The bill proposes comprehensive changes to property tax regulations in Iowa, particularly affecting local governments and school districts. It modifies the timeline for certain fiscal years, establishing a new end date of July 1, 2026, for specific tax rate applications. For fiscal years beginning on or after this date, new calculations for levy rates will be introduced, based on assessed property values and actual property tax dollars certified for levy. The bill also sets a minimum levy rate for the budget year starting July 1, 2027, and outlines conditions for adjustments based on the consumer price index. Additionally, it introduces new definitions for "new valuation" and establishes a structured approach to property tax levies, ensuring local governments can adequately fund their services.

In terms of school funding, the bill reduces the foundation property tax rate for school districts from $5.40 to $2.97 per thousand dollars of assessed valuation starting July 1, 2026, and introduces new limitations on unexpended fund balances in school district management levy funds. It also modifies the assessment percentages for various property types, mandating that residential, commercial, and industrial properties be assessed at 100% of their actual value. Furthermore, the bill includes provisions for property tax exemptions for veterans and senior citizens, establishing new exemptions for individuals aged sixty-five and older, and modifies the definition of "homestead" for tax credit applications. Overall, the bill aims to streamline property tax processes, enhance funding equity among school districts, and provide targeted financial relief to specific groups.

Statutes affected:
Introduced: 331.423, 441.21, 384.12, 257.3, 257.4, 257.15, 257.16, 257.16D, 8.33, 298A.3, 297.36, 298.4, 257.2, 39.2, 423F.2, 423F.3, 425A.3, 444.3, 386.11, 404.3, 404.3A, 4.13, 425.1, 35.1, 425.1A, 425.2, 425.11, 483A.24, 483A.1, 347A.3, 357F.8, 357G.8, 176A.10, 312.2, 331.429, 165.18, 331.559