Property tax limits under debate in Iowa legislature
DES MOINES — Republicans in the House and Senate have drafted bills they say will “slow down the growth of property taxes.”
Six years ago, Iowa lawmakers cut commercial and industrial property taxes by 10 percent. This year, GOP Senators have proposed limiting tax increases on all classes of property to no more than three percent.
“Commercial/industrial taxpayers continue to see a lot of increases. We’re concerned about those increases,” Nicole Crain said this week during a senate subcommittee meeting. “We really think that putting a cap on local governments is a way to help control some of those increases that we’ve seen.”
According to Matt Steinfeldt of the Iowa Farm Bureau, property tax payments in Iowa have doubled since the year 2000.
“The total of property taxes collected this year will be over $5.75 billion,” Steinfeldt said. “The growth of property taxes is outpacing the economy. It’s outpacing Iowans’ ability to pay.”
Critics say the limit will restrict the ability of growing communities to pay for needed infrastructure and services. Ames Mayor John Haila told senators there’s “amazing” expansion in his city’s research park.
“As we continue to grow, we need a fourth fire station. We can bond for it, but it’s going to cost us $1.3 million for the fire fighters to fill it every year,” he said. “If this bill goes through and the cap goes through as it is, we won’t be able to do that.”
Brett Barker, the mayor of the city of Nevada, is also chairman of Story County Republicans. He told legislators their proposal may have unintended consequences.
“Ultimately cities aren’t created equally. We all have different challenges. We all have unique situations and I think local officials are most in tune with our communities,” he said. “We hear them.”
Republicans in the Iowa House have a property tax plan that addresses any increase above two percent. Citizens would be able to petition for a referendum if a city council or county board of supervisors proposes increasing property taxes by more than two percent.