Governor signs bill estimated to reduce property taxes by $100 million
DES MOINES — Governor Kim Reynolds has approved the property tax changes that cleared the legislature this week.
“Legislation as complex and important as local property taxes only happen when policymakers are willing to dig into the weeds and get the details right,” Reynolds says. “This bill’s near unanimous passage through both chambers of the legislature is a testament to their long hours of work on behalf of the people of Iowa.”
The new law requires cities and counties to lower property tax collections based on a new formula that kicks in next year. It’s designed to limit property tax revenue growth after this spring’s assessments showed farmland and home values skyrocketing — which could lead to higher property tax bills in September of 2024. The plan includes more generous property tax benefits for veterans and elderly Iowans. “All tolled, this bill will deliver $100 million in savings,” Reynolds said, “the most significant property tax reform in state history.”
Reynolds signed the bill into law Thursday afternoon, shortly after the 2023 legislative session concluded.
Senate Republican Leader Jack Whitver says lawmakers are listening to property owners. “This spring they were shocked, appalled and concerned with the drastic assessment increases to their property and extremely concerned about what it would mean for their property taxes,” Whitver says. “We promised on the opening day of this session that we would address this issue and today we keep that promise.”
Senator Dan Dawson, a Republican from Council Bluffs, led development of the bill. “The historic building blocks being put into place here will start the longterm process of rebuilding our property tax system,” Dawson says. “Ultimately we are asking local governments to do what we have been doing at the state level: fund your priorities, but pass along some of this excess assessment valuation back to the taxpayers.”
House Speaker Pat Grassley says the bill provides certainty as well as relief to property owners. “This bill shows, as well as everything else that we’ve been able to accomplish…the ability for the governor’s office, the House and Senate to identify problems that Iowans have brought to us,” Grassley says, “and be able to take true action that provides true levels of reform.”
Every Republican present and all but one Democrat in the legislature supported the bill.
Senate Minority Leader Zach Wahls says Democrats are thrilled middle class families are getting relief and will listen to local officials who are worried about how to implement the changes. House Minority Leader Jennifer Konfrst says Democrats want to make sure seniors and veterans don’t get smaller property tax bills, but wind up losing local services they depend upon.