Senate File 2472 S-5260 Amend the House amendment, S-5210, to Senate File 2472, as 1 amended, passed, and reprinted by the Senate, as follows: 2 1. By striking page 1, line 5, through page 57, line 19, and 3 inserting: 4 << DIVISION I 5 COUNTY PROPERTY TAXES AND BUDGETS 6 Section 1. Section 331.423, subsection 1, paragraph b, 7 subparagraph (1), Code 2026, is amended to read as follows: 8 (1) For each fiscal year beginning on or after July 1, 9 2024, but before July 1, 2028 2027 , subject to subparagraph 10 (3), the greater of three dollars and fifty cents per thousand 11 dollars of assessed value used to calculate taxes for general 12 county services for the budget year and the adjusted general 13 county basic levy rate, as adjusted under subparagraph (2), if 14 applicable. 15 Sec. ___. Section 331.423, subsection 1, paragraph c, Code 16 2026, is amended to read as follows: 17 c. For each fiscal year beginning on or after July 1, 18 2028, three dollars and fifty cents per thousand dollars of 19 assessed value. For fiscal years beginning on or after July 20 1, 2027, but before July 1, 2030, a levy rate per one thousand 21 dollars of assessed value equal to one thousand multiplied 22 by the quotient of one hundred two percent of the current 23 fiscal year’s actual property tax dollars certified for levy 24 under this subsection 1 divided by the remainder of the total 25 assessed value used to calculate such taxes for the budget year 26 minus value attributable to new valuation. 27 Sec. ___. Section 331.423, subsection 1, Code 2026, is 28 amended by adding the following new paragraph: 29 NEW PARAGRAPH . d. For each fiscal year beginning on or 30 after July 1, 2030, the lesser of: 31 (1) A levy rate per one thousand dollars of assessed value 32 equal to one thousand multiplied by the quotient of one hundred 33 two percent of the current fiscal year’s actual property tax 34 dollars certified for levy under this subsection 1 divided by 35 -1- S 5210.4558 (1) 91 md/jh 1/ 83 #1.

the remainder of the total assessed value used to calculate 1 such taxes for the budget year minus value attributable to new 2 valuation. 3 (2) Three dollars and fifty cents per thousand dollars of 4 assessed value. 5 Sec. ___. Section 331.423, subsection 2, paragraph b, 6 subparagraph (1), Code 2026, is amended to read as follows: 7 (1) For each fiscal year beginning on or after July 1, 2024, 8 but before July 1, 2028 2027 , subject to subparagraph (3), the 9 greater of three dollars and ninety-five cents per thousand 10 dollars of assessed value used to calculate taxes for rural 11 county services for the budget year and the adjusted rural 12 county basic levy rate, as adjusted under subparagraph (2), if 13 applicable. 14 Sec. ___. Section 331.423, subsection 2, paragraph c, Code 15 2026, is amended to read as follows: 16 c. For each fiscal year beginning on or after July 1, 2028, 17 three dollars and ninety-five cents per thousand dollars of 18 assessed value. For fiscal years beginning on or after July 19 1, 2027, but before July 1, 2030, a levy rate per one thousand 20 dollars of assessed value equal to one thousand multiplied 21 by the quotient of one hundred two percent of the current 22 fiscal year’s actual property tax dollars certified for levy 23 under this subsection 2 divided by the remainder of the total 24 assessed value used to calculate such taxes for the budget year 25 minus value attributable to new valuation. 26 Sec. ___. Section 331.423, subsection 2, Code 2026, is 27 amended by adding the following new paragraph: 28 NEW PARAGRAPH . d. For each fiscal year beginning on or 29 after July 1, 2030, the lesser of: 30 (1) A levy rate per one thousand dollars of assessed value 31 equal to one thousand multiplied by the quotient of one hundred 32 two percent of the current fiscal year’s actual property tax 33 dollars certified for levy under this subsection 2 divided by 34 the remainder of the total assessed value used to calculate 35 -2- S 5210.4558 (1) 91 md/jh 2/ 83

