Republicans on a House subcommittee have endorsed a moratorium on state economic development awards to businesses in Iowa’s four most populous counties.
Over a million Iowans live in Polk, Linn, Scott and Johnson Counties. Republican Representative Derek Wulf of Hudson said it’s time for a shift.
“Everything we’ve been talking about and everything we’ve been doing in this building to revitalize rural has not worked. It has not worked, folks,” Wulf said during a subcommittee hearing Wednesday. “…Is this the perfect answer? I don’t know. We’ll continue to have that discussion, but something has to happen.”
Representative John Wills, a Republican from Spirit Lake, said the state’s four most populous counties already have the infrastructure to keep growing. “What needs to happen for our rural areas to grow and to advance is for economic incentives to be concentrated in those areas,” Wills said.
Business and tourism groups are opposed the bill. Dustin Miller, executive director of the Iowa Chamber Alliance which represents the 16 largest chambers of commerce in Iowa, testified at the subcommittee.
“These four counties represent 42% of the real GDP for the state,” Miller said. “…Don’t kill the ‘golden goose.'”
Sara Allen, a lobbyist for the Iowa Travel Industry Partners, stressed the importance of regional partnerships.
“We do have some concerns with this. We are registered against it,” she said. “All of us working together are going to, you know, attract people to visit our state and hopefully grow our GDP.”
Craig Patterson, a lobbyist for the Professional Developers of Iowa, said there are other ways to direct state incentives to boost development in rural areas. “The Workforce Housing Tax Credit has a small community set aside that was put in place specifically, you know, to take care of rural Iowa,” Patterson says. “Things like that tend to work a little bit better, in our opinion, than kind of having firewalls.”
The chairman of the House Ways and Means Committee indicated the bill is likely to be considered by his committee before the end of the month and the bill may be changed. According to the Iowa Chamber Alliance, the highest number of state economic development awards go to businesses in cities with populations between five-thousand and 30-thousand residents — but state incentive packages tend to be larger in the state’s largest urban areas.