| 1 | 1 | | House Study Bill 328 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON KAUFMANN) A BILL FOR An Act relating to local government property taxes, financial 1 authority, and budgets, modifying appropriations, and 2 including effective date, applicability, and retroactive 3 applicability provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 2982YC (1) 91 jm/md |
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| 3 | 3 | | H.F. _____ DIVISION I 1 COUNTY PROPERTY TAXES AND BUDGETS 2 Section 1. Section 331.423, subsection 1, paragraph b, 3 subparagraph (1), Code 2025, is amended to read as follows: 4 (1) For each fiscal year beginning on or after July 1, 5 2024, but before July 1, 2028 2026 , subject to subparagraph 6 (3), the greater of three dollars and fifty cents per thousand 7 dollars of assessed value used to calculate taxes for general 8 county services for the budget year and the adjusted general 9 county basic levy rate, as adjusted under subparagraph (2), if 10 applicable. 11 Sec. 2. Section 331.423, subsection 1, paragraph c, Code 12 2025, is amended to read as follows: 13 c. For each fiscal year beginning on or after July 1, 2028, 14 three dollars and fifty cents per thousand dollars of assessed 15 value. For the fiscal year beginning July 1, 2026, the greater 16 of: 17 (1) A levy rate per one thousand dollars of assessed value 18 equal to one thousand multiplied by the quotient of one hundred 19 two percent of the current fiscal years actual property tax 20 dollars certified for levy under this subsection 1 divided by 21 the remainder of the total assessed value used to calculate 22 such taxes for the budget year minus value attributable to new 23 valuation. 24 (2) A levy rate per one thousand dollars of assessed value 25 that results in an amount of actual property tax dollars 26 certified for levy under this subsection 1 equal to one 27 hundred and one-half percent of the actual property tax dollars 28 certified for levy under this subsection 1 for the current 29 fiscal year. 30 Sec. 3. Section 331.423, subsection 1, Code 2025, is amended 31 by adding the following new paragraph: 32 NEW PARAGRAPH . d. (1) For each fiscal year beginning 33 on or after July 1, 2027, the levy rate imposed under this 34 subsection 1 for the current fiscal year, unless subject to 35 -1- LSB 2982YC (1) 91 jm/md 1/ 76 |
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| 5 | 5 | | H.F. _____ subparagraph (2), and for the budget year beginning July 1, 1 2027, only, not less than a levy rate per one thousand dollars 2 of assessed value that results in an amount of actual property 3 tax dollars certified for levy under this subsection 1 equal 4 to one hundred and one-half percent of the actual property tax 5 dollars certified for levy under this subsection 1 for the 6 current fiscal year. 7 (2) (a) If the total assessed value, excluding value 8 attributable to new valuation, used to calculate taxes for 9 general county services under this subsection 1 for the budget 10 year is equal to or exceeds one hundred two percent of the 11 total assessed value used to calculate taxes for general 12 county services for the current fiscal year, the levy rate 13 imposed under this subsection 1 shall not exceed a levy rate 14 per one thousand dollars of assessed value that is equal to 15 one thousand multiplied by the quotient obtained by dividing 16 the product of the budget adjustment factor multiplied by the 17 current fiscal years actual property tax dollars certified 18 for levy under this subsection 1 by the remainder of the total 19 assessed value used to calculate such taxes for the budget year 20 minus value attributable to new valuation. 21 (b) For purposes of this subparagraph, budget adjustment 22 factor is equal to one of the following: 23 (i) If the change in the consumer price index for all urban 24 consumers for the twelve-month period ending six months prior 25 to the beginning of the applicable budget year is less than 26 four percent, one hundred two percent. 27 (ii) If the change in the consumer price index for all 28 urban consumers for the twelve-month period ending six months 29 prior to the beginning of the applicable budget year is equal 30 to or greater than four percent but less than six percent, one 31 hundred three percent. 32 (iii) If the change in the consumer price index for all 33 urban consumers for the twelve-month period ending six months 34 prior to the beginning of the applicable budget year is equal 35 -2- LSB 2982YC (1) 91 jm/md 2/ 76 |
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| 7 | 7 | | H.F. _____ to or greater than six percent but less than eight percent, one 1 hundred four percent. 2 (iv) If the change in the consumer price index for all urban 3 consumers for the twelve-month period ending six months prior 4 to the beginning of the applicable budget year is equal to or 5 greater than eight percent, one hundred five percent. 6 Sec. 4. Section 331.423, subsection 2, paragraph b, 7 subparagraph (1), Code 2025, is amended to read as follows: 8 (1) For each fiscal year beginning on or after July 1, 2024, 9 but before July 1, 2028 2026 , subject to subparagraph (3), the 10 greater of three dollars and ninety-five cents per thousand 11 dollars of assessed value used to calculate taxes for rural 12 county services for the budget year and the adjusted rural 13 county basic levy rate, as adjusted under subparagraph (2), if 14 applicable. 15 Sec. 5. Section 331.423, subsection 2, paragraph c, Code 16 2025, is amended to read as follows: 17 c. For each fiscal year beginning on or after July 1, 2028, 18 three dollars and ninety-five cents per thousand dollars of 19 assessed value. For the fiscal year beginning July 1, 2026, 20 the greater of: 21 (1) A levy rate per one thousand dollars of assessed value 22 equal to one thousand multiplied by the quotient of one hundred 23 two percent of the current fiscal years actual property tax 24 dollars certified for levy under this subsection 2 divided by 25 the remainder of the total assessed value used to calculate 26 such taxes for the budget year minus value attributable to new 27 valuation. 28 (2) A levy rate per one thousand dollars of assessed value 29 that results in an amount of actual property tax dollars 30 certified for levy under this subsection 2 equal to one 31 hundred and one-half percent of the actual property tax dollars 32 certified for levy under this subsection 2 for the current 33 fiscal year. 34 Sec. 6. Section 331.423, subsection 2, Code 2025, is amended 35 -3- LSB 2982YC (1) 91 jm/md 3/ 76 |
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| 9 | 9 | | H.F. _____ by adding the following new paragraph: 1 NEW PARAGRAPH . d. (1) For each fiscal year beginning 2 on or after July 1, 2027, the levy rate imposed under this 3 subsection 2 for the current fiscal year, unless subject to 4 subparagraph (2), and for the budget year beginning July 1, 5 2027, only, not less than a levy rate per one thousand dollars 6 of assessed value that results in an amount of actual property 7 tax dollars certified for levy under this subsection 2 equal 8 to one hundred and one-half percent of the actual property tax 9 dollars certified for levy under this subsection 2 for the 10 current fiscal year. 11 (2) (a) If the total assessed value, excluding value 12 attributable to new valuation, used to calculate taxes for 13 rural county services under this subsection 2 for the budget 14 year is equal to or exceeds one hundred two percent of the 15 total assessed value used to calculate taxes for rural county 16 services for the current fiscal year, the levy rate imposed 17 under this subsection 2 shall not exceed a levy rate per 18 one thousand dollars of assessed value that is equal to one 19 thousand multiplied by the quotient obtained by dividing the 20 product of the budget adjustment factor multiplied by the 21 current fiscal years actual property tax dollars certified 22 for levy under this subsection 2 by the remainder of the total 23 assessed value used to calculate such taxes for the budget year 24 minus value attributable to new valuation. 25 (b) For purposes of this subparagraph, budget adjustment 26 factor is equal to one of the following: 27 (i) If the change in the consumer price index for all urban 28 consumers for the twelve-month period ending six months prior 29 to the beginning of the applicable budget year is less than 30 four percent, one hundred two percent. 31 (ii) If the change in the consumer price index for all 32 urban consumers for the twelve-month period ending six months 33 prior to the beginning of the applicable budget year is equal 34 to or greater than four percent but less than six percent, one 35 -4- LSB 2982YC (1) 91 jm/md 4/ 76 |
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| 11 | 11 | | H.F. _____ hundred three percent. 1 (iii) If the change in the consumer price index for all 2 urban consumers for the twelve-month period ending six months 3 prior to the beginning of the applicable budget year is equal 4 to or greater than six percent but less than eight percent, one 5 hundred four percent. 6 (iv) If the change in the consumer price index for all urban 7 consumers for the twelve-month period ending six months prior 8 to the beginning of the applicable budget year is equal to or 9 greater than eight percent, one hundred five percent. 10 Sec. 7. Section 331.423, subsection 3, Code 2025, is amended 11 by adding the following new paragraph: 12 NEW PARAGRAPH . c. New valuation means the increase from 13 the current fiscal year to the budget year in taxable valuation 14 due to the following, the amount of each as certified by the 15 county auditor to the department of management: 16 (1) New construction. 17 (2) Additions or improvements to existing structures that 18 are not normal and necessary repairs under section 441.21, 19 subsection 8. 20 (3) Net boundary adjustments, including annexation, 21 severance, incorporation, consolidation, or discontinuance as 22 those terms are defined in section 368.1. 23 Sec. 8. EFFECTIVE DATE. This division of this Act takes 24 effect January 1, 2026. 25 Sec. 9. APPLICABILITY. This division of this Act applies 26 to property taxes and budgets for fiscal years beginning on or 27 after July 1, 2026. 28 DIVISION II 29 CITY PROPERTY TAXES AND BUDGETS 30 Sec. 10. Section 384.1, subsection 3, paragraph c, 31 subparagraph (1), Code 2025, is amended to read as follows: 32 (1) For each fiscal year beginning on or after July 1, 33 2024, but before July 1, 2028 2026 , subject to subparagraph 34 (3), a citys tax levy for the general fund, except for levies 35 -5- LSB 2982YC (1) 91 jm/md 5/ 76 |
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| 13 | 13 | | H.F. _____ authorized in section 384.12 , shall not exceed in any tax year 1 the greater of eight dollars and ten cents per thousand dollars 2 of assessed value used to calculate taxes for the budget year 3 and the adjusted city general fund levy rate, as adjusted under 4 subparagraph (2), if applicable. 5 Sec. 11. Section 384.1, subsection 3, paragraph d, Code 6 2025, is amended to read as follows: 7 d. (1) For each fiscal year beginning on or after July 1, 8 2028, a citys tax levy rate for the general fund, except for 9 levies authorized in section 384.12 , shall not exceed eight 10 dollars and ten cents per thousand dollars of assessed value 11 used to calculate taxes in any fiscal year. For the fiscal 12 year beginning July 1, 2026, a citys tax levy rate for the 13 general fund, except for levies authorized in section 384.12, 14 shall not exceed the greater of: 15 (a) A levy rate per one thousand dollars of assessed value 16 equal to one thousand multiplied by the quotient of one hundred 17 two percent of the current fiscal years actual property tax 18 dollars certified for levy under this subsection divided by 19 the remainder of the total assessed value used to calculate 20 such taxes for the budget year minus value attributable to new 21 valuation. 22 (b) A levy rate per one thousand dollars of assessed value 23 that results in an amount of actual property tax dollars 24 certified for levy under this subsection equal to one hundred 25 and one-half percent of the actual property tax dollars 26 certified for levy under this subsection for the current fiscal 27 year. 28 (2) Notwithstanding other provisions of this paragraph, 29 if a citys actual levy rate for the current fiscal year is 30 zero dollars per one thousand dollars of assessed value, a levy 31 rate per one thousand dollars of assessed value equal to one 32 thousand multiplied by the quotient of one hundred two percent 33 of the citys certified general fund budget for the current 34 fiscal year divided by the remainder of the total assessed 35 -6- LSB 2982YC (1) 91 jm/md 6/ 76 |
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| 15 | 15 | | H.F. _____ value used to calculate taxes for the budget year minus value 1 attributable to new valuation. 2 Sec. 12. Section 384.1, subsection 3, Code 2025, is amended 3 by adding the following new paragraph: 4 NEW PARAGRAPH . e. (1) For each fiscal year beginning on 5 or after July 1, 2027, a citys tax levy rate for the general 6 fund, except for levies authorized in section 384.12, shall 7 not exceed the levy rate imposed under this subsection for the 8 current fiscal year, unless subject to subparagraph (2), and 9 for the budget year beginning July 1, 2027, only, not less than 10 a levy rate per one thousand dollars of assessed value that 11 results in an amount of actual property tax dollars certified 12 for levy under this subsection equal to one hundred and 13 one-half percent of the actual property tax dollars certified 14 for levy under this subsection for the current fiscal year. 15 (2) (a) If the total assessed value, excluding value 16 attributable to new valuation, used to calculate taxes under 17 this subsection for the budget year is equal to or exceeds 18 one hundred two percent of the total assessed value used to 19 calculate taxes under this subsection for the current fiscal 20 year, the citys levy rate under this subsection shall not 21 exceed a levy rate per one thousand dollars of assessed value 22 that is equal to one thousand multiplied by the quotient 23 obtained by dividing the product of the budget adjustment 24 factor multiplied by the current fiscal years actual property 25 tax dollars certified for levy under this subsection by the 26 remainder of the total assessed value used to calculate such 27 taxes for the budget year minus value attributable to new 28 valuation. 29 (b) For purposes of this subparagraph, budget adjustment 30 factor is equal to one of the following: 31 (i) If the change in the consumer price index for all urban 32 consumers for the twelve-month period ending six months prior 33 to the beginning of the applicable budget year is less than 34 four percent, one hundred two percent. 35 -7- LSB 2982YC (1) 91 jm/md 7/ 76 |
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| 17 | 17 | | H.F. _____ (ii) If the change in the consumer price index for all 1 urban consumers for the twelve-month period ending six months 2 prior to the beginning of the applicable budget year is equal 3 to or greater than four percent but less than six percent, one 4 hundred three percent. 5 (iii) If the change in the consumer price index for all 6 urban consumers for the twelve-month period ending six months 7 prior to the beginning of the applicable budget year is equal 8 to or greater than six percent but less than eight percent, one 9 hundred four percent. 10 (iv) If the change in the consumer price index for all urban 11 consumers for the twelve-month period ending six months prior 12 to the beginning of the applicable budget year is equal to or 13 greater than eight percent, one hundred five percent. 14 (3) Notwithstanding other provisions of this paragraph, 15 if a citys actual levy rate for the current fiscal year is 16 zero dollars per one thousand dollars of assessed value, the 17 citys levy rate under this subsection shall not exceed a levy 18 rate per one thousand dollars of assessed value equal to one 19 thousand multiplied by the quotient of one hundred two percent 20 of the citys certified general fund budget for the current 21 fiscal year divided by the remainder of the total assessed 22 value used to calculate taxes for the budget year minus value 23 attributable to new valuation. 24 Sec. 13. Section 384.1, subsection 4, Code 2025, is amended 25 by adding the following new paragraph: 26 NEW PARAGRAPH . c. New valuation means the increase from 27 the current fiscal year to the budget year in taxable valuation 28 due to the following, the amount of each as certified by the 29 county auditor to the department of management: 30 (1) New construction. 31 (2) Additions or improvements to existing structures that 32 are not normal and necessary repairs under section 441.21, 33 subsection 8. 34 (3) Net boundary adjustments, including annexation, 35 -8- LSB 2982YC (1) 91 jm/md 8/ 76 |
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| 19 | 19 | | H.F. _____ severance, incorporation, consolidation, or discontinuance as 1 those terms are defined in section 368.1. 2 Sec. 14. EFFECTIVE DATE. This division of this Act takes 3 effect January 1, 2026. 4 Sec. 15. APPLICABILITY. This division of this Act applies 5 to property taxes and budgets for fiscal years beginning on or 6 after July 1, 2026. 7 DIVISION III 8 SCHOOL TAXES AND BUDGETS 9 Sec. 16. Section 257.1, subsection 2, paragraph b, Code 10 2025, is amended to read as follows: 11 b. (1) (a) For the budget year commencing July 1, 1999, 12 and for each succeeding budget year beginning before July 13 1, 2022, the regular program foundation base per pupil is 14 eighty-seven and five-tenths percent of the regular program 15 state cost per pupil. 16 (b) For the budget year commencing July 1, 2022, and for 17 each succeeding budget year beginning before July 1, 2026 , 18 the regular program foundation base per pupil is eighty-eight 19 and four-tenths percent of the regular program state cost per 20 pupil. 21 (c) For the budget year commencing July 1, 2026, and each 22 succeeding budget year, the regular program foundation base per 23 pupil is one hundred percent of the regular program state cost 24 per pupil. 25 (2) (a) For the budget year commencing July 1, 1991, and 26 for each succeeding budget year beginning before July 1, 2026, 27 the special education support services foundation base is 28 seventy-nine percent of the special education support services 29 state cost per pupil. 30 (b) For the budget year commencing July 1, 2026, and each 31 succeeding budget year, the special education support services 32 foundation base is one hundred percent of the special education 33 support services state cost per pupil. 34 (3) The combined foundation base is the sum of the regular 35 -9- LSB 2982YC (1) 91 jm/md 9/ 76 |
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| 21 | 21 | | H.F. _____ program foundation base, the special education support services 1 foundation base, the total teacher salary supplement district 2 cost, the total professional development supplement district 3 cost, the total early intervention supplement district cost, 4 the total teacher leadership supplement district cost, and the 5 total area education agency teacher salary supplement district 6 cost , and the amounts added to the combined district cost of 7 the school district for media services and educational services 8 under section 257.37 . 9 Sec. 17. Section 257.3, subsection 1, paragraph a, Code 10 2025, is amended to read as follows: 11 a. (1) Except as provided in subsections 2 and 3 , a school 12 district shall cause to be levied each budget year beginning 13 before July 1, 2026 , for the school general fund, a foundation 14 property tax equal to five dollars and forty cents per thousand 15 dollars of assessed valuation on all taxable property in the 16 district. The county auditor shall spread the foundation levy 17 over all taxable property in the district. 18 (2) Except as provided in subsections 2 and 3, a school 19 district shall cause to be levied for the budget year beginning 20 July 1, 2026, and each succeeding budget year, for the school 21 general fund, a foundation property tax equal to two dollars 22 and ninety-seven cents per thousand dollars of assessed 23 valuation on all taxable property in the district. The county 24 auditor shall spread the foundation levy over all taxable 25 property in the district. 26 Sec. 18. Section 257.3, subsection 2, paragraphs a and b, 27 Code 2025, are amended to read as follows: 28 a. Notwithstanding subsection 1 , a reorganized school 29 district for which the reorganization takes effect on or after 30 July 1, 2026, shall cause a foundation property tax of four 31 two dollars and forty forty-two cents per thousand dollars of 32 assessed valuation to be levied on all taxable property which, 33 in the year preceding a reorganization, was within a school 34 district affected by the reorganization as defined in section 35 -10- LSB 2982YC (1) 91 jm/md 10/ 76 |
