2000 Summary of Legislation TAXATION Published by the Iowa General Assembly -- Legislative Service Bureau

TAXATION LEGISLATION

SENATE FILE 2089 - School Taxes -- Physical Plant and Equipment Levy -- Urban Renewal Projects (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act provides that the revenues from a school district physical plant and equipment levy (PPEL) imposed in an urban renewal area that is utilizing tax increment financing shall not be paid to the municipality implementing the urban renewal plan, but shall be paid to the school district imposing the PPEL unless the levy is needed to pay indebtedness for the urban renewal area incurred before July 1, 2000. The amount certified is to be paid to the municipality by November 1 following certification. The Act applies to both the regular PPEL and the voter-approved PPEL.

   The Act applies to property taxes due and payable on or after July 1, 2000.

SENATE FILE 2420 - Electricity and Natural Gas Replacement Tax (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act amends provisions relating to a "replacement tax" imposed on the generation, transmission, delivery, consumption, and use of electricity and natural gas. Code Section 421.10 is amended to provide for a 60-day period for an appeal of a denial of refund or portion of a refund of a replacement tax paid.

   Code Section 437A.3 is amended to provide that the "base year assessed value" for a municipal utility subject to Code Section 437A.17A is the value certified by the Department of Revenue and Finance and local assessors to the county auditors for the assessment date of January 1, 1998. Currently, such value is the value certified by the department and local assessors to the county auditors for the assessment date of January 1, 1997. A municipal utility subject to Code Section 437A.17A is one whose property tax assessment for the 1998 assessment year was adjusted by the department to include depreciation and whose property tax assessment for the 1997 assessment year did not include depreciation in determining its assessment.

   Code Section 437A.5 is amended to exempt from the replacement tax, natural gas delivered by a pipeline not permitted under Code Chapter 479, to a person other than an electric company, natural gas company, electric cooperative, or municipal utility, who consumes the gas for the purpose of bypassing the local natural gas company or municipal utility.

   Code Section 437A.6 is amended to provide that a taxpayer participating in a jointly owned or leased generation facility is to pay replacement tax on the number of kilowatt-hours of electricity generated and dispatched by such facility to the account of the taxpayer. The Code section is also amended to provide that the number of kilowatt-hours generated by a generation facility excludes any kilowatt-hours used in the operation of the generation facility.

   Code Section 437A.8 is amended to provide that a generation and transmission electric cooperative is not liable for unpaid replacement tax due from a distribution electric cooperative member or a municipal utility purchasing member so long as appropriate notice, as provided for in the Code section, is given to the Director of Revenue and Finance. If a generation and transmission electric cooperative, after notice, does not timely pay the correct amount of replacement tax attributable to the excess property tax liability to the appropriate county treasurer, after receiving the required payment from the distribution electric cooperative member or municipal utility purchasing member, such replacement tax is to be enforced solely against the generation and transmission electric cooperative.

   Code Section 437A.11 is amended to authorize the collection of accrued interest associated with the replacement taxes and special utility property tax levies. The Act also authorizes the county treasurer to enforce payment of the special utility property tax levy by the tax sale process in the same manner as other property tax payments are enforced. The Act provides that a tax deed issued does not extinguish a tax lien or judgment lien for replacement taxes that has attached to the property.

   Code Section 437A.14 is amended to provide that if an amount of overpaid replacement tax is attributable to payment of excess property tax liability, a claim for refund or credit may only be made by, and a refund or credit shall only be made to, the person who made such excess payment. Code Section 437A.15 is amended to provide for the allocation of electric delivery replacement tax attributable to excess property tax liability, if excess property tax liability has been assigned under Code Section 437A.4. The Code section is also amended to provide for the accrual of a penalty and interest on a delinquent special utility property tax levy payment.

   Code Section 437A.19 is amended to conform to Code Section 437A.3 regarding the definition of "base year assessed value" for a municipal utility subject to Code Section 437A.17A.

