The bill would create the Major Economic Growth Attraction Program, and is often referred to simply as MEGA.

The Iowa Economic Development Authority asked the legislature to pass a bill that would help it secure such large projects, according to state Sen. Tim Kraayenbrink, R-Fort Dodge.

He said there are a couple of specific projects the bill is intended to support, but added that he is not at liberty to discuss them.

The Senate passed the bill last year. This year, it has been approved by a subcommittee in the House of Representatives and awaits action by the House Ways and Means Committee. State Rep. Ann Meyer, R-Fort Dodge, said it is expected to pass.

“We are excited to see this MEGA site incentive bill being championed at the statehouse,” said Astra Ferris, chief executive officer of the Greater Fort Dodge Growth Alliance.

“This is an amazing opportunity to help create even more opportunities and economic vitality for the Fort Dodge region,” she added.

The bill provides various tax incentives. It also prohibits any country that is adversarial to the United States from participating.

Kraayenbrink said that the state government in recent years has reduced the number of tax credits it offers. But he added it still has not reduced the corporate income tax enough to make the state inviting for really big investments.

“Corporate income tax wise, we’re not where we need to be,” he said.

The MEGA Program tax breaks are intended to help overcome that situation, according to the senator. Those incentives include a full refund of sales, service and use taxes paid during construction; and a refundable investment tax credit of up to 5 percent of the capital investment.

The state’s restrictions on foreign ownership of land would not apply for projects that meet the MEGA criteria and would be located at a certified site.

“I think what we in Iowa are concerned about is foreign countries coming in and buying up farmland,” Kraayenbrink said. “They’re not buying farmland. They’re buying a spot to put a company on.”

Allowing foreign ownership of land was a concern for House Republicans when they received the bill from the Senate near the end of the 2023 legislative session, according to Meyer. She said that’s why they did not advance the bill last year.

She said the bill allows only countries that are friendly to the United States to own land and receive incentives through the MEGA program.

Requirements

To qualify for tax incentives under the proposed MEGA Program projects must::

• Be worth more than $1 billion in capital investment

• Be related to advanced manufacturing, biosciences or research

• Create jobs that pay at least 140 percent of the laborshed wage as defined by state law

• Offer employees a qualified benefits plan

• Projects that meet those requirements can receive:

• A refund of sales, service and use taxes paid during construction

• A refundable investment tax credit of up to 5 percent of the capital investment

• A withholding tax credit