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| 23 | 23 | | H.F. _____ 275.1 , or in the year preceding a dissolution was a part of a 1 school district that dissolved if the dissolution proposal has 2 been approved by the director of the department of education 3 pursuant to section 275.55 . 4 b. In For a reorganized school district for which the 5 reorganization took effect on or after July 1, 2026, in 6 succeeding school years, the foundation property tax levy on 7 that portion shall be increased to the rate of four two dollars 8 and ninety sixty-nine cents per thousand dollars of assessed 9 valuation the first succeeding year, five two dollars and 10 fifteen eighty-three cents per thousand dollars of assessed 11 valuation the second succeeding year, and five two dollars 12 and forty ninety-seven cents per thousand dollars of assessed 13 valuation the third succeeding year and each year thereafter 14 under subsection 1, paragraph a . 15 Sec. 19. Section 257.4, subsection 1, paragraph a, Code 16 2025, is amended by adding the following new subparagraphs: 17 NEW SUBPARAGRAPH . (10) The amount added to the combined 18 district cost of the school district for media services under 19 section 257.37. 20 NEW SUBPARAGRAPH . (11) The amount added to the combined 21 district cost of the school district for educational services 22 under section 257.37. 23 Sec. 20. Section 257.4, subsection 2, Code 2025, is amended 24 by adding the following new paragraph: 25 NEW PARAGRAPH . c. This subsection applies to budget years 26 beginning before July 1, 2026. 27 Sec. 21. Section 257.15, subsections 2 and 3, Code 2025, are 28 amended to read as follows: 29 2. Property tax adjustment aid for 1992-1993 and succeeding 30 years beginning before 2026-2027 . For the budget year beginning 31 July 1, 1992, and succeeding budget years beginning before July 32 1, 2026 , the department of education shall pay property tax 33 adjustment aid to a school district equal to the amount paid 34 to the district for the base year less an amount equal to the 35 -11- LSB 2982YC (1) 91 jm/md 11/ 76 |
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| 25 | 25 | | H.F. _____ product of the percent by which the taxable valuation in the 1 district increased, if the taxable valuation increased, from 2 January 1 of the year prior to the base year to January 1 of the 3 base year and the property tax adjustment aid. The department 4 of management shall adjust the rate of the additional property 5 tax accordingly and notify the department of education of 6 the amount of aid to be paid to each district from moneys 7 appropriated for property tax adjustment aid. 8 3. Property tax adjustment aid appropriation. There 9 is appropriated from the general fund of the state to the 10 department of education, for each fiscal year beginning 11 before July 1, 2026 , an amount necessary to pay property 12 tax adjustment aid to school districts under this section . 13 Property tax adjustment aid shall be paid to school districts 14 in the manner provided in section 257.16 . 15 Sec. 22. Section 257.15, subsection 4, paragraph a, 16 subparagraph (1), subparagraph division (d), Code 2025, is 17 amended to read as follows: 18 (d) For the budget year beginning July 1, 2009, and 19 succeeding budget years beginning before July 1, 2026 , 20 twenty-four million dollars. 21 Sec. 23. Section 257.15, subsection 4, paragraph b, Code 22 2025, is amended to read as follows: 23 b. After For fiscal years beginning before July 1, 2025, 24 after lowering all school district adjusted additional property 25 tax levy rates to the statewide maximum adjusted additional 26 property tax levy rate under paragraph a , the department of 27 management shall use any remaining funds at the end of the 28 calendar year to further lower additional property taxes by 29 increasing for the budget year beginning the following July 30 1, the regular program foundation base per pupil percentage 31 under section 257.1 . Moneys used pursuant to this paragraph 32 shall supplant an equal amount of the appropriation made from 33 the general fund of the state pursuant to section 257.16 that 34 represents the increase in state foundation aid. Any moneys 35 -12- LSB 2982YC (1) 91 jm/md 12/ 76 |
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| 27 | 27 | | H.F. _____ remaining at the conclusion of the fiscal year beginning July 1 1, 2024, shall be transferred by the department of management 2 for deposit in the general fund of the state. 3 Sec. 24. Section 257.16A, subsections 2 and 3, Code 2025, 4 are amended to read as follows: 5 2. There For each fiscal year beginning before July 1, 6 2026, there is appropriated annually all moneys in the fund to 7 the department of management for purposes of section 257.15, 8 subsection 4 . 9 3. Notwithstanding section 8.33 , any moneys remaining in 10 the property tax equity and relief fund at the end of a fiscal 11 year shall not revert to any other fund but shall remain in the 12 property tax equity and relief fund for use as provided in this 13 section for the following fiscal year. However, at the end of 14 the fiscal year beginning July 1, 2025, any moneys remaining in 15 the property tax equity and relief fund shall be transferred 16 for deposit into either the secure an advanced vision for 17 education fund or the general fund of the state based on the 18 fund from which the moneys were received. 19 Sec. 25. Section 257.16B, subsection 1, Code 2025, is 20 amended to read as follows: 21 1. For each fiscal year beginning on or after July 1, 2022, 22 but before July 1, 2026, there is appropriated from the general 23 fund of the state to the department of education an amount 24 necessary to make all school district property tax replacement 25 payments under this section , as calculated in subsection 2 . 26 Sec. 26. Section 257.16D, subsection 2, paragraph a, Code 27 2025, is amended to read as follows: 28 a. There For fiscal years beginning before July 1, 2026, 29 there is appropriated annually from the fund to the department 30 of management an amount necessary to make all foundation base 31 supplement payments under this section . The department of 32 management shall calculate each school districts foundation 33 base supplement payment based on the distribution methodology 34 under paragraph b . 35 -13- LSB 2982YC (1) 91 jm/md 13/ 76 |
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| 29 | 29 | | H.F. _____ Sec. 27. Section 257.16D, subsection 3, Code 2025, is 1 amended to read as follows: 2 3. Notwithstanding section 8.33 , any moneys remaining in 3 the foundation base supplement fund at the end of a fiscal year 4 shall not revert to any other fund but shall remain in the 5 foundation base supplement fund for use as provided in this 6 section for the following fiscal year. However, at the end of 7 the fiscal year beginning July 1, 2025, any moneys remaining in 8 the foundation base supplement fund shall be transferred for 9 deposit in the secure an advanced vision for education fund. 10 Sec. 28. Section 257.31, Code 2025, is amended by adding the 11 following new subsection: 12 NEW SUBSECTION . 19. a. The board of directors of each 13 school district with an unexpended fund balance in the 14 districts management levy fund under section 298A.3 at the 15 conclusion of the fiscal year beginning July 1, 2024, that 16 exceeds an amount equal to the total expenditures from the 17 districts management levy fund for the fiscal year beginning 18 July 1, 2024, shall certify such unexpended fund balance and 19 expenditure amounts, including any reserved or designated 20 amounts in the fund and the purposes therefor, to the school 21 budget review committee by November 15, 2025. The committee 22 shall prescribe the form for such certifications. 23 b. The committee shall conduct a review of the unexpended 24 fund balances and expenditures of school district management 25 levy funds certified under paragraph a . The committee 26 shall consult with boards of directors of school districts 27 and other relevant persons to determine the appropriateness 28 of establishing district management levy fund unexpended fund 29 balance limitations. By February 1, 2026, the committee 30 shall make recommendations to the general assembly for 31 establishing district management levy fund unexpended fund 32 balance limitations for fiscal years beginning on or after July 33 1, 2027, including recommendations for limitations based on a 34 percentage of the districts management levy fund expenditures 35 -14- LSB 2982YC (1) 91 jm/md 14/ 76 |
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| 31 | 31 | | H.F. _____ and recommendations for management levy limitations and 1 expenditure requirements for excess funds. 2 Sec. 29. Section 298.2, subsection 1, Code 2025, is amended 3 to read as follows: 4 1. a. A physical plant and equipment levy of not exceeding 5 one dollar and sixty-seven eighty-three and one-half cents 6 per thousand dollars of assessed valuation in the district is 7 established except as otherwise provided in this subsection . 8 The physical plant and equipment levy consists of the regular 9 physical plant and equipment levy of not exceeding thirty-three 10 sixteen and one-half cents per thousand dollars of assessed 11 valuation in the district and a voter-approved physical plant 12 and equipment levy of not exceeding one dollar and thirty-four 13 sixty-seven cents per thousand dollars of assessed valuation 14 in the district. However, the voter-approved physical plant 15 and equipment levy may consist of a combination of a physical 16 plant and equipment property tax levy and a physical plant and 17 equipment income surtax as provided in subsection 4 with the 18 maximum amount levied and imposed limited to an amount that 19 could be raised by a one dollar and thirty-four sixty-seven 20 cent property tax levy. A voter-approved physical plant and 21 equipment levy approved prior to the effective date of this 22 division of this Act are subject to the rate limitations of 23 this paragraph. 24 b. For school budget years beginning on or after July 1, 25 2015 2026 , a school district may by resolution of the board of 26 directors adopted prior to April 30 preceding the budget year 27 impose a physical plant and equipment levy at a rate in excess 28 of the levy rate limitations under paragraph a if the board 29 has refunded or refinanced a loan agreement entered into under 30 section 297.36 and such refunding or refinancing complies with 31 the maturity period authorized under section 297.36, subsection 32 1 , paragraph c , and results in a lower amount of interest on 33 the amount of the loan agreement. However, the rate imposed 34 by a school district under this paragraph shall not exceed the 35 -15- LSB 2982YC (1) 91 jm/md 15/ 76 |
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| 33 | 33 | | H.F. _____ rate imposed during the budget year in which the loan agreement 1 was refunded or refinanced or fifty percent of such levy rate 2 if the refunding or refinancing occurred in the budget year 3 beginning July 1, 2025 . Authorization to exceed the levy 4 rate limitations of paragraph a shall terminate upon the 5 maturity of the loan agreement after refunding or refinancing. 6 Upon adoption of the resolution under this paragraph b , the 7 board shall comply with the requirements of section 297.36, 8 subsection 1 , paragraph b . 9 Sec. 30. Section 298.2, subsection 2, Code 2025, is amended 10 by striking the subsection. 11 Sec. 31. Section 298.4, subsection 1, unnumbered paragraph 12 1, Code 2025, is amended to read as follows: 13 The Unless prohibited by subsection 1A, paragraph a , the 14 board of directors of a school district may certify for levy by 15 April 30 of a school year, a tax on all taxable property in the 16 school district for a district management levy , subject to the 17 limitations in subsection 1A, paragraph b . The revenue from 18 the tax levied in this section shall be placed in the district 19 management levy fund of the school district. The district 20 management levy shall be expended only for the following 21 purposes: 22 Sec. 32. Section 298.4, Code 2025, is amended by adding the 23 following new subsection: 24 NEW SUBSECTION . 1A. a. (1) For the fiscal year beginning 25 July 1, 2027, if a school districts unexpended fund balance, 26 as defined in section 257.2, of the districts management levy 27 fund is equal to or exceeds one hundred eighty percent of the 28 average annual expenditures from the districts management 29 levy fund for the three consecutive fiscal years immediately 30 preceding the base year, the board of directors shall not 31 certify a levy under this section for the fiscal year. 32 (2) For the fiscal year beginning July 1, 2028, if a school 33 districts unexpended fund balance, as defined in section 34 257.2, of the districts management levy fund is equal to or 35 -16- LSB 2982YC (1) 91 jm/md 16/ 76 |
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| 34 | 34 | | |
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| 35 | 35 | | H.F. _____ exceeds one hundred seventy-five percent of the average annual 1 expenditures from the districts management levy fund for the 2 three consecutive fiscal years immediately preceding the base 3 year, the board of directors shall not certify a levy under 4 this section for the fiscal year. 5 (3) For the fiscal year beginning July 1, 2029, if a school 6 districts unexpended fund balance, as defined in section 7 257.2, of the districts management levy fund is equal to or 8 exceeds one hundred seventy percent of the average annual 9 expenditures from the districts management levy fund for the 10 three consecutive fiscal years immediately preceding the base 11 year, the board of directors shall not certify a levy under 12 this section for the fiscal year. 13 (4) For the fiscal year beginning July 1, 2030, if a school 14 districts unexpended fund balance, as defined in section 15 257.2, of the districts management levy fund is equal to or 16 exceeds one hundred sixty-five percent of the average annual 17 expenditures from the districts management levy fund for the 18 three consecutive fiscal years immediately preceding the base 19 year, the board of directors shall not certify a levy under 20 this section for the fiscal year. 21 (5) For the fiscal year beginning July 1, 2031, and each 22 succeeding fiscal year, if a school districts unexpended 23 fund balance, as defined in section 257.2, of the districts 24 management levy fund is equal to or exceeds one hundred sixty 25 percent of the average annual expenditures from the districts 26 management levy fund for the three consecutive fiscal years 27 immediately preceding the base year, the board of directors 28 shall not certify a levy under this section for the fiscal 29 year. 30 b. (1) For the fiscal year beginning July 1, 2027, if 31 a school district is not prohibited from certifying a levy 32 pursuant to paragraph a , the maximum amount that the board of 33 directors may certify for levy under this section shall be an 34 amount equal to the remainder of one hundred eighty percent of 35 -17- LSB 2982YC (1) 91 jm/md 17/ 76 |
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| 36 | 36 | | |
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| 37 | 37 | | H.F. _____ the average annual expenditures from the districts management 1 levy fund for the three consecutive fiscal years immediately 2 preceding the base year minus the districts management levy 3 fund unexpended fund balance for the fiscal year preceding the 4 base year. 5 (2) For the fiscal year beginning July 1, 2028, if a school 6 district is not prohibited from certifying a levy pursuant to 7 paragraph a , the maximum amount that the board of directors 8 may certify for levy under this section shall be an amount 9 equal to the remainder of one hundred seventy-five percent of 10 the average annual expenditures from the districts management 11 levy fund for the three consecutive fiscal years immediately 12 preceding the base year minus the districts management levy 13 fund unexpended fund balance for the fiscal year preceding the 14 base year. 15 (3) For the fiscal year beginning July 1, 2029, if a school 16 district is not prohibited from certifying a levy pursuant to 17 paragraph a , the maximum amount that the board of directors 18 may certify for levy under this section shall be an amount 19 equal to the remainder of one hundred seventy percent of the 20 average annual expenditures from the districts management 21 levy fund for the three consecutive fiscal years immediately 22 preceding the base year minus the districts management levy 23 fund unexpended fund balance for the fiscal year preceding the 24 base year. 25 (4) For the fiscal year beginning July 1, 2030, if a school 26 district is not prohibited from certifying a levy pursuant to 27 paragraph a , the maximum amount that the board of directors 28 may certify for levy under this section shall be an amount 29 equal to the remainder of one hundred sixty-five percent of 30 the average annual expenditures from the districts management 31 levy fund for the three consecutive fiscal years immediately 32 preceding the base year minus the districts management levy 33 fund unexpended fund balance for the fiscal year preceding the 34 base year. 35 -18- LSB 2982YC (1) 91 jm/md 18/ 76 |
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| 38 | 38 | | |
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| 39 | 39 | | H.F. _____ (5) For the fiscal year beginning July 1, 2031, and each 1 succeeding fiscal year, if a school district is not prohibited 2 from certifying a levy pursuant to paragraph a , the maximum 3 amount that the board of directors may certify for levy under 4 this section shall be an amount equal to the remainder of one 5 hundred sixty percent of the average annual expenditures from 6 the districts management levy fund for the three consecutive 7 fiscal years immediately preceding the base year minus the 8 districts management levy fund unexpended fund balance for the 9 fiscal year preceding the base year. 10 Sec. 33. Section 298.18, subsection 1, paragraph d, Code 11 2025, is amended to read as follows: 12 d. The amount estimated and certified to apply on principal 13 and interest for any one year may exceed two dollars and 14 seventy one dollar and thirty-five cents per thousand dollars 15 of assessed value by the amount approved by the voters of the 16 school corporation, but not exceeding four two dollars and five 17 two and one-half cents per thousand dollars of the assessed 18 value of the taxable property within any school corporation, 19 provided that the registered voters of such school corporation 20 have first approved such increased amount at an election held 21 on a date specified in section 39.2, subsection 4 , paragraph 22 c . Amounts approved at election before the effective date 23 of this division of this Act are subject to the levy rate 24 limitations of this paragraph. 25 Sec. 34. Section 423F.2, subsection 3, paragraph b, 26 subparagraph (2), Code 2025, is amended to read as follows: 27 (2) For purposes of this subsection , the equity transfer 28 amount for fiscal years beginning before July 1, 2026, is 29 determined by multiplying the equity transfer percentage by the 30 amount of moneys available in the secure an advanced vision for 31 education fund in the fiscal year. For fiscal years beginning 32 on or after July 1, 2026, the equity transfer amount is zero. 33 (a) For the fiscal year beginning July 1, 2018, the equity 34 transfer percentage is two and one-tenth percent. For the 35 -19- LSB 2982YC (1) 91 jm/md 19/ 76 |
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| 40 | 40 | | |