such taxes for the budget year minus value attributable to new 1 valuation. 2 (2) Three dollars and ninety-five cents per thousand 3 dollars of assessed value. 4 Sec. ___. Section 331.423, subsection 3, Code 2026, is 5 amended by adding the following new paragraph: 6 NEW PARAGRAPH . c. “New valuation” means the increase 7 from the current fiscal year to the budget year in taxable 8 valuation, as shown on the assessment roll due to the 9 following, the amount of each as reported under section 331.510 10 by the county auditor to the department of management: 11 (1) New construction. 12 (2) Additions or improvements to existing structures that 13 are not normal and necessary repairs under section 441.21, 14 subsection 8. 15 (3) Net boundary adjustments, including annexation, 16 severance, incorporation, consolidation, or discontinuance as 17 those terms are defined in section 368.1. 18 Sec. ___. Section 331.423, Code 2026, is amended by adding 19 the following new subsection: 20 NEW SUBSECTION . 2A. The amount of property tax dollars 21 calculated under this section includes those amounts budgeted 22 and received by the county as replacement taxes under chapter 23 437A or 437B, if applicable. 24 Sec. ___. EFFECTIVE DATE. This division of this Act takes 25 effect January 1, 2027. 26 Sec. ___. APPLICABILITY. This division of this Act applies 27 to property taxes and budgets for fiscal years beginning on or 28 after July 1, 2027. 29 DIVISION ___ 30 CITY PROPERTY TAXES AND BUDGETS 31 Sec. ___. Section 384.1, subsection 3, paragraph c, 32 subparagraph (1), Code 2026, is amended to read as follows: 33 (1) For each fiscal year beginning on or after July 1, 34 2024, but before July 1, 2028 2027 , subject to subparagraph 35 -3- S 5210.4558 (1) 91 md/jh 3/ 83

(3), a city’s tax levy for the general fund, except for levies 1 authorized in section 384.12 , shall not exceed in any tax year 2 the greater of eight dollars and ten cents per thousand dollars 3 of assessed value used to calculate taxes for the budget year 4 and the adjusted city general fund levy rate, as adjusted under 5 subparagraph (2), if applicable. 6 Sec. ___. Section 384.1, subsection 3, paragraph d, Code 7 2026, is amended to read as follows: 8 d. For each fiscal year beginning on or after July 1, 2028, 9 a city’s tax levy rate for the general fund, except for levies 10 authorized in section 384.12 , shall not exceed eight dollars 11 and ten cents per thousand dollars of assessed value used to 12 calculate taxes in any fiscal year. For fiscal years beginning 13 on or after July 1, 2027, but before July 1, 2030, a city’s tax 14 levy rate for the general fund, except for levies authorized in 15 section 384.12, shall not exceed a levy rate per one thousand 16 dollars of assessed value equal to one thousand multiplied by 17 the quotient of one hundred two percent of the current fiscal 18 year’s actual property tax dollars certified for levy under 19 this subsection divided by the remainder of the total assessed 20 value used to calculate such taxes for the budget year minus 21 value attributable to new valuation. 22 Sec. ___. Section 384.1, subsection 3, Code 2026, is amended 23 by adding the following new paragraph: 24 NEW PARAGRAPH . e. For each fiscal year beginning on or 25 after July 1, 2030, a city’s tax levy rate for the general 26 fund, except for levies authorized in section 384.12, shall not 27 exceed the lesser of: 28 (1) A levy rate per one thousand dollars of assessed value 29 equal to one thousand multiplied by the quotient of one hundred 30 two percent of the current fiscal year’s actual property tax 31 dollars certified for levy under this subsection divided by 32 the remainder of the total assessed value used to calculate 33 such taxes for the budget year minus value attributable to new 34 valuation. 35 -4- S 5210.4558 (1) 91 md/jh 4/ 83

