SF 28 (LSB 1104XS (4) 86)

SENATE FILE 28

BY  TAYLOR

A BILL FOR

An Act relating to the property tax exemption for property designated to be a native prairie or wetland and including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 427.1, subsection 23, paragraph a, Code 2015, is amended to read as follows:
   a.  Application for the exemption shall be made on forms provided by the department of revenue. Land designated as a protected wetland shall be assessed at a value equal to the average value of the land where the wetland is located and which is owned by the person granted the exemption. The application forms shall be filed with the assessing authority not later than the first of February of the year for which the exemption is requested. The application must be accompanied by an affidavit signed by the applicant that if the exemption is granted, the property will not be used for economic gain during the assessment year in which the exemption is granted.  The receipt of payments required to be made in connection with a contract, agreement, or easement under the federal wetlands reserve program, formerly codified at 16 U.S.C. §3837 et seq., and as authorized by the federal Agricultural Act of 2014, Pub. L. No. 113-79, §2703(b), or the receipt of payments under the federal agricultural conservation easement program established under the federal Food Security Act of 1985, Tit. XII, subtit. H, as enacted in the federal Agricultural Act of 2014, Pub. L. No. 113-79, §2301, shall not be considered a use for economic gain. If the property is used for economic gain during the assessment year in which the exemption is granted, the property shall lose its tax exemption and shall be taxed at the rate levied by the county for the fiscal year beginning in that assessment year. The first annual application shall be accompanied by a certificate from the department of natural resources stating that the land is native prairie or protected wetland. The department of natural resources shall issue a certificate for the native prairie exemption if the department finds that the land has never been cultivated, is unimproved, is primarily a mixture of warm season grasses interspersed with flowering plants, and meets the other criteria established by the natural resource commission for native prairie. The department of natural resources shall issue a certificate for the wetland exemption if the department finds the land is a protected wetland, as defined under section 456B.1, or if the wetland was previously drained and cropped but has been restored under a nonpermanent restoration agreement with the department or other county, state, or federal agency or private conservation group. A taxpayer may seek judicial review of a decision of the department according to chapter 17A. The natural resource commission shall adopt rules to implement this subsection.
    Sec. 2.  IMPLEMENTATION OF ACT.  Section 25B.7 shall not apply to this Act to the extent of any insufficient reimbursement of lost tax revenue from exempted protected wetlands under section 427.1, subsection 23, paragraph “b”.
    Sec. 3.  EFFECTIVE UPON ENACTMENT.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 4.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to January 1, 2015, for assessment years beginning on or after that date.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   Current Code section 427.1(23) provides a property tax exemption for land designated as native prairie or land designated as a protected wetland by the department of natural resources if the property is not used for economic gain. This bill specifies that the receipt of payments under the federal wetlands reserve program or the federal agricultural conservation easement program shall not be considered a use for economic gain.
   Code section 25B.7 provides that for a property tax credit or exemption enacted on or after January 1, 1997, if a state appropriation made to fund the credit or exemption is not sufficient to fully fund the credit or exemption, the political subdivision shall be required to extend to the taxpayer only that portion of the credit or exemption estimated by the department of revenue to be funded by the state appropriation. Code section 25B.7 does not apply to the bill insofar as state reimbursement for lost tax revenue from exempted protected wetlands is insufficient.
   The bill takes effect upon enactment and applies retroactively to January 1, 2015, for assessment years beginning on or after that date.