September 20, 2014

Property tax reduction still holding up close of legislature

It appears the biggest hurdle to completing the work of the 2011 legislative session is a dramatic difference of opinion on how best to reduce commercial property taxes. Republicans in the House favor a 25% reduction in commercial property tax rates, while Democrats in the Senate propose a tax credit that would be paid directly to the owners of commercial property.

The two sides can’t even agree on what would happen if nothing’s done. Republicans like Senator Jack Whitver of Ankeny make this assertion: “I’m concerned about the estimated $1.3 billion of property tax increase that will hit our citizens and job creators if we choose to do nothing about our current property tax system.”

Democrats like Senator Joe Bolkcom of Iowa City make this counter argument: “It’s your talking points on this. There’s no way local governments are going to be increasing our property taxes statewide by $1.3 billion.” Legislative leaders met privately with the governor’s staff Tuesday. While differences over the spending plan for next year’s state budget have narrowed considerably, it’s still unclear how the two parties can reconcile their vastly different approaches to property tax reform.