March 14, 2025

This Week at the Capitol

• The Revenue Estimating Conference (REC) met to review the state budget on Thursday.

  • The REC lowered its estimate from FY 2025 to $9.13 billion, an overall revenue decline of about 6% from the previous year and reduced the FY 2026 revenue estimate to $8.7 billion.

  • The budget proposed by Governor Reynolds in January was $9.4 billion and will use money from the reserve funds. Kraig Paulsen, the director of DOM and a member of the panel, said that the reductions are from tax rate cuts and were not unexpected. He said that “Iowa is in a great financial position” to deal with any revenue declines.

  • Review the REC publication here.
    

• Republican Blaine Watkins won the special election for House District 100 on Tuesday.

League's Priority Legislation

• SSB 1208 & HSB 313 | Property Tax System Overhaul 
  

  • Bill Sponsors have asked for feedback from the League and other stakeholders on amendments that fit within the current framework of the bill.

    • Legislators have acknowledged the significance of the change for local governments while maintaining their intention to deliver a tax cut to Iowans.

• SSB 1116 & HF 651 | Public Notice Alignment 
  

  • Both House and Senate bills passed full committees, making them funnel-proof.

    • League is working to maintain the bill’s form against proposed amendments that lengthen the minimum reporting period to 10 days from 4 days, which exacerbates the issue the bill is meant to address.

• SSB 1118 & HF 192 | Sidewalk Liability 
  

  • Disappointingly, both bills died in the legislative funnel. The Government Affairs team will elevate this issue with lawmakers for further discussion.

How to Read Legislative Link

With many bills failing to cross the legislative “funnel” deadline. The Legislature will begin to consider Ways & Means bills dealing with fiscal policy alongside other policy bills that remain alive. Legislative Link will change to reflect these designations with these bills.

• Legislation that Advanced 
  

  • These bills advanced in the legislative process this past week.

• Legislation with Scheduled Subcommittees
  

  • These bills will be heard in subcommittee next week. Please review for any impacts to your community for us to know as we attend and testify at these meetings. If you would like to testify yourself, we are happy to assist you. You can find the full list of scheduled subcommittees here.
    

• Newly Introduced Legislation of Interest
  

  • We expect these bills to have a direct influence on local government, but may not affect all communities the same. Let us know of impacts to your city!

Legislation that Advanced 

 SF 42 | EMS Wages

• To the Governor.

• Allows the wages for EMS workers to be paid out of the voter-approved county EMS fund.

SF 75 | County Supervisors

• Passed Senate 33-14.

• Requires counties with a regent university located within them to elect county supervisors by district instead of at-large, which would affect all three counties it applies to: Johnson, Story, and Black Hawk counties.

SF 566 | Court Debt System Study

• Passed Senate 48-0.

• Establishes a study committee, chaired by the state court administrator, to evaluate and propose reforms to the statutory framework governing the administration of the court debt system in Iowa, with recommendations due by November 1, 2025.

HF 297 | FF & EMS Services

• Passed House 88-0.
  

• Deems payments to volunteer FF and EMS workers who are also city officials to be lawful if not prohibited by law or incompatible with the office held by the official. Allows a city council member to be a volunteer fire chief but requires the member to abstain from the vote allowing that.

HF 652 | Amendment to County/City Regulation of Real Property

• Passed House 89-6.
  

• Allows county and city boards of adjustment to grant variances from zoning ordinances related to area, dimensional, or numerical limitations when property owners demonstrate unique practical difficulties and that the variance will not significantly alter the character of the surrounding neighborhood.
  

HSB 271 | Property Tax Exemption for Disaster-Affected Areas

• Passed House Ways & Means subcommittee March 12.
  

• Offers a temporary property tax exemption for four years on homes sold by HUD to buyers receiving a homestead tax credit, specifically for properties located in areas affected by major disasters.
  

