On June 2, 2026, Iowa Governor Kim Reynolds signed House File 2799, a six-division economic development package. The bill creates the Headquarters Expansion and Development for Growth and Employment (EDGE) program, extends the Major Economic Growth Attraction (MEGA) program through January 1, 2030, and attaches a dedicated employer training fund to the Business Incentives for Growth (BIG) program. The bill, formerly House Study Bill 755, passed the House 78-7 on May 2 and the Senate 41-0 on May 3 in the closing days of the 2026 session. The repeal of the New Jobs Tax Credit took effect on signing, and the remaining divisions take effect July 1, 2026.
Key Takeaways
| 01 | Iowa now has a dedicated headquarters incentive. EDGE pays refundable credits of up to 15% of wages for new headquarters jobs and 1% for retained jobs, for up to three years. |
| 02 | MEGA gets three more years to land a megaproject. The award deadline for $1 billion-plus projects moves from January 1, 2027, to January 1, 2030, and the two-business limit stays. |
| 03 | BIG projects gain a training fund tied to their own payroll. Up to 1.5% of covered wages is diverted from withholding into the fund, projected to reach $2.7 million by FY 2031. |
| 04 | The New Jobs Tax Credit is gone as of June 2, 2026. It was worth up to $1,224 per new job in 2026, and credits already issued remain claimable. |
| 05 | The Iowa Industrial New Jobs Training (260E) program is tightened and under study. New agreements face a seven-year deferral cap and 70% bond limit, and a study committee reports by December 15, 2026. |
HF 2799 completes a three-year rebuild of Iowa's incentive toolkit (Exhibit 1). The legislature created MEGA in 2024 (2024 Iowa Acts, chapter 1090) for projects investing more than $1 billion, then replaced the long-running High Quality Jobs program with BIG in 2025 (2025 Iowa Acts, chapter 136). BIG launched in January 2026 and approved its first five awards on February 20, 2026: 536 jobs and $268.2 million in new capital investment, led by Arconic's $131 million casting complex in Bettendorf and Vermeer's $102.7 million plant in Bondurant. Reynolds credits the pro-growth posture with more than $20 billion in new capital investment attracted since 2024. In announcing the awards, she also cited state GDP growth of 5%, net earnings growth of 7.3%, and personal income growth of 3.7%. EDGE adds a program aimed at corporate headquarters.
Iowa's EDGE program is unrelated to Illinois' Economic Development for a Growing Economy (EDGE) credit, which shares only the acronym.
"Since 2024, Iowa has attracted more than $20 billion in new capital investment and our economic indicators are on the rise..."
Gov. Kim Reynolds, announcing the first BIG awards
Source: Office of the Governor of Iowa, February 20, 2026. Photo: official photo, Office of the Governor of Iowa.
Exhibit 1
Iowa's incentive rebuild, 2024 to 2026
| Program | Enacted | Target | Status |
|---|---|---|---|
| MEGA | 2024 Iowa Acts ch. 1090 (SF 574) | Projects investing more than $1 billion | Extended to Jan. 1, 2030 by HF 2799 |
| BIG | 2025 Iowa Acts ch. 136 (SF 657) | Replaced High Quality Jobs; launched Jan. 2026 | First five awards Feb. 20, 2026; training fund added by HF 2799 |
| EDGE | HF 2799, signed June 2, 2026 | Corporate headquarters, new and retained | Effective July 1, 2026; agency rules pending |
Sources: Iowa Legislature; Office of the Governor of Iowa.
EDGE pays refundable, wage-based tax credits to companies that locate or keep corporate headquarters in Iowa. The program, administered by the Iowa Economic Development Authority (IEDA), offers two credits under Division I of the enrolled bill, shown in Exhibit 2.
Exhibit 2
EDGE credits at a glance, HF 2799, Division I
| Credit | Amount | Duration | Cap |
|---|---|---|---|
| New corporate jobs | Up to 15% of gross annual wages | Up to 3 years | None specified |
| Retained corporate jobs | Up to 1% of gross annual wages | Up to 3 years | $1.0 million |
Sources: HF 2799 (enrolled), Division I; LSA Fiscal Note, May 19, 2026.
Both credits can be claimed against personal income, corporate income, franchise, and moneys-and-credits taxes, and any credit exceeding liability is refundable or may be carried to the following tax year. Because the credit is refundable, a headquarters relocation with limited early-year Iowa tax liability still receives its full value. Credits cannot be carried back to prior years.
The Legislative Services Agency (LSA) expects EDGE to be a small, high-wage program. The final fiscal note (May 19, 2026) models one new-headquarters and one retained-headquarters agreement every two years, an average headquarters of 255 employees with 30% meeting the qualifying wage, and an average qualifying wage of $140,000 in FY 2026. First agreements are expected in FY 2027, with first claims in FY 2028 (an estimated $1.8 million General Fund cost that year, growing to $4.1 million by FY 2032). IEDA will set eligibility requirements and an application fee by administrative rule, and the authority retains discretion to negotiate the aggregate value of incentives in each agreement.
