Current through Register Vol. 47, No. 6, September 18, 2024
(1)
Execution. Successful
applicants will be required to execute an agreement with the authority within
180 days of the award date. The time limit for execution may be extended by the
authority director for an additional 180 days for good cause shown. Upon
expiration of the time limit, including any extensions approved pursuant to
this subrule, the board may approve additional extensions or rescind the
award.
(2)
Requirements. An agreement shall meet all requirements of and
be administered pursuant to Iowa Code sections
15.330 and
15.330A.
(3)
Jobs. An agreement will
specify the number of jobs the business has pledged to create in addition to
the base employment level and the number of retained jobs, if applicable. If
the project is a modernization project or retention-only project, the business
shall maintain the base employment level. Job obligations will be established
and monitored pursuant to rule 261-68.7(15).
(4)
Investment. An agreement
will describe the project and specify the investment the business proposes to
make.
(5)
Project
completion date. An agreement will specify the project completion
date. The project completion date will be the date on which a program recipient
has agreed to meet all the terms and obligations contained in an agreement with
the authority, including but not limited to completing the project and creating
or retaining jobs. The project completion period will be at least three years.
The project completion date is calculated by the authority from the end of the
month during which an award is made. For example, if an award is made on June
13, 2023, the three-year project completion date will be calculated from June
30, 2023. The project completion date for this award would be June 30,
2026.
(6)
Maintenance
period completion date. An agreement will specify the maintenance
period completion date. The maintenance period completion date will be used to
establish the period during which the project, the created jobs, if any, and
the retained jobs must be maintained. A modernization project shall maintain
the base employment level through the maintenance period completion date. The
total contract length, including the maintenance period, will be at least five
years.
(7)
Conditions to
disbursement. An agreement will specify the conditions to disbursement
of project completion assistance funds or issuance of a tax credit certificate,
including but not limited to compliance with the requirements of Iowa Code
section 15A.1(3)
"b" regarding solid and hazardous waste.
(8)
Monitoring and reports.
The authority shall ensure that program recipients comply with contracts
entered into pursuant to this rule. An agreement will specify the reports a
program recipient must submit to the authority and due dates for such reports.
Reports shall be provided in form and content acceptable to the authority.
a. Recipients shall report annually to the
authority about the status of the funded project, including but not limited to
employment, wages, benefits, project costs, capital investment, and compliance
with the contract. The authority will use the data it collects in the
authority's annual report to the general assembly.
b. Recipients shall submit a report to the
authority following the project completion date and the maintenance period
completion date to verify compliance with the agreement. On-site or remote
monitoring may be conducted following the project completion date as deemed
appropriate by the authority. On-site or remote monitoring may be conducted
following the maintenance period completion date as deemed appropriate by the
authority.
(9)
Default. An agreement will specify events of default and the
remedies available to the authority.
a.
Project completion assistance. If the authority determines
that a recipient is in default, the authority may seek recovery of all project
completion assistance funds plus interest; assess penalties; negotiate
alternative repayment schedules; initiate, suspend or discontinue collection
efforts; and take other appropriate action as the board deems necessary.
Negotiated settlements, write-offs or discontinuance of collection efforts are
subject to approval by the board. If the authority or board refers defaulted
contracts to outside counsel for collection, then the terms of the agreement
between the authority and the outside counsel regarding scope of counsel's
authorization to accept settlements shall apply.
b.
Tax incentives. If the
authority determines that a recipient is in default, the authority may seek
recovery of all state tax incentives by notifying the department of revenue of
the event of default and the required repayment amount. The repayment amount is
subject to applicable interest and penalties as determined by the department of
revenue. The department of revenue will undertake collection efforts. If the
business is an entity that has elected pass-through taxation status for income
tax purposes, the department of revenue may undertake collection efforts
against members, individuals, or shareholders to whom the tax incentives were
passed through. If the agreement provided for local tax incentives, the
authority will notify the community that provided incentives.
c.
Calculation of repayment due or
reduction of incentives.
(1) Job
shortfall. If a business does not meet its job requirements, the repayment
amount or reduction of incentives shall be the same proportion as the amount of
the job shortfall. For example, if the business creates 50 percent of the jobs
required, the business shall repay 50 percent of the incentives received or
incentives will be reduced by 50 percent.
(2) Capital investment shortfall. If a
business does not meet the capital investment requirement, the repayment amount
or reduction of incentives shall be the same proportion as the amount of the
shortfall in required capital investment. For example, if the business meets 75
percent of the amount of required capital investment, the business shall repay
25 percent of the amount of the incentives received or incentives will be
reduced by 25 percent.
(3) Job and
capital investment shortfalls. If a business has a shortfall in both capital
investment and job requirements, the repayment amount or reduction of
incentives shall be the same proportion as the greater of the two shortfalls.
For example, if a business creates 50 percent of the required jobs and meets 75
percent of the required capital investment, the business shall be required to
repay 50 percent of the amount of the incentives received or incentives will be
reduced by 50 percent.
(4)
Benefits. Notwithstanding any other provision in this subrule, if a business
fails to comply with the benefit requirements of the agreement, the business
shall be required to repay all of the incentives received or incentives will be
fully revoked.
(5) Minimum
eligibility. Notwithstanding any other provision in this subrule, if a business
fails to maintain eligibility for the program, the business shall repay all of
the incentives received or incentives will be fully revoked.
d.
Notice of
default. The authority will notify a business and, if applicable, the
community of an event of default as described in the agreement.
(10)
Amendments.
Agreement amendments must comply with Iowa Code chapter 15, subchapter II, part
13, and this chapter. Participating businesses may submit requests for
amendments to authority staff.
a. Except as
provided in paragraph 68.6(10)"b," no request to amend an
agreement may be approved unless it has been reviewed by the due diligence
committee established pursuant to 261-subrule 1.3(7), the due diligence
committee has recommended approving the request to amend the agreement, and the
board approves the request to amend the agreement.
b. Authority staff may approve nonsubstantive
changes, including but not limited to the following:
(1) Recipient name, address and similar
changes.
(2) Collateral changes
that do not materially and substantially impact the authority's
security.
(3) Line item budget
changes that do not reduce overall total project costs.
(4) Loan repayment amounts or due dates that
do not extend the final due date of a loan.
(5) Changes to tax credit amortization
schedules.
