The state’s top economic development official says if lawmakers create a tax credit for production of sustainable aviation fuel, Iowa could land a refinery. There are already refineries in Georgia, North Dakota and Montana producing the renewable fuel for airplanes, but Iowa Economic Development Authority director Debi (like “Debbie”) Durham says there’s a market for several more around the country.
“We believe Iowa’s the perfect place to do that and actually there’s a lot of interest from the private sector to do that, based on our lead activity,” Durham says. “When you look at our overall competitive nature of our taxes, when you look where the supply is from a transportation point of view, when you look at what we’re proposing, just simply having a conversation around a production tax credit would be, I think, just stuff to move the needle a little bit because there is plenty of room in this marketplace for growth.”
Governor Reynolds will reveal the specifics on tax-related recommendations in January, during the annual “Condition of the State” address governors deliver at the statehouse. Durham suggests some long-standing tax credits the state has offered businesses are up for a potential overhaul.
“We’ve done research on other states, the states we compete with,” Durham says, “because we want to make sure we’re not outliers in doing something.”
The state tax credit for research and development is critical, according to Durham, but she says it can be adjusted. However, Durham says change is needed in the state’s 20-year-old High Quality Jobs Program. It has provided tax breaks to Iowa businesses expanding their operations here and to out-of-state companies launching an Iowa location. Durham says the program’s tax credits and exemptions were created to buy down Iowa’s corporate tax rate, which was among the highest in the country.
“Even at a 7.1% corporate flat rate now, or a two tier, getting to a goal of 5.5% with single factor — all of just makes us pretty competitive and so those incentives are not as meaningful,” Durham says. “…We don’t need as many tax incentives, we don’t need as much tax incentives, but they need to look differently and they need to function differently.”
Durham has been Iowa’s top economic development official since 2011. She spoke with reporters after an appearance at the Iowa Taxpayers Association’s annual symposium.