State Capitol. (RI photo)
The Republican who’s leading development of a tax reduction plan in the Iowa Senate says the focus is on cutting income taxes. Senator Dan Dawson of Council Bluffs says reducing property taxes is more complicated.
“I think anything on property taxes, it’s going to be a multi-year effort,” says Dawson, who is chairman of the Iowa Senate’s Ways and Means Committee.
The last major property tax reduction in Iowa was the 2013 law that reduced commercial property taxes by 10 percent. “It’s something that we definitely are trying to take a look at this year,” Dawson says, “but knowing the history of this, I think probably the best way to go about it is more of an incremental approach and try to tacklone or two levies at a time.”
The tax plan that took effect this summer gets rid of the property tax levy that has supported Iowa’s mental health system and the state is to cover all those costs in the future.
Representative Lee Hein, a Republican from Monticello who is chairman of the House Ways and Means Committee, says Iowa should consider adopting a law, like one in Utah, that requires citizens be notified of the intent to raise property taxes and invited to a public hearing to voice concerns.
“I think that’s something that we need to look at first,” Hein says. “And then we need to figure out a way, from that, what’s the next procedure for controlling the property taxes?”
Representative Dave Jacoby, the top-ranking Democrat on the House Ways and Means Committee, says the starting block on property tax reform should be relief for homeowners. “More people 65 and older who are living on incomes that don’t rise like they did before retirement…they’re the ones saying: ‘I want to stay here, but I can’t afford a 15% to 25% jump year-to-year,” says Jacoby, who is from Coralville. “…We all want to see our homes improve in value, but it is putting some people in a hardship when valuations went up 25% — actually 30% to 35% in our neck of the woods.”
Senator Pam Jochum of Dubuque, the top Democrat on the Senate Ways and Means Committee, says the property tax system is perplexing.
“It really is a more regressive tax, so regardless of what your income is, you’re going to pay that property tax bill every year,” Jochum says. “Those who are on a fixed income, I do believe we can do more to make sure that they can afford to stay in their homes long-term.”
The legislators made their comments during a forum sponsored by the Iowa Taxpayers Association. The 2022 Iowa Legislative session begins January 10.