- The Legislature passed HF 2552, which will reduce local government revenues and creates up to a $125 million annual backfill to local governments. Read more about this legislation and the impact this imposes on city revenues.
- Legislation deregulating the zoning of fireworks has been amended into another bill.
- The Workforce/Housing Omnibus bill, which preempts local building codes, is moving through the process in both the House and Senate.
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SF2285 | Fireworks Sale Regulation Preemption |
- Firework zoning preemption was amended into the bill on the House Floor, prohibiting a city or county from regulating or restricting the location of permanent buildings or temporary structures used for the sale of consumer fireworks in any location zoned for commercial or industrial purposes.
- Prevents a city from requiring a property’s consent to annexation in exchange for granting a zoning change within the two-mile border outside of city limits.
- Passed out of the House. It will be sent to the Senate, where it will either be conformed on the Floor or rejected.
- The League will be changing registration to against based on this amendment.
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SF 2379 | Mobile Home Property Tax Exemption |
- Division 9 repeals the Mobile Home Square Footage Tax, which is levied on a per-foot basis on mobile homes and other structures within mobile home parks.
- Permanently exempts 100% of property taxes of all modular homes in a mobile home park/manufactured home community.
- The Fiscal Note has been updated. The original fiscal impact showing a $4.6 million impact has been revised to an $8.9 million reduction to local government budgets.
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SF 2361 | Workforce/Housing Omnibus |
- Prohibits cities from enforcing zoning ordinances if 80% of the lots covered do not conform. Prohibits requiring inspections of manufactured homes that have been inspected and built in accordance with federal regulation. The League has requested this language be striken.
- Prohibits local building codes and creates a statewide building code that cannot be raised or lowered by local governments for electrical, plumbing, fire safety or energy efficiency standards. We have heard from our membership that these local codes have been reviewed, honed, and implemented over decades of conversations at the local level.
- Increases the Veterans Property Tax Credit to reduce a veteran’s taxable value by $2,500, which would reduce revenues to local governments.
- Prohibits the enforcement of any parking fee or fine for an individual with a license plate specially designated for purple heart recipients, Prisoners of War or a "DV" designation.
- Local impacts need to be communicated directly to legislators. Contact your legislator with specific impacts.
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SSB 3157 | Local Option Sales and Service Tax (LOSST) Alteration and IWILL Funding |
- Restructures the existing local option sales tax as a new statewide sales tax, collected in all cities and redistributed to all cities. Establishes a base year minimum in an attempt to ensure cities with existing LOSST do not see any revenue loss.
- This legislation will trigger an amount equal to three-eighths of 1% sales tax to be deposited by the state in the Iowa Water Land and Legacy Trust. The IWILL funding will not impact local government revenues. The legislation amends the Code of Iowa Chapter 461, which directs the distribution of the fund with the goal of improving Iowa’s drinking and recreational waters.
- Passed out of a Senate Subcommittee and is eligible for consideration by the Senate Ways & Means Committee.
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SF 2372 | Sales Tax Exemptions & Expansions |
- Expands the revenues of sales taxes, including Local Option Sales and Service Tax, by making web hosting and digitally automated services subject to sales tax. Provides an exemption to sales tax for feminine hygiene products and diapers for all ages. Phases in an insurance and banking franchise fee reduction.
- Passed out of the Senate Ways & Means Committee and will be eligible for consideration on the Senate Floor.
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HF 2552 | Business Property Tax Credit Backfill |
- Division 11 alters the Business Property Tax Credit (BPTC), moving from a capped credit to an uncapped, permanent revenue reduction and creating a backfill of $125 million to reimburse local governments for the losses. Even with the backfill, the amount appropriated is only sufficient to cover the losses until FY 2029, according to the Legislative Services Agency (LSA)'s Fiscal Note. After FY 2029, local governments will begin losing revenue where claims exceed the appropriation. Historically, the state has failed to maintain other backfill committments, such as those related to Machinery and Equipment taxation and Commercial and Industrial property rollback.
- The Fiscal Note states that under this proposal, local governments lose revenues starting in FY 2030. This also assumes that the state continues to fund the $125 million backfill. If this isn't fully funded, local governments would lose those resources as well. This will cause a proportional shift of the burden to residental property taxpayers.
- This legislation has passed both Chambers and will be sent to the Governor.
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SSB 3064 | Supermajority Approval for Tax Increases Constitutional Amendment |
- Proposes an amendment to the Iowa Constitution that would require a two-thirds majority in both the House and Senate Chambers for legislation increasing individual income, corporate income, sales tax rate and use tax rates.
- Constitutional amendments are required to pass out of both Chambers in two consecutive General Assemblies and then be approved by a public referendum. Therefore, this language would have to be passed this year and in either 2023 or 2024 before it can be placed on the ballot for a public referendum.
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- Declares a state policy that garbage placed on the curb for collection is considered searchable and preempts a city from adopting or enforcing an ordinance in which garbage placed on the street has a reasonable expectation of privacy.
- Passed out of the House and will be sent to the Governor.
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HF 2555 | Cybersecurity Training Facilities |
- Appropriates the funds for a cybersecurity training facility at Iowa State University, which would be available to private and public entities.
- Passed out of the House and will be sent to the Senate for consideration.
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SF 2322 | Cost of Redacting Public Records |
Important Legislation With No Action Last Week |
- HF 2296 | Right-of-Way Management Deregulation
- SF 2374 | Alcohol Licenses Restructuring
- HF 2475 | Utility Board Removal Preemption
- HF 2431 | Home Based Businesses
- HF 2340 | Public Safety Nuisances
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