Republicans in the legislature are proposing a variety of ideas to simplify and reduce property taxes.

“We didn’t get here overnight and we’re not going to be able to change this overnight, but at least we are going to start us on the process,” said Senator Dan Dawson, a Republican from Council Bluffs who’s chairman of the Senate Ways and Means Committee.

Dawson has introduced a bill that would double a property tax credit homeowners may claim for the house they occupy. “We double the homestead benefit to $10,000,” Dawson said. “We double the military benefit to $4000. We increase the senior property tax freeze that we did two years ago up to 300% of poverty level.”

Increasing those property tax credits reduces revenue for local governments, so Dawson also is proposing a change in the 1% local option sales taxes being collected around the state. It would become a statewide tax and his bill then would send 1.25% of all state sales tax revenue to cities and counties.

“We have to diversify local government spending away from property taxes,” Dawson told Radio Iowa.

Dawson has another bill that gradually consolidates property tax levies that fund local government operations. He said the goal is to get rid of most special levies. Then all city and county governments would operate under the general levy rate on property tax assessments set in 1975. However, Dawson said there would be some exceptions, plus a yearly growth rate would be allowed to account for inflation.

“Here’s what it means for the average property owner out there: better restrictions on how their local entities spend those monies,” Dawson said. “…They should be able to see long term wise at least some stabilization of their property taxes, if not relief, potentially.”

A senate subcommittee is scheduled for late this afternoon to review part of Dawson’s property tax relief plans.

House Republicans have proposed different ways to reduce property taxes. Governor Kim Reynolds has made a very specific proposal, to reduce taxes for child care centers by taxing them as residential rather than commercial property. The governor said she’s “anxious to sign” a wider property tax reduction plan from the Republican led legislature.

“I’m a heck yes. I’m just kind of letting them take the lead and then we’ll see where it goes and then that would be probably part of my package next year if we don’t go far enough or we’re not able to get done what we need to get done,” Reynolds said. “It is the most hated tax.”

Governor Reynolds has been saying getting rid of the state income tax is a top priority, but during a recent Radio Iowa interview she said reducing how much local governments collect in property taxes is also a goal.

“We have to figure out something different. The hard part is people want the services. We have a lot of government across the state when you think about city, county, school, state — so we’ve got to figure that out and just figure out how we can still provide services, but we have to streamline the way we do it and we’ve got to reduce the property tax burden, especially on our seniors,” Reynolds said. “It’s just too much.”

Senator Pam Jochum of Dubuque, the top-ranking Democrat on the Senate Ways and Means Committee, has said it’s important to use a scalpel, not an ax when cutting property taxes.  Jochum is calling for a broader discussion that might let local governments “diversify” their tax base, so it’s not primarily property taxes supporting police, fire, emergency services and other functions of local government.

Radio Iowa