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| 41 | 41 | | H.F. _____ fiscal year beginning July 1, 2019, the equity transfer 1 percentage is three and one-tenth percent. 2 (b) For each fiscal year beginning on or after July 1, 3 2020, but before July 1, 2026, the equity transfer percentage 4 is equal to the equity transfer percentage for the immediately 5 preceding fiscal year, unless the amount of moneys available 6 in the secure an advanced vision for education fund in the 7 immediately preceding fiscal year equals or exceeds one hundred 8 two percent of the amount of moneys available in the fund for 9 the fiscal year prior to the immediately preceding fiscal year, 10 in which case the equity transfer percentage shall be the 11 equity transfer percentage for the immediately preceding fiscal 12 year plus one percent subject to the limitation in subparagraph 13 division (c). 14 (c) If the equity transfer percentage calculated under 15 subparagraph division (b) exceeds thirty percent, the equity 16 transfer percentage for that fiscal year shall be thirty 17 percent. 18 Sec. 35. Section 423F.2, subsection 3, paragraph b, 19 subparagraph (3), unnumbered paragraph 1, Code 2025, is amended 20 to read as follows: 21 For purposes of this subsection , the foundation base 22 transfer amount for the fiscal year beginning July 1, 2019, is 23 zero, and for each fiscal year beginning on or after July 1, 24 2020, but before July 1, 2026, the foundation base transfer 25 amount equals the equity transfer amount for the fiscal year 26 under subparagraph (2) minus the sum of the following: 27 Sec. 36. Section 423F.2, subsection 3, paragraph b, Code 28 2025, is amended by adding the following new subparagraph: 29 NEW SUBPARAGRAPH . (04) For purposes of this subsection, the 30 foundation base transfer amount for each fiscal year beginning 31 on or after July 1, 2026, is zero. 32 Sec. 37. Section 423F.3, subsection 1, paragraph a, Code 33 2025, is amended to read as follows: 34 a. Reduction of the bond levies levy under sections section 35 -20- LSB 2982YC (1) 91 jm/md 20/ 76 |
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| 42 | 42 | | |
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| 43 | 43 | | H.F. _____ 298.18 and 298.18A and all other debt levies. 1 Sec. 38. Section 425A.3, subsection 1, Code 2025, is amended 2 to read as follows: 3 1. The family farm tax credit fund shall be apportioned 4 each year in the manner provided in this chapter so as to give 5 a credit against the tax on each eligible tract of agricultural 6 land within the several school districts of the state in which 7 the levy for the general school fund exceeds five dollars and 8 forty cents per thousand dollars of assessed value the levy 9 rate under section 257.3, subsection 1, paragraph a . The 10 amount of the credit on each eligible tract of agricultural 11 land shall be the amount the tax levied for the general school 12 fund exceeds the amount of tax which would be levied on each 13 eligible tract of agricultural land were the levy for the 14 general school fund five dollars and forty cents per thousand 15 dollars of assessed value the levy rate under section 257.3, 16 subsection 1, paragraph a , for the previous year. However, 17 in the case of a deficiency in the family farm tax credit fund 18 to pay the credits in full, the credit on each eligible tract 19 of agricultural land in the state shall be proportionate and 20 applied as provided in this chapter . 21 Sec. 39. Section 425A.5, Code 2025, is amended to read as 22 follows: 23 425A.5 Computation by county auditor. 24 The family farm tax credit allowed each year shall be 25 computed as follows: On or before April 1, the county auditor 26 shall list by school districts all tracts of agricultural 27 land which are entitled to credit, the taxable value for the 28 previous year, the budget from each school district for the 29 previous year, and the tax rate determined for the general 30 fund of the school district in the manner prescribed in 31 section 444.3 for the previous year, and if the tax rate is in 32 excess of five dollars and forty cents per thousand dollars of 33 assessed value the levy rate under section 257.3, subsection 34 1, paragraph a , the auditor shall multiply the tax levy which 35 -21- LSB 2982YC (1) 91 jm/md 21/ 76 |
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| 44 | 44 | | |
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| 45 | 45 | | H.F. _____ is in excess of five dollars and forty cents per thousand 1 dollars of assessed value the levy rate under section 257.3, 2 subsection 1, paragraph a , by the total taxable value of the 3 agricultural land entitled to credit in the school district, 4 and on or before April 1, certify the total amount of credit 5 and the total number of acres entitled to the credit to the 6 department of revenue. 7 Sec. 40. Section 426.3, Code 2025, is amended to read as 8 follows: 9 426.3 Where credit given. 10 The agricultural land credit fund shall be apportioned each 11 year in the manner hereinafter provided so as to give a credit 12 against the tax on each tract of agricultural lands within the 13 several school districts of the state in which the levy for 14 the general school fund exceeds five dollars and forty cents 15 per thousand dollars of assessed value the levy rate under 16 section 257.3, subsection 1, paragraph a ; the amount of such 17 credit on each tract of such lands shall be the amount the tax 18 levied for the general school fund exceeds the amount of tax 19 which would be levied on said tract of such lands were the 20 levy for the general school fund five dollars and forty cents 21 per thousand dollars of assessed value the levy rate under 22 section 257.3, subsection 1, paragraph a , for the previous 23 year, except in the case of a deficiency in the agricultural 24 land credit fund to pay said credits in full, in which case the 25 credit on each eligible tract of such lands in the state shall 26 be proportionate and shall be applied as hereinafter provided. 27 Sec. 41. Section 426.6, subsection 1, Code 2025, is amended 28 to read as follows: 29 1. The agricultural land tax credit allowed each year 30 shall be computed as follows: On or before April 1, the 31 county auditor shall list by school districts all tracts of 32 agricultural lands which are entitled to credit, together with 33 the taxable value for the previous year, together with the 34 budget from each school district for the previous year, and the 35 -22- LSB 2982YC (1) 91 jm/md 22/ 76 |
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| 46 | 46 | | |
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| 47 | 47 | | H.F. _____ tax rate determined for the general fund of the district in 1 the manner prescribed in section 444.3 for the previous year, 2 and if such tax rate is in excess of five dollars and forty 3 cents per thousand dollars of assessed value the levy rate 4 under section 257.3, subsection 1, paragraph a , the auditor 5 shall multiply the tax levy which is in excess of five dollars 6 and forty cents per thousand dollars of assessed value the 7 levy rate under section 257.3, subsection 1, paragraph a , by 8 the total taxable value of the agricultural lands entitled to 9 credit in the district, and on or before April 1, certify the 10 amount to the department of revenue. 11 Sec. 42. REPEAL. Section 298.18A, Code 2025, is repealed. 12 Sec. 43. ADJUSTMENT OF CALCULATIONS. For property tax 13 credits under chapters 425A and 426 for property taxes due and 14 payable in the fiscal year beginning July 1, 2026, the tax rate 15 determined for the general fund of the school district in the 16 manner prescribed in section 444.3 for the previous year shall 17 be determined using the appropriate property tax levy rate 18 under section 257.3, as amended in this division of this Act. 19 Sec. 44. EFFECTIVE DATE. Except for the section of this 20 division of this Act amending section 257.31, this division of 21 this Act takes effect January 1, 2026. 22 Sec. 45. APPLICABILITY. Except for the section of this 23 division of this Act amending section 257.31, this division 24 of this Act applies to fiscal years and school budget years 25 beginning on or after July 1, 2026. 26 DIVISION IV 27 PROPERTY CLASSIFICATIONS, VALUATIONS, AND ASSESSMENT 28 LIMITATIONS 29 Sec. 46. Section 386.8, Code 2025, is amended to read as 30 follows: 31 386.8 Operation tax. 32 A city may establish a self-supported improvement district 33 operation fund, and may certify taxes not to exceed the 34 rate limitation as established in the ordinance creating the 35 -23- LSB 2982YC (1) 91 jm/md 23/ 76 |
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| 48 | 48 | | |
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| 49 | 49 | | H.F. _____ district, or any amendment thereto, each year to be levied 1 for the fund against all of the property in the district, 2 for the purpose of paying the administrative expenses of 3 the district, which may include but are not limited to 4 administrative personnel salaries, a separate administrative 5 office, planning costs including consultation fees, engineering 6 fees, architectural fees, and legal fees and all other expenses 7 reasonably associated with the administration of the district 8 and the fulfilling of the purposes of the district. The taxes 9 levied for this fund may also be used for the purpose of paying 10 maintenance expenses of improvements or self-liquidating 11 improvements for a specified length of time with one or more 12 options to renew if such is clearly stated in the petition 13 which requests the council to authorize construction of the 14 improvement or self-liquidating improvement, whether or not 15 such petition is combined with the petition requesting creation 16 of a district. Parcels of property which are assessed as 17 residential property for property tax purposes are exempt from 18 the tax levied under this section except residential properties 19 within a duly designated historic district or property 20 classified as residential multiresidential property under 21 section 441.21, subsection 14 13 , paragraph a , subparagraph 22 (6) (5) . A tax levied under this section is not subject to the 23 levy limitation in section 384.1 . 24 Sec. 47. Section 386.9, Code 2025, is amended to read as 25 follows: 26 386.9 Capital improvement tax. 27 A city may establish a capital improvement fund for a 28 district and may certify taxes, not to exceed the rate 29 established by the ordinance creating the district, or any 30 subsequent amendment thereto, each year to be levied for 31 the fund against all of the property in the district, for 32 the purpose of accumulating moneys for the financing or 33 payment of a part or all of the costs of any improvement or 34 self-liquidating improvement. However, parcels of property 35 -24- LSB 2982YC (1) 91 jm/md 24/ 76 |
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| 50 | 50 | | |
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| 51 | 51 | | H.F. _____ which are assessed as residential property for property tax 1 purposes are exempt from the tax levied under this section 2 except residential properties within a duly designated historic 3 district or property classified as residential multiresidential 4 property under section 441.21, subsection 14 13 , paragraph a , 5 subparagraph (6) (5) . A tax levied under this section is not 6 subject to the levy limitations in section 384.1 or 384.7 . 7 Sec. 48. Section 386.10, Code 2025, is amended to read as 8 follows: 9 386.10 Debt service tax. 10 A city shall establish a self-supported municipal 11 improvement district debt service fund whenever any 12 self-supported municipal improvement district bonds are issued 13 and outstanding, other than revenue bonds, and shall certify 14 taxes to be levied against all of the property in the district 15 for the debt service fund in the amount necessary to pay 16 interest as it becomes due and the amount necessary to pay, 17 or to create a sinking fund to pay, the principal at maturity 18 of all self-supported municipal improvement district bonds as 19 authorized in section 386.11 , issued by the city. However, 20 parcels of property which are assessed as residential property 21 for property tax purposes at the time of the issuance of the 22 bonds are exempt from the tax levied under this section until 23 the parcels are no longer assessed as residential property 24 or until the residential properties are designated as a part 25 of a historic district or property classified as residential 26 multiresidential property under section 441.21, subsection 14 27 13 , paragraph a , subparagraph (6) (5) . 28 Sec. 49. Section 404.2, subsection 2, paragraph f, Code 29 2025, is amended to read as follows: 30 f. A statement specifying whether the revitalization is 31 applicable to none, some, or all of the property assessed as 32 residential, multiresidential, agricultural, commercial, or 33 industrial property within the designated area or a combination 34 thereof and whether the revitalization is for rehabilitation 35 -25- LSB 2982YC (1) 91 jm/md 25/ 76 |
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| 52 | 52 | | |
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| 53 | 53 | | H.F. _____ and additions to existing buildings or new construction or 1 both. If revitalization is made applicable only to some 2 property within an assessment classification, the definition of 3 that subset of eligible property must be by uniform criteria 4 which further some planning objective identified in the plan. 5 The city shall state how long it is estimated that the area 6 shall remain a designated revitalization area which time 7 shall be longer than one year from the date of designation 8 and shall state any plan by the city to issue revenue bonds 9 for revitalization projects within the area. For a county, 10 a revitalization area shall include only property which 11 will be used as industrial property, commercial property, 12 multiresidential property, or residential property. However, a 13 county shall not provide a tax exemption under this chapter to 14 commercial property , multiresidential property, or residential 15 property which is located within the limits of a city. 16 Sec. 50. Section 404.3, subsection 4, paragraph a, Code 17 2025, is amended by striking the paragraph and inserting in 18 lieu thereof the following: 19 a. All qualified real estate assessed as any of the 20 following is eligible to receive a one hundred percent 21 exemption from taxation on the actual value added by the 22 improvements: 23 (1) Residential property. 24 (2) Commercial property if the commercial property 25 consists of three or more separate living quarters with at 26 least seventy-five percent of the space used for residential 27 purposes. 28 (3) Multiresidential property if the multiresidential 29 property consists of three or more separate living quarters 30 with at least seventy-five percent of the space used for 31 residential purposes. 32 Sec. 51. Section 404.3A, Code 2025, is amended to read as 33 follows: 34 404.3A Residential development area exemption. 35 -26- LSB 2982YC (1) 91 jm/md 26/ 76 |
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| 54 | 54 | | |
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| 55 | 55 | | H.F. _____ Notwithstanding the schedules provided for in section 404.3 , 1 all qualified real estate assessed as residential property or 2 multiresidential property , excluding property classified as 3 residential multiresidential property under section 441.21, 4 subsection 14 13 , paragraph a , subparagraph (6) (5) , in an 5 area designated under section 404.1, subsection 5 , is eligible 6 to receive an exemption from taxation on the first seventy-five 7 thousand dollars of actual value added by the improvements. 8 The exemption is for a period of five years. 9 Sec. 52. Section 404.3D, Code 2025, is amended to read as 10 follows: 11 404.3D Exemptions for residential and multiresidential 12 property. 13 For revitalization areas established under this chapter 14 on or after July 1, 2024, and for first-year exemption 15 applications for property located in a revitalization area in 16 existence on July 1, 2024, filed on or after July 1, 2024, an 17 exemption authorized under this chapter for property that is 18 residential property or multiresidential property shall not 19 apply to property tax levies imposed by a school district. 20 Sec. 53. Section 441.21, subsection 1, paragraph b, 21 subparagraph (1), Code 2025, is amended to read as follows: 22 (1) The actual value of all property subject to assessment 23 and taxation shall be the fair and reasonable market value of 24 such property except as otherwise provided in this section . 25 Market value is defined as the fair and reasonable exchange 26 in the year in which the property is listed and valued between 27 a willing buyer and a willing seller, neither being under any 28 compulsion to buy or sell and each being familiar with all 29 the facts relating to the particular property. Sale prices 30 of the property or comparable property in normal transactions 31 reflecting market value, and the probable availability 32 or unavailability of persons interested in purchasing the 33 property, shall be taken into consideration in arriving at 34 its market value. In arriving at market value, sale prices 35 -27- LSB 2982YC (1) 91 jm/md 27/ 76 |
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| 56 | 56 | | |
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| 57 | 57 | | H.F. _____ of property in abnormal transactions not reflecting market 1 value shall not be taken into account, or shall be adjusted to 2 eliminate the effect of factors which distort market value, 3 including but not limited to built-to-suit construction, 4 sale-leaseback transactions, leased fee sales, sales to 5 immediate family of the seller between related parties , 6 foreclosure or other forced sales, contract sales, discounted 7 purchase transactions or purchase of adjoining land or other 8 land to be operated as a unit. 9 Sec. 54. Section 441.21, subsection 1, paragraph e, Code 10 2025, is amended to read as follows: 11 e. The actual value of agricultural property shall be 12 determined on the basis of productivity and net earning 13 capacity of the property determined on the basis of its use for 14 agricultural purposes capitalized at a rate of seven percent 15 and applied uniformly among counties and among classes of 16 property. However, for assessment years beginning on or after 17 January 1, 2026, structures on agricultural land constructed on 18 or after January 1, 2026, that are not agricultural dwellings 19 shall not be included in determination of productivity and 20 net earning capacity of agricultural property and shall not 21 be allocated any portion of the total county productivity 22 value so determined. However, such structures shall be 23 treated similarly to agricultural structures constructed 24 before January 1, 2026, when applying any equalization 25 order of the department. Such agricultural structures shall 26 instead be valued according to the structures replacement 27 cost less depreciation and obsolescence and the structures 28 assessed value subject to taxation prior to application of any 29 assessment limitation under subsection 4 shall be equal to the 30 product of the structures value multiplied by the agricultural 31 factor, as determined in 701 IAC 102.3(2) or succeeding rule of 32 the department. Any formula or method employed to determine 33 productivity and net earning capacity of property shall be 34 adopted in full by rule. 35 -28- LSB 2982YC (1) 91 jm/md 28/ 76 |
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| 58 | 58 | | |
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| 59 | 59 | | H.F. _____ Sec. 55. Section 441.21, subsection 2, Code 2025, is amended 1 to read as follows: 2 2. In the event market value of the property being assessed 3 cannot be readily established in the foregoing manner, then 4 the assessor may determine the value of the property using the 5 other uniform and recognized appraisal methods including its 6 productive and earning capacity, if any, industrial conditions, 7 its cost, physical and functional depreciation and obsolescence 8 and replacement cost, and all other factors which would assist 9 in determining the fair and reasonable market value of the 10 property but the actual value shall not be determined by use 11 of only one such factor. The following shall not be taken into 12 consideration: Special value or use value of the property to 13 its present owner, and the goodwill or value of a business 14 which uses the property as distinguished from the value of 15 the property as property. In addition, for assessment years 16 beginning on or after January 1, 2018, and unless otherwise 17 required for property valued by the department of revenue 18 pursuant to chapters 428 , 437 , and 438 , the assessor shall not 19 take into consideration and shall not request from any person 20 sales or receipts data, expense data, balance sheets, bank 21 account information, or other data related to the financial 22 condition of a business operating in whole or in part on the 23 property if the property is both classified as commercial or 24 industrial property and owned and used by the owner of the 25 business. However, in assessing property that is rented or 26 leased to low-income individuals and families as authorized by 27 section 42 of the Internal Revenue Code, as amended, and which 28 section limits the amount that the individual or family pays 29 for the rental or lease of units in the property, the assessor 30 shall, unless the owner elects to withdraw the property from 31 the assessment procedures for section 42 property, use the 32 productive and earning capacity from the actual rents received 33 as a method of appraisal and shall take into account the extent 34 to which that use and limitation reduces the market value of 35 -29- LSB 2982YC (1) 91 jm/md 29/ 76 |
