Action Alert: Honor Iowa’s Tax Credit Promise

Iowa Solar Homeowners: Speak NOW in support of bills to fund the waitlist

As many as 3,000 residential solar owners will lose the expired Iowa tax credit unless the Legislature funds the waitlist.

We now have live bills to fund the waitlist! Thank you to Representative Bergan for introducing HF 2395 (now HF 2556), and to Senator Klimesh for introducing SF 2326.

UPDATE: HF 2395 is approved by House Ways and Means Committee, amended, and renamed HF 2556.

UPDATE 3-31-22: HF 2556 passed the full House yesterday, 94-0! SF 2326 passed the Ways and Means subcommittee (with an amendment maintaining the bill integrity) and moves on to the full Ways and Means. ALL EFFORT NOW ON THE SENATE, AND EVERY SENATOR MATTERS!

1. Contact your legislator via phone and/or email. Ask them to support these bills, and specifically, to work with their colleagues to ensure they are enacted. If you’re set to lose your ~$3,000 tax credit, make sure they understand how much this means to you! Be clear: these bills do NOT extend Iowa’s solar tax credit, they ONLY fund the wait list for those that installed prior to the 2021 deadline.
2. SF 2326 goes to the Senate Ways and Means Committee. These individuals are especially important to contact:
   1. Dan Dawson, District 8 (Council Bluffs), Chair of Ways and Means
   2. Tim Goodwin, District 44 (Des Moines/Louisa/Muscatine Counties), Vice Chair of Ways and Means
   3. YOUR own Senator: ask them to work with Dawson and Klimesh to move the bill.
3. HF 2556 passed the House, but they may need to pass the amended Senate version again.  These individuals are especially important to contact:
   1. Speaker Pat Grassley, District 50 (Grundy County, parts of Hardin and Butler)
   2. Lee Hein, District 96 (Delaware/Jones Counties), Chair of Ways and Means
   3. YOUR representative: ask them to work with Reps Grassley and Hein to pass the amended Senate bill when it arrives.
4. Email Representative Bergan and Senator Klimesh thanking them for introducing the bills, and ask for continued support.
5. Reach out to every solar owner you know who may also be on the waitlist and encourage them to advocate!
6. Be active on social media, promote traditional media stories, tag your legislators.
7. Keep communication going with your legislators asking for progress, until a bill is passed.
8. If you installed a solar system in 2021, be sure to apply for the tax credit on the Department of Revenue’s web site. (if you don’t apply and get on the waitlist, and then the legislature does allocate funds, you’ll be out of luck). The Department is currently issuing denial letters because the residential funds are gone, but they have assured us the waitlist will not be purged on January 1st. If the Legislature acts this coming session to fix the issue, all eligible applicants should be covered, but you must advocate.

The following is excerpted from our newsletter article. Read the full article here.

For years, Iowa homeowners have been told the state’s solar tax credit is available for solar systems installed through 2021. Now it appears the State of Iowa is about to break that promise.

The Iowa Department of Revenue’s Solar Energy System Tax Credit page says:

The Department estimates that for residential installation applications with a submission date of October 1, 2020, or later, the application and tax credit request will expire under Iowa law and the taxpayer will not receive an Iowa Solar Energy System Tax Credit.

That’s right, it looks like homeowners who invested in solar during the second half of 2020 and all of 2021 – believing the tax credit was available to them – are about to be hung out to dry. Because of a quirk in Iowa law, business solar owners will all receive their credit in full.

What is the magnitude of the broken promise? According the Revenue Department, in October 2021 the waitlist of homeowners expected to lose their credit included 1,262 applicants and totaled $4,020,144 (over $3,000 per applicant).

The fix is not rocket science: the Legislature needs to directly appropriate the money to make these residential solar owners whole, just as the waitlisted business solar owners will also be made whole.

According to Governor Reynolds’ office, the state ended fiscal year 2021 in June with a budget surplus of $1.238 billion. “Iowa is in a very strong financial position” said Reynolds, “We will continue to invest .. going forward to meet the needs of our citizens and our state.” Honoring the solar tax credit promise to homeowners, we suggest, would be a good place to start.

Even if the residential waitlist grows through 2021 to a $5-6 million shortfall, this would still represent less than one-half of one percent of the 2021 budget surplus.

If you’re on Iowa’s solar residential tax credit waitlist, or have installed solar in 2021 and have yet to apply … now is the time to speak up, because your promised tax credit is on the line. Tell your legislators and Governor to do the work, fix the waitlist, and honor the state’s promise.

Iowa Residential Solar System Tax Credit Waitlist Numbers By County, October 2021 (provided by Iowa Department of Revenue*)

*note, the IDR data provided included the first three columns; the actual number of systems/homeowners on the list (column four) is a derived calculation using the average statewide residential tax credit value of $3,186