The House broke out in applause last night after passage of a bill that would dramatically alter the way property taxes for businesses and homeowners are calculated. The bill connects the assessed value of your home to the sale or market price, and the tax would be based on square footage. That means home owners aren’t penalized for making improvements, like adding a bathroom. But adding on a sun room would increase the square footage, and therefore increase your property tax bill. The changes wouldn’t take effect for three years, and three counties would be selected for a trial run. Representative Danny Carroll, a republican from Grinnell, says the bill is the brain child of a group of freshman lawmakers who saw a new way of doing business. He says it’s a “big deal” and he says anybody that has worked on it knows it’s a big deal.Representative James Kurtenbach, a republican from Nevada, was among those who devised the new system. Kurtenbach says lawmakers had “an opportunity to make history” by voting on the kind of sweeping changes not many legislators ever have a chance to vote on. House Democrat Leader Dick Myers of Iowa City says he has a “distaste” for the current system, and while the bill isn’t perfect, it’s a good start. Myers called it a “work progress” and he warned bill backers that they shouldn’t expect miracles. Critics say the changes that encourage home improvements may discourage people from moving and dampen the housing market. Others warned cities and counties will be strapped for cash because it’ll be much harder to raise taxes since elected officials will be forced to vote to raise the tax rate rather than depend on increased valuations to hike property taxes. Senate leaders say the Senate probably won’t consider the bill this year.
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