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| 60 | 60 | | |
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| 61 | 61 | | H.F. _____ the property. The assessor shall not consider any tax credit 1 equity or other subsidized financing as income provided to 2 the property in determining the assessed value. The property 3 owner shall notify the assessor when property is withdrawn 4 from section 42 eligibility under the Internal Revenue Code 5 or if the owner elects to withdraw the property from the 6 assessment procedures for section 42 property under this 7 subsection . The property shall not be subject to section 42 8 assessment procedures for the assessment year for which section 9 42 eligibility is withdrawn or an election is made. This 10 notification must be provided to the assessor no later than 11 March 1 of the assessment year or the owner will be subject to a 12 penalty of five hundred dollars for that assessment year. The 13 penalty shall be collected at the same time and in the same 14 manner as regular property taxes. An election to withdraw 15 from the assessment procedures for section 42 property is 16 irrevocable. Property that is withdrawn from the assessment 17 procedures for section 42 property shall be classified and 18 assessed as residential multiresidential property unless the 19 property otherwise fails to meet the requirements of subsection 20 14 13 . Upon adoption of uniform rules by the department of 21 revenue or succeeding authority covering assessments and 22 valuations of such properties, the valuation on such properties 23 shall be determined in accordance with such rules and in 24 accordance with forms and guidelines contained in the real 25 property appraisal manual prepared by the department as updated 26 from time to time for assessment purposes to assure uniformity, 27 but such rules, forms, and guidelines shall not be inconsistent 28 with or change the foregoing means of determining the actual, 29 market, taxable, and assessed values. 30 Sec. 56. Section 441.21, subsections 4 and 5, Code 2025, are 31 amended to read as follows: 32 4. For valuations established as of January 1, 1979 2025 , 33 the percentage of actual value at which agricultural and 34 residential property shall be assessed shall be the quotient of 35 -30- LSB 2982YC (1) 91 jm/md 30/ 76 |
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| 62 | 62 | | |
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| 63 | 63 | | H.F. _____ the dividend and divisor as defined in this section determined 1 under this subsection . 2 a. (1) The percentage of actual value at which agricultural 3 property shall be assessed shall be the quotient of the 4 dividend and divisor as defined in this paragraph. The 5 dividend for each class of property shall be the dividend 6 as determined for each class of agricultural property 7 for valuations established as of January 1, 1978 2024 , as 8 determined under the applicable law for that assessment year, 9 adjusted by the product obtained by multiplying the percentage 10 determined for that year by the amount of any additions or 11 deletions to actual value, excluding those resulting from 12 the revaluation of existing properties, as reported by the 13 assessors on the abstracts of assessment for 1978 2024 , plus 14 six three percent of the amount so determined. 15 (2) However, if the difference between the dividend so 16 determined for either class of property and the dividend for 17 that class of property for valuations established as of January 18 1, 1978, adjusted by the product obtained by multiplying 19 the percentage determined for that year by the amount of 20 any additions or deletions to actual value, excluding those 21 resulting from the revaluation of existing properties, as 22 reported by the assessors on the abstracts of assessment for 23 1978, is less than six percent, the 1979 dividend for the other 24 class of property shall be the dividend as determined for that 25 class of property for valuations established as of January 26 1, 1978, adjusted by the product obtained by multiplying 27 the percentage determined for that year by the amount of 28 any additions or deletions to actual value, excluding those 29 resulting from the revaluation of existing properties, as 30 reported by the assessors on the abstracts of assessment for 31 1978, plus a percentage of the amount so determined which is 32 equal to the percentage by which the dividend as determined 33 for the other class of property for valuations established 34 as of January 1, 1978, adjusted by the product obtained by 35 -31- LSB 2982YC (1) 91 jm/md 31/ 76 |
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| 64 | 64 | | |
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| 65 | 65 | | H.F. _____ multiplying the percentage determined for that year by the 1 amount of any additions or deletions to actual value, excluding 2 those resulting from the revaluation of existing properties, as 3 reported by the assessors on the abstracts of assessment for 4 1978, is increased in arriving at the 1979 dividend for the 5 other class of property. 6 (3) For valuations established for assessment years 7 beginning on or after January 1, 2022, the calculation of the 8 dividend for residential property under this subsection shall 9 exclude the value of all property described in subsection 14 , 10 paragraph a , subparagraphs (2), (3), (4), (5), and (6), 11 and the property described in subsection 14 , paragraph a , 12 subparagraph (7), that contains three or more separate dwelling 13 units. 14 b. (1) The divisor for each class of property shall be 15 the total actual value of all such agricultural property in 16 the state in the preceding year, as reported by the assessors 17 on the abstracts of assessment submitted for 1978 2024 , as 18 determined under the applicable law for that assessment year, 19 plus the amount of value added to said total actual value 20 by the revaluation of existing properties in 1979 2025 as 21 equalized by the director of revenue pursuant to section 22 441.49 . The director shall utilize information reported on 23 abstracts of assessment submitted pursuant to section 441.45 24 in determining such percentage. For valuations established as 25 of January 1, 2026, and each assessment year thereafter, the 26 percentage of actual value as equalized by the department of 27 revenue as provided in section 441.49 at which agricultural 28 property shall be assessed shall be calculated in accordance 29 with the methods provided in this paragraph. 30 (2) For valuations established for assessment years 31 beginning on or after January 1, 2022, the calculation of the 32 divisor for residential property under this subsection shall 33 exclude the value of all property described in subsection 14 , 34 paragraph a , subparagraphs (2), (3), (4), (5), and (6), 35 -32- LSB 2982YC (1) 91 jm/md 32/ 76 |
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| 66 | 66 | | |
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| 67 | 67 | | H.F. _____ and the property described in subsection 14 , paragraph a , 1 subparagraph (7), that contains three or more separate dwelling 2 units. 3 c. (1) For valuations established as of January 1, 1980, 4 and each assessment year thereafter beginning before January 5 1, 2013, the percentage of actual value as equalized by the 6 director of revenue as provided in section 441.49 at which 7 agricultural and residential property shall be assessed shall 8 be calculated in accordance with the methods provided in 9 this subsection , including the limitation of increases in 10 agricultural and residential assessed values to the percentage 11 increase of the other class of property if the other class 12 increases less than the allowable limit adjusted to include 13 the applicable and current values as equalized by the director 14 of revenue, except that any references to six percent in this 15 subsection shall be four percent. 16 (2) For valuations established as of January 1, 2013, and 17 each assessment year thereafter, the percentage of actual 18 value as equalized by the department of revenue as provided in 19 section 441.49 at which agricultural and residential property 20 shall be assessed shall be calculated in accordance with the 21 methods provided in this subsection , including the limitation 22 of increases in agricultural and residential assessed values to 23 the percentage increase of the other class of property if the 24 other class increases less than the allowable limit adjusted 25 to include the applicable and current values as equalized by 26 the department of revenue, except that any references to six 27 percent in this subsection shall be three percent. 28 b. (1) For valuations established for the assessment year 29 beginning January 1, 2024, the percentage of actual value 30 as equalized by the department of revenue as provided in 31 section 441.49 at which residential property shall be assessed 32 shall be forty-seven and four thousand three hundred sixteen 33 ten-thousandths percent. 34 (2) For valuations established for the assessment year 35 -33- LSB 2982YC (1) 91 jm/md 33/ 76 |
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| 68 | 68 | | |
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| 69 | 69 | | H.F. _____ beginning January 1, 2025, and each assessment year thereafter, 1 the percentage of actual value as equalized by the department 2 of revenue as provided in section 441.49 at which residential 3 property shall be assessed shall be one hundred percent. 4 5. a. (1) For valuations established as of January 1, 5 1979, property valued by the department of revenue pursuant to 6 chapter 437 shall be considered as one class of property and 7 shall be assessed as a percentage of its actual value. The 8 percentage shall be determined by the director of revenue in 9 accordance with the provisions of this section . For valuations 10 established as of January 1, 1979, the percentage shall be 11 the quotient of the dividend and divisor as defined in this 12 section . The dividend shall be the total actual valuation 13 established for 1978 by the department of revenue, plus ten 14 percent of the amount so determined. The divisor for property 15 valued by the department of revenue pursuant to chapter 437 16 shall be the valuation established for 1978, plus the amount of 17 value added to the total actual value by the revaluation of the 18 property by the department of revenue as of January 1, 1979. 19 For valuations established as of January 1, 1980, property 20 valued by the department of revenue pursuant to chapter 437 21 shall be assessed at a percentage of its actual value. The 22 percentage shall be determined by the director of revenue in 23 accordance with the provisions of this section . For valuations 24 established as of January 1, 1980, the percentage shall be 25 the quotient of the dividend and divisor as defined in this 26 section . The dividend shall be the total actual valuation 27 established for 1979 by the department of revenue, plus eight 28 percent of the amount so determined. The divisor for property 29 valued by the department of revenue pursuant to chapter 437 30 shall be the valuation established for 1979, plus the amount of 31 value added to the total actual value by the revaluation of the 32 property by the department of revenue as of January 1, 1980. 33 For valuations established as of January 1, 1981, and each year 34 thereafter, the percentage of actual value at which property 35 -34- LSB 2982YC (1) 91 jm/md 34/ 76 |
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| 70 | 70 | | |
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| 71 | 71 | | H.F. _____ valued by the department of revenue pursuant to chapter 437 1 shall be assessed shall be calculated in accordance with the 2 methods provided herein, except that any references to ten 3 percent in this subsection shall be eight percent. 4 (2) (1) For valuations established on or after January 1, 5 2013, property valued by the department of revenue pursuant to 6 chapter 434 shall be assessed at a portion of its actual value 7 determined in the same manner at which property assessed as 8 commercial property is assessed under paragraph b for the same 9 assessment year. 10 (3) (2) For valuations established for the assessment year 11 beginning January 1, 2025, and each assessment year thereafter, 12 the percentage of actual value at which property valued by the 13 department of revenue pursuant to chapters 428 , 437, and 438 14 shall be assessed shall be ninety-eight one hundred percent. 15 (4) For valuations established for the assessment year 16 beginning January 1, 2026, the percentage of actual value at 17 which property valued by the department of revenue pursuant 18 to chapters 428 and 438 shall be assessed shall be ninety-six 19 percent. 20 (5) For valuations established for the assessment year 21 beginning January 1, 2027, the percentage of actual value at 22 which property valued by the department of revenue pursuant to 23 chapters 428 and 438 shall be assessed shall be ninety-four 24 percent. 25 (6) For valuations established for the assessment year 26 beginning January 1, 2028, the percentage of actual value at 27 which property valued by the department of revenue pursuant 28 to chapters 428 and 438 shall be assessed shall be ninety-two 29 percent. 30 (7) For valuations established on or after January 1, 2029, 31 the percentage of actual value at which property valued by the 32 department of revenue pursuant to chapters 428 and 438 shall be 33 assessed shall be ninety percent. 34 b. For valuations established on or after January 1, 2013, 35 -35- LSB 2982YC (1) 91 jm/md 35/ 76 |
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| 72 | 72 | | |
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| 73 | 73 | | H.F. _____ commercial Commercial property, excluding properties referred 1 to in section 427A.1, subsection 9 , shall be assessed at a 2 portion of its actual value, as determined in this paragraph 3 b . 4 (1) For valuations established for the assessment year 5 beginning January 1, 2013, the percentage of actual value 6 as equalized by the department of revenue as provided in 7 section 441.49 at which commercial property shall be assessed 8 shall be ninety-five percent. For valuations established 9 for the assessment year beginning January 1, 2014, and each 10 assessment year thereafter beginning before January 1, 2022, 11 the percentage of actual value as equalized by the department 12 of revenue as provided in section 441.49 at which commercial 13 property shall be assessed shall be ninety percent. 14 (2) (1) For valuations established for the assessment year 15 beginning January 1, 2022, and each assessment year thereafter 16 beginning before January 1, 2025 , the portion of actual value 17 at which each property unit of commercial property shall be 18 assessed shall be the sum of the following: 19 (a) An amount equal to the product of the assessment 20 limitation percentage applicable to residential property under 21 subsection 4 for that assessment year multiplied by the actual 22 value of the property that exceeds zero dollars but does not 23 exceed one hundred fifty thousand dollars. 24 (b) An amount equal to ninety percent of the actual value of 25 the property for that assessment year that exceeds one hundred 26 fifty thousand dollars. 27 (2) For valuations established for the assessment year 28 beginning January 1, 2025, and each assessment year thereafter, 29 the percentage of actual value as equalized by the department 30 of revenue as provided in section 441.49 at which commercial 31 property shall be assessed shall be one hundred percent. 32 c. For valuations established on or after January 1, 2013, 33 industrial Industrial property, excluding properties referred 34 to in section 427A.1, subsection 9 , shall be assessed at a 35 -36- LSB 2982YC (1) 91 jm/md 36/ 76 |
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| 74 | 74 | | |
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| 75 | 75 | | H.F. _____ portion of its actual value, as determined in this paragraph 1 c . 2 (1) For valuations established for the assessment year 3 beginning January 1, 2013, the percentage of actual value 4 as equalized by the department of revenue as provided in 5 section 441.49 at which industrial property shall be assessed 6 shall be ninety-five percent. For valuations established 7 for the assessment year beginning January 1, 2014, and each 8 assessment year thereafter beginning before January 1, 2022, 9 the percentage of actual value as equalized by the department 10 of revenue as provided in section 441.49 at which industrial 11 property shall be assessed shall be ninety percent. 12 (2) (1) For valuations established for the assessment year 13 beginning January 1, 2022, and each assessment year thereafter 14 beginning before January 1, 2025 , the portion of actual value 15 at which each property unit of industrial property shall be 16 assessed shall be the sum of the following: 17 (a) An amount equal to the product of the assessment 18 limitation percentage applicable to residential property under 19 subsection 4 for that assessment year multiplied by the actual 20 value of the property that exceeds zero dollars but does not 21 exceed one hundred fifty thousand dollars. 22 (b) An amount equal to ninety percent of the actual value of 23 the property for that assessment year that exceeds one hundred 24 fifty thousand dollars. 25 (2) For valuations established for the assessment year 26 beginning January 1, 2025, and each assessment year thereafter, 27 the percentage of actual value as equalized by the department 28 of revenue as provided in section 441.49 at which industrial 29 property shall be assessed shall be one hundred percent. 30 d. For valuations established for the assessment year 31 beginning January 1, 2019, and each assessment year thereafter 32 beginning before January 1, 2025 , the percentages or portions 33 of actual value at which property is assessed, as determined 34 under this subsection , shall not be applied to the value of 35 -37- LSB 2982YC (1) 91 jm/md 37/ 76 |
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| 76 | 76 | | |
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| 77 | 77 | | H.F. _____ wind energy conversion property valued under section 427B.26 1 the construction of which is approved by the Iowa utilities 2 commission on or after July 1, 2018. 3 e. (1) For the fiscal year beginning July 1, 2023, 4 there is appropriated from the general fund of the state to 5 the department of revenue the sum of one hundred twenty-two 6 million three hundred fifty thousand dollars to be used 7 for payments under this paragraph calculated as a result 8 of the assessment limitations imposed under paragraph b , 9 subparagraph (2), subparagraph division (a), and paragraph 10 c , subparagraph (2), subparagraph division (a). For each 11 fiscal year beginning on or after July 1, 2024, but before 12 July 1, 2026, there is appropriated from the general fund of 13 the state to the department of revenue the sum of one hundred 14 twenty-five million dollars to be used for payments under this 15 paragraph calculated as a result of the assessment limitations 16 imposed under paragraph b , subparagraph (2), subparagraph 17 division (a), Code 2025, and paragraph c , subparagraph (2), 18 subparagraph division (a) , Code 2025 . 19 (2) For fiscal years beginning on or after July 1, 2023, but 20 before July 1, 2026, each county treasurer shall be paid by the 21 department of revenue an amount calculated under subparagraph 22 (4) for the applicable fiscal year . If an amount appropriated 23 for the fiscal year is insufficient to make all payments as 24 calculated under subparagraph (4), the director of revenue 25 shall prorate the payments to the county treasurers and shall 26 notify the county auditors of the pro rata percentage on or 27 before September 30. 28 (3) On or before July 1 of each applicable fiscal year, the 29 assessor shall report to the county auditor that portion of the 30 total actual value of all commercial property and industrial 31 property in the county that is subject to the assessment 32 limitations imposed under paragraph b , subparagraph (2), 33 subparagraph division (a), Code 2025, and paragraph c , 34 subparagraph (2), subparagraph division (a), Code 2025, for the 35 -38- LSB 2982YC (1) 91 jm/md 38/ 76 |