SF 21 | Property Tax Abatement for EMS Surviving Spouses

• Passed Senate Ways & Means subcommittee March 13.

  • House Companion: HF 75.

• Allows the surviving spouse of an emergency services member who was killed in the line of duty to apply for a property tax abatement on their home.

HF 329 | Tax Exemption for Water Utilities

• Passed House Ways & Means subcommittee March 12
  

  • Senate Companion: SF 200.

• Requires water utilities to accept valid tax exemption certificates for water use and imposes penalties if they fail to do so.

Legislation with Scheduled Subcommittees

HSB 231 | Disabled Veteran Homestead Tax Credit

• Expands the disabled veteran homestead tax credit in Iowa by introducing new eligibility criteria based on permanent service-connected disability ratings, with phased implementation starting in fiscal year 2026, and includes provisions for retroactive applicability and funding limitations.

• Subcommittee scheduled for March 18 at noon.
  

HSB 272 | Emergency Medical Services Trust Fund

• Modifies the emergency medical services trust fund by excluding property taxes for emergency medical services from urban renewal revenue divisions and clarifying that fund expenditures must directly support emergency medical services without violating laws or servicing debt.

• Subcommittee scheduled for March 18 at 12:15 p.m.
  

HSB 307 | Development Property Assessments

• Amends property assessment regulations to allow development property acquired or improved after January 1, 2020, to maintain its previous tax classification until certain conditions are met, while repealing existing provisions and establishing a retroactive applicability date of January 1, 2025.

• Subcommittee scheduled for March 18 at 12:30 p.m.
  

HSB 233 | Prohibiting Enforcement of International Organization Actions

• Prohibits state and local governmental entities from enforcing or implementing actions from the United Nations, its agencies, or the World Economic Forum.

• Subcommittee scheduled for March 18 at 12:45 p.m.
  

Newly Introduced Legislation of Interest

HSB 317 | Renewable Electric Power Generation Facilities

• Establishes standardized regulations for the siting and operation of renewable electric power generation facilities in Iowa, impacting city governments by requiring them to adopt specific setback standards, streamline approval processes, and comply with new provisions by December 31, 2025. This may limit local regulatory authority while imposing additional administrative responsibilities.
  

HSB 316 | Assessment Limitations for Commercial Child Care Facilities

• Establishes assessment limitations for commercial child care facilities, allowing their property value to be assessed at a reduced rate based on the residential assessment limitation percentage, effective for assessment years beginning January 1, 2025. The bill includes application and approval procedures for property owners and takes effect upon enactment, with retroactive applicability to certain assessment years.
  

HF 951 | E911 System Repair and Replacement

• Appropriates $2 million from the 911 emergency communications fund to the Department of Homeland Security and Emergency Management for grants to counties with populations between 16,000 and 16,500 to repair or replace E911 systems damaged by natural disasters in 2024. The funds will remain available for expenditure until the end of the fiscal year 2026.
  

HF 916 | Property Tax Credit Eligibility for Elderly and Disabled Persons

• Modifies the eligibility criteria for the additional property tax credit for elderly persons by allowing individuals aged 65 and older to qualify for the credit regardless of income level, whereas previously only those aged 70 with a household income below 250% of the federal poverty level were eligible. This change will apply to claims filed on or after January 1, 2026.
  

Key Dates for Session

• Week of March 31 | Second Legislative Funnel

  • By March 7, bills must have been approved by a committee in either the House or Senate to remain eligible for consideration. Bills that didn’t make it through a committee are effectively "dead" for the session, with some exceptions (such as budget and tax bills).

  • For the second funnel, bills must be approved by a committee in the opposite chamber to continue moving forward.
    

• May 2 | 110th Day of Session (per diem expenses end)
  

You can view all editions of Legislative Link at iowaleague.org/resource/legislative-link.

Like our membership, the Iowa League of Cities is a non-partisan, service-oriented organization that does not participate in elections, make campaign contributions, or have a political action committee (PAC).