Senate File 633 - Introduced SENATE FILE 633 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO SF 219) A BILL FOR An Act relating to forest and fruit-tree reservations by 1 establishing a program fee and including contingent 2 effective date provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2007SV (3) 91 jm/md
S.F. 633 Section 1. NEW SECTION . 427C.14 Program fee. 1 1. a. For each assessment year beginning on or after 2 January 1, 2026, each acre of forest and fruit-tree reservation 3 that is exempt from tax pursuant to this chapter shall be 4 subject to a program fee to be paid no later than September 1 5 of each assessment year to the county treasurer of the county 6 where the forest or fruit-tree reservation is located to be 7 deposited into the county general fund. 8 b. (1) Amounts collected by the county that are due on 9 September 1, 2026, and due on September 1, 2027, may be used 10 for any county general fund purpose. 11 (2) Amounts collected by a county that are due on or after 12 September 1, 2028, shall be used for property tax relief for 13 fiscal years beginning on or after July 1, 2029, including, for 14 counties subject to section 331.423, subsection 1, paragraph 15 d , subparagraph (2), as enacted in 2025 Acts, Senate Study 16 Bill 1227, an adjustment to the calculation of the countys 17 authorized levy rate for general county services under section 18 331.423, subsection 1, paragraph d , subparagraph (2), 19 subparagraph division (a), as enacted in 2025 Acts, Senate 20 Study Bill 1227. 21 2. Fee rates shall be in the following amounts: 22 a. Subject to paragraph c , for forest and fruit-tree 23 reservations located in the county where at least one of the 24 owners of the forest or fruit-tree reservation maintains a 25 homestead, as defined in section 425.11, two dollars per acre, 26 as adjusted pursuant to subsection 4. 27 b. Subject to paragraph c , for forest and fruit-tree 28 reservations not subject to paragraph a and located in a 29 county that is contiguous to the county where at least one of 30 the owners of the forest or fruit-tree reservation maintains 31 a homestead, as defined in section 425.11, three dollars per 32 acre, as adjusted pursuant to subsection 4. 33 c. (1) For forest and fruit-tree reservations not described 34 by paragraph a or b , and forest and fruit-tree reservations 35 -1- LSB 2007SV (3) 91 jm/md 1/ 5
S.F. 633 located inside the corporate limits of a city, a rate per acre 1 equal to the product of the average property taxes due per acre 2 of agricultural property in the county with the most acres of 3 land subject to an exemption under this chapter for the most 4 recently available assessment year multiplied by the quotient 5 of thirteen divided by the average corn suitability rating for 6 agricultural property located in the county with the most acres 7 of property subject to an exemption under this chapter. 8 (2) The department of management shall make all 9 calculations necessary to determine the fee rate in 10 subparagraph (1) and transmit the rate to each county treasurer 11 no later than July 1 of each year. 12 3. For purposes of this section: 13 a. Annual inflation factor means an index, expressed as a 14 percentage, determined by the department of management based 15 upon the consumer price index for all urban consumers for the 16 twelve-month period ending six months prior to January 1 of 17 the assessment year for which the factor is determined. In 18 determining the annual inflation factor, the department of 19 management shall use the annual percent change, but not less 20 than zero percent, in the consumer price index for all urban 21 consumers in the applicable twelve-month period and shall add 22 all of that percent change to one hundred percent. The annual 23 inflation factor and the cumulative inflation factor shall each 24 be expressed as a percentage rounded to the nearest one-tenth 25 of one percent. The annual inflation factor shall not be less 26 than one hundred percent. The annual inflation factor for 27 the assessment year beginning January 1, 2026, is one hundred 28 percent. 29 b. Cumulative inflation factor means the product of the 30 annual inflation factor for the assessment year beginning 31 on January 1, 2027, and all annual inflation factors for 32 subsequent assessment years as determined pursuant to this 33 subsection. The cumulative inflation factor applies to 34 all assessment years beginning on or after January 1 of the 35 -2- LSB 2007SV (3) 91 jm/md 2/ 5