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| 78 | 78 | | |
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| 79 | 79 | | H.F. _____ assessment year used to calculate the taxes due and payable in 1 that fiscal year. 2 (4) On or before September 1 of each applicable fiscal year, 3 the county auditor shall prepare a statement, based on the 4 report received in subparagraph (3) and information transmitted 5 to the county auditor under chapter 434 , listing for each 6 taxing district in the county: 7 (a) The product of the portion of the total actual value 8 of all commercial property, industrial property, and property 9 valued by the department under chapter 434 in the county 10 that is subject to the assessment limitations imposed under 11 paragraph b , subparagraph (2), subparagraph division (a), 12 Code 2025, and paragraph c , subparagraph (2), subparagraph 13 division (a), Code 2025, for the applicable assessment year 14 used to calculate taxes which are due and payable in the 15 applicable fiscal year multiplied by the difference, stated 16 as a percentage, between ninety percent and the assessment 17 limitation percentage applicable to residential property under 18 subsection 4 for the applicable assessment year. 19 (b) The tax levy rate per one thousand dollars of assessed 20 value for each taxing district for the applicable fiscal year. 21 (c) The amount of the payment for each county is equal to 22 the amount determined pursuant to subparagraph division (a), 23 multiplied by the tax rate specified in subparagraph division 24 (b), and then divided by one thousand dollars. 25 (5) The county auditor shall certify and forward one copy of 26 the statement described in subparagraph (4) to the department 27 of revenue not later than September 1 of each fiscal year. 28 (6) The amounts determined under this paragraph shall 29 be paid by the department to the county treasurers in equal 30 installments in September and March of each year. The county 31 treasurer shall apportion the payments among the eligible 32 taxing districts in the county and the amounts received by each 33 taxing authority shall be treated the same as property taxes 34 paid. 35 -39- LSB 2982YC (1) 91 jm/md 39/ 76 |
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| 80 | 80 | | |
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| 81 | 81 | | H.F. _____ f. For the purposes of this subsection , unless the context 1 otherwise requires: 2 (1) Contiguous parcels means any of the following: 3 (a) Parcels that share a common boundary. 4 (b) Parcels within the same building or structure 5 regardless of whether the parcels share a common boundary. 6 (c) Permanent improvements to the land that are situated 7 on one or more parcels of land that are assessed and taxed 8 separately from the permanent improvements if the parcels of 9 land upon which the permanent improvements are situated share 10 a common boundary. 11 (2) Parcel means the same as defined in section 445.1 . 12 Parcel also means that portion of a parcel assigned a 13 classification of commercial property or industrial property 14 pursuant to section 441.21, subsection 14 13 , paragraph b . 15 (3) Property unit means a parcel or contiguous parcels 16 all of which are located within the same county, with the same 17 property tax classification, are owned by the same person, and 18 are operated by that person for a common use and purpose. 19 Sec. 57. Section 441.21, subsection 8, paragraph b, Code 20 2025, is amended to read as follows: 21 b. Notwithstanding paragraph a , any construction or 22 installation of a solar energy system on property classified 23 as agricultural, residential, multiresidential, commercial, or 24 industrial property shall not increase the actual, assessed, 25 and taxable values of the property for five full assessment 26 years. 27 Sec. 58. Section 441.21, subsections 9 and 10, Code 2025, 28 are amended to read as follows: 29 9. Not later than November 1, 1979 2025 , and November 1 30 of each subsequent year, the director shall certify to the 31 county auditor of each county the percentages percentage of 32 actual value at which residential property, agricultural 33 property , commercial property, industrial property, property 34 valued by the department of revenue pursuant to chapters 428 35 -40- LSB 2982YC (1) 91 jm/md 40/ 76 |
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| 82 | 82 | | |
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| 83 | 83 | | H.F. _____ and 438 , property valued by the department of revenue pursuant 1 to chapter 434 , and property valued by the department of 2 revenue pursuant to chapter 437 in each assessing jurisdiction 3 in the county shall be assessed for taxation , including for 4 assessment years beginning on or after January 1, 2022, the 5 percentages used to apply the assessment limitations under 6 subsection 5 , paragraphs b and c as determined under 7 subsection 4 . The county auditor shall proceed to determine 8 the assessed values of agricultural property , residential 9 property, commercial property, industrial property, property 10 valued by the department of revenue pursuant to chapters 428 11 and 438 , property valued by the department of revenue pursuant 12 to chapter 434 , and property valued by the department of 13 revenue pursuant to chapter 437 by applying such percentages 14 the percentage to the current actual value of such property, 15 as reported to the county auditor by the assessor, and the 16 assessed values so determined shall be the taxable values of 17 such properties upon which the levy shall be made. 18 10. The percentages percentage of actual value computed by 19 the department of revenue under subsection 4 for agricultural 20 property , residential property, commercial property, industrial 21 property, property valued by the department of revenue pursuant 22 to chapters 428 and 438 , property valued by the department of 23 revenue pursuant to chapter 434 , and property valued by the 24 department of revenue pursuant to chapter 437 , including for 25 assessment years beginning on or after January 1, 2022, the 26 percentages used to apply the assessment limitations under 27 subsection 5 , paragraphs b and c , and used to determine 28 assessed values of those classes of agricultural property 29 do does not constitute a rule as defined in section 17A.2, 30 subsection 11 . 31 Sec. 59. Section 441.21, subsections 13 and 14, Code 2025, 32 are amended to read as follows: 33 13. a. Beginning with valuations established on or after 34 January 1, 2016 2025 , but before January 1, 2022, all of the 35 -41- LSB 2982YC (1) 91 jm/md 41/ 76 |
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| 84 | 84 | | |
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| 85 | 85 | | H.F. _____ following shall be valued as a separate class of property 1 known as multiresidential property and, excluding properties 2 referred to in section 427A.1, subsection 9 , shall be assessed 3 at a percentage of its actual value, as determined in this 4 subsection the percentage of actual value as equalized by 5 the department of revenue as provided in section 441.49 at 6 which multiresidential property shall be assessed shall be one 7 hundred percent : 8 (1) Mobile home parks. 9 (2) Manufactured home communities. 10 (3) Land-leased communities. 11 (4) Assisted living facilities. 12 (5) A parcel primarily used or intended for human habitation 13 containing three or more separate dwelling units. If a 14 portion of such a parcel is used or intended for a purpose 15 that, if the primary use, would be classified as commercial 16 property or industrial property, each such portion, including 17 a proportionate share of the land included in the parcel, if 18 applicable, shall be assigned the appropriate classification 19 pursuant to paragraph c b . 20 (6) For a parcel that is primarily used or intended for use 21 as commercial property or industrial property, that portion 22 of the parcel that is used or intended for human habitation, 23 regardless of the number of dwelling units contained on the 24 parcel, including a proportionate share of the land included 25 in the parcel, if applicable. The portion of such a parcel 26 used or intended for use as commercial property or industrial 27 property, including a proportionate share of the land included 28 in the parcel, if applicable, shall be assigned the appropriate 29 classification pursuant to paragraph c b . 30 b. For valuations established for the assessment year 31 beginning January 1, 2015, the percentage of actual value as 32 equalized by the department of revenue as provided in section 33 441.49 at which multiresidential property shall be assessed 34 shall be the greater of eighty-six and twenty-five hundredths 35 -42- LSB 2982YC (1) 91 jm/md 42/ 76 |
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| 86 | 86 | | |
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| 87 | 87 | | H.F. _____ percent or the percentage of actual value determined by the 1 department of revenue at which property assessed as residential 2 property is assessed for the same assessment year under 3 subsection 4 . For valuations established for the assessment 4 year beginning January 1, 2016, the percentage of actual 5 value as equalized by the department of revenue as provided 6 in section 441.49 at which multiresidential property shall be 7 assessed shall be the greater of eighty-two and five-tenths 8 percent or the percentage of actual value determined by the 9 department of revenue at which property assessed as residential 10 property is assessed for the same assessment year under 11 subsection 4 . For valuations established for the assessment 12 year beginning January 1, 2017, the percentage of actual 13 value as equalized by the department of revenue as provided 14 in section 441.49 at which multiresidential property shall be 15 assessed shall be the greater of seventy-eight and seventy-five 16 hundredths percent or the percentage of actual value determined 17 by the department of revenue at which property assessed as 18 residential property is assessed for the same assessment 19 year under subsection 4 . For valuations established for the 20 assessment year beginning January 1, 2018, the percentage of 21 actual value as equalized by the department of revenue as 22 provided in section 441.49 at which multiresidential property 23 shall be assessed shall be the greater of seventy-five percent 24 or the percentage of actual value determined by the department 25 of revenue at which property assessed as residential property 26 is assessed for the same assessment year under subsection 4 . 27 For valuations established for the assessment year beginning 28 January 1, 2019, the percentage of actual value as equalized 29 by the department of revenue as provided in section 441.49 at 30 which multiresidential property shall be assessed shall be the 31 greater of seventy-one and twenty-five hundredths percent or 32 the percentage of actual value determined by the department 33 of revenue at which property assessed as residential property 34 is assessed for the same assessment year under subsection 4 . 35 -43- LSB 2982YC (1) 91 jm/md 43/ 76 |
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| 88 | 88 | | |
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| 89 | 89 | | H.F. _____ For valuations established for the assessment year beginning 1 January 1, 2020, the percentage of actual value as equalized 2 by the department of revenue as provided in section 441.49 3 at which multiresidential property shall be assessed shall 4 be the greater of sixty-seven and five-tenths percent or the 5 percentage of actual value determined by the department of 6 revenue at which property assessed as residential property 7 is assessed for the same assessment year under subsection 4 . 8 For valuations established for the assessment year beginning 9 January 1, 2021, the percentage of actual value as equalized 10 by the department of revenue as provided in section 441.49 at 11 which multiresidential property shall be assessed shall be the 12 greater of sixty-three and seventy-five hundredths percent or 13 the percentage of actual value determined by the department of 14 revenue at which property assessed as residential property is 15 assessed for the same assessment year under subsection 4 . 16 c. b. Beginning with valuations established on or after 17 January 1, 2016 2025 , but before January 1, 2022, for parcels 18 for which a portion of the parcel satisfies the requirements 19 for classification as multiresidential property pursuant to 20 paragraph a , subparagraph (5) or (6), the assessor shall 21 assign to that portion of the parcel the classification 22 of multiresidential property and to such other portions of 23 the parcel the property classification for which such other 24 portions qualify. 25 d. c. Property that is rented or leased to low-income 26 individuals and families as authorized by section 42 of the 27 Internal Revenue Code, and that has not been withdrawn from 28 section 42 assessment procedures under subsection 2 of this 29 section , or a hotel, motel, inn, or other building where rooms 30 or dwelling units are usually rented for less than one month 31 shall not be classified as multiresidential property under this 32 subsection . 33 e. d. As used in this subsection : 34 (1) Assisted living facility means property for providing 35 -44- LSB 2982YC (1) 91 jm/md 44/ 76 |
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| 90 | 90 | | |
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| 91 | 91 | | H.F. _____ assisted living as defined in section 231C.2 . Assisted living 1 facility also includes a health care facility, as defined in 2 section 135C.1 , an elder group home, as defined in section 3 231B.1 , a child foster care facility under chapter 237 , or 4 property used for a hospice program as defined in section 5 135J.1 . 6 (2) Dwelling unit means an apartment, group of rooms, 7 or single room which is occupied as separate living quarters 8 or, if vacant, is intended for occupancy as separate living 9 quarters, in which a tenant can live and sleep separately from 10 any other persons in the building. 11 (3) Land-leased community means the same as defined in 12 sections 335.30A and 414.28A . 13 (4) Manufactured home community means the same as a 14 land-leased community. 15 (5) Mobile home park means the same as defined in section 16 435.1 . 17 e. For purposes of equalization under sections 441.47 18 through 441.49, multiresidential property shall be considered 19 residential property. 20 14. a. Beginning with valuations established on or after 21 January 1, 2022 2025 , all of the following property primarily 22 used or intended for human habitation containing two or fewer 23 dwelling units shall be classified and valued as residential 24 property : . 25 (1) Property primarily used or intended for human 26 habitation containing two or fewer dwelling units. 27 (2) Mobile home parks. 28 (3) Manufactured home communities. 29 (4) Land-leased communities. 30 (5) Assisted living facilities. 31 (6) A parcel primarily used or intended for human habitation 32 containing three or more separate dwelling units. If a 33 portion of such a parcel is used or intended for a purpose 34 that, if the primary use, would be classified as commercial 35 -45- LSB 2982YC (1) 91 jm/md 45/ 76 |
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| 92 | 92 | | |
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| 93 | 93 | | H.F. _____ property or industrial property, each such portion, including 1 a proportionate share of the land included in the parcel, if 2 applicable, shall be assigned the appropriate classification 3 pursuant to paragraph b . 4 (7) For a parcel that is primarily used or intended for use 5 as commercial property or industrial property, that portion 6 of the parcel that is used or intended for human habitation, 7 regardless of the number of dwelling units contained on the 8 parcel, including a proportionate share of the land included 9 in the parcel, if applicable. The portion of such a parcel 10 used or intended for use as commercial property or industrial 11 property, including a proportionate share of the land included 12 in the parcel, if applicable, shall be assigned the appropriate 13 classification pursuant to paragraph b . 14 b. Beginning with valuations established on or after 15 January 1, 2022, for parcels for which a portion of the parcel 16 satisfies the requirements for classification as residential 17 property pursuant to paragraph a , subparagraph (6) or (7), 18 the assessor shall assign to that portion of the parcel the 19 classification of residential property and to such other 20 portions of the parcel the property classification for which 21 such other portions qualify. 22 c. Property that is rented or leased to low-income 23 individuals and families as authorized by section 42 of the 24 Internal Revenue Code , and that has not been withdrawn from 25 section 42 assessment procedures under subsection 2 of this 26 section , or a hotel, motel, inn, or other building where rooms 27 or dwelling units are usually rented for less than one month 28 shall not be classified as residential property under this 29 subsection . 30 d. As used in this subsection : 31 (1) Assisted living facility means property for providing 32 assisted living as defined in section 231C.2 . Assisted living 33 facility also includes a health care facility, as defined in 34 section 135C.1 , an elder group home, as defined in section 35 -46- LSB 2982YC (1) 91 jm/md 46/ 76 |
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| 94 | 94 | | |
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| 95 | 95 | | H.F. _____ 231B.1 , a child foster care facility under chapter 237 , or 1 property used for a hospice program as defined in section 2 135J.1 . 3 (2) Dwelling unit means an apartment, group of rooms, 4 or single room which is occupied as separate living quarters 5 or, if vacant, is intended for occupancy as separate living 6 quarters, in which a tenant can live and sleep separately from 7 any other persons in the building. 8 (3) Land-leased community means the same as defined in 9 sections 335.30A and 414.28A . 10 (4) Manufactured home community means the same as a 11 land-leased community. 12 (5) Mobile home park means the same as defined in section 13 435.1 . 14 Sec. 60. Section 558.46, Code 2025, is amended by adding the 15 following new subsection: 16 NEW SUBSECTION . 4A. For the purposes of this section, 17 residential property includes commercial or multiresidential 18 property. 19 Sec. 61. SAVINGS PROVISION. This division of this Act, 20 pursuant to section 4.13, does not affect the operation of, 21 or prohibit the application of, prior provisions of section 22 441.21, or rules adopted under chapter 17A to administer prior 23 provisions of section 441.21, for assessment years beginning 24 before January 1, 2025, or for duties, powers, protests, 25 appeals, proceedings, actions, or remedies attributable to an 26 assessment year beginning before January 1, 2025, including 27 property taxes due and payable in a fiscal year as the result 28 of an assessment year beginning before January 1, 2025. 29 Sec. 62. RETROACTIVE APPLICABILITY. This division of this 30 Act applies retroactively to assessment years beginning on or 31 after January 1, 2025. 32 DIVISION V 33 DISABLED VETERAN AND HOMESTEAD CREDITS AND EXEMPTIONS 34 Sec. 63. Section 25B.7, subsection 2, paragraph a, Code 35 -47- LSB 2982YC (1) 91 jm/md 47/ 76 |
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| 96 | 96 | | |
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| 97 | 97 | | H.F. _____ 2025, is amended to read as follows: 1 a. Homestead tax credit pursuant to section 425.1 , and 2 sections 425.2 through 425.13 , and section 425.15 . 3 Sec. 64. Section 425.1, subsection 2, Code 2025, is amended 4 by striking the subsection and inserting in lieu thereof the 5 following: 6 2. a. The homestead credit fund shall be apportioned each 7 year so as to give a credit against the tax on each eligible 8 homestead in the state equal to the amounts specified pursuant 9 to paragraph b or c , as applicable. 10 b. (1) If the owner of a homestead allowed a credit under 11 this subchapter is any of the following, the homestead credit 12 allowed on the homestead shall be the entire amount of tax 13 levied on the homestead: 14 (a) A veteran of any of the military forces of the United 15 States who acquired the homestead under 38 U.S.C. 21.801, 16 21.802 prior to August 6, 1991, or under 38 U.S.C. 2101, 2102. 17 (b) A veteran as defined in section 35.1 with a permanent 18 service-connected disability rating of one hundred percent, as 19 certified by the United States department of veterans affairs, 20 or a permanent and total disability rating based on individual 21 unemployability that is compensated at the one hundred percent 22 disability rate, as certified by the United States department 23 of veterans affairs. 24 (c) A former member of the national guard of any state 25 who otherwise meets the service requirements of section 35.1, 26 subsection 2, paragraph b , subparagraph (2) or (7), with a 27 permanent service-connected disability rating of one hundred 28 percent, as certified by the United States department of 29 veterans affairs, or a permanent and total disability rating 30 based on individual unemployability that is compensated at the 31 one hundred percent disability rate, as certified by the United 32 States department of veterans affairs. 33 (d) An individual who is a surviving spouse or a child and 34 who is receiving dependency and indemnity compensation pursuant 35 -48- LSB 2982YC (1) 91 jm/md 48/ 76 |
