House Speaker Pat Grassley says property tax negotiations during the recently concluded 2026 session of the Iowa legislature ended in “a good place.”
“The 2% revenue cap really is going to be what I would say is…the hallmark of this legislation that really limits the growth of new revenue that local governments can take in.”
There will be exceptions, however, for new home construction and for expenses like employee benefits and liability insurance. The plan provides future property tax relief in other ways,by a homestead exemption worth up to $20,000 a year on a person’s primary home. There’s also a move to dedicate a greater share of the one percent sales tax for school infrastructure to property tax relief. “I think where we ended was actually a good place,” Grassley said. “A hard 2% cap, allow local goverments to pay those critical services that we expect, but at the same time make sure that we’re getting certainty for the taxpayer.”
Governor Reynolds has expressed support and praise for the package, but has not yet announced when she plans to sign it into law.
During a wide ranging interview on “Iowa Press” that aired this weekend on Iowa PBS, Grassley said he’s disappointed the Iowa Senate did not debate a House bill that would have prohibited carbon pipeline developers from using the government’s eminent domain authority to seize property from landowners who do not want the pipeline running through their property. This was year five of the stand-off between a majority of Republicans in the House and in the Senate on the issue. “I’ve heard from conversations with people that think maybe doing nothing is better than doing a marginal compromise,” Grassley said. “There’s a lot of different opinions on this topic. Ultimately what I can say is we do need to have more protections, whether the project moves forward this fall, whether it ends up in court.”
Grassley said the legislature did act to set important guidelines for companies looking for pools of hydrogen deep underground and extracting what’s found. “We took a few of our lessons that we learned in the conversation about pipelines and applied them to hydrogen…which is saying if you want to survey someone’s land, you have to have their permission. That’s been a big sticking point in any property rights fight we’ve had over the last several years. And also that if you decline to be a part of a project that you’ve declined to be a part of the project and you don’t need to continue to be bothered by it,” Grassley said. “Now that doesn’t mean a new company couldn’t come. That doesn’t mean that you couldn’t reach out.”