National and industry leaders agree that housing is the single-most significant opportunity for rapid economic recovery and growth for families and communities.
With the state projected to gain 47,000 more households by 2030, Iowa faces widespread demand for quality, affordable housing. But much of Iowa’s housing inventory is aging. Forty percent of all housing units in the state were built before 1950.
The 2020 Iowa Profile cites cost burdens as the most common housing issue in Iowa. More than 38% of renters and nearly 16% of homeowners are spending more than 30% of their income on housing.
Gov. Reynolds is proposing a comprehensive housing plan that delivers innovative solutions to bolster the housing supply and financial assistance for Iowans who need it most, including low-income families and seniors.
Increase Workforce Housing Tax Credits
This existing program provides tax benefits to developers to expand housing in Iowa communities, focusing especially on projects using abandoned, empty or dilapidated properties. The program has a current backlog of $13.3 million in shovel ready housing projects.
- Increase the Workforce Housing Tax Credit from $25 million to $50 million, and increase the small cities set-aside from $10 million to $20 million for three years.
Establish Iowa Housing Tax Credit Program
This new program will address the housing need for the lowest-income Iowans. The program is expected to assist in the development of approximately 375 new rental homes each year for a total of 3,750 new rental homes by 2030.
- Establish the Iowa Housing Tax Credit program and provide an annual allocation of $15 million in tax credits.
Expand Redevelopment Tax Credits
Developers in Iowa can receive tax credits for redeveloping abandoned, idled or underutilized industrial or commercial properties known as brownfield properties, or grayfield properties, which include abandoned public buildings, industrial or commercial properties.
Increasing the availability of Brownfield and Grayfield Redevelopment Tax Credits will increase the supply of housing options for all Iowans, revitalize neighborhoods and boost economic growth in redeveloping communities.
- Extend the sunset date for redevelopment tax credits by 10 years to June 30, 2031.
- Increase the allocation from $10 million to $20 million per year.
Create Disaster Recovery Housing Assistance
Create a standing Disaster Recovery Housing Assistance program to assist in immediate recovery efforts after natural disasters, to be implemented and funded upon the issuance of a state disaster proclamation.
Support Main Street Revitalization
Create a Main Street Loan Guarantee Program in partnership with Iowa banks to allow businesses access to financing for eligible downtown revitalization projects.
Support State Housing Trust Fund
Remove the current cap from the Real Estate Transfer Tax as an enhanced funding mechanism for the State Housing Trust Fund.