   Code Section 437A.21 is amended to provide that a taxpayer is not required to file a return under this section or remit any statewide property tax for any tax year in which the taxpayer's statewide property tax liability is $1 or less.

   Code Section 443.2 is amended to provide that the actual value and the taxable value of property subject to the statewide property tax under Code Chapter 437A is to be listed by the county auditor as part of the aggregate actual value and the aggregate taxable value of all taxable property within the county for purposes of computing the debt-incurring capacity of the county or political subdivision.

   Code Section 445.57 is amended to provide that all interest and penalties collected on delinquent replacement taxes and special utility property tax levies are to be deposited in the county general fund. The Code section is also amended to specifically state that replacement taxes collected by the county treasurer are to be apportioned as directed in that Code section.

   The Act requires the Director of Revenue and Finance to recompute the electric replacement delivery tax rate applicable to each electric competitive service area under Code Section 437A.4 in order to clearly reflect the electric generation tax component determined under Code Section 437A.6, as amended by this Act. The Act provides that Code Section 437A.5, subsection 7; Code Section 437A.6; Code Section 437A.8, subsection 4; Code Section 437A.14, subsection 1; and Code Section 437A.15, subsection 3, as amended in this Act, are made retroactively applicable to January 1, 1999, for tax years beginning on and after that date.

   The Act takes effect April 19, 2000.

SENATE FILE 2424 - Internal Revenue Code References and Income Tax Provisions (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act updates the references to the Internal Revenue Code to make the federal income tax revisions enacted by Congress in 1999 applicable for Iowa income tax purposes.

   Code Sections 15.335, 15A.9, 422.10, and 422.33 are amended to update the references to the state research activities credit for individuals, corporations, corporations in economic development areas, and corporations in quality jobs enterprise zones to include the 1999 federal changes in the research activities credit.

   Code Section 422.3 is amended to update the reference to January 1, 2000, to include the federal income tax revisions made by Congress in the 1999 calendar year, making those revisions applicable for Iowa income tax purposes.

   Code Section 422.12B, providing the earned income credit, is amended to delete extraneous language relating to a health insurance credit.

   Code Section 422.13 is amended to require nonresident taxpayers to file state income tax returns if the taxpayers are subject to the alternative minimum tax.

   Code Section 422.21 is amended to provide tax benefits to military personnel who serve in hazardous duty areas.

   All but one of the provisions in the Act apply retroactively to January 1, 1999, for tax years beginning on or after that date. The provision amending Code Section 422.13 relating to nonresident taxpayers applies retroactively to January 1, 2000, for tax years beginning on or after that date.

   The Act takes effect April 26, 2000.

SENATE FILE 2426 - Horizontal Property Regimes (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act specifies that a building unit, and general common interests and limited common interests appurtenant to the building unit, in a horizontal property regime, i.e., condominium complex, constitutes a separate parcel of real property. Also, the Act provides that, for property taxation purposes, the fair market value determined for the building unit in a condominium complex includes the value of the land and general and limited common elements. After April 25, 2000, existing structures shall not be converted to condominiums unless the structures meet the applicable city or county building code or the State Building Code if the city or county does not have a building code. The Act provides that a 60-day notice must be provided to the applicable city or county or to the state before the filing of the declaration to convert a structure to a condominium complex.

   This Act takes effect April 25, 2000.

SENATE FILE 2444 - Taxation of Property Used by Iowa National Guard (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act provides that property of the Iowa National Guard is exempt from property tax when it is devoted for public use and not for pecuniary gain. Property leased by a city or county to the Iowa National Guard or to a federal agency for the benefit of the Iowa National Guard is also exempt from property taxation.

SENATE JOINT 2005 - Nullification of Administrative Rule -- Property Tax Classification of Condominiums (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Joint Resolution nullifies two amendments to administrative rules of the Department of Revenue and Finance that define, for property tax purposes, units in a condominium complex as commercial real estate if more than one-half of the units are used for commercial purposes, i.e., rented without intent to sell.

   The Joint Resolution takes effect May 9, 2000.