Division II extends the MEGA award deadline by three years, from January 1, 2027, to January 1, 2030. MEGA targets businesses investing more than $1 billion in advanced manufacturing, bioscience, or R&D facilities, offering an investment tax credit of up to 5% of qualifying investment, a refund of state sales, service, or use taxes paid during construction, and a withholding tax credit of up to 3% of gross wages for qualifying project jobs. The statutory limit of two participating businesses remains. The division also updates the program's "foreign adversary" exclusion to track the federal definitions at 15 C.F.R. § 7.4(a) and § 791.4, which currently cover China, Cuba, Iran, North Korea, Russia, and the Maduro regime. The LSA models one additional award from the extension, costing roughly $18 million per year in General Fund revenue in FY 2030 through FY 2034 once claimed, plus about $0.5 million per year in lost Secure an Advanced Vision for Education (SAVE) fund revenue.
BIG gains a training fund that ties workforce dollars directly to employer demand. Division III creates the BIG Program Training Fund, financed by diverting up to 1.5% of the gross wages of employees covered by a BIG agreement from state income tax withholding under Iowa Code § 422.16. The fund reimburses training expenses for BIG projects and is projected to grow from $0.8 million in FY 2027 to $2.7 million by FY 2031. IEDA's BIG program page lists reimbursable job training expenses alongside the program's five-year investment tax credit and construction sales tax refund. Exhibit 3 shows the LSA estimates for each division.
Exhibit 3
LSA fiscal estimates by division, General Fund effect unless noted
| Division | Provision | Estimated fiscal effect |
|---|---|---|
| I | EDGE credits | $1.8M cost in FY 2028, rising to $4.1M by FY 2032 |
| II | MEGA extension | $18.0M to $18.7M per year, FY 2030 to FY 2034 |
| III | BIG training fund | $0.8M diverted in FY 2027, rising to $2.7M by FY 2031 |
| IV | New Jobs Tax Credit repeal | $14,000 gain in FY 2027, rising to $528,000 by FY 2037 |
| V | ISU load forecast fund | $244,000 remitted to the forecasting fund in FY 2027; $489,000 in FY 2028 |
| VI | 260E limits | $15,000 gain in FY 2027, rising to $9.2M by FY 2037 |
Sources: Iowa Legislative Services Agency, Fiscal Note, Final Action, HF 2799, May 19, 2026.
HF 2799 repeals the New Jobs Tax Credit and tightens the 260E industrial training program. Division IV repeals the New Jobs Tax Credit at Iowa Code § 422.11A, worth up to 6% of unemployment insurance taxable wages, a maximum of $1,224 per new job in calendar year 2026, effective June 2, 2026. Credits issued before enactment remain claimable with full carryforward rights. Division VI bars community colleges from extending 260E agreements entered into on or before June 30, 2026; caps payment deferrals at seven years for new agreements; limits bonds to 70% of total program costs; excludes travel, conference, and legal fees; and caps community college administrative expenses at 15% of program costs. A legislative interim study committee on the 260E program must hold its first meeting by August 1, 2026, and report recommendations by December 15, 2026.
Separately, Division V requires IEDA to commission a biennial Iowa State University (ISU) electric load forecast, funded by a utility remittance of up to 0.02% of intrastate gross operating revenues, with the first forecast due by December 31, 2028. The forecast comes with an analysis of electric transmission system expansion plans. Exhibit 4 lists the dates set by the bill.
Exhibit 4
HF 2799 milestones, as of June 12, 2026
| Date | Milestone |
|---|---|
| May 2, 2026 | House passes HF 2799, 78-7 |
| May 3, 2026 | Senate passes HF 2799, 41-0 |
| June 2, 2026 | Gov. Reynolds signs; New Jobs Tax Credit repeal takes effect |
| June 30, 2026 | Last day for 260E agreements under prior deferral and extension rules |
| July 1, 2026 | EDGE, MEGA extension, BIG training fund, load forecast, and 260E limits take effect |
| Aug. 1, 2026 | Deadline for first meeting of the 260E interim study committee |
| Dec. 15, 2026 | 260E study committee report due to the General Assembly |
| FY 2027 | First EDGE agreements anticipated; IEDA rules on eligibility and fees |
| Dec. 31, 2028 | First ISU electric load forecast due |
| Jan. 1, 2030 | MEGA award window closes (up to two businesses) |
Sources: HF 2799 (enrolled); LSA Fiscal Note, May 19, 2026.
This is for companies weighing a headquarters location, sponsors of $1 billion-plus manufacturing, bioscience, or R&D projects, and employers holding BIG agreements. EDGE takes effect July 1, 2026, with IEDA's eligibility and fee rules still to come, and the MEGA window now runs to January 1, 2030. If you want a read on fit before IEDA finalizes the EDGE rules, reach out to our team.
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