targeted incentives that align with current economic needs.

Key Provisions

Tax Credit Limits

  • Aggregate Tax Credit Limit: The bill establishes a cap on the total amount of tax credits that can be authorized in a fiscal year, set at $170 million.
  • Excess Authorization: The IEDA may authorize up to 20% above this limit under specific conditions, with excess amounts counted against the following fiscal year's total.

New Programs Introduced

  1. Business Incentives for Growth Program
  2. Seed Investor Tax Credit Program
  3. Iowa Film Production Incentive Program
  4. Research and Development Tax Credit Program
  5. Sustainable Aviation Fuel Production Tax Credit Program

Programs Eliminated

The bill proposes the elimination of several existing programs, including:
- High Quality Jobs Program
- Investments in Qualifying Businesses Tax Credit
- Employer Child Care Tax Credits
- Assistive Device Tax Credits
- Endow Iowa Tax Credits
- Research Activities Tax Credits

Allocation of Tax Credits

The bill outlines specific allocations for various programs, including:
- Research and Development Tax Credit Program: $40 million
- Business Incentives for Growth Program: $50 million
- Workforce Housing Tax Incentives Program: $35 million, with a portion reserved for small cities.

Affected Parties

The bill will impact:
- Businesses seeking tax credits and incentives for growth and development.
- Investors in new programs aimed at fostering innovation and production in Iowa.
- Local governments and communities, particularly those involved in housing and economic development initiatives.

Procedural Aspects

  • The IEDA is required to submit an annual report to the Department of Revenue by August 15 detailing the tax credits allocated and awarded under the programs.
  • The bill includes provisions for criminal penalties related to non-compliance with the established guidelines.

Conclusion

Bill 1186XD represents a significant shift in Iowa's approach to economic development by consolidating and refining existing programs while introducing new incentives aimed at fostering growth in key sectors. The proposed changes are designed to streamline processes and ensure that resources are allocated effectively to stimulate economic activity and job creation across the state.

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

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