HOUSE FILE 2351 - Limited Sales and Use Tax Exemption for Clothing and Footwear (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act provides for a sales and use tax exemption for clothing and footwear purchased on the first Friday and Saturday of August in each year. The exemption only applies if the article of clothing or footwear purchased costs less than $100. The exemption does not apply to special clothing or footwear that is primarily designed for athletic or protective use, to accessories such as jewelry, watches, handbags, and wallets, or to the rental of clothing or footwear. The exemption would also apply to local sales and services taxes.

   The Act also requires the appropriate standing committees to review this exemption during the 2002 Legislative Session as to the impact on the economy and on tax revenues of the state. After reviewing such impact, the appropriate committees shall consider the benefits of expanding the exemption to apply to whenever such sales take place.

   The Act takes effect May 26, 2000.

HOUSE FILE 2542 - World War II Victim Property Reparations (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act provides that certain payments made to, and income from lost property of, a victim of racial, ethnic or religious persecution by any Axis power or the heirs of such victims are not to be considered as income or assets in determining eligibility for state or local governmental benefit or entitlement programs. In addition, such payments and income are not included in net income for purposes of the individual income tax.

   The Act takes effect April 14, 2000, and the income tax provision applies retroactively to January 1, 2000, for tax years beginning on or after that date.

HOUSE FILE 2548 - Tax Administration and Related Matters -- VETOED BY THE GOVERNOR (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This bill would have amended various provisions of state and local tax laws. The bill, in addition to eliminating obsolete provisions, would have done the following:

• Allowed a business that is eligible to receive benefits under the New Jobs and Income Act to file a claim for refund of sales and use tax paid by the contractor under a building contract within one year of the project's completion rather than the six months currently allowed.
• Specified that the length of time over which an urban revitalization property tax exemption may be allowed in situations where a timely application for exemption was not filed is equal to the number of remaining years left in the exemption schedule selected.
• Expanded the scope of the technical advice received from other state agencies to include that related to all taxes administered by the Department of Revenue and Finance (DORF) rather than just property taxes.
• Authorized DORF to enter into agreements with an Indian tribe to collect and distribute a state tax or a tribal tax.
• Extended the Director of Revenue and Finance's authority to abate unpaid state sales and use taxes and local option sales and services taxes to situations in which a retailer who is responsible for collecting these taxes fails to do so in reliance on erroneous written advice specially issued to the retailer by DORF, and the retailer is unable to collect the unpaid taxes from purchasers. Subsequent written advice sent by DORF to the retailer, or a change in state or federal law, a reported contrary court case, a contrary rule adopted by the department, or the retailer's misrepresentation would preclude the abatement. An abatement of the unpaid tax by a retailer under the circumstances provided in the bill would not preclude DORF from collecting the tax from the purchaser. Language enacted in H.F. 2205 (see Business, Banking & Insurance).
• Abated taxes not collected as a result of certain erroneous written advice issued by DORF to a retailer prior to July 1, 1999, relating to sales and use taxes on charges for access to on-line computer services. Language enacted in H.F. 2205 (see Business, Banking & Insurance).
• Expanded the computer access exemption from sales and use taxes. The present exemption only applies to access to the Internet. The amendment would have included other information made available through any computer server. Language enacted in H.F. 2205 (see Business, Banking & Insurance).
• Allowed a sales tax permit holder to keep the same permit when the business is relocated in the state if the ownership remains the same.
• Replaced the words "eligible purchasers" with the word "distributors" to reflect more accurate terminology as defined in the "Motor Fuel and Special Fuel Taxes" chapter.
• Imposed a duty upon the county auditor to notify, within 10 days, the Director of Revenue and Finance of the outcome of the election favoring the imposition, repeal or rate change of the local hotel and motel tax.
• Imposed local options sales and services taxes only on motor fuels and special fuels for which tax pursuant to the state "Motor Fuel and Special Fuel Taxes" chapter has not been imposed or, if paid, will be refunded.
• Added limited liability companies to the list of businesses that are exempt from the use tax for the transfer of vehicles subject to registration between businesses where the purpose of the transfer is to continue the business. The exemption would also apply to such transfer made by a corporation as part of its liquidation to its shareholders if the shareholders retransfer the vehicles to another business owned by them for the purpose of continuing the business of the corporation.
• Reduced the period for assessing the environmental protection charge or for filing a claim for refund of an environmental protection charge paid from five to three years. This would have promoted consistency by bringing those periods into harmony with the time allowed for assessing or filing a claim for refund of sales or use tax paid.
• Amended the "Environmental Protection Charge on Petroleum Diminution" Law to replace the word "tax" with "charge" and to change the reference to "taxpayer" to "person against whom (a charge) is assessed." The bill would have reduced from five years to three years the length of time that depositors of underground petroleum are required to keep records for purposes of the environmental protection charge.
• Changed the dates for filing claims for various property tax exemptions to February 1 for purposes of uniformity.
• Specified the effective date of an order issued by the director that revokes or modifies a property tax exemption for a specific year either on the director's own motion or upon application by a taxpayer. The bill would have allowed the director to modify an exemption rather than simply revoke it.
• Provided that any additional real estate transfer tax owed that cannot be collected by the local county recorder would be collected by DORF in the same manner as individual income tax.
• Allowed distributions to beneficiaries to be exempt from Iowa inheritance tax whether such distributions are lump sum in nature or in the form of installments. Installment payments are currently exempt from tax. The bill would have provided for the exemption from Iowa inheritance tax of distributions from nonresident employment-related pensions and pension income excluded from net income under the state individualized income tax.
• Removed outdated reciprocity language and included additional language to specify the tax treatment of fraternal and social organizations.
• Added definitions for "denatured alcohol" and "racing fuel" for purposes of the "Motor Fuel and Special Fuel Taxes" chapter and redefined "motor fuel" to include ethanol blended gasoline (also under the "Motor Fuel and Special Fuel Taxes" chapter).
• Provided that the tax on alcohol be paid when it is withdrawn from the terminal rather than when it is sold within the terminal and permitted a refund of tax paid on fuel used for racing.
• Provided for moist snuff to be taxed on a per ounce basis similar to the federal method of taxation under the "Cigarette and Tobacco Taxes" chapter. The bill also would have specified under that chapter that an appeal of a cigarette permit suspension or revocation must be made to the authority that issued the permit, i.e., DORF, the city, or county.