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| 98 | 98 | | |
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| 99 | 99 | | H.F. _____ to 38 U.S.C. 1301 et seq., as certified by the United States 1 department of veterans affairs. 2 (2) (a) For an owner described in subparagraph (1), 3 subparagraph division (a), (b), or (c), the credit allowed 4 shall be continued to the estate of an owner who is deceased 5 or the surviving spouse and any child, as defined in section 6 234.1, who are the beneficiaries of a deceased owner, so long 7 as the surviving spouse remains unmarried. 8 (b) An individual described in subparagraph (1), 9 subparagraph division (d), is no longer eligible for the credit 10 upon termination of dependency and indemnity compensation under 11 38 U.S.C. 1301 et seq. 12 (3) An owner or a beneficiary of an owner who elects to 13 secure the credit provided in this paragraph is not eligible 14 for the credit provided in paragraph c or any other real 15 property tax credit or exemption provided by law for veterans 16 of military service. 17 (4) If an owner acquires a different homestead, the 18 credit allowed under this paragraph may be claimed on the new 19 homestead unless the owner fails to meet the other requirements 20 of this paragraph. 21 (5) (a) Except as provided in subparagraph division (b), 22 the list of the names and addresses of individuals allowed 23 a credit under this paragraph and maintained by the county 24 recorder, county treasurer, county assessor, city assessor, or 25 other government body is confidential information and shall 26 not be disseminated to any person unless otherwise ordered by 27 a court or released by the lawful custodian of the records 28 pursuant to state or federal law. The county recorder, county 29 treasurer, county assessor, city assessor, or other government 30 body responsible for maintaining the names and addresses 31 of individuals allowed a credit under this paragraph may 32 display such credit on individual paper records and individual 33 electronic records, including display on an internet site. 34 (b) Upon request, a county recorder, county assessor, city 35 -49- LSB 2982YC (1) 91 jm/md 49/ 76 |
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| 100 | 100 | | |
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| 101 | 101 | | H.F. _____ assessor, or other entity may share information as described in 1 subparagraph division (a) to a county veterans service officer 2 for purposes of providing information on benefits and services 3 available to veterans and their families. 4 (6) (a) For an owner who makes an application to secure 5 the credit provided in this paragraph before July 1, 2025, 6 and for the beneficiary of such an owner, homestead shall 7 mean the same as defined in section 425.11 for each succeeding 8 assessment year. 9 (b) For an owner who makes an application to secure the 10 credit provided in this paragraph on or after July 1, 2025, and 11 for the beneficiary of such an owner, homestead shall mean the 12 same as provided in section 425.11, except the homestead shall 13 not include appurtenances and shall not exceed one-half acre. 14 (7) For purposes of this paragraph, permanent and total 15 disability rating based on individual unemployability means 16 a condition under which a person has either a permanent 17 service-connected disability rating of sixty percent or two or 18 more permanent service-connected disability conditions in which 19 one of the conditions has at least a forty percent rating and 20 the combined rating for all the conditions is at least seventy 21 percent, and the person has an administrative adjustment added 22 to the service-connected disability rating, due to individual 23 unemployability, such that the United States department of 24 veterans affairs rates the veteran permanently and totally 25 disabled for purposes of disability compensation. 26 c. (1) For assessment years beginning prior to January 27 1, 2025, unless eligible under section 425.15, Code 2025, an 28 amount equal to the actual levy on the first four thousand 29 eight hundred fifty dollars of actual value for each homestead. 30 (2) For the assessment year beginning January 1, 2025, 31 and each assessment year thereafter, unless eligible under 32 paragraph b , zero. 33 Sec. 65. Section 425.1A, subsection 1, Code 2025, is amended 34 to read as follows: 35 -50- LSB 2982YC (1) 91 jm/md 50/ 76 |
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| 102 | 102 | | |
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| 103 | 103 | | H.F. _____ 1. The following exemptions from taxation shall be allowed 1 in addition to the homestead credit exemption under subsection 2 1A for an owner that has attained the age of sixty-five years 3 by January 1 of the assessment year: 4 a. For the assessment year beginning January 1, 2023, the 5 eligible homestead, not to exceed three thousand two hundred 6 fifty dollars in taxable value. 7 b. For the assessment year years beginning on or after 8 January 1, 2024, and each succeeding assessment year, the 9 eligible homestead, not to exceed six thousand five hundred 10 dollars in taxable value. 11 Sec. 66. Section 425.1A, Code 2025, is amended by adding the 12 following new subsection: 13 NEW SUBSECTION . 1A. For each assessment year beginning 14 on or after January 1, 2025, an exemption from taxation of 15 fifty thousand dollars in taxable value shall be allowed on 16 each eligible homestead in addition to the exemption under 17 subsection 1, if applicable. 18 Sec. 67. Section 425.2, subsections 1 and 2, Code 2025, are 19 amended to read as follows: 20 1. A person who wishes to qualify for the homestead credit 21 or exemption allowed under this subchapter shall obtain the 22 appropriate forms for filing for the credit from the assessor. 23 The forms shall include the ability to claim the credit under 24 section 425.1 and the exemptions under section 425.1A. 25 However, a separate form shall be required for claiming a 26 credit under section 425.1, subsection 2, paragraph b . The 27 person claiming the credit or exemption shall file a verified 28 statement and designation of homestead with the assessor for 29 the year for which the person is first claiming the credit 30 or exemption . The claim shall be filed not later than July 31 1 of the year for which the person is claiming the credit or 32 exemption . A claim filed after July 1 of the year for which the 33 person is claiming the credit or exemption shall be considered 34 as a claim filed for the following year. 35 -51- LSB 2982YC (1) 91 jm/md 51/ 76 |
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| 104 | 104 | | |
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| 105 | 105 | | H.F. _____ 2. Upon the filing and allowance of the claim, the claim 1 shall be allowed on that homestead for successive years without 2 further filing as long as the property is legally or equitably 3 owned and used as a homestead by that person or that persons 4 spouse on July 1 of each of those successive years, and the 5 owner of the property being claimed as a homestead declares 6 residency in Iowa for purposes of income taxation, and the 7 property is occupied by that person or that persons spouse 8 for at least six months in each of those calendar years in 9 which the fiscal year begins. When the property is sold or 10 transferred, the buyer or transferee who wishes to qualify 11 shall refile for the credit or exemption . However, when the 12 property is transferred as part of a distribution made pursuant 13 to chapter 598 , the transferee who is the spouse retaining 14 ownership of the property is not required to refile for the 15 credit or exemption . Property divided pursuant to chapter 598 16 shall not be modified following the division of the property. 17 An owner who ceases to use a property for a homestead or 18 intends not to use it as a homestead for at least six months in 19 a calendar year shall provide written notice to the assessor 20 by July 1 following the date on which the use is changed. A 21 person who sells or transfers a homestead or the personal 22 representative of a deceased person who had a homestead at the 23 time of death, shall provide written notice to the assessor 24 that the property is no longer the homestead of the former 25 claimant. 26 Sec. 68. Section 425.2, subsection 4, Code 2025, is amended 27 by striking the subsection. 28 Sec. 69. Section 425.2, subsections 5 and 6, Code 2025, are 29 amended to read as follows: 30 5. Any person sixty-five years of age or older or any person 31 who is disabled may request, in writing, from the appropriate 32 assessor forms for filing for homestead tax credit . Any 33 person sixty-five years of age or older or who is disabled 34 may complete the form, which shall include a statement of 35 -52- LSB 2982YC (1) 91 jm/md 52/ 76 |
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| 106 | 106 | | |
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| 107 | 107 | | H.F. _____ homestead, and mail or return it to the appropriate assessor. 1 The signature of the claimant on the statement shall be 2 considered the claimants acknowledgment that all statements 3 and facts entered on the form are correct to the best of the 4 claimants knowledge. 5 6. Upon adoption of a resolution by the county board 6 of supervisors, any person may request, in writing, from 7 the appropriate assessor forms for the filing for homestead 8 tax credit . The person may complete the form, which shall 9 include a statement of homestead, and mail or return it to 10 the appropriate assessor. The signature of the claimant on 11 the statement of homestead shall be considered the claimants 12 acknowledgment that all statements and facts entered on the 13 form are correct to the best of the claimants knowledge. 14 Sec. 70. Section 425.8, subsection 1, Code 2025, is amended 15 to read as follows: 16 1. The director of revenue shall prescribe the form 17 for the making of a verified statement and designation of 18 homestead, the form for the supporting affidavits required 19 herein, and such other forms as may be necessary for the proper 20 administration of this subchapter . Whenever necessary, the 21 department of revenue shall forward to the county auditors of 22 the several counties in the state the prescribed sample forms, 23 and the county auditors shall furnish blank forms prepared in 24 accordance therewith with the assessment rolls, books, and 25 supplies delivered to the assessors. The department of revenue 26 shall prescribe and the county auditors shall provide on the 27 forms for claiming the homestead credit a statement to the 28 effect that the owner realizes that the owner must give written 29 notice to the assessor when the owner changes the use of the 30 property. 31 Sec. 71. Section 425.11, subsection 1, paragraph d, 32 subparagraph (1), unnumbered paragraph 1, Code 2025, is amended 33 to read as follows: 34 The homestead includes the dwelling house which the owner, 35 -53- LSB 2982YC (1) 91 jm/md 53/ 76 |
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| 108 | 108 | | |
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| 109 | 109 | | H.F. _____ in good faith, is occupying as a home on July 1 of the year for 1 which the credit or exemption is claimed and occupies as a home 2 for at least six months during the calendar year in which the 3 fiscal year begins, except as otherwise provided. 4 Sec. 72. Section 425.11, subsection 1, paragraph d, 5 subparagraph (3), Code 2025, is amended to read as follows: 6 (3) It must not embrace more than one dwelling house, but 7 where a homestead has more than one dwelling house situated 8 thereon, the exemption and or credit provided for in this 9 subchapter shall apply to the home and buildings used by the 10 owner, but shall not apply to any other dwelling house and 11 buildings appurtenant. 12 Sec. 73. Section 425.11, subsection 1, paragraph e, 13 subparagraph (2), Code 2025, is amended to read as follows: 14 (2) For the purpose of this subchapter , the word owner 15 shall be construed to mean a bona fide owner and not one for 16 the purpose only of availing the person of the benefits of this 17 subchapter . In order to qualify for the homestead tax credit 18 and or exemption, evidence of ownership shall be on file in the 19 office of the clerk of the district court or recorded in the 20 office of the county recorder at the time the owner files with 21 the assessor a verified statement of the homestead claimed by 22 the owner as provided in section 425.2 . 23 Sec. 74. Section 483A.24, subsection 19, Code 2025, is 24 amended to read as follows: 25 19. Upon payment of a fee established by rules adopted 26 pursuant to section 483A.1 for a lifetime trout fishing 27 license, the department shall issue a lifetime trout fishing 28 license to a person who is at least sixty-five years of age or 29 to a person who qualifies for the disabled veteran homestead 30 credit under section 425.15 425.1, subsection 2, paragraph b . 31 The department shall prepare an application to be used by a 32 person requesting a lifetime trout fishing license under this 33 subsection . 34 Sec. 75. REPEAL. Section 425.15, Code 2025, is repealed. 35 -54- LSB 2982YC (1) 91 jm/md 54/ 76 |
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| 110 | 110 | | |
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| 111 | 111 | | H.F. _____ Sec. 76. IMPLEMENTATION. Homestead owners who have filed 1 for or that are receiving homestead credits or exemptions under 2 chapter 425, subchapter I, before the effective date of this 3 division of this Act shall continue to receive such credits and 4 exemptions for which the owner is eligible for assessment years 5 beginning on or after January 1, 2025, without refiling, and, 6 if the owner is eligible, shall receive the exemption under 7 section 425.1A, subsection 1A, as enacted in this division of 8 this Act, without filing for such exemption. 9 Sec. 77. RETROACTIVE APPLICABILITY. This division of this 10 Act applies retroactively to assessment years beginning on or 11 after January 1, 2025. 12 DIVISION VI 13 MILITARY SERVICE PROPERTY TAX EXEMPTION 14 Sec. 78. Section 426A.11, subsection 2, Code 2025, is 15 amended to read as follows: 16 2. a. The property, not to exceed one thousand eight 17 hundred fifty-two dollars in taxable value for assessment years 18 beginning before January 1, 2023, of an honorably separated, 19 retired, furloughed to a reserve, placed on inactive status, 20 or discharged veteran, as defined in section 35.1, subsection 21 2 , paragraph a or b . 22 b. The property, not to exceed four thousand dollars in 23 taxable value for the assessment years beginning on or after 24 January 1, 2023, but before January 1, 2025, of an honorably 25 separated, retired, furloughed to a reserve, placed on inactive 26 status, or discharged veteran, as defined in section 35.1, 27 subsection 2 , paragraph a or b . 28 c. The property, not to exceed the following amounts in 29 taxable value, of an honorably separated, retired, furloughed 30 to a reserve, placed on inactive status, or discharged veteran, 31 as defined in section 35.1, subsection 2, paragraph a or b : 32 (1) Five thousand dollars in taxable value for the 33 assessment year beginning January 1, 2025. 34 (2) Six thousand dollars in taxable value for the assessment 35 -55- LSB 2982YC (1) 91 jm/md 55/ 76 |
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| 112 | 112 | | |
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| 113 | 113 | | H.F. _____ year beginning January 1, 2026. 1 (3) Seven thousand dollars in taxable value for assessment 2 years beginning on or after January 1, 2027. 3 Sec. 79. RETROACTIVE APPLICABILITY. This division of this 4 Act applies retroactively to January 1, 2025, for assessment 5 years beginning on or after that date. 6 DIVISION VII 7 HOSPITAL AND EMERGENCY MEDICAL SERVICES PROPERTY TAX LEVIES 8 Sec. 80. Section 347.7, Code 2025, is amended by adding the 9 following new subsection: 10 NEW SUBSECTION . 3A. a. For fiscal years beginning on 11 or after July 1, 2026, any property tax levy imposed for a 12 county hospital under this chapter that is limited by law to 13 a specific property tax levy rate per one thousand dollars of 14 assessed value shall not exceed a levy rate per one thousand 15 dollars of assessed value that is equal to one thousand 16 multiplied by the quotient obtained by dividing the product of 17 the budget adjustment factor multiplied by the current fiscal 18 years actual property tax dollars certified for such levy by 19 the remainder of the total assessed value used to calculate 20 such taxes for the budget year minus value attributable to new 21 valuation. 22 b. For purposes of this subsection, budget adjustment 23 factor , budget year , and current fiscal year mean the same 24 as defined in section 331.423. 25 Sec. 81. Section 347A.3, Code 2025, is amended by adding the 26 following new subsection: 27 NEW SUBSECTION . 3. a. For fiscal years beginning on 28 or after July 1, 2026, any property tax levy imposed for a 29 county hospital under this chapter that is limited by law to 30 a specific property tax levy rate per one thousand dollars of 31 assessed value shall not exceed a levy rate per one thousand 32 dollars of assessed value that is equal to one thousand 33 multiplied by the quotient obtained by dividing the product of 34 the budget adjustment factor multiplied by the current fiscal 35 -56- LSB 2982YC (1) 91 jm/md 56/ 76 |
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| 114 | 114 | | |
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| 115 | 115 | | H.F. _____ years actual property tax dollars certified for such levy by 1 the remainder of the total assessed value used to calculate 2 such taxes for the budget year minus value attributable to new 3 valuation. 4 b. For purposes of this subsection, budget adjustment 5 factor , budget year , and current fiscal year mean the same 6 as defined in section 331.423. 7 Sec. 82. Section 357F.8, Code 2025, is amended by adding the 8 following new subsection: 9 NEW SUBSECTION . 3. a. For fiscal years beginning on 10 or after July 1, 2026, any property tax levy imposed for 11 the district under this chapter that is limited by law to a 12 specific property tax levy rate per one thousand dollars of 13 assessed value shall not exceed a levy rate per one thousand 14 dollars of assessed value that is equal to one thousand 15 multiplied by the quotient obtained by dividing the product of 16 the budget adjustment factor multiplied by the current fiscal 17 years actual property tax dollars certified for such levy by 18 the remainder of the total assessed value used to calculate 19 such taxes for the budget year minus value attributable to new 20 valuation. 21 b. For purposes of this subsection, budget adjustment 22 factor , budget year , and current fiscal year mean the same 23 as defined in section 331.423. 24 Sec. 83. Section 357G.8, Code 2025, is amended by adding the 25 following new subsection: 26 NEW SUBSECTION . 3. a. For fiscal years beginning on 27 or after July 1, 2026, any property tax levy imposed for 28 the district under this chapter that is limited by law to a 29 specific property tax levy rate per one thousand dollars of 30 assessed value shall not exceed a levy rate per one thousand 31 dollars of assessed value that is equal to one thousand 32 multiplied by the quotient obtained by dividing the product of 33 the budget adjustment factor multiplied by the current fiscal 34 years actual property tax dollars certified for such levy by 35 -57- LSB 2982YC (1) 91 jm/md 57/ 76 |
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| 116 | 116 | | |
