State Financial and Technical Assistance Programs
Community Economic Betterment Account (CEBA) & Economic Development Set-Aside (EDSA)
The CEBA & EDSA programs provide financial assistance to businesses creating new job opportunities or retaining existing jobs. Assistance may be provided to encourage new business start-ups, expansion or retention of existing businesses, or the recruitment of out-of-state businesses into Iowa. All cities, counties or merged area schools (community colleges) are eligible to apply on behalf of businesses that are expanding or are new business ventures in Iowa. Projects eligible for CEBA & EDSA funding include, but are not limited to, the following:
- Building construction or reconstruction
- Acquisition of land
- Equipment purchases
- Operating and maintenance expenses
- Site development-clearance, demolition and removal of buildings
- Working capital
Assistance may be in the form of loans and/or forgivable loans. The maximum award of any type is $1 million for the CEBA and $500,000 for EDSA, based in part on job creation, quality of employment, and benefits for the state and local community. The EDSA program assistance is targeted toward communities with populations of less than 50,000. At least 51% of the created/retained employment opportunities must be made available to individuals presently earning wages defined as "low and moderate" income.
Another assistance tool is the Public Facilities Set-Aside (PFSA) program that provides financial assistance to cities and counties for public infrastructure improvements.
Targeted Small Business Assistance Program (TSB):
The Iowa Department of Economic Development (IDED) is committed to helping Iowans achieve their business goals. The Small Business Assistance Programs are designed to help women, minorities and persons with disabilities receive business assistance. These programs not only support multiculturalism in Iowa, but grow and expand Iowa's economy.
The Targeted Small Business (TSB) Assistance Program supports the creation and expansion of specified businesses. To qualify for the program, a business must have annual gross sales of less than $3 million and be at least 51% owned, operated and managed by women, minorities or persons with disabilities.
Forms of Assistance
Loans of up to $25,000 may be provided at interest rates of 0-5% that must be repaid in monthly installments over a five to seven year period. The first installment can be deferred for three months for a start-up business and one month for an existing business.
Loan guarantees are available in limited cases for lines of credit up to $40,000. Loan guarantees can cover up to 75% of a loan obtained from a bank or other conventional leader. Interest rates are at the discretion of the lender.
Equity grants are available in amounts up to $25,000, in limited cases. TSB funds may be used to purchase equipment, acquire inventory, provide operating capital or leverage additional funding.
Entrepreneurial Ventures Assistance (EVA):
The Entrepreneurial Ventures Assistance (EVA) program provides financial assistance and technical assistance to start-up and early-stage companies and existing companies that are developing a new product or new technology. The purpose of the Entrepreneurial Ventures Assistance program is to encourage the development of entrepreneurial venture planning and managerial skills in conjunction with the delivery of a financial assistance program for business start-ups and expansions. Eligibility Requirements:
An eligible business must be a start-up company, or an existing company that is developing a new product or technology.
An eligible applicant must have completed or be participating in a recognized entrepreneurial venture development program, or a business whose principal participant has successfully completed a recognized entrepreneurial venture development program or its equivalent.
An applicant should consult with and obtain a letter of endorsement from one of Iowa’s business accelerators. The individual or business must have a business plan that details the business growth strategy, management team (if applicable), production/management plan, marketing plan, financial plan, and other standard elements of a business plan (the business plan will be assessed on a numeric basis with weight given to a variety of traditional business plan components/categories).
An eligible business must be located in Iowa and in an industry sector offering the greatest start-up and growth potential for the state.
Value-Added Products and Processes Financial Assistance Program (VAAPFAP)
VAAPFAP funds projects utilizing Iowa's wealth of agricultural commodities. Awards are based on project feasibility, utilization of Iowa commodities, and new or innovative products or processes. Assistance is provided in the form of grants and loans with the maximum award being $900,000. Currently, no one project may receive more than 25% of the program's annual fund appropriation.
Physical Infrastructure Assistance (PIAP)
PIAP provides financial assistance for projects having a statewide impact and substantial private investment with the opportunity to create high-wage jobs.
Revitalize Iowa's Sound Economy (RISE)
This program is administered by the Iowa Department of Transportation for expenditures on city, county and state highways to help attract new development or to support growth with existing developments. Projects are evaluated on economic potential and impact.
Revitalization Assistance for Community Improvement (RACI)
RACI is a unique fund utilizing funding from the Prairie Meadows Racetrack and Casino. This program targets cities with a population under 30,000 and strives to support economic development initiatives, which enhance opportunities and viability for a community's future.
Rail Economic Development Program
The Iowa Department of Transportation provides funds for construction or rehabilitation of rail spurs to serve new or existing industries. The rail project must be a key to the creation or retention of jobs.
Community Development Block Grant (CDBG)
The primary goal for the CDBG program is to the development of viable communities by providing decent housing, suitable living conditions, and expanding economic opportunities-primarily for persons of low and moderate income. CDBG funding includes public facilities, community facilities and services, and imminent threat funding. CDBG also provides funding for improvements/enhancements to water and sewer systems, and rural water connections.
Job Training Programs
Iowa Industrial New Jobs Training (260E):
The Industrial New Jobs Training Program provides businesses, which are expanding their Iowa workforce, with new employee training. Available via Iowa's 15 community colleges, the program is financed through bonds sold by the colleges. Depending on wages paid, the business then diverts 1.5 or 3 percent of the Iowa state withholding taxes generated by the new positions to the community college to retire the bonds. Because of this structure, the training is available at what is essentially no cost since the bonds are retired with dollars that otherwise would have been paid to the state as withholding taxes. In addition to increasing worker productivity and company profitability, businesses participating in the Iowa Industrial New Jobs Training Program may also be eligible for reimbursement up to 50 percent of the annual gross payroll costs expended for on-the-job training, as well as a corporate tax credit if Iowa employment is increased by at least 10 percent.
Iowa Jobs Training Program (260F)
The Iowa Jobs Training Program provides job training services to current employees of eligible businesses that are located in Iowa. Eligible businesses can work with their local Iowa community college, which will assess training needs, determine funds availability and provide training. For participating businesses, the advantages include valuable employee training at a reduced - or no- cost.
New Jobs Credit
When businesses enter into an agreement under the Iowa New Jobs Training Program, they may qualify for this additional credit to their Iowa corporate income tax.