The bill would have taken effect upon enactment with some provisions having different effective and applicability dates

HOUSE FILE 2560 - Income and Property Taxes -- Credits, Deductions, and Exemptions (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act provides various income tax and property tax incentives and credits as follows:

Research Activities Credit

   The Act expands the research activities credit for income tax purposes for businesses under the New Jobs and Income Program, the Quality Jobs Enterprise Zone Program, the incentives for building in enterprise zones, the individual income tax, and corporate income tax. The expansion provides for an alternative method of computing the tax credit based upon the federal approach using an incremental computation method for measuring increased research activities. This alternative method is in lieu of a portion of Iowa's present computation approach. Therefore, the present Iowa law is rewritten in a manner that coincides with the computation under the federal income tax credit. The federal approach has three tiers under the incremental approach with a different percentage for each tier. The Act uses the same percentages for the three tiers that were used for federal income taxes for tax years beginning before July 1, 1999.

   These provisions apply retroactively to January 1, 2000, for tax years beginning on or after that date.

Property Rehabilitation Credit

   The Act provides for an individual and corporate income tax credit equal to 25 percent of the costs of rehabilitating eligible properties, which are properties eligible to be listed on the National Register of Historic Places, historic properties in areas eligible to be designated local historic districts, local landmarks, or a barn constructed prior to 1937. In the case of commercial property, rehabilitation costs must equal at least 50 percent of the assessed value of the property, excluding the land, prior to rehabilitation. In the case of residential property or barns, the rehabilitation costs must equal at least $25,000 or 25 percent of the fair market value, excluding the land, prior to rehabilitation, whichever is less. In addition, the rehabilitation project must be approved by the State Historic Preservation Office of the Department of Cultural Affairs.

