There comes a time every legislative session when the conversations shift from an emphasis on policy discussions to budget and taxes. Today marks the end of the second funnel which also tends to be a time that we really start to dig in on the budget process, which includes any changes to tax policy.
Since the Legislature has done great work to lower income taxes, Iowans have been loud and clear that they want us to shift our focus to property taxes. For Iowa House Republicans, we’ve made our focus providing certainty to the taxpayer. We want to make sure taxpayers are at the forefront of the conversation over the taxing entities.
Before we get into the bills that have been introduced so far, I want to hear from you. I hope that you will take the time to fill out this brief survey to share with me your thoughts on our current property tax system and how it’s affecting you. Property taxes are the most difficult tax to address, so we know we need to be thoughtful about any reforms we make to the system. We can’t do this without your feedback.
This session, we have introduced a number of bills for consideration, from slight tweaks to major reforms to the system. These bills serve as a starting point to kickstart a broad conversation about property tax reform. We’ve made it very clear that we are not looking to rush these bills through, but are giving time for Iowans and interest groups to weigh in on how these changes would affect them or their members. We are relying on the feedback we receive from Iowans.
The main bill that has been garnering the most attention because it would be a big overhaul of the property tax system is House Study Bill 313. Here’s a general overview of what the bill does in its current form:
- Lowers the uniform levy as it phases out the rollback system for residential, commercial and industrial property over five years. This rollback system was enacted in 1977 and currently results in a lack of predictability for local governments, among other issues
- Brings additional property tax relief to Iowa veterans and seniors.
- Provides a $25k homestead benefit
- Implements a revenue restriction to ensure property tax relief for all Iowans
Altogether, this bill is estimated to provide $426 million in property tax relief. Based on the feedback we hear from Iowans, the current system is disliked by both taxpayers and taxing entities. We should not be afraid of big changes to the system. However, we do want to make sure we are taking our time to understand the full impacts of the legislation.
Other bills we’ve introduced on property taxes include:
- HSB 304 calculates property taxes on a per parcel basis with a 3% limitation. This solution would effectively provide certainty for property taxpayers.
- HSB 303 uses the interest from the taxpayer relief fund to buy down property taxes.
- HF 600 puts a cap of 2% on the average levy rate per $1000 but permits local government to go higher with a 60% vote of the people.
- HF 418 modifies the methodology for determining the actual value of residential property, assessment limitations of certain classes of property, and certain levy rate limitations.
Freeze valuations on homes owned by seniors making less than $80K annual.
The only property tax increase for eligible seniors is when the millage rate increases.
I need to understand what happened. How did we go from government being instituted among men to secure rights to life, liberty, property, etc – to government being allowed to enact a situation where a homeowner must pay to avoid having men with badges and guns take their home away. And to pour salt on a wound, to use that payment to fund the ‘education’ of evolution and now ‘pronouns’ to the local county’s youth?