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| 117 | 117 | | H.F. _____ the remainder of the total assessed value used to calculate 1 such taxes for the budget year minus value attributable to new 2 valuation. 3 b. For purposes of this subsection, budget adjustment 4 factor , budget year , and current fiscal year mean the same 5 as defined in section 384.1. 6 Sec. 84. NEW SECTION . 422D.5A Levy limitation. 7 1. For fiscal years beginning on or after July 1, 2026, any 8 property tax levy imposed under this chapter that is limited 9 by law to a specific property tax levy rate per one thousand 10 dollars of assessed value shall not exceed a levy rate per 11 one thousand dollars of assessed value that is equal to one 12 thousand multiplied by the quotient obtained by dividing the 13 product of the budget adjustment factor multiplied by the 14 current fiscal years actual property tax dollars certified 15 for such levy by the remainder of the total assessed value 16 used to calculate such taxes for the budget year minus value 17 attributable to new valuation. 18 2. For purposes of this section, budget adjustment factor , 19 budget year , and current fiscal year mean the same as 20 defined in section 331.423. 21 DIVISION VIII 22 PROPERTY TAX LEVY RATES 23 Sec. 85. Section 176A.10, subsection 1, paragraphs a, b, c, 24 d, and e, Code 2025, are amended by striking the paragraphs and 25 inserting in lieu thereof the following: 26 a. For an extension district having a population of less 27 than thirty thousand, an annual levy of fifteen cents per 28 thousand dollars of the assessed valuation of the taxable 29 property in the district up to a maximum of two hundred 30 ninety-one thousand dollars payable during the fiscal year 31 commencing July 1, 2026, and an increase of six thousand 32 dollars in the amount payable during each subsequent fiscal 33 year. 34 b. For an extension district having a population of thirty 35 -58- LSB 2982YC (1) 91 jm/md 58/ 76 |
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| 118 | 118 | | |
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| 119 | 119 | | H.F. _____ thousand or more but less than fifty thousand, an annual 1 levy of ten and one-eighth cents per thousand dollars of the 2 assessed valuation of the taxable property in the district 3 up to a maximum of three hundred forty-two thousand dollars 4 payable during the fiscal year commencing July 1, 2026, and an 5 increase of seven thousand dollars in the amount payable during 6 each subsequent fiscal year. 7 c. For an extension district having a population of fifty 8 thousand or more but less than ninety thousand, an annual levy 9 of six and three-fourths cents per thousand dollars of the 10 assessed valuation of the taxable property in the district up 11 to a maximum of four hundred thirty-six thousand five hundred 12 dollars payable during the fiscal year commencing July 1, 2026, 13 and an increase of nine thousand dollars in the amount payable 14 during each subsequent fiscal year. 15 d. For an extension district having a population of ninety 16 thousand or more but less than two hundred thousand, an annual 17 levy of six and three-fourths cents per thousand dollars of 18 the assessed valuation of the taxable property in the district 19 up to a maximum of six hundred ninety thousand dollars payable 20 during the fiscal year commencing July 1, 2026, and an increase 21 of fifteen thousand dollars in the amount payable during each 22 subsequent fiscal year. 23 e. For an extension district having a population of two 24 hundred thousand or more, an annual levy of two and one-half 25 cents per thousand dollars of the assessed valuation of 26 the taxable property in the district up to a maximum of one 27 million fifty thousand dollars payable during the fiscal 28 year commencing July 1, 2026, and an increase of twenty-five 29 thousand dollars in the amount payable during each subsequent 30 fiscal year. 31 Sec. 86. Section 176A.10, subsection 2, Code 2025, is 32 amended by striking the subsection. 33 Sec. 87. Section 312.2, subsection 5, paragraph a, Code 34 2025, is amended to read as follows: 35 -59- LSB 2982YC (1) 91 jm/md 59/ 76 |
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| 120 | 120 | | |
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| 121 | 121 | | H.F. _____ a. The treasurer of state, before making any allotments 1 to counties under this section , shall reduce the allotment to 2 a county for the secondary road fund by the amount by which 3 the total funds that the county transferred or provided during 4 the prior fiscal year under section 331.429, subsection 1 , 5 paragraphs a , b , d , and e , are less than seventy-five 6 fifty-one percent of the sum of the following: 7 (1) From the general fund of the county, the dollar 8 equivalent of a tax of sixteen and seven-eighths eight and 9 seven-sixteenths cents per thousand dollars of assessed value 10 on all taxable property in the county. 11 (2) From the rural services fund of the county, the 12 dollar equivalent of a tax of three dollars one dollar and 13 three-eighths fifty and three-sixteenths of a cent per thousand 14 dollars of assessed value on all taxable property not located 15 within the corporate limits of a city in the county. 16 Sec. 88. NEW SECTION . 444.25 Maximum property tax levy 17 rates adjustments. 18 1. For purposes of this section: 19 a. Budget year is the fiscal year beginning during the 20 calendar year in which a budget is certified. 21 b. Current fiscal year is the fiscal year ending during 22 the calendar year in which a budget for the budget year is 23 certified. 24 c. Rate-limited property tax levy includes any ad valorem 25 property tax levy limited by law to a specific property tax 26 levy rate per one thousand dollars of assessed value used to 27 calculate taxes, but does not include the school district 28 foundation levy under section 257.3, the county general 29 services levy under section 331.423, subsection 1, the county 30 rural services levy under section 331.423, subsection 2, the 31 city general fund levy under section 384.1, subsection 3, the 32 physical plant and equipment levies under section 298.2, the 33 school district bond tax under section 298.18, any levy under 34 chapter 347 or 347A, and any levy under chapter 357F, 357G, 35 -60- LSB 2982YC (1) 91 jm/md 60/ 76 |
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| 122 | 122 | | |
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| 123 | 123 | | H.F. _____ or 422D. In addition, rate-limited property tax levy does 1 not include levy rates used in the calculations under section 2 312.2, subsection 5, paragraph a . 3 2. For the fiscal year beginning July 1, 2026, each 4 rate-limited property tax levy may only be imposed if the 5 governmental entity imposed such levy for the fiscal year 6 beginning July 1, 2025, and shall, by operation of this 7 section, be limited to a levy rate per one thousand dollars 8 of assessed value that is equal to one thousand multiplied by 9 the quotient of one hundred two percent of the current fiscal 10 years actual property tax dollars certified for such levy 11 divided by the total assessed value used to calculate such 12 taxes for the budget year, but not less than a levy rate per one 13 thousand dollars of assessed value that results in an amount 14 of actual property tax dollars certified for levy for such 15 levy equal to one hundred and one-half percent of the actual 16 property tax dollars certified for such levy for the fiscal 17 year beginning July 1, 2025. 18 3. For the fiscal year beginning July 1, 2027, and each 19 fiscal year thereafter, rate-limited property tax levies may 20 be imposed by any governmental entity otherwise authorized by 21 law, regardless of whether the governmental entity imposed the 22 levy for the fiscal year beginning July 1, 2025, at rates not 23 to exceed those established by the general assembly by statute 24 following receipt and consideration of the report submitted by 25 the legislative interim committee requested to be established 26 by the legislative council in this division of this Act. 27 Sec. 89. NEW SECTION . 444.26 Use of bonds and indebtedness 28 for general operations prohibition. 29 1. For purposes of this section, general operations means 30 services or activities generally funded from the governmental 31 entitys general fund, which are necessary for the operation 32 of the governmental entity, including salaries and benefits, 33 or which are for the health and welfare of the governmental 34 entitys citizens or primarily intended to benefit all 35 -61- LSB 2982YC (1) 91 jm/md 61/ 76 |
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| 124 | 124 | | |
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| 125 | 125 | | H.F. _____ residents of the governmental entity, but excluding services 1 financed by statutory funds other than a debt service fund. 2 2. On or after July 1, 2025, a city or county shall not 3 issue bonds or other indebtedness payable from an ad valorem 4 property tax levy for the purpose of funding the general 5 operations of the city or general operations of the county, as 6 applicable, or otherwise use proceeds from the sale of bonds or 7 issuance of other indebtedness to fund general operations. 8 3. The city finance committee shall adopt rules under 9 chapter 17A for cities to implement this section. The county 10 finance committee shall adopt rules under chapter 17A for 11 counties to implement this section. 12 Sec. 90. PROPERTY TAXATION RATES STUDY COMMITTEE. 13 1. a. The legislative council is requested to establish a 14 legislative study committee during the 2025 legislative interim 15 to examine appropriate rates of property taxation imposed by 16 governmental entities following the adjustments to assessment 17 limitations and levy rate limitations made in this Act. 18 b. The study committee shall consist of the following voting 19 members of the general assembly: 20 (1) Two members of the senate appointed by the majority 21 leader of the senate. 22 (2) One member of the senate appointed by the minority 23 leader of the senate. 24 (3) Two members of the house of representatives appointed by 25 the speaker of the house of representatives. 26 (4) One member of the house of representatives appointed by 27 the minority leader of the house of representatives. 28 2. The committee shall make recommendations to and file a 29 report with the general assembly relating to the appropriate 30 rates of property taxation imposed by governmental entities 31 following enactment of this Act, no later than January 15, 32 2026. 33 Sec. 91. EFFECTIVE DATE. The following take effect January 34 1, 2026: 35 -62- LSB 2982YC (1) 91 jm/md 62/ 76 |
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| 126 | 126 | | |
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| 127 | 127 | | H.F. _____ 1. The sections of this division of this Act amending 1 section 176A.10. 2 2. The section of this division of this Act amending section 3 312.2. 4 Sec. 92. APPLICABILITY. The following apply to fiscal years 5 beginning on or after July 1, 2026: 6 1. The sections of this division of this Act amending 7 section 176A.10. 8 2. The section of this division of this Act amending section 9 312.2. 10 DIVISION IX 11 ELDERLY PROPERTY TAXES LOW INCOME 12 Sec. 93. Section 425.17, subsection 2, paragraph a, 13 subparagraph (3), Code 2025, is amended to read as follows: 14 (3) A person filing a claim for credit under this subchapter 15 who has attained the age of seventy years on or before December 16 31 of the base year, who has a household income of less than two 17 three hundred fifty percent of the federal poverty level, as 18 defined by the most recently revised poverty income guidelines 19 published by the United States department of health and human 20 services, and is domiciled in this state at the time the claim 21 is filed or at the time of the persons death in the case of a 22 claim filed by the executor or administrator of the claimants 23 estate. 24 Sec. 94. APPLICABILITY. This division of this Act applies 25 to assessment years beginning on or after January 1, 2026. 26 DIVISION X 27 BRUCELLOSIS AND TUBERCULOSIS ERADICATION FUND LEVY 28 Sec. 95. Section 165.18, subsections 2 and 3, Code 2025, are 29 amended by striking the subsections. 30 Sec. 96. Section 331.512, subsection 1, paragraph e, Code 31 2025, is amended by striking the paragraph. 32 Sec. 97. Section 331.559, subsection 2, Code 2025, is 33 amended by striking the subsection. 34 Sec. 98. EFFECTIVE DATE. This division of this Act takes 35 -63- LSB 2982YC (1) 91 jm/md 63/ 76 |
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| 128 | 128 | | |
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| 129 | 129 | | H.F. _____ effect upon enactment. 1 Sec. 99. APPLICABILITY. This division of this Act applies 2 to property taxes due and payable in fiscal years beginning on 3 or after July 1, 2025. 4 EXPLANATION 5 The inclusion of this explanation does not constitute agreement with 6 the explanations substance by the members of the general assembly. 7 This bill relates to local government property taxes, 8 financial authority, and budgets. 9 DIVISION I COUNTY PROPERTY TAXES AND BUDGETS. Code 10 section 331.423 establishes a levy rate limitation for the 11 general county services levy and a limitation for the rural 12 county services levy. The bill modifies the general county 13 services levy rate limitation for the fiscal year beginning 14 July 1, 2026, to be a levy rate not to exceed the greater of: 15 (1) a levy rate per $1,000 of assessed value equal to 1,000 16 multiplied by the quotient of 102 percent of the current fiscal 17 years (immediately preceding fiscal year) actual property tax 18 dollars certified for levy for general county services divided 19 by the remainder of the total assessed value used to calculate 20 such taxes for the budget year minus value attributable to new 21 valuation, as defined in the bill; and (2) a levy rate per 22 $1,000 of assessed value that results in an amount of actual 23 property tax dollars certified for levy for general county 24 services equal to 100.5 percent of the actual property tax 25 dollars certified for such levy for the current fiscal year. 26 For each fiscal year beginning on or after July 1, 2027, 27 the maximum levy rate is the levy rate imposed by the county 28 for the current fiscal year unless the total assessed value, 29 excluding new valuation, used to calculate taxes for general 30 county services for the budget year is equal to or exceeds 102 31 percent of the total assessed value used to calculate taxes for 32 general county services for the current fiscal year, and for 33 the budget year beginning July 1, 2027, only, not less than 34 a levy rate per $1,000 of assessed value that results in an 35 -64- LSB 2982YC (1) 91 jm/md 64/ 76 |
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| 130 | 130 | | |
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| 131 | 131 | | H.F. _____ amount of actual property tax dollars certified for levy equal 1 to 100.5 percent of the actual property tax dollars certified 2 for levy for the current fiscal year. 3 If the total assessed value, excluding value attributable 4 to new valuation, used to calculate taxes for general county 5 services for the budget year is equal to or exceeds 102 percent 6 of the total assessed value used to calculate taxes for general 7 county services for the current fiscal year, the levy rate 8 imposed shall not exceed a levy rate per $1,000 of assessed 9 value that is equal to 1,000 multiplied by the quotient 10 obtained by dividing the product of the budget adjustment 11 factor, as defined in the bill and which ranges from 102 12 percent to 105 percent depending upon the amount of annual 13 increase in the consumer price index, multiplied by the current 14 fiscal years actual property tax dollars certified for levy 15 by the remainder of the total assessed value used to calculate 16 such taxes for the budget year minus value attributable to new 17 valuation. 18 The bill similarly modifies the maximum levy rate for rural 19 county services for fiscal years beginning on or after July 1, 20 2026. 21 The division takes effect January 1, 2026, and applies to 22 county taxes and budgets for fiscal years beginning on or after 23 July 1, 2026. 24 DIVISION II CITY PROPERTY TAXES AND BUDGETS. Code 25 section 384.1 establishes the city general fund levy and limits 26 on the levy rate. The bill modifies the general fund levy 27 rate limitation for the fiscal year beginning July 1, 2026, 28 to be a levy rate not to exceed the greater of: (1) a levy 29 rate per $1,000 of assessed value equal to 1,000 multiplied 30 by the quotient of 102 percent of the current fiscal years 31 (immediately preceding fiscal year) actual property tax dollars 32 certified for levy divided by the remainder of the total 33 assessed value used to calculate such taxes for the budget year 34 minus value attributable to new valuation, as defined in the 35 -65- LSB 2982YC (1) 91 jm/md 65/ 76 |
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| 132 | 132 | | |
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| 133 | 133 | | H.F. _____ bill; and (2) a levy rate per $1,000 of assessed value that 1 results in an amount of actual property tax dollars certified 2 for levy equal to 100.5 percent of the actual property tax 3 dollars certified for such levy for the current fiscal year. 4 For each fiscal year beginning on or after July 1, 2027, the 5 maximum levy rate is the levy rate imposed by the city for the 6 current fiscal year unless the total assessed value, excluding 7 new valuation, used to calculate taxes for the budget year is 8 equal to or exceeds 102 percent of the total assessed value 9 used to calculate taxes for the current fiscal year, and for 10 the budget year beginning July 1, 2027, only, not less than 11 a levy rate per $1,000 of assessed value that results in an 12 amount of actual property tax dollars certified for levy equal 13 to 100.5 percent of the actual property tax dollars certified 14 for levy for the current fiscal year. 15 If the total assessed value, excluding value attributable 16 to new valuation, used to calculate taxes for the city general 17 fund for the budget year is equal to or exceeds 102 percent 18 of the total assessed value used to calculate taxes for the 19 current fiscal year, the levy rate imposed shall not exceed a 20 levy rate per $1,000 of assessed value that is equal to 1,000 21 multiplied by the quotient obtained by dividing the product 22 of the budget adjustment factor, as defined in the bill and 23 which ranges from 102 percent to 105 percent depending upon 24 the amount of annual increase in the consumer price index, 25 multiplied by the current fiscal years actual property tax 26 dollars certified for levy by the remainder of the total 27 assessed value used to calculate such taxes for the budget year 28 minus value attributable to new valuation. 29 The bill also establishes a methodology to determine a 30 maximum levy rate for a city that is not imposing a general 31 fund levy in the current fiscal year. 32 The division takes effect January 1, 2026, and applies to 33 property taxes and budgets for fiscal years beginning on or 34 after July 1, 2026. 35 -66- LSB 2982YC (1) 91 jm/md 66/ 76 |
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| 134 | 134 | | |
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| 135 | 135 | | H.F. _____ DIVISION III SCHOOL TAXES AND BUDGETS. As part of 1 the state school foundation program, for school budget 2 years beginning on or after July 1, 2022, Code section 257.1 3 establishes the regular program foundation base to be 88.4 4 percent of the regular program state cost per pupil. Beginning 5 with the budget year beginning July 1, 2026, the bill increases 6 that percentage to 100 percent. Similarly, the bill increases 7 the special education support services foundation base 8 percentage from 79 percent to 100 percent. 9 Code section 257.3 requires school districts to levy a 10 foundation property tax of $5.40 per $1,000 of assessed value 11 on all taxable property in the school district. The bill 12 reduces the foundation property tax levy rate to $2.97 per 13 $1,000 of assessed value for budget years beginning on or after 14 July 1, 2026. 15 Code section 257.3 provides an exception to the foundation 16 property tax levy rate of $5.40 for those school districts that 17 have recently been reorganized. Such districts are provided 18 reduced foundation property tax levy rates for three years 19 following the reorganization. The bill adjusts those reduced 20 rates for reorganizations that take effect on or after July 21 1, 2026, to reflect the reduction made in the bill to the 22 foundation property tax levy imposed by school districts that 23 are not subject to a reorganization and eliminates certain 24 supplemental aid related to such reorganized school district 25 rates for budget years beginning on or after July 1, 2026. 26 The bill eliminates certain property tax adjustment aid 27 under Code section 257.15(2) and (3) for fiscal years beginning 28 on or after July 1, 2026. 29 The bill eliminates the $24 million general fund 30 appropriation for adjusted additional property tax levy aid 31 under Code section 257.15(4) for fiscal years beginning on 32 or after July 1, 2026. The bill also eliminates the annual 33 appropriation of the balance of the property tax equity and 34 relief fund under Code section 257.16A for purposes designated 35 -67- LSB 2982YC (1) 91 jm/md 67/ 76 |
