Iowa House Bill HSB557

Iowa 2023-2024 Regular Session

• Introduced: 1/16/24
• Refer: 1/16/24

Caption

A bill for an act removing the maximum annual amount of real estate transfer tax receipts that may be transferred into the housing trust fund.(See HF 2188, HF 2634.)

Impact

The passage of HSB557 may significantly enhance the state's ability to address housing needs. Increased funding for the HTF could lead to expanded programs aimed at alleviating the affordable housing crisis, providing more resources for low-income families, and potentially helping to reduce homelessness in Iowa. As housing costs continue to rise, a more robust funding mechanism could facilitate the creation and preservation of affordable units, thus benefiting many residents who struggle in the current market.

Summary

House Study Bill 557 proposes the removal of the annual cap on the amount of real estate transfer tax (RETT) receipts that can be allocated to the housing trust fund (HTF) in Iowa. Currently, the Iowa Department of Revenue is limited to transferring a maximum of $7 million into the HTF each year, which is a fund designed to support the development and preservation of affordable housing for low-income individuals and families. By eliminating this cap, the bill intends to provide a greater source of funding for the HTF, potentially increasing the resources available for housing initiatives across the state.

Contention

Opponents of the bill might argue that removing the cap could lead to budgetary constraints elsewhere in the state budget, as higher tax receipts could result in reduced funds available for other state priorities. Additionally, there may be concerns about how the additional funds will be allocated, ensuring they meet the needs of those truly requiring assistance. The discussion around this bill may bring to light the balance needed between addressing affordable housing and managing overall state financial responsibilities.