A plan to revitalize Iowa’s economy by making communities more livable and attractive to business owners has been proposed by the League of Cities.

The goal of the plan, Re-energizing Economic Value in Iowa, or REV Iowa, is to restructure state and local tax systems to promote economic growth.

Thomas Bredeweg, executive director of League of Cities, said REV Iowa came in response to Iowa Farm Bureau’s Statewide Tax Increment Renewal (STIR) plan. He said one major reason the League of Cities opposes STIR is because the plan calls for the elimination of local tax increment financing (TIF), a primary tool for local economic development, and replacing them with state-wide tax increment financing.

TIF is an issued bond that helps businesses throughout Iowa expand its companies, such as new factories, at the expense of the city. The city then repays the debt through a margin of the business’ property tax.

“TIF is an incentive for businesses to set up in Iowa,” Bredeweg said.

The League introduced its program at its annual legislative meeting on Feb. 12 in Des Moines.

Bredeweg said the meeting was one of two annual meetings attended by the entire organization.

The meeting in February was for the discussion of legislation, while an annual meeting in the fall is used for discussing issues within the organization.

Mark Jackson, member of the League’s executive board, said REV Iowa’s plan is to put $500 million into economic development, then pay off the debt of $40 million a year through bonds.

“We would be able to allocate about $27 million through tax revenue, without having to raise state taxes one cent,” Jackson said. “There are many ways we can go around and find the remaining amount needed.”

Jackson said other proposals are under consideration by the state legislature.

Iowa Farm Bureau’s STIR plan calls for the removal of TIFs to allow a “revenue neutral” offset, thus allowing an increase in state property taxes by 4.5 percent. The goal is to raise $2 billion for development for the state.

“With interest, we would really be paying back about $3.2 billion for $2 billion worth of development,” Jackson said.

Another plan has been proposed by Iowa’s Chamber of Alliance to raise funds through the added taxation of gaming revenues and lottery profits, Jackson said.

Their proposal would be “pay as you go,” not issuing bonds and slowly working on economic development. He said the advantage would be no interest to pay off.

Ted Tedesco, president of Iowa League of Cities and mayor of Ames, said REV Iowa’s plan allows better security if the economic development fails.

“Paying back $500 million will be much easier than paying back $2 billion,” he said.

Bredeweg said he is not entirely sure if state legislators will accept REV Iowa, but said he hopes they will use the ideas as a starting point for Iowa’s economic development plan.