   Rehabilitation costs include amounts that are properly includable in computing the basis of the eligible property for tax purposes. Costs of sidewalks, parking lots and landscaping do not constitute rehabilitation costs for purposes of determining the credit.

   Only $2.4 million in tax credits may be approved in a fiscal year, with credit certificates issued on the basis of the earliest awarding of certificates of completion. To receive the tax credit certificate, the taxpayer must obtain a certification of completion of the rehabilitation project from the State Historic Preservation Office. If the tax credit is in excess of the taxpayer's tax liability, a refund, at a discounted amount, of the excess credit over the tax liability is provided.

   The Department of Cultural Affairs, in consultation with the Department of Economic Development, is responsible for keeping the General Assembly and Legislative Fiscal Bureau apprised of the overall economic impact of the tax credit as it relates to rehabilitation of eligible properties.

   The rehabilitation tax credit provisions apply to rehabilitation costs incurred on or after July 1, 2000.

Pension Exclusion Increased

   The Act increases the pension income exclusion under the individual income tax from $5,000 for single filers and $10,000 for joint filers to $6,000 and $12,000, respectively. This provision applies to tax years beginning on or after January 1, 2001.

Assistive Device Credit

   The Act allows a tax credit equal to 50 percent of the first $5,000 paid for the purchase, rental or modification of an assistive device or for the renovation of the workplace for an individual with a disability. The credit is refundable and applies to both the individual and corporate income taxes. Only small businesses are entitled to the credit. A small business is one that either had gross receipts in the preceding tax year of $3 million or less or employed not more than 14 full-time employees during its preceding tax year. An assistive device is an item, piece of equipment, or product system which is used to increase, maintain or improve the functional capabilities of an individual with a disability in the workplace or on the job. If the assistive tax credit is claimed, the small business is not allowed to deduct any amount of the cost of the device or modification that is deductible for federal income tax purposes.

   The Act provides that only $500,000 in combined individual and corporate income tax credits are allowed for any fiscal year. Because of this, eligible small businesses must apply for the credits with the Department of Economic Development, which approves the eligible credits on an earliest-date-applied basis.

   The assistive device tax credit applies retroactively to January 1, 2000, for tax years beginning on or after that date.

Barn Preservation Exemption

   The Act provides a property tax exemption for the increase in value added to a farm structure resulting from improvements made to the structure to preserve it as a barn. The structure must have been constructed and first placed in service as a barn prior to 1937. The exemption is equal to 100 percent of the assessed value added and is ongoing until the farm structure ceases to be used as a barn. A barn is any agricultural structure used for storage of farm products or feed or for the housing of farm animals, poultry or farm equipment. One-Room Schoolhouse Preservation Exemption

   The Act provides a property tax exemption for the increase in value added to a one-room schoolhouse as a result of improvements made to the structure for purposes of preserving the integrity of the internal and external features of the structure as a one-room schoolhouse. The exemption is equal to 100 percent of the assessed value added and is ongoing so long as the structure is not used for dwelling purposes and is preserved as a one-room schoolhouse. The exemption applies even though the structure is no longer used for instructional purposes.

Study Request

   The Act requests the Legislative Council to establish an interim study committee for the 2000 Interim to review the benefits of allowing state tax credits to be transferable. The study committee would analyze the benefits of transferability of credits to the transferor, transferee and the state, the costs involved, and the conditions or restrictions under which transferability should be allowed.

HOUSE FILE 2562 - Sales and Use Taxes -- Information Services -- Transactions Delivered Electromagnetically, Digitally, or Via Cable or Fiber Optics (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act authorizes the Director of Revenue and Finance to enter into agreements or compacts with remote sellers, retailers, or third-party providers for the voluntary collection of Iowa sales or use taxes.