(2) Eight dollars and ten cents per thousand dollars of 1 assessed value. 2 Sec. ___. Section 384.1, subsection 4, Code 2026, is amended 3 by adding the following new paragraph: 4 NEW PARAGRAPH . c. “New valuation” means the increase 5 from the current fiscal year to the budget year in taxable 6 valuation, as shown on the assessment roll due to the 7 following, the amount of each as reported under section 331.510 8 by the county auditor to the department of management: 9 (1) New construction. 10 (2) Additions or improvements to existing structures that 11 are not normal and necessary repairs under section 441.21, 12 subsection 8. 13 (3) Net boundary adjustments, including annexation, 14 severance, incorporation, consolidation, or discontinuance as 15 those terms are defined in section 368.1. 16 Sec. ___. Section 384.1, Code 2026, is amended by adding the 17 following new subsection: 18 NEW SUBSECTION . 3A. The amount of property tax dollars 19 calculated under this section includes those amounts budgeted 20 and received by the city as replacement taxes under chapter 21 437A or 437B, if applicable. 22 Sec. ___. EFFECTIVE DATE. This division of this Act takes 23 effect January 1, 2027. 24 Sec. ___. APPLICABILITY. This division of this Act applies 25 to property taxes and budgets for fiscal years beginning on or 26 after July 1, 2027. 27 DIVISION ___ 28 RATE-LIMITED PROPERTY TAX LEVY RATES 29 Sec. ___. Section 24.48, Code 2026, is amended by adding the 30 following new subsection: 31 NEW SUBSECTION . 6. The authority to suspend property tax 32 levy limitations under this section shall not apply to the 33 limitations of section 444.25. 34 Sec. ___. Section 312.2, subsection 5, paragraph a, 35 -5- S 5210.4558 (1) 91 md/jh 5/ 83

unnumbered paragraph 1, Code 2026, is amended to read as 1 follows: 2 The treasurer of state, before making any allotments to 3 counties under this section , shall reduce the allotment to a 4 county for the secondary road fund by the amount by which the 5 total funds that the county transferred or provided during 6 the prior fiscal year under section 331.429, subsection 1 , 7 paragraphs “a” , “b” , “d” , and “e” , are less than seventy-five 8 fifty-one percent of the sum of the following: 9 Sec. ___. NEW SECTION . 444.25 Maximum property tax levy 10 rates —— adjustments. 11 1. For purposes of this section: 12 a. “Budget year” is the fiscal year beginning during the 13 calendar year in which a budget is certified. 14 b. “Current fiscal year” is the fiscal year ending during 15 the calendar year in which a budget for the budget year is 16 certified. 17 c. “Rate-limited property tax levy” includes any ad valorem 18 property tax levy limited by law to a specific property tax 19 levy rate for a fiscal year beginning on or after July 1, 2027, 20 expressed in statute as a specific amount of money due other 21 than a calculated amount, per one thousand dollars of assessed 22 value used to calculate taxes. “Rate-limited property tax 23 levy” also includes a levy for a county agricultural extension 24 under section 176A.10. This paragraph shall not be construed 25 to include the school district foundation levy under section 26 257.3, the county general services levy under section 331.423, 27 subsection 1, the county rural services levy under section 28 331.423, subsection 2, the city general fund levy under section 29 384.1, the physical plant and equipment levies under section 30 298.2, the school district bond tax under section 298.18, any 31 levy under chapter 28M, a levy under section 384.12, subsection 32 1, paragraph “b” , levied for operation and maintenance of a 33 regional transit district, any levy under chapter 347 or 347A, 34 and any levy under chapter 386. In addition, “rate-limited 35 -6- S 5210.4558 (1) 91 md/jh 6/ 83

property tax levy” does not include levy rates used in the 1 calculations under section 312.2, subsection 5, paragraph “a” . 2 2. Except as provided in subsection 3, for the fiscal year 3 beginning July 1, 2027, and each fiscal year thereafter, each 4 rate-limited property tax levy shall, by operation of this 5 section and in addition to any applicable levy rate limitation 6 imposed by another provision of law, be limited to a levy rate 7 per one thousand dollars of assessed value that is equal to one 8 thousand multiplied by the quotient of one hundred two percent 9 of the current fiscal year’s actual property tax dollars 10 certified for such levy divided by the total assessed value 11 used to calculate such taxes for the budget year. 12 3. a. For the fiscal year beginning July 1, 2027, and each 13 fiscal year thereafter, if the rate limited property tax levy 14 was not imposed by the governmental entity in the immediately 15 preceding fiscal year, such levy may for the initial year of 16 imposition be imposed at a rate not to exceed the maximum rate 17 for such levy authorized by law. 18 b. If a budget year includes a voter-approved increase in 19 the authorized rate of a voter-approved rate-limited property 20 tax levy for which the increased rate was not approved for 21 imposition in the current fiscal year, such rate-limited 22 property tax levy may be imposed for that budget year at a rate 23 not to exceed the voter-approved rate without application of 24 subsection 2. 25 4. The amount of property tax dollars calculated under this 26 section includes those amounts budgeted and received by the 27 governmental entity as replacement taxes under chapter 437A or 28 437B, if applicable. 29 Sec. ___. NEW SECTION . 444.26 Use of bonds and indebtedness 30 for general operations —— prohibition. 31 1. For purposes of this section: 32 a. “General operations” means services or activities 33 generally funded from the governmental entity’s general fund, 34 which are necessary for the operation of the governmental 35 -7- S 5210.4558 (1) 91 md/jh 7/ 83

