Statehouse leaders says they’re willing to consider a sales tax incentive for flood ravaged Cedar Rapids. Republican House Speaker-elect Kraig Paulsen says while lawmakers have been reluctant to adopt an increase in the hotel/motel tax, Republicans may support allowing the community to keep a portion of sales tax revenue to invest in flood prevention and repairs.
“I think it would have to be dedicated, for the legislature to have interest, to making sure that the flood walls were built to protect both the east and west sides of the river in the City of Cedar Rapids,” Paulsen said. Paulsen, who represents the Cedar Rapids suburb of Hiawatha, says the tax break would be modeled after the one approved five years ago for the Newton Speedway.
Senate Majority Leader Mike Gronstal, a Democrat from Council Bluffs, says the idea has merit but should not be solely restricted to Cedar Rapids. “We recognize that Cedar Rapids, Linn County, and a number of other communities in the state have had dramatic challenges relative to the flood of 2008, so we’re willing to look at a variety of ideas,” Gronstal said. “Those ideas have to have broad appeal, not just in those communities, but also be tools in other communities that have challenges.”
When Newton lost its major employer Maytag, the legislature approved a tax incentive to lure a NASCAR style racetrack. The Speedway was allowed to keep the first $12.5 million it collected in sales tax before remitting the rest to the state.
Paulsen and Gronstal made their comments on the Iowa Public Radio program The Exchange.