   The Act provides that a sale of tangible personal property does not occur for purposes of the sales and use taxes if the substance of the transaction is delivered to the purchaser digitally, electronically or utilizing cable, or by radio waves, microwaves, satellites, or fiber optics. This provision is repealed December 31, 2002.

   The Act also exempts from the sales and use taxes the furnishing, sale or rental of information or data processing services regardless of how the resultant information is transferred. Every business activity, process or function by which the seller or its agent accumulates, prepares or organizes for a buyer is an information service. Information services include but are not limited to the accumulation, preparation or organization of database files, mailing lists, subscription files, market research, credit reports, surveys, real estate listings, bond rating reports, abstracts of title, bad check lists, broadcasting rating services, wire services, and scouting reports.

   The Act also requests the Legislative Council to establish an e-commerce task force to study the issues that e-commerce has generated under the state sales and use taxes, including the status as tangible or intangible property of the substance of transactions that are delivered digitally, electromagnetically, or through or by means of cable, satellites or fiber optics, and vendor discounts.

   The Act takes effect May 16, 2000, and applies retroactively to March 15, 1995. As a result of the retroactivity of the exemption, refunds are provided for but are limited to $25,000 in the aggregate.

HOUSE FILE 2563 - Sales and Use Taxes -- Nonprofit Hospital Construction Contracts (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act provides an exemption from the sales and use taxes for construction materials and services used in fulfillment of a written contract with a nonprofit hospital. This exemption only applies if the following three conditions are met:

1. The sales and delivery of the materials or the services occur between July 1, 1998, and December 31, 2001.
2. The written construction contract was entered into prior to December 31, 1999, or bonds were issued to fund the construction prior to December 31, 1999.
3. The materials were purchased by the contractor as the agent for the hospital or directly by the hospital.

   The Act takes effect May 19, 2000, and applies retroactively to July 1, 1998. Because of this retroactive applicability, refunds are allowed. However, a limit of $25,000 in the aggregate is set on the amount of refunds.

HOUSE FILE 2569 - Taxation of Sale of Livestock Ear Tags (full text of act)

   BY COMMITTEE ON WAYS AND MEANS. This Act exempts from the sales and use taxes the sale of livestock ear tags by a nonprofit organization whose income is exempt from federal taxation where the proceeds are used in bovine research programs approved by that organization.

RELATED LEGISLATION

SENATE FILE 2092 -- Substantive Code Corrections (Complete summary under STATE GOVERNMENT.)

   This Act contains statutory corrections that adjust language to reflect current practices, insert earlier omissions, delete redundancies and inaccuracies, delete temporary language, resolve inconsistencies and conflicts, update ongoing provisions, or remove ambiguities. Provisions pertaining to the Sheep and Wool Promotion Board are clarified to provide that the board has the authority to set an assessment if approved by a majority of voters at a referendum. A clerical error that occurred during the drafting process of 1999 Iowa Acts, Chapter 158, is corrected in language which relates to the imposition of excise taxes on turkeys. Language relating to an obsolete certification of the amount of the personal property tax replacement base for each taxing district by the Director of Revenue is deleted. A reference to the Department of Management is changed to the Department of Revenue and Finance in language pertaining to the adjustment function in the personal property tax replacement base. Section 3 of 1999 Iowa Acts, Chapter 131, is amended by striking the phrase "all claims of exemption under this section" and inserting the phrase "all claims of exemption under this Act," in order to apply the effective date provision to the substantive part of 1999 Iowa Acts, Chapter 131. This change is made retroactively applicable to May 17, 1999.

SENATE FILE 2111 -- School Finance -- Budget Adjustments (Complete summary under EDUCATION.)

   This Act provides that for the school budget year beginning July 1, 2000, if a school district's actual enrollment for the budget year is greater than its budget enrollment for the budget year, the school district is eligible to receive an on-time funding budget adjustment in the form of a modified allowable growth equal to 50 percent of the difference, multiplied by district cost per pupil. The Act also provides that for the school budget year beginning July 1, 2000, if the Department of Management determines that the regular program district cost of a school district for a budget year is less than its regular program district cost with the budget guarantee provision for the year preceding the budget year, the school district will be eligible to receive a budget adjustment for the budget year up to an amount equal to the difference.