entity, including salaries and benefits, or which are for the 1 health and welfare of the governmental entity’s citizens or 2 primarily intended to benefit all residents of the governmental 3 entity, but excluding direct and indirect capital expenditures 4 properly allocable under the Internal Revenue Code, as defined 5 in section 422.3, if the governmental entity were a taxpayer, 6 capital leases, and services financed by statutory funds other 7 than a debt service fund. 8 b. “Governmental entity” means any unit of government 9 or other public body or public corporation, including any 10 intergovernmental entity, that has the power to impose or 11 certify a property tax levy. 12 2. On or after July 1, 2026, the governing body of a 13 governmental entity shall not issue bonds or other indebtedness 14 payable from an ad valorem property tax levy for the purpose of 15 funding the general operations of the governmental entity or 16 otherwise use proceeds from the sale of bonds or issuance of 17 other indebtedness to fund general operations. 18 3. The department of management, following consultation 19 with the city finance committee and the county finance 20 committee, may adopt rules under chapter 17A for governmental 21 entities to implement this section. 22 Sec. ___. EFFECTIVE DATE. The following takes effect 23 January 1, 2027: 24 The section of this division of this Act amending section 25 312.2. 26 Sec. ___. APPLICABILITY. The following applies to fiscal 27 years beginning on or after July 1, 2027: 28 The section of this division of this Act amending section 29 312.2. 30 DIVISION ___ 31 FIRSTHOME IOWA ACCOUNTS 32 Sec. ___. Section 12G.2, Code 2026, is amended by adding the 33 following new subsection: 34 NEW SUBSECTION . 6. Create strategies for coordination of 35 -8- S 5210.4558 (1) 91 md/jh 8/ 83

the program with the FirstHome Iowa program trust established 1 in chapter 12L. 2 Sec. ___. NEW SECTION . 12L.1 FirstHome Iowa program —— 3 purpose and definitions. 4 1. The general assembly finds that the general welfare and 5 well-being of the state are directly related to homeownership 6 of the citizens of the state, and that a vital and valid 7 public purpose is served by the creation and implementation 8 of programs which encourage and make possible the attainment 9 of homeownership by the greatest number of citizens of the 10 state. The general welfare of the citizens of the state will 11 be enhanced by establishing a FirstHome Iowa program which 12 allows citizens of the state to invest money in a public trust 13 for future application to the payment of qualified homebuyer 14 expenses. The creation of the means of encouragement for 15 citizens to invest in such a program represents the carrying 16 out of a vital and valid public purpose. In order to make 17 available to the citizens of the state an opportunity to fund 18 future first-time homeownership, it is necessary that a public 19 trust be established in which moneys may be invested for future 20 use. 21 2. As used in this chapter, unless the context otherwise 22 requires: 23 a. “Administrative fund” means the administrative fund 24 established under section 12L.4. 25 b. “Beneficiary” means the individual designated by a 26 participation agreement to benefit from advance payments of 27 qualified homebuyer expenses on behalf of the beneficiary. 28 c. “First-time homebuyer” means an individual who is a 29 resident of Iowa and who does not own, either individually or 30 jointly, a single-family or multifamily residence, and who 31 has not previously owned or purchased, either individually or 32 jointly, a single-family or multifamily residence prior to the 33 date of the qualified purchase for which the eligible home 34 costs are paid or reimbursed from an account. 35 -9- S 5210.4558 (1) 91 md/jh 9/ 83

