Biorenewable Chemical Tax Credit Program signed into law Wednesday, April 6, 2016.
DES MOINES, Iowa (April 6, 2015) —Governor Branstad just signed into law the Biorenewable Chemical Tax Credit Program (SF 2300), the world’s first incentive package aimed specifically at the biorenewable chemicals industry.
The revenue-neutral tax credit program allocates up to $105 million in tax incentives over ten years for the in-state manufacture of 40 essential building-block chemicals. In passing this legislation, Iowa has formally opened its doors to the $250-billion-per-year U.S. chemicals market and a global bio-polymers market that is expected to triple by 2020.
The program, which is to be administered by the Iowa Economic Development Authority, creates an eligible credit of $0.05/pound for production of qualifying renewable chemicals in a given year. Companies less than five years old will have a lifetime maximum credit cap of $1 million per year for five years; companies older than five years will be eligible for a maximum of $500,000 per year for five years.
Supported in the house and senate by a diverse coalition of organizations including the Cultivation Corridor and the Iowa Biotechnology Association, the Biorenewable Chemical Tax Credit Program will help Iowa remain a competitive national leader in agribusiness innovation while inviting thousands of new jobs and millions in revenue to the state.
“The Biorenewable Chemical Tax Credit Program is a critical success for Iowa. A report released by the Cultivation Corridor and IowaBio in January suggests that upwards of 50,000 new jobs will be created in the biorenewable chemicals industry in the United States in the next ten years,” said Brent Willett, the Cultivation Corridor’s executive director. “This action sends a message to the market that Iowa is committed to being a premier destination for biochem investment, talent and research. The Cultivation Corridor congratulates and thanks each individual, business and organization that helped to make this unique accomplishment a reality.”
“An unprecedented coalition of supporters helped carry this through the legislature to the governor’s desk,” said Willett. “The Cultivation Corridor applauds IEDA director Debi Durham, Senator Rita Hart [D-Clinton] and Representative Mary Ann Hanusa [R-Council Bluffs] for championing a bill three years in the making, and the Iowa Legislature and Governor Branstad for approving it. The Iowa Biotechnology Association, the Ames Chamber of Commerce, the Greater Des Moines Partnership and numerous other groups were also instrumental in moving the legislation through both chambers. Together, these individuals and organizations have effectively positioned Iowa at the forefront of a growing national industry.”
The findings report, Biobased Chemicals: The Iowa Opportunity [PDF], indicates that Iowa is well-suited to lead the nation in the biorenewables chemical market due to the state’s existing biorenewables infrastructure, which includes the National Science Foundation’s Engineering Research Center for Biorenewable Chemicals, Iowa State University’s BioCentury Research Farm and Center for Bioplastics and Biocomposites, and Iowa’s foundational network of more than 50 biofuel processing sites. Iowa also has the nation’s highest availability of bio-based feedstock and the nation’s highest rate of employment in agricultural feedstock and chemical production.
“With this legislation, we’ve rounded out the equation between Iowa’s existing capital, world-class expertise and available feedstock,” said Willett. “The opportunity was there, and we took it.”
For more information about the Biorenewable Chemical Tax Credit Program, visit www.cultivationcorridor.org/
About the Cultivation Corridor
Led by Executive Director Brent Willett, CEcD, the Corridor brings together the Iowa Economic Development Association with the Greater Des Moines Partnership and the Ames Economic Development Commission to brand and market central Iowa to audiences within Iowa and around the world. Since its launch, the Cultivation Corridor has overseen more than $1.7 billion in new business development and expansions in Iowa’s agbioscience and agtechnology spaces, and has promoted its message to delegate groups from Canada, China, Israel, Great Britain and Kosovo.
The Cultivation Corridor was launched in April 2014 and unites central Iowa under a project that stimulates economic growth through the extension of beneficial public-private partnerships, increased capital resources, business incentives and the development of a highly specialized workforce. As one of the world’s most productive bioeconomies and the nation’s foremost innovation cluster for the agbioscience and agtechnology industries, central Iowa’s Cultivation Corridor is attracting investment, talent and research from across the globe in its mission to support and sustain the science that feeds the world.
For more information, visit www.cultivationcorridor.org.
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