Democrats in the Iowa Senate are touting four ideas targeted toward small businesses, including a sizable tax credit for small business owners who provide health insurance to their employees. Under the plan, Iowa businesses with two to 10 employees would get a refundable tax credit worth 25 percent of the federal credit that companies are now getting for health care premiums.
Senator Tom Rielly, a Democrat from Oskaloosa, says big businesses have benefited from the refundable state tax credit for research and development. “Why not help out a Main Street business that’s struggling to pay their health insurance?” Rielly asks. “I think they deserve a little help, too.”
According to Rielly, it means a small businessman who pays 50-thousand dollars a year to provide health care coverage for his employees would get a nearly $4,400 state tax credit. “We feel that this is a step in the right direction to helping small businesses thrive and grow in Iowa,” Rielly says.
Senate Democrats also propose a series of town hall meetings around the state to hear from small business owners who’ve had trouble with state government red tape. Republican Governor Terry Branstad has proposed a review of all state regulations.
Senator Jeff Danielson, a Democrat from Cedar Falls, says their idea for town hall meetings “fits” with Branstad’s idea. “We would love to help the governor figure out how to ease the burdens on small businesses,” Danielson says. A five-million dollar state fund to provide loans to small businesses was established last year.
Senate Democrats want to make those loans interest-free for the first six months. Senator Steve Sodders, a Democrat from State Center, says it’s about helping small businesses get the capital they need to expand. “The foundation of our state’s economy and economic recovery must include helping out our small businesses,” Sodders says.
“And that’s what we’re trying to do.” Senate Democrats are also proposing a $200,000 increase in state money available in the form of grants to help clean up shabby buildings and abandoned properties around the state.
Senator Tom Hancock, a Democrat from Epworth, says it’s a huge issue in small-town Iowa. “Blighted buildings on our Main Streets or in our industrial parks are a drag on successful small businesses,” Hancock says.
Democrats estimate these four ideas have a total price tag of about $8.5-million.