d. “FirstHome Iowa program trust” or “trust” means the trust 1 created under section 12L.2. 2 e. “FirstHome Iowa program trust account” or “account” 3 means an account within the trust that was established for 4 the purpose of paying or reimbursing a beneficiary’s eligible 5 qualified homebuyer expenses in connection with a qualified 6 purchase. 7 f. “Individual” means a natural person. 8 g. “Participant” means an individual, individual’s legal 9 representative, trust, or estate that has entered into a 10 participation agreement under this chapter, either individually 11 or jointly with the individual’s spouse, for the advance 12 payment of qualified homebuyer expenses on behalf of a 13 beneficiary. 14 h. “Participation agreement” means an agreement between a 15 participant and the trust entered into under this chapter. 16 i. “Program fund” means the program fund established under 17 section 12L.4. 18 j. “Qualified homebuyer expenses” means any of the 19 following: 20 (1) A down payment or closing costs for the qualified 21 purchase of a single-family residence in Iowa that is to be the 22 homestead, as defined in section 425.11, of the beneficiary if 23 such beneficiary is a first-time homebuyer with respect to such 24 purchase. 25 (2) A cost, fee, tax, or payment incurred by, or charged 26 or assigned to, a beneficiary as part of the purchase under 27 subparagraph (1) and listed on the statement of receipts and 28 disbursements for the sale, including any statement prescribed 29 by 12 C.F.R. §1026.38, as amended. 30 (3) Any United States veterans administration funding 31 fee incurred by, or charged or assigned to, a beneficiary in 32 connection with a veterans administration home loan guaranty 33 program. 34 k. “Qualified purchase” means the purchase of a 35 -10- S 5210.4558 (1) 91 md/jh 10/ 83

single-family residence in Iowa by the account’s beneficiary 1 for which the account’s beneficiary will use as a homestead, as 2 defined in section 425.11, one year or more after the date the 3 participant first opened the account. 4 l. “Resident” means the same as defined in section 422.4. 5 m. “Single-family residence” means a single-family residence 6 owned and occupied by a beneficiary as the beneficiary’s 7 homestead within the meaning of section 425.1, including but 8 not limited to a manufactured home, mobile home, condominium 9 unit, or cooperative. 10 Sec. ___. NEW SECTION . 12L.2 Creation of FirstHome Iowa 11 program trust. 12 A FirstHome Iowa program trust is created. The treasurer of 13 state is the trustee of the trust, and has all powers necessary 14 to carry out and effectuate the purposes, objectives, and 15 provisions of this chapter pertaining to the trust, including 16 the power to do all of the following: 17 1. Make and enter into contracts necessary for the 18 administration of the trust created under this chapter. 19 2. Enter into agreements with any financial institution, 20 the state, or any federal or other state agency, or other 21 entity as required to implement this chapter. 22 3. Carry out the duties and obligations of the trust 23 pursuant to this chapter. 24 4. Accept any grants, gifts, legislative appropriations, 25 and other moneys from the state, any unit of federal, state, or 26 local government, or any other person, firm, partnership, or 27 corporation which the treasurer of state shall deposit into the 28 administrative fund or the program fund. 29 5. Carry out studies and projections so the treasurer of 30 state may advise participants regarding present and estimated 31 future qualified homebuyer expenses and levels of financial 32 participation in the trust required in order to enable 33 participants to achieve their qualifying purchase objectives. 34 6. Participate in any federal, state, or local governmental 35 -11- S 5210.4558 (1) 91 md/jh 11/ 83

program for the benefit of the trust. 1 7. Procure insurance against any loss in connection with the 2 property, assets, or activities of the trust. 3 8. Enter into participation agreements with participants. 4 9. Make payments to or on behalf of beneficiaries for 5 qualified homebuyer expenses pursuant to participation 6 agreements. 7 10. Make refunds to participants upon the termination 8 of participation agreements, and partial nonqualified 9 distributions to participants, pursuant to the provisions, 10 limitations, and restrictions set forth in this chapter. 11 11. Invest moneys from the program fund in any investments 12 which are determined by the treasurer of state to be 13 appropriate. 14 12. Engage investment advisors, if necessary, to assist in 15 the investment of trust assets. 16 13. Contract for goods and services and engage personnel 17 as necessary, including consultants, actuaries, managers, 18 legal counsel, and auditors for the purpose of rendering 19 professional, managerial, and technical assistance and advice 20 to the treasurer of state regarding trust administration and 21 operation. 22 14. Establish, impose, and collect administrative fees 23 and charges in connection with transactions of the trust for 24 deposit in the administrative fund and provide for reasonable 25 service charges. 26 15. Administer the funds of the trust. 27 16. Adopt rules pursuant to chapter 17A for the 28 administration of the trust. 29 Sec. ___. NEW SECTION . 12L.3 Participation agreements for 30 trust. 31 The trust may enter into participation agreements with 32 participants on behalf of beneficiaries pursuant to the 33 following terms and agreements: 34 1. Each participation agreement may require a participant 35 -12- S 5210.4558 (1) 91 md/jh 12/ 83