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| 136 | 136 | | |
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| 137 | 137 | | H.F. _____ under Code section 257.15(4) and requires remaining moneys at 1 the end of a specified fiscal year to be transferred back to 2 the funds from which they were received. 3 The bill eliminates the payment of school district property 4 tax replacement payments for fiscal years beginning on or after 5 July 1, 2026. 6 The bill eliminates the annual appropriation of moneys in 7 the foundation base supplement fund for fiscal years beginning 8 on or after July 1, 2026, and requires the remaining moneys 9 at the end of a specified fiscal year to be transferred for 10 deposit in the secure an advanced vision for education fund. 11 The bill eliminates transfers from the secure an advanced 12 vision for education fund to the property tax equity and relief 13 fund and the foundation base supplement fund for fiscal years 14 beginning on or after July 1, 2026. 15 In Code chapters 425A (family farm tax credit) and 426 16 (agricultural land tax credit), the bill replaces references 17 to the school foundation property tax levy rate ($5.40) with 18 citations to the appropriate provision of the Code section 19 establishing the foundation property tax rate. 20 The bill requires each school district with an unexpended 21 fund balance in the districts management levy fund under 22 Code section 298A.3 at the conclusion of the fiscal year 23 beginning July 1, 2024, that exceeds an amount equal to the 24 total expenditures from the districts management fund for the 25 fiscal year beginning July 1, 2024, to certify such unexpended 26 fund balance and expenditure amounts, including any reserved 27 or designated amounts in the fund and the purposes therefor, 28 to the school budget review committee by November 15, 2025. 29 The committee is then required to conduct a review of the 30 unexpended fund balances and expenditures of school district 31 management levy funds certified under the bill. By February 32 1, 2026, the committee shall make recommendations to the 33 general assembly for establishing district management levy fund 34 unexpended fund balance limitations for fiscal years beginning 35 -68- LSB 2982YC (1) 91 jm/md 68/ 76 |
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| 138 | 138 | | |
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| 139 | 139 | | H.F. _____ on or after July 1, 2027, including recommendations for 1 limitations based on a percentage of the districts management 2 levy fund expenditures and recommendations for management levy 3 limitations and expenditure requirements for excess funds. 4 The bill amends several provisions relating to the state 5 school foundation program funding formula to include funding 6 for the media services funding and educational services funding 7 under Code section 257.37 to be included and funded as part of 8 foundation aid paid by the state instead of funding through a 9 school districts additional property tax under Code section 10 257.4 for school budget years beginning on or after July 1, 11 2026. 12 The bill reduces by 50 percent the maximum levy rates for 13 the regular and voter-approved physical plant and equipment 14 levy under Code section 298.2 and the school district bond tax 15 under Code section 298.18. The bill also repeals an obsolete 16 provision relating to levy adjustments authorized to occur 17 before June 30, 2007, in Code section 298.18A. 18 The bill also amends Code section 298.4 by providing that for 19 fiscal years beginning on or after July 1, 2027, if a school 20 districts unexpended fund balance of the districts management 21 levy fund is equal to or exceeds a specified percentage of the 22 average annual expenditures from the districts management 23 levy fund for the three consecutive fiscal years immediately 24 preceding the base year, the board of directors may not certify 25 a district management levy for the fiscal year. Additionally, 26 if a school district is not prohibited from certifying a levy 27 under the bill, the maximum amount that the board of directors 28 may certify for levy under the district management levy shall 29 be an amount equal to the remainder of a specified percentage 30 of the average annual expenditures from the districts 31 management levy fund for the three consecutive fiscal years 32 immediately preceding the base year minus the districts 33 management levy fund unexpended fund balance for the fiscal 34 year preceding the base year. 35 -69- LSB 2982YC (1) 91 jm/md 69/ 76 |
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| 140 | 140 | | |
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| 141 | 141 | | H.F. _____ Except for the section of the division amending Code section 1 257.31, which relates to the school budget review committee, 2 this division of the bill takes effect January 1, 2026, and 3 applies to fiscal years and school budget years beginning on 4 or after July 1, 2026. 5 DIVISION IV PROPERTY VALUATIONS AND ASSESSMENT 6 LIMITATIONS. Code section 441.21 provides that the actual 7 value of agricultural property shall be determined on the 8 basis of productivity and net earning capacity and that any 9 formula or method employed to determine productivity and net 10 earning capacity of property shall be adopted in full by rule 11 of the department of revenue. The bill amends that provision 12 by specifying that for assessment years beginning on or after 13 January 1, 2026, structures on agricultural land constructed on 14 or after January 1, 2026, that are not agricultural dwellings 15 shall not be included in determination of productivity and 16 net earning capacity of agricultural property and shall not 17 be allocated any portion of the total county productivity 18 value so determined. Such agricultural structures shall 19 instead be valued according to the structures replacement 20 cost less depreciation and obsolescence and the structures 21 assessed value subject to taxation prior to application of 22 any assessment limitation shall be equal to the product of 23 the structures value multiplied by the agricultural factor, 24 as determined in 701 IAC 102.3(2) or succeeding rule of the 25 department. The bill also provides that such structures shall 26 be treated similarly to agricultural structures constructed 27 before January 1, 2026, when applying any equalization order 28 of the department of revenue. 29 The bill modifies the list of examples of abnormal property 30 transactions that are to be excluded from consideration or 31 adjusted to eliminate distortions of market value when valuing 32 property to include built-to-suit construction, sale-leaseback 33 transactions, leased fee sales, and instead of sales to 34 immediate family, sales between related parties. 35 -70- LSB 2982YC (1) 91 jm/md 70/ 76 |
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| 142 | 142 | | |
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| 143 | 143 | | H.F. _____ Code section 441.21(4) establishes the calculation for 1 assessment limitations (rollback) for residential property and 2 agricultural property. The bill strikes the calculation of 3 the residential property assessment limitation for assessment 4 years beginning on or after January 1, 2025, and strikes 5 the provision within the agricultural property assessment 6 limitation calculation that limits growth of residential or 7 agricultural property to the growth in the other classification 8 (ag-residential tie). The bill provides that residential 9 property is assessed at 100 percent of the propertys actual 10 value for assessment years beginning on or after January 1, 11 2025. By operation of law and through changes in the bill, 12 all other classifications of property, except for agricultural 13 property, are assessed at 100 percent of actual value for 14 assessment years beginning on or after January 1, 2025. 15 The bill modifies provisions governing the calculation 16 of payments made to local governments under Code section 17 441.21(5)(e) that are made to replace property taxes due to the 18 application of the residential property assessment limitation 19 to certain portions of commercial and industrial property 20 valuations and eliminates the appropriation for such payments 21 for fiscal years beginning on or after July 1, 2026, due to 22 elimination of the assessment limitations. 23 The bill also reestablishes a multiresidential property 24 classification for assessment years beginning on or after 25 January 1, 2025, that includes types of property that were 26 classified as multiresidential property for assessment years 27 beginning before January 1, 2022. Such property is included 28 within the residential property classification under current 29 law. Under the bill, for purposes of equalization under Code 30 sections 441.47 through 441.49, multiresidential property shall 31 be considered residential property. 32 This division of the bill applies retroactively to 33 assessment years beginning on or after January 1, 2025. 34 DIVISION V DISABLED VETERAN AND HOMESTEAD CREDITS AND 35 -71- LSB 2982YC (1) 91 jm/md 71/ 76 |
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| 144 | 144 | | |
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| 145 | 145 | | H.F. _____ EXEMPTIONS. Starting with the assessment year beginning 1 January 1, 2025, the bill replaces the homestead property 2 tax credit, other than the portion of the credit provided 3 to certain disabled veterans, with a homestead property tax 4 exemption. For assessment years beginning on or after January 5 1, 2025, the exemption amount is $50,000 in taxable value. The 6 bill specifies that the elderly homestead exemption of $6,500 7 in taxable value applies in addition to the $50,000 homestead 8 exemption established in the bill. 9 The bill moves the disabled veteran homestead credit from 10 Code section 425.15 to Code section 425.1, and makes changes 11 to the scope of the disabled veteran homestead credit for new 12 applicants. Currently, a disabled veteran with a 100 percent 13 permanent and total disability rating receives a homestead 14 credit on the entire amount of tax levied on the homestead. 15 The bill specifies that a separate application form is required 16 to claim the disabled veteran homestead credit. The bill 17 does not change the homestead credit for an eligible disabled 18 veteran who makes an application for the homestead credit 19 before July 1, 2025. For a disabled veteran who makes an 20 application for the homestead credit on or after July 1, 2025, 21 the bill changes the definition of homestead to exclude 22 appurtenances and limits the size of the homestead credit to 23 property on one-half acre. 24 The state continues to reimburse local governments for the 25 homestead credit, which for assessment years beginning on or 26 after January 1, 2025, includes only the disabled veterans 27 homestead credit, but does not reimburse local governments for 28 the homestead exemption under current law and in the bill. 29 The bill provides that homestead owners who have filed for 30 or who are receiving homestead credits or exemptions before 31 the effective date of this division of the bill shall continue 32 to receive such credits and exemptions for which the owner is 33 eligible for assessment years beginning on or after January 34 1, 2025, without refiling, and, if the owner is eligible, 35 -72- LSB 2982YC (1) 91 jm/md 72/ 76 |
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| 146 | 146 | | |
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| 147 | 147 | | H.F. _____ shall receive the exemption under Code section 425.1A(1A), as 1 enacted in this division of the bill, without filing for such 2 exemption. 3 This division of the bill applies retroactively to 4 assessment years beginning on or after January 1, 2025. 5 DIVISION VI MILITARY SERVICE PROPERTY TAX EXEMPTION. 6 Under current law, a veteran receives a property tax exemption 7 of $4,000 in taxable value on property owned by the veteran. 8 The bill increases the veterans property tax exemption from 9 $4,000 to the following exemption amounts: for the assessment 10 year beginning January 1, 2025, $5,000; for the assessment year 11 beginning January 1, 2026, $6,000; and for assessment years 12 beginning on or after January 1, 2027, $7,000. 13 The division applies retroactively to assessment years 14 beginning on or after January 1, 2025. 15 DIVISION VII HOSPITAL AND EMERGENCY MEDICAL SERVICES 16 PROPERTY TAX LEVIES. The bill provides that for fiscal years 17 beginning on or after July 1, 2026, any property tax levy 18 imposed for a county hospital under Code chapter 347 that 19 is limited by law to a specific property tax levy rate per 20 $1,000 of assessed value shall not exceed a levy rate per 21 $1,000 of assessed value that is equal to 1,000 multiplied by 22 the quotient obtained by dividing the product of the budget 23 adjustment factor multiplied by the current fiscal years 24 actual property tax dollars certified for such levy by the 25 remainder of the total assessed value used to calculate such 26 taxes for the budget year minus value attributable to new 27 valuation. The bill defines budget adjustment factor, 28 budget year, and current fiscal year to mean the same as 29 defined in Code section 331.423, as amended in the bill. 30 The bill establishes similar limitations for levies imposed 31 under Code chapters 347A (county hospitals payable from 32 revenue), 357F (emergency medical services districts), 357G 33 (city emergency medical services districts), and 422D (optional 34 taxes for emergency medical services) that are limited by law 35 -73- LSB 2982YC (1) 91 jm/md 73/ 76 |
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| 148 | 148 | | |
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| 149 | 149 | | H.F. _____ to a specific property tax levy rate per $1,000 of assessed 1 value. 2 DIVISION VIII PROPERTY TAX LEVY RATES. The bill 3 establishes a reduction for rate-limited property tax levies. 4 The bill defines rate-limited property tax levy to be any ad 5 valorem property tax levy limited by law to a specific property 6 tax levy rate per $1,000 of assessed value used to calculate 7 taxes, but does not include the school district foundation 8 levy under Code section 257.3, the county general services 9 levy under Code section 331.423(1), the county rural services 10 levy under Code section 331.423(2), the city general fund levy 11 under Code section 384.1(3), the physical plant and equipment 12 levies under Code section 298.2, the school district bond 13 tax under Code section 298.18, any levy under Code chapter 14 347 or 347A, and any levy under Code chapter 357F, 357G, or 15 422D. In addition, rate-limited property tax levy does not 16 include levy rates used in the calculations under Code section 17 312.2(5)(a). 18 For the fiscal year beginning July 1, 2026, each 19 rate-limited property tax levy may only be imposed if the 20 governmental entity imposed such levy for the fiscal year 21 beginning July 1, 2025, and shall, by operation of the bill, 22 be limited to a levy rate that is equal to 1,000 multiplied 23 by the quotient of 102 percent of the current fiscal years 24 actual property tax dollars certified for such levy divided 25 by the total assessed value used to calculate such taxes for 26 the budget year, but not less than a levy rate per $1,000 of 27 assessed value that results in an amount of actual property tax 28 dollars certified for levy for such levy equal to 100.5 percent 29 of the actual property tax dollars certified for such levy for 30 the fiscal year beginning July 1, 2025. 31 For the fiscal year beginning July 1, 2027, and each fiscal 32 year thereafter, rate-limited property tax levies may be 33 imposed by any governmental entity otherwise authorized by law, 34 regardless of whether the governmental entity imposed the levy 35 -74- LSB 2982YC (1) 91 jm/md 74/ 76 |
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| 150 | 150 | | |
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| 151 | 151 | | H.F. _____ for the fiscal year beginning July 1, 2025, at rates not to 1 exceed those established by the general assembly by statute 2 following receipt and consideration of the report submitted by 3 the legislative interim committee requested to be established 4 by the legislative council in this division of the bill. 5 The bill also provides that, on or after July 1, 2025, a city 6 or county shall not issue bonds or other indebtedness payable 7 from an ad valorem property tax levy for the purpose of funding 8 the general operations of the city or general operations of 9 the county, as applicable, or otherwise use proceeds from the 10 sale of bonds or issuance of other indebtedness to fund general 11 operations. The bill defines general operations to mean 12 services or activities generally funded from the governmental 13 entitys general fund, which are necessary for the operation 14 of the governmental entity, including salaries and benefits, 15 or which are for the health and welfare of the governmental 16 entitys citizens or primarily intended to benefit all 17 residents of the governmental entity, but excluding services 18 financed by statutory funds other than a debt service fund. 19 The city finance committee is required to adopt rules under 20 Code chapter 17A for cities to implement the new Code section 21 governing funding of general operations. The county finance 22 committee is required to adopt rules under Code chapter 17A for 23 counties to implement the new Code section governing funding 24 of general operations. 25 The bill updates the calculation methodologies for 26 agricultural extension levies under Code section 176A.10 and 27 reduces levy rates used to make certain calculations related to 28 the secondary road fund allocations under Code section 312.2. 29 The bill requests the legislative council to establish 30 a legislative study committee during the 2025 legislative 31 interim to examine appropriate rates of property taxation 32 imposed by governmental entities following enactment of 33 the bill. The study committee shall consist of six voting 34 members of the general assembly. Two members shall be 35 -75- LSB 2982YC (1) 91 jm/md 75/ 76 |
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| 152 | 152 | | |
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| 153 | 153 | | H.F. _____ appointed by the majority leader of the senate, one member 1 appointed by the minority member of the senate, two members 2 appointed by the speaker of the house of representatives, 3 and one member appointed by the minority leader of the house 4 of representatives. The study committee is required to make 5 recommendations to the general assembly by January 15, 2026. 6 DIVISION IX ELDERLY PROPERTY TAXES LOW INCOME. The 7 bill modifies the eligibility for the property tax credit for 8 persons ages 70 and older under Code chapter 425, subchapter 9 II. Currently, a person filing a claim for the property tax 10 credit who is at least 70 years of age and who has a household 11 income of less than 250 percent of the federal poverty level is 12 eligible to receive a specified credit amount against property 13 taxes due on the claimants homestead. The bill increases the 14 household income threshold for eligibility from less than 250 15 percent of the federal poverty level to less than 350 percent 16 of the federal poverty level. 17 The division applies to assessment years beginning on or 18 after January 1, 2026. 19 DIVISION X BRUCELLOSIS AND TUBERCULOSIS ERADICATION FUND 20 LEVY. Code section 165.18 authorizes the secretary of 21 agriculture to direct the board of supervisors of each county 22 to levy an amount sufficient to pay the expenses estimated to 23 be incurred from the brucellosis and tuberculosis eradication 24 fund for the following fiscal year, subject to a maximum levy 25 of 33.75 cents per $1,000. The bill strikes the authority to 26 levy such a tax beginning with property taxes due and payable 27 in fiscal years beginning July 1, 2025. The division takes 28 effect upon enactment. 29 -76- LSB 2982YC (1) 91 jm/md 76/ 76 |
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