SENATE FILE 2418 -- Property Tax Certification by Townships (Complete summary under LOCAL GOVERNMENT.)

   This Act requires that township property taxes be certified to the county by May 1, 2000, for FY 2000-2001. The Act takes effect April 19, 2000.

SENATE FILE 2438 -- Water Quality Districts (Complete summary under LOCAL GOVERNMENT.)

   This Act provides for the creation of a water quality district in the same manner as provided for the creation of a benefited recreational lake district and authorizes the creation of a combined district.

SENATE FILE 2439 -- Accelerated Career Education and Job Training (Complete summary under ECONOMIC DEVELOPMENT.)

   This Act provides that a possible funding source which could be used to pay the program costs for an agreement under the Accelerated Career Education Program is a tax credit from withholding.

SENATE FILE 2459 -- Annual Financial Report for Urban Renewal Areas -- Filing Deadline (Complete summary under LOCAL GOVERNMENT.)

   This Act changes the filing deadline for urban renewal annual reports from September 30 to December 1 and provides that if the annual report is not filed by the deadline, the county treasurer shall withhold disbursement of tax increment revenues to the municipality.

HOUSE FILE 2027 -- Rural Water District Infrastructure Financing (Complete summary under LOCAL GOVERNMENT.)

   This Act amends provisions in Code Chapter 357A by providing for financing by rural water districts in constructing water projects. The Act provides that notes and the interest on notes issued by a district are not subject to taxation by the state or local government, just as bonds and interest earned by bonds are not subject to such taxation.

HOUSE FILE 2205 -- Electronic Commerce (Complete summary under BUSINESS, BANKING & INSURANCE.)

   This Act provides for the abatement of unpaid state sales and use taxes and local sales and services taxes owed by a retailer in the event that the retailer failed to collect tax from the purchaser as a result of erroneous written advice issued by the department. These provisions take effect May 15, 2000.

HOUSE FILE 2435 -- Asbestos Removal in Schools -- Funding (Complete summary under EDUCATION.)

   This Act provides for the repeal of provisions authorizing the raising of an additional enrichment amount to fund asbestos removal projects.

HOUSE FILE 2540 -- Economic Development Programs -- Tax Credits -- Incentives (Complete summary under ECONOMIC DEVELOPMENT. )

   This Act amends tax credit provisions of the New Jobs and Income Program and the Economic Development Enterprise Zone Program.

HOUSE FILE 2541 -- Rural Improvement Zones (Complete summary under LOCAL GOVERNMENT.)

   This Act allows a county with a population of less than 18,500 residents, with a private lake development in its unincorporated areas, to designate a rural improvement zone that includes the lake development. The Act provides that if a standby tax is imposed to ensure the payment of principal and interest of certificates issued to pay for improvements, the rate must be at least $.50 per $1,000 of assessed value but not more than $2.50 per $1,000 of assessed value.

HOUSE FILE 2550 -- Iowa Educational Savings Plan Trust (Complete summary under EDUCATION.)

   This Act amends certain Code provisions relating to the Iowa Educational Savings Plan Trust. The Act provides that the Treasurer of State will establish an account balance limit for all accounts established for a designated beneficiary beyond which contributions will not be permitted in order to maintain compliance with Internal Revenue Code Section 529. However, of the level of contributions made, the maximum contribution per contributor that will be deductible for state income tax purposes cannot exceed the annually adjusted $2,000 per beneficiary amount. The Act takes effect May 3, 2000.

HOUSE FILE 2581 -- Iowa Higher Education Loan Authority -- Authorization (Complete summary under EDUCATION.)

   This Act provides for a tax exemption from all state and local taxes of the obligations and interest income from the obligations issued on or after July 1, 2000, by the Iowa Higher Education Loan Authority.

© 1998 Cornell College and League of Women Voters of Iowa

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