to agree to invest a specific amount of money in the trust 1 for a specific period of time for the benefit of a specific 2 beneficiary. A participant shall not be required to make an 3 annual contribution on behalf of a beneficiary. The maximum 4 contribution that may be deducted for Iowa income tax purposes 5 shall be the amount contributed by the participant during the 6 applicable tax year, not to exceed five thousand five hundred 7 dollars per beneficiary per year adjusted annually to reflect 8 increases in the consumer price index. 9 2. The execution of a participation agreement by the 10 trust shall not guarantee in any way that qualified homebuyer 11 expenses will be equal to projections and estimates provided by 12 the trust or that the beneficiary named in any participation 13 agreement will qualify for a mortgage, home loan, or other 14 forms of credit for a qualified purchase. 15 3. a. A beneficiary under a participation agreement may be 16 changed as permitted under rules adopted by the treasurer of 17 state upon written request of the participant as long as the 18 substitute beneficiary is eligible for participation. 19 b. Participation agreements may otherwise be freely amended 20 throughout their terms in order to enable participants to 21 increase or decrease the level of participation, change the 22 designation of beneficiaries, and carry out similar matters as 23 authorized by rule. 24 4. Each participation agreement shall provide that the 25 participation agreement may be canceled upon the terms and 26 conditions, and upon payment of applicable fees and costs set 27 forth and contained in the rules adopted by the treasurer of 28 state. 29 5. A participant may designate a successor in accordance 30 with rules adopted by the treasurer of state. The designated 31 successor shall succeed to the ownership of the account in 32 the event of the death of the participant. In the event a 33 participant dies and has not designated a successor to the 34 account, the following criteria shall apply: 35 -13- S 5210.4558 (1) 91 md/jh 13/ 83

a. The beneficiary of the account, if eighteen years of 1 age or older, shall become the owner of the account as well as 2 remain the beneficiary upon filing the appropriate forms in 3 accordance with rules adopted by the treasurer of state. 4 b. If the beneficiary of the account is under the age of 5 eighteen, account ownership shall be transferred to the first 6 surviving parent or other legal guardian of the beneficiary to 7 file the appropriate forms in accordance with rules adopted by 8 the treasurer of state. 9 Sec. ___. NEW SECTION . 12L.4 FirstHome Iowa program and 10 administrative funds —— investment and payments. 11 1. a. The treasurer of state shall segregate moneys 12 received by the trust into two funds: the FirstHome Iowa 13 program fund and the administrative fund to be used for 14 administration of the program. 15 b. All moneys paid by participants in connection with 16 participation agreements shall be deposited as received into 17 separate accounts within the program fund. 18 c. Contributions to the trust made by participants may only 19 be made in the form of cash. 20 d. A participant or beneficiary may, directly or indirectly, 21 direct the investment of any contributions to the trust or any 22 earnings thereon no more than four times in a calendar year. 23 2. Moneys accrued by participants in the program fund of the 24 trust may be used for payments to or on behalf of a beneficiary 25 for qualified homebuyer expenses. 26 Sec. ___. NEW SECTION . 12L.5 Cancellation of agreements. 27 A participant may cancel a participation agreement at will. 28 Upon cancellation of a participation agreement, a participant 29 shall be entitled to the return of the participant’s account 30 balance. 31 Sec. ___. NEW SECTION . 12L.6 Ownership of payments and 32 investment income —— transfer of ownership rights. 33 1. a. A participant retains ownership of all payments 34 made under a participation agreement up to the date of 35 -14- S 5210.4558 (1) 91 md/jh 14/ 83

