Legislature can cover Iowans on waiting list for solar tax credits

Gary Gromman with the rooftop solar panels installed Wednesday at his southeast Cedar Rapids home. Gromman applied for a solar tax credit, but was told the funds had run out. (Jim Slosiarek/The Gazette)

CEDAR RAPIDS — Over 10 years, more than 4,600 Iowa homeowners have received nearly $15 million in tax credits for solar energy installations.

However, solar power installations proved so popular that the $5 million that Iowa lawmakers earmarked for tax credits ran out. Thus, rather than obtaining their tax credit, nearly 3,000 owners were put on a waiting list.

And they are still waiting.

Carol Sweeting, of southeast Cedar Rapids, said her experience made her feel like a “bait and switch” from the state.

“A whole bunch of us got screwed over this thing,” Cedar Rapids’ Gary Gromman said. He received a “Dear John” letter from the state rather than the $4,700 tax credit he expected after investing $35,000 in a solar system. The tax credit and federal credit of about $9,000 made installation affordable for the software engineer.

“I expected the state to honor its word,” Gromman said.

Like others, Jason Burns from Solon was motivated to install a solar power system to reduce his electricity bills and do something for the environment. Burns spent about $13,000 on a solar installation, expecting to get about $1,700 from his state tax credit.

“People have invested a lot of money,” Burns said. “People relied, to their detriment, on the government. They should keep their promises.

Gary Gromman installed solar panels on the roof of his home in southeast Cedar Rapids, Iowa on Wednesday, March 2, 2022. Gromman applied for a solar tax credit, but was told funds had run out . (Jim Slosiarek/The Gazette)

He is not alone. Christopher Rants, representing the Iowa Solar Energy Trade Association, told a House Ways and Means subcommittee on Wednesday that although the Legislature decided last year not to extend the credit, “many Iowans think they were entitled to the tax credit, that they had met their “half of the bargain” by investing in solar power.

“You have people who didn’t just go and buy solar yesterday,” Rants said. “You have people on the waiting list who made their investment two years ago who were waiting for their credit because at the time they made their investment, the credit was in progress.”

Not receiving the tax credit she was entitled to was “hard to swallow when the governor says there’s so much surplus we’re going to cut taxes,” Sweeting said.

House File 2395 would not extend or renew the tax credit, but would cover credits claimed by homeowners before the credit expired.

“That’s my goal,” said the bill’s sponsor, Rep. Michael Bergan, R-Dorchester, who called the credit “a significant investment in Iowa’s solar power options.”

According to information he received from the Department of Revenue, there were just under 1,500 homeowners claiming $4.5 million in tax credits in 2020. The numbers are expected to be similar for 2021, a- he declared.

It’s not just homeowners who benefit from the credit, according to Bergan, Rants and others who point out that the state has benefited from the diversification of Iowa’s energy portfolio and the environmental benefits that come with it.

“Since the inception of credit, but especially over the past few years, we have informed policy makers of the benefits and the amount of private investment that $5 million a year has spurred,” said Tyler Olson of SiteGen Solar at Cedar Rapids. , a former Democrat. legislator and member of the solar professional association. Solar industry jobs in Iowa are spread across all 99 counties and have grown from 350 in 2015 to nearly 1,000 in 2019.

There is a related bill in the Senate, Senate File 2326. Ways and Means Committee Chairman Dan Dawson, R-Council Bluffs, is on the subcommittee. He was not in favor of extending the tax credit last year, saying such credits have created a “mosaic” of tax relief that has hampered full tax relief. The GOP-controlled Legislature approved “historic” tax relief in 2021 and again this year.

Dawson’s counterpart in the House, Ways and Means Chairman Lee Hein, R-Monticello, said in January he expected something to be done on the oversubscribed solar tax credit.

Covering tax credits claimed by Iowa homeowners over the past two years “I think that’s the lowest bar,” D-Cedar Rapids Rep. Eric Gjerde said during the HF 2395 subcommittee hearing.

Comments: (319) 398-8375; [email protected]

Gary Gromman with the rooftop solar panels he had installed at his southeast home in Cedar Rapids, Iowa, Wednesday, March 2, 2022. Gromman applied for a solar tax credit, but was told the funds were exhausted. (Jim Slosiarek/The Gazette)

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