The Workforce Housing Tax Incentive Program (WHTIP) provides tax benefits to incent the development of housing across Iowa. The program provides a State investment tax credit of up to 10% or 20% of the investment directly related to the construction or rehabilitation of the approved housing project, as well as a refund of the sales, service or use taxes paid during construction.
The program includes a Small City set aside for projects located in the 88 least populous counties and projects in the 11 largest counties that meet the following criteria:
- Has a population of 2500 or less, based on census data
- Had a population growth of less than 30% as determined by comparing population growth from the most recent decennial census to the census 10 years prior (growth from 2010 to 2020)
Projects qualifying under the Small City set aside may receive a 20% State investment tax credit.
For FY 2023, the program has $35 million allocation.
$17.5 million is set aside for projects taking place in communities designated as a Small City with the remaining $17.5 million available to projects located in all other communities within Iowa’s 11 most populated counties.
Proposed housing project must meet one of four criteria:
- Housing development located on a grayfield or brownfield site
- Repair or rehabilitation of dilapidated housing stock (units must have been vacant for the previous 6 months)
- Upper story housing development
- New construction in a greenfield site
The developer must build or rehabilitate at least four (4) single family units (Note- Projects in a Small City may include two (2) single family units) OR at least three (3) units in a multi-family building OR at least two (2) upper story housing units.
Total project costs may not exceed the per unit cost cap established by IEDA. Please visit the program website for more information regarding the FY 2023 per unit cost cap: Workforce Housing Tax Credit | Iowa Economic Development Authority (iowaeda.com)
Local matching funds must be provided to the project. Match must be in the form of cash or cash equivalent and equal at least $1,000 per unit to be created. Tax abatement, exemptions, or rebates may be considered local match towards a project.
Projects must be completed within three (3) years from the date of award.
Project costs incurred prior to receiving an award are not eligible project costs and will not be included when calculating tax credit award amount.
Federal, state, or local incentives that do not require repayment are not included as qualifying investment and will not be included when calculating the tax credit award amount.
Public Records Policies
The Iowa Economic Development Authority (IEDA) is subject to the Open Records law (Iowa Code Chapter 22). Treatment of information submitted to IEDA through an application for assistance is governed by the provisions of the Open Records law.
Completing Your Application
- Applications are reviewed and scored on a competitive basis. The evaluation and scoring criteria used can be found here: Workforce Housing Tax Credit | Iowa Economic Development Authority (iowaeda.com) (Under “Resources)
- Prior to applying, applicants should review Iowa Code 15.351 through 15.356 and Iowa Administrative Code 261 – Chapter 48 for additional information on program requirements: 03-23-2022.261.48.pdf (iowa.gov)
- Applications are submitted through www.Iowagrants.gov. Applicants must first create an Iowagrant.gov account prior to creating/submitting an application.
- Once an application is submitted for review, applicants will not be able to amend or correct information in the application. It is imperative that applicants review all information and ensure all required attachments are included with an application before the application is submitted for review. IEDA may ask for clarification on submitted information during the application review.
- Applications must be complete. Applications that are missing required information and attachments will not be reviewed or scored. IEDA staff will inform applicants why an application was not scored.
- Please visit the Workforce Housing Tax Incentive website for additional resources regarding the application process: Workforce Housing Tax Credit | Iowa Economic Development Authority (iowaeda.com)
- Applicants should email firstname.lastname@example.org with questions regarding the application and review process.
Agreement and Fees
Developers receiving an award will 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 WHTIP agreements. 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.
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