Dan Dawson. (IA Legislature photo.)

A bill in the Iowa Senate would prevent the collection of up to $127 million dollars in property taxes and force local officials to make cuts in city and county budget plans.

Last fall, Iowa Department of Revenue officials discovered a mistake in a 2021 state law caused the miscalculation of residential property taxes, but local officials were only recently notified of the discrepancy and have been drafting local budgets based on the higher numbers.

Pleasant Hill Mayor Sara Kurovski and other city officials have held four public meetings as they developed Pleasant Hill’s next budget and will have to cut out about $200,000 due to the mistake.

“All of us know that in these inflationary times, it is very difficult to keep up the costs while providing these services,” she said. “…Give us a year to prepare correctly.”

Leaders from Iowa’s larger cities say they’ll be forced to quickly cut millions from budget plans that must be released for public input and finalized by March 31.

Republican Senator Dan Dawson supports giving local officials two more weeks to make those decisions, but Dawson says the residential property tax formula is going to be fixed this spring. “We’re always advocating on behalf of the taxpayers,” Dawson says. “A delay would be a tax increase to the residential property taxpayers.”

The bill to fix the miscalculation of residential property taxes has cleared a Senate subcommittee and is eligible for debate in the Senate Ways and Means Committee.

(By Katarina Sostaric, Iowa Public Radio/O. Kay Henderson, Radio Iowa)

Radio Iowa