A legislator who shepherded the original Grow Iowa Values Fund bill to passage in 2003 says he’s confident that a measure to reinstate the economic development program will have even stronger support when it reaches the House floor this session.

“I think the support for it is very, very good,” said Rep. Clarence Hoffman, co-chairman of the House Economic Growth Committee. “I would say that 95 percent of the candidates that ran for re-election said economic development was one of the top issues. They cannot go home and tell their constituents that they’re not supportive of economic development after having campaigned for it. I think the public pretty much feels a program like the Iowa Values Fund is a good vehicle for economic growth.”

Sen. Jack Kibbie, the Democratic president of the Senate, agreed that the measure carries widespread support and interest, but said funding remains the biggest hurdle.

“I think the biggest stumbling block is how to make it long-range and how to fund it,” said Kibbie, who is among those lawmakers who strongly support the program. “To me, if we’re going to move this state forward, it’s must-do legislation,” he added.

Kibbie said many of his colleagues seem to like the idea of issuing a limited number of bonds to provide two years of “bridge financing” until revenue begins flowing from new casinos that may be authorized by the state gaming commission early this summer. Legislators are anticipating that new licenses could generate approximately $30 million in additional gambling revenues to the state annually.

Rep. Jamie Van Fossen, who chairs the House Ways and Means Committee, said that repaying bonds from gambling revenues is a likely scenario, given the tight general fund numbers the state has to work with from the December revenue estimate.

Will that funding approach gain sufficient support?

“I think that’s still the question of the day,” he said. “I’m not sure if people have solidified or changed their positions (since the original legislation). I think there has been successes with the Values Fund so far, and I think it’s something we would want to keep going.”

From the perspective of the Republican caucus, “larger isn’t necessarily better when it comes to bonding,” Van Fossen said. “I think we would support $100 million in bonding, or less.” Additionally, the Republicans say tax credits for job creation should be used in addition to providing direct incentives to companies, he said.

Hoffman, a Republican, served on the 11-member Values Fund board, which awarded $56 million to 36 projects statewide in fiscal year 2004. Iowa Department of Economic Development officials say the Values Fund’s total investments have resulted in the creation or retention of more than 14,000 high-paying jobs in the state and sparked private capital investments totaling $2.25 billion.

The program, which suffered from the beginning from the lack of a permanent funding source, was thrown into limbo when the Iowa Supreme Court ruled that Gov. Tom Vilsack’s line item vetoes of portions of the bill that created the fund rendered the entire piece of legislation null and void. A one-day special legislative session held in September reinstated its funding, which enabled the IDED board of directors to continue using Values Fund money to make awards through existing economic development programs.

Using the original bipartisan legislation from 2003 as a guide, the House Economic Growth Committee earlier this month introduced a study bill and created 11 subcommittees to “look at all the components that are out there that we think will lead to growing our economy,” Hoffman said. Among the study topics are regional development, taxes and fees, transportation and infrastructure, venture capital and business climate.

“We’ll address those that are appropriate (for Values Fund issues) in House Study Bill 137,” he said. “The rest of them we’ll refer to other committees and hope that they’ll take appropriate action.”

Those close to the process say it appears more likely a House version of a Values fund bill, rather than a Senate measure, will move forward. The House committee’s goal is to have the bill on the floor by the first week of March, Hoffman said.