The Workforce Housing Tax Incentive Program (WHTIP) is designed to provide financial incentives for the development of housing across Iowa. Housing businesses utilizing WHTIP will produce a net increase in affordable housing units in their community of operation. In return, the Iowa Economic Development Authority (IEDA) can provide a sales and use tax refund and an investment tax credit based on qualifying new investment.
WHTIP is further designed to encourage housing development where existing public infrastructure already exists – vacant lots, dilapidated properties, and mixed use buildings to suggest a few. Communities with a severe housing need can work with IEDA to seek designation as a Distressed Workforce Housing Community. This designation allows WHTIP assistance to be provided towards new housing development on previously undeveloped land.
WHTIP is a statewide program that focuses development in existing communities. The housing business is the entity responsible for submitting all application documents and maintaining contractual responsibilities with IEDA.
Projects that have been initiated before receiving formal application approval by the Iowa Economic Development Authority for WHTIP shall not be eligible for tax incentives and assistance under this program.
“Project initiation” means any one of the following: the start of construction of new or expanded buildings; the start of rehabilitation of existing buildings, or; the purchase or leasing of existing buildings when included as qualifying investment in a WHTIP project. The purchase of land or signing an option to purchase land or earth moving or other site development activities not involving actual building construction, expansion or rehabilitation shall not constitute project initiation.
Public Records Policies
The Iowa Economic Development Authority (IEDA) is subject to the Open Records law (Iowa Code Chapter 22). Treatment of information submitted the IEDA in a WHTIP application is governed by the provisions of the Open Records law. All public records are available for public inspection.
Primary WHTIP Requirements
An eligible housing project consists of one or more of the following:
- Rehabilitation, repair or redevelopment in a Brownfield or Grayfield site. This will generate the production of new units on infill lots.
- Rehabilitation, repair or redevelopment of dilapidated units. Only dilapidated or unlivable housing units are eligible for this category. Livable units are not eligible for WHTIP assistance.
- The rehabilitation, repair or redevelopment of dwelling units located in the upper story of an existing multi-use building.
- The new construction (Greenfield) , rehabilitation, repair, or redevelopment of dwelling units in a distressed workforce housing community. The authority will determine whether a community is considered a distressed workforce housing community pursuant to subrule 48.4(2). Small cities are not required to demonstrate distressed workforce housing community requirements.
Minimum Project Size
- Four or more single family dwelling units, or two or more single family dwelling units for small cities;
- Three or more multifamily dwelling units under a single roof, or;
- Two or more dwelling units located in the upper story of an existing multi-use building.
Average Dwelling Unit Cost Cap
The average dwelling unit cost cannot exceed $200,000 per dwelling unit or $215,000 in small cities. The average dwelling unit cost may not exceed $250,000 per dwelling unit if the project meets the definitions outlined in Iowa Code 404A.1, subsection 2.
Completing Your Application
- Review Iowa Code 15.351 through 15.356, Iowa Administrative Code 261 – Chapter 48, and the WHTIP sample contract prior to submitting this application. Links are provided within IowaGrants.gov.
- All application activities for the WHTIP will be carried out through IowaGrants.gov.
- Applicants may request technical assistance from IEDA housing staff during the application development process.
- When submitting supporting documentation, include ONLY what is directly relevant to the proposed activity (e.g., include highlighted excerpts, rather than the entire document). Within the narrative of the application, reference supporting documentation and explain its relevance.
- Costs incurred in the preparation of this application are NOT eligible or reimbursable.
- A supporting resolution from the local government entity must be submitted with the application. At minimum, the resolution must clearly identify the project and identify the source of local matching funds required for the project.
- All required documentation must be submitted with the application to initiate review and approval.
Agreement and Fees
A WHTIP award requires the housing business to enter into an agreement with IEDA for the successful completion of all program requirements. The compliance cost fees imposed in Iowa Code 15.330, subsection 12, apply to all agreements entered into under the WHTIP. These fees include:
- A one-time fee of $500 to be collected by IEDA prior to the issuance of a tax incentive certificate.
- A compliance cost fee equal to one-half of one percent (0.05%) of the value of tax incentives claimed pursuant to an agreement that has an aggregate tax incentive value of $100,000 or greater. This fee is collected from the housing business after the tax incentive is claimed from the Iowa Department of Revenue.
Important Note on Claiming the Sales and Use Tax Refund
Iowa Code 15.331A requires the eligible housing business to notify the Department of Revenue in writing of intent to claim the sales tax refund for a WHTIP project. The housing business must also make application to claim the sales and use tax refund within one year of project completion. Failure to meet both requirements will result in forfeiture of the project’s sales and use tax refund. IEDA will verify documentation at the end of the project, establish a project completion date, and notify the housing business through IowaGrants.gov.