utilization for payment of qualified homebuyer expenses for the 1 beneficiary. 2 b. All income derived from the investment of the payments 3 made by the participant shall be considered to be held in trust 4 for the benefit of the beneficiary. 5 2. In the event the FirstHome Iowa program is terminated 6 prior to payment of qualified homebuyer expenses for the 7 beneficiary, the participant is entitled to a refund of the 8 participant’s account balance. 9 3. Any amounts which may be paid to any person or persons 10 pursuant to the FirstHome Iowa program trust but which are not 11 listed in this section are owned by the trust. 12 4. A participant may transfer ownership rights to another 13 participant or may transfer funds to another account under the 14 trust. The transfer shall be made and the property distributed 15 in accordance with rules adopted by the treasurer of state or 16 with the terms of the participation agreement. 17 5. A participant shall not be entitled to utilize any 18 interest in the trust as security for a loan. 19 Sec. ___. NEW SECTION . 12L.7 Annual audited financial 20 report to governor and general assembly. 21 1. a. The treasurer of state shall submit an annual 22 audited financial report, prepared in accordance with generally 23 accepted accounting principles, on the operations of the trust 24 by November 1 to the governor and the general assembly. 25 b. The annual audit shall be made either by the auditor 26 of state or by an independent certified public accountant 27 designated by the auditor of state and shall include direct and 28 indirect costs attributable to the use of outside consultants, 29 independent contractors, and any other persons who are not 30 state employees. 31 2. The annual audit shall be supplemented by all of the 32 following information prepared by the treasurer of state: 33 a. Any related studies or evaluations prepared in the 34 preceding year. 35 -15- S 5210.4558 (1) 91 md/jh 15/ 83

b. A summary of the benefits provided by the trust including 1 the number of participants and beneficiaries in the trust. 2 c. Any other information which is relevant in order to make 3 a full, fair, and effective disclosure of the operations of the 4 trust. 5 Sec. ___. NEW SECTION . 12L.8 Tax considerations. 6 State income tax treatment of the FirstHome Iowa program 7 trust shall be as provided in section 422.7, subsections 46 and 8 47. 9 Sec. ___. NEW SECTION . 12L.9 Property rights to assets in 10 trust. 11 1. The assets of the trust shall at all times be preserved, 12 invested, and expended solely and only for the purposes of 13 the trust and shall be held in trust for the participants and 14 beneficiaries. 15 2. No property rights in the trust shall exist in favor of 16 the state. 17 3. The assets of the trust shall not be transferred or used 18 by the state for any purposes other than the purposes of the 19 trust. 20 Sec. ___. NEW SECTION . 12L.10 Construction. 21 This chapter shall be construed liberally in order to 22 effectuate its purpose. 23 Sec. ___. Section 232D.503, subsection 6, Code 2026, is 24 amended by adding the following new paragraph: 25 NEW PARAGRAPH . g. A FirstHome Iowa program trust account 26 established for the minor pursuant to chapter 12L. 27 Sec. ___. Section 422.7, Code 2026, is amended by adding the 28 following new subsections: 29 NEW SUBSECTION . 46. a. Subtract the contribution that may 30 be deducted for Iowa income tax purposes as a participant in 31 the FirstHome Iowa program trust pursuant to section 12L.3, 32 subsection 1. For purposes of this paragraph, a participant 33 who makes a contribution on or before the date prescribed in 34 section 422.21 for making and filing an individual income tax 35 -16- S 5210.4558 (1) 91 md/jh 16/ 83

return, excluding extensions, or the date for making and filing 1 an individual income tax return determined by the director 2 pursuant to an order issued under section 421.17, subsection 3 30, may elect to be deemed to have made the contribution on the 4 last day of the preceding calendar year. The director, after 5 consultation with the treasurer of state, shall prescribe by 6 rule the manner and method by which a participant may make an 7 election authorized by the preceding sentence. 8 b. Add the amount resulting from the cancellation of 9 a participation agreement refunded to the taxpayer as a 10 participant in the FirstHome Iowa program trust to the extent 11 previously deducted as a contribution to the trust. 12 c. Add, to the extent previously deducted as a contribution 13 to the trust, the amount resulting from a withdrawal or 14 transfer made by the taxpayer from the FirstHome Iowa program 15 trust for purposes other than the payment of qualified 16 homebuyer expenses. 17 NEW SUBSECTION . 47. Subtract, to the extent included, 18 income from interest and earnings received from the FirstHome 19 Iowa program trust created in chapter 12L. 20 Sec. ___. Section 541B.4, Code 2026, is amended by adding 21 the following new subsections: 22 NEW SUBSECTION . 5. Withdrawal for deposit into FirstHome 23 Iowa program trust account. First-time homebuyer account 24 balances under this chapter may be withdrawn without penalty or 25 taxation in this state if such withdrawal is deposited in an 26 account within the FirstHome Iowa program trust under chapter 27 12L within thirty days of the withdrawal. The treasurer of 28 state may by rule provide for the direct transfer of moneys 29 within an account under this chapter to a FirstHome Iowa 30 program trust account and such transfer shall not be subject to 31 penalty or taxation in this state. 32 NEW SUBSECTION . 6. No new accounts. New accounts shall not 33 be established under this chapter on or after July 1, 2026. 34 Sec. ___. Section 627.6, Code 2026, is amended by adding the 35 -17- S 5210.4558 (1) 91 md/jh 17/ 83