S.F. 633 assessment year for which the latest annual inflation factor 1 has been determined pursuant to paragraph a . 2 4. For the assessment year beginning on or after January 3 1, 2027, the department of management shall multiply the 4 adjusted fee amount, if applicable, set forth in subsection 2, 5 paragraphs a and b , by the cumulative inflation factor, 6 and shall round off the resulting product to the nearest cent. 7 The resulting factor shall be the fee rate used in subsection 8 2, paragraphs a and b for the applicable assessment year. 9 However, the fee rate in subsection 2, paragraphs a and 10 b , including any adjusted fee amount calculated under this 11 subsection, shall not exceed the fee rate calculated under 12 subsection 2, paragraph c , used during the same assessment 13 year. The department of management shall transmit the fee rate 14 as adjusted pursuant to this subsection, if applicable, to the 15 county treasurer no later than July 1 of each year. 16 Sec. 2. Section 331.423, subsection 1, paragraph d, 17 subparagraph (2), subparagraph division (a), as enacted by 2025 18 Iowa Acts, Senate Study Bill 1227, section 3, is amended to 19 read as follows: 20 (a) If the total assessed value, excluding value 21 attributable to new valuation, used to calculate taxes for 22 general county services under this subsection 1 for the budget 23 year is equal to or exceeds one hundred two percent of the 24 total assessed value used to calculate taxes for general 25 county services for the current fiscal year, the levy rate 26 imposed under this subsection 1 shall not exceed a levy rate 27 per one thousand dollars of assessed value that is equal to 28 one thousand multiplied by the quotient obtained by dividing 29 the product of the budget adjustment factor multiplied by the 30 remainder of current fiscal years actual property tax dollars 31 certified for levy under this subsection 1 minus, for fiscal 32 years beginning on or after July 1, 2029, the amount of fees 33 collected by the county under section 427C.14 due by September 34 1 preceding the budget year by the remainder of the total 35 -3- LSB 2007SV (3) 91 jm/md 3/ 5
S.F. 633 assessed value used to calculate such taxes for the budget year 1 minus value attributable to new valuation. 2 Sec. 3. CONTINGENT EFFECTIVE DATE. This Act takes effect 3 on the effective date of 2025 Acts, Senate Study Bill 1227, 4 division I. 5 EXPLANATION 6 The inclusion of this explanation does not constitute agreement with 7 the explanations substance by the members of the general assembly. 8 Currently, a person who establishes a forest or fruit-tree 9 reservation (reservation) is entitled to a property tax 10 exemption on the tract of land selected to be a reservation, 11 subject to certain conditions. 12 Beginning January 1, 2026, this bill establishes a fee 13 structure for reservations dependent upon where the reservation 14 is located. For a reservation located in a county where 15 at least one of the owners of the reservation maintains a 16 homestead, the fee is $2 per acre per year, subject to annual 17 adjustments for inflation. For a reservation located in a 18 county contiguous to the county where at least one of the 19 owners of the reservation maintains a homestead, the fee is $3 20 per acre per year, subject to annual adjustments for inflation. 21 For all other reservations, including a reservation located 22 inside the corporate limits of a city, the fee shall be a rate 23 per acre equal to a formula calculated by the department of 24 management and subject to annual adjustments for inflation. 25 Fees collected under the bill are to be paid no later than 26 September 1 of each year to the county treasurer of the county 27 where the forest or fruit-tree reservation is located to be 28 deposited into the county general fund. 29 Amounts collected pursuant to the bill that are due on 30 September 1, 2026, or on September 1, 2027, may be used for any 31 county general fund purpose. Amounts that are due on or after 32 September 1, 2028, shall be used for property tax relief. 33 The bill does not take effect unless Senate Study Bill 1227, 34 division I (county property taxes and budgets), also takes 35 -4- LSB 2007SV (3) 91 jm/md 4/ 5
S.F. 633 effect. 1 -5- LSB 2007SV (3) 91 jm/md 5/ 5