HF 717 (LSB 1059HV (2) 90)

HOUSE FILE 717

BY  COMMITTEE ON WAYS AND MEANS

(SUCCESSOR TO HSB 61)

A BILL FOR

An Act relating to the assessment and valuation of property rented or leased to certain low-income individuals and families and including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 441.21, subsection 14, paragraph c, Code 2023, is amended to read as follows:
   c.  Property that is rented or leased to low-income individuals and families as authorized by section 42 of the Internal Revenue Code, and that has not been withdrawn from section 42 assessment procedures under subsection 2 of this section, or a hotel, motel, inn, or other building where rooms or dwelling units are usually rented for less than one month shall not be classified as residential property under this subsection, unless the property otherwise meets the requirements of paragraph “a”, subparagraph (1).
    Sec. 2.  Section 441.21, subsection 14, Code 2023, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  0d.  Property that is a hotel, motel, inn, or other building where rooms or dwelling units are usually rented for less than one month shall not be classified as residential property under this subsection.
    Sec. 3.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 4.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to assessment years beginning on or after January 1, 2023.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   Under Code section 441.21(2), in assessing property that is rented or leased to low-income individuals and families as authorized by section 42 of the Internal Revenue Code, unless the owner elects to withdraw the property from the assessment procedures for section 42 property, the assessor shall use the productive and earning capacity from the actual rents received as a method of appraisal and shall take into account the extent to which that use and limitation reduces the market value of the property. The definition of “residential property” under Code section 441.21(14) excludes such property if it has not been withdrawn from section 42 assessment procedures. This bill allows for section 42 property to be classified as residential property even if it has not been withdrawn from section 42 assessment procedures if the property is primarily used or intended for human habitation containing two or fewer dwelling units.
   The bill takes effect upon enactment and applies retroactively to assessment years beginning on or after January 1, 2023.