following new subsection: 1 NEW SUBSECTION . 18. The debtor’s interest, whether as 2 participant or beneficiary, in contributions and assets, 3 including the accumulated earnings and market increases in 4 value, held in an account in the FirstHome Iowa program trust 5 organized under chapter 12L. 6 Sec. ___. Section 633.108, subsection 2, Code 2026, is 7 amended by adding the following new paragraph: 8 NEW PARAGRAPH . e. A FirstHome Iowa program trust account 9 established for the minor pursuant to chapter 12L. 10 Sec. ___. Section 633.555, subsection 1, Code 2026, is 11 amended by adding the following new paragraph: 12 NEW PARAGRAPH . f. An account owner or participant under 13 a FirstHome Iowa program trust account established for the 14 protected person pursuant to chapter 12L. 15 Sec. ___. Section 633.678, subsection 1, Code 2026, is 16 amended by adding the following new paragraph: 17 NEW PARAGRAPH . f. An account owner or participant under 18 a FirstHome Iowa program trust account established for the 19 protected person pursuant to chapter 12L. 20 Sec. ___. Section 633.681, subsection 1, Code 2026, is 21 amended by adding the following new paragraph: 22 NEW PARAGRAPH . e. An account owner or participant under 23 a FirstHome Iowa program trust account established for the 24 protected person pursuant to chapter 12L. 25 Sec. ___. APPLICABILITY. The following applies to 26 contributions made under chapter 12L on or after July 1, 2026, 27 for tax years ending on or after that date: 28 The section of this division of this Act enacting section 29 422.7, subsections 46 and 47. 30 DIVISION ___ 31 SCHOOL TAXES 32 Sec. ___. Section 257.3, subsection 1, paragraph a, Code 33 2026, is amended to read as follows: 34 a. (1) Except as provided in subsections 2 and 3 , a school 35 -18- S 5210.4558 (1) 91 md/jh 18/ 83

district shall cause to be levied each budget year beginning 1 before July 1, 2028 , for the school general fund, a foundation 2 property tax equal to five dollars and forty cents per thousand 3 dollars of assessed valuation on all taxable property in the 4 district. The county auditor shall spread the foundation levy 5 over all taxable property in the district. 6 (2) Except as provided in subsections 2 and 3, a school 7 district shall cause to be levied for the budget year beginning 8 July 1, 2028, for the school general fund, a foundation 9 property tax equal to five dollars and ten cents per thousand 10 dollars of assessed valuation on all taxable property in the 11 district. The county auditor shall spread the foundation levy 12 over all taxable property in the district. 13 (3) Except as provided in subsections 2 and 3, a school 14 district shall cause to be levied for the budget year beginning 15 July 1, 2029, and each succeeding budget year, for the school 16 general fund, a foundation property tax equal to four dollars 17 and ninety cents per thousand dollars of assessed valuation 18 on all taxable property in the district. The county auditor 19 shall spread the foundation levy over all taxable property in 20 the district. 21 Sec. ___. Section 257.3, subsection 2, paragraphs a and b, 22 Code 2026, are amended to read as follows: 23 a. Notwithstanding subsection 1 , a reorganized school 24 district shall cause a foundation property tax of four dollars 25 and forty cents at a rate equal to one dollar per thousand 26 dollars of assessed valuation less than the rate under 27 subsection 1, paragraph “a” , for the applicable budget year to 28 be levied on all taxable property which, in the year preceding 29 a reorganization, was within a school district affected by the 30 reorganization as defined in section 275.1 , or in the year 31 preceding a dissolution was a part of a school district that 32 dissolved if the dissolution proposal has been approved by the 33 director of the department of education pursuant to section 34 275.55 . 35 -19- S 5210.4558 (1) 91 md/jh 19/ 83