March 20, 2026

You Need to Know

The week got off to a slow start as a blizzard moved through the state on Monday, delaying lawmakers’ travel to Des Moines and canceling floor debate in both chambers. Activity picked up Tuesday, with a handful of bills debated on the floor and renewed focus on advancing legislation through subcommittee and full committee in the opposite chamber, the threshold for keeping bills alive for the remainder of the session. Floor debate is expected to resume in earnest next week.

Most notably for city governments, this week the House Ways and Means Committee advanced the House’s property tax bill, HSB 596 (soon to be renumbered), by adopting a strike-after amendment, meaning the amendment now becomes the bill. The new language incorporates several provisions from the Governor’s proposal, suggesting a potential alignment between those two bodies may be emerging. However, it is our understanding that the Senate has not yet agreed to this approach. Notably, the amendment includes very little of the Senate’s proposal, indicating that a final compromise has yet to take shape.

League Priority Legislation

Property Taxes | HSB 596 (Updated Amendment Language Here)

Defines and increases the 10% limit on unassigned funds to 35%
Amends the definition of New Valuation to include abatement release
- Amendment does not currently include TIF releases
Increases the Business Property Tax exemption from first $150k of valuation to $350k being subject to the residential rollback, remaining valuation above this threshold would be taxed at the 90% rollback
Changes the $25k homestead exemption on top the rollback to be either 10% of taxable value or $25k – whichever is less
Removes voluntary EMS levies from TIF agreement diversion
Removes the school foundation levy from future TIF agreement diversion
- Maintains foundation levy inclusion in current agreements agreed to prior to Jan. 1, 2026
Limits current perpetual TIFs from capturing full increment after 20 years from bill’s enactment
- After 20 years, a city may keep a maximum of 60% of increment generated – any increment above that threshold must be allocated to the other taxing entities
Lowers city population threshold for LMI housing requirements within residential TIF agreements to 5,000 from 15,000
- TIF project LMI costs shall not be required to exceed the lesser of 20% or $350K
- Cities under 5,000 are not statutorily required to provide any LMI housing assistance
Establishes a $10M “Local Government Efficiency Grant Fund” within the State Treasury under the control of Iowa State University
The Taxpayer Notice Form remains one of the universally appreciated portions of the House property tax bill. The improved notice was included in the House’s amendment bill and digital delivery was added as an allowable option.

Sidewalk Liability | SF 2146 & HF 2359

The League’s sidewalk liability priority bill is funnel-proof as it has been passed by the Senate and linked in the House. The League will continue to work to ensure this bill clears the House and is sent to the Governor’s desk.

Digital Public Notices | SSB 3183

Due to its place in the Appropriations Committee, this bill is funnel-proof. The legislation requires Iowa public entities – including state, counties, cities, school districts and qualifying agencies – to post all statutorily required public notices on an online portal managed by the Secretary of State, rather than in newspapers. A $5 fee per posting is collected and deposited into a new Public Notice Administration Fund (capped at $350,000) to fund the portal's administration.

Capitol Pulse

League Bill Tracker

The League is using Legible to track bills. Please follow the link below to access a table of newly introduced bills and all bills tracked by the League.
League of Cities Weekly Bill Report

Passed One Chamber and Opposite (Sub)Committee

SF 2434 | Local REINS Act

Prohibits county and city departments, offices, or subunits from adopting, implementing, or enforcing internal policies or rules unless these have been submitted to, and approved by, the respective governing body via ordinance. Each ordinance must be accompanied by a public cost analysis detailing economic impacts. Exemptions exist for public safety agencies and certain county offices. The bill applies to all relevant policies, rules and ordinances adopted or implemented on or after its effective date.