House File 668 - Introduced HOUSE FILE BY JACOBY Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to the taxation of commercial property and 2 providing an applicability date. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2286YH 83 5 md/mg:sc/24 PAG LIN 1 1 Section 1. Section 441.21, subsection 5, Code 2009, is 1 2 amended to read as follows: 1 3 5. a. For valuations established as of January 1, 1979, 1 4 commercial property and industrial property, excluding 1 5 properties referred to in section 427A.1, subsection 8, shall 1 6 be assessed as a percentage of the actual value of each class 1 7 of property. The percentage shall be determined for each 1 8 class of property by the director of revenue for the state in 1 9 accordance with the provisions of this section. For 1 10 valuations established as of January 1, 1979, the percentage 1 11 shall be the quotient of the dividend and divisor as defined 1 12 in this section. The dividend for each class of property 1 13 shall be the total actual valuation for each class of property 1 14 established for 1978, plus six percent of the amount so 1 15 determined. The divisor for each class of property shall be 1 16 the valuation for each class of property established for 1978, 1 17 as reported by the assessors on the abstracts of assessment 1 18 for 1978, plus the amount of value added to the total actual 1 19 value by the revaluation of existing properties in 1979 as 1 20 equalized by the director of revenue pursuant to section 1 21 441.49. For valuations established as of January 1, 1979, 1 22 property valued by the department of revenue pursuant to 1 23 chapters 428, 433, 437, and 438 shall be considered as one 1 24 class of property and shall be assessed as a percentage of its 1 25 actual value. The percentage shall be determined by the 1 26 director of revenue in accordance with the provisions of this 1 27 section. For valuations established as of January 1, 1979, 1 28 the percentage shall be the quotient of the dividend and 1 29 divisor as defined in this section. The dividend shall be the 1 30 total actual valuation established for 1978 by the department 1 31 of revenue, plus ten percent of the amount so determined. The 1 32 divisor for property valued by the department of revenue 1 33 pursuant to chapters 428, 433, 437, and 438 shall be the 1 34 valuation established for 1978, plus the amount of value added 1 35 to the total actual value by the revaluation of the property 2 1 by the department of revenue as of January 1, 1979. For 2 2 valuations established as of January 1, 1980, commercial 2 3 property and industrial property, excluding properties 2 4 referred to in section 427A.1, subsection 8, shall be assessed 2 5 at a percentage of the actual value of each class of property. 2 6 The percentage shall be determined for each class of property 2 7 by the director of revenue for the state in accordance with 2 8 the provisions of this section. For valuations established as 2 9 of January 1, 1980, the percentage shall be the quotient of 2 10 the dividend and divisor as defined in this section. The 2 11 dividend for each class of property shall be the dividend as 2 12 determined for each class of property for valuations 2 13 established as of January 1, 1979, adjusted by the product 2 14 obtained by multiplying the percentage determined for that 2 15 year by the amount of any additions or deletions to actual 2 16 value, excluding those resulting from the revaluation of 2 17 existing properties, as reported by the assessors on the 2 18 abstracts of assessment for 1979, plus four percent of the 2 19 amount so determined. The divisor for each class of property 2 20 shall be the total actual value of all such property in 1979, 2 21 as equalized by the director of revenue pursuant to section 2 22 441.49, plus the amount of value added to the total actual 2 23 value by the revaluation of existing properties in 1980. The 2 24 director shall utilize information reported on the abstracts 2 25 of assessment submitted pursuant to section 441.45 in 2 26 determining such percentage. For valuations established as of 2 27 January 1, 1980, property valued by the department of revenue 2 28 pursuant to chapters 428, 433, 437, and 438 shall be assessed 2 29 at a percentage of its actual value. The percentage shall be 2 30 determined by the director of revenue in accordance with the 2 31 provisions of this section. For valuations established as of 2 32 January 1, 1980, the percentage shall be the quotient of the 2 33 dividend and divisor as defined in this section. The dividend 2 34 shall be the total actual valuation established for 1979 by 2 35 the department of revenue, plus eight percent of the amount so 3 1 determined. The divisor for property valued by the department 3 2 of revenue pursuant to chapters 428, 433, 437, and 438 shall 3 3 be the valuation established for 1979, plus the amount of 3 4 value added to the total actual value by the revaluation of 3 5 the property by the department of revenue as of January 1, 3 6 1980. For valuations established as of January 1, 1981, and 3 7 each year thereafter, the percentage of actual value as 3 8 equalized by the director of revenue as provided in section 3 9 441.49 at which commercial property and industrial property, 3 10 excluding properties referred to in section 427A.1, subsection 3 11 8, shall be assessed shall be calculated in accordance with 3 12 the methods provided herein, except that any references to six 3 13 percent in this subsection shall be four percent. 3 14 For valuations established as of January 1, 1981, and each 3 15 year thereafter, the percentage of actual value at which 3 16 property valued by the department of revenue pursuant to 3 17 chapters 428, 433, 437, and 438 shall be assessed shall be 3 18 calculated in accordance with the methods provided herein, 3 19 except that any references to ten percent in this subsection 3 20 shall be eight percent. Beginning with valuations established 3 21 as of January 1, 1979, and each year thereafter, property 3 22 valued by the department of revenue pursuant to chapter 434 3 23 shall also be assessed at a percentage of its actual value 3 24 which percentage shall be equal to the percentage determined 3 25 by the director of revenue for commercial property, industrial 3 26 property, or property valued by the department of revenue 3 27 pursuant to chapters 428, 433, 437, and 438, whichever is 3 28 lowest. 3 29 b. Notwithstanding paragraph "a", for valuations 3 30 established for the assessment year beginning January 1, 2010, 3 31 through valuations established for the assessment year 3 32 beginning January 1, 2019, the percentage of actual value, as 3 33 equalized by the director of revenue as provided in section 3 34 441.49, at which commercial property, excluding properties 3 35 referred to in section 427A.1, subsection 8, shall be assessed 4 1 shall be the percentage of actual value that commercial 4 2 property was assessed in the previous assessment year minus 4 3 one percentage point. For valuations established as of 4 4 January 1, 2020, and each year thereafter, the percentage of 4 5 actual value, as equalized by the director of revenue as 4 6 provided in section 441.49, at which commercial property, 4 7 excluding properties referred to in section 427A.1, subsection 4 8 8, shall be assessed shall be the percentage of actual value 4 9 that commercial property was assessed in the assessment year 4 10 beginning January 1, 2019. 4 11 Sec. 2. APPLICABILITY. This Act applies to assessment 4 12 years beginning on or after January 1, 2010. 4 13 EXPLANATION 4 14 This bill provides that the percentage of actual value at 4 15 which commercial property is assessed for the assessment years 4 16 beginning January 1, 2010, through January 1, 2019, is reduced 4 17 by 1 percentage point each year from the percentage in the 4 18 previous assessment year. The bill provides that for the 4 19 assessment year beginning January 1, 2020, and each subsequent 4 20 assessment year, the percentage of actual value at which 4 21 commercial property is assessed shall be the percentage of 4 22 actual value that commercial property was assessed in the 4 23 assessment year beginning January 1, 2019. 4 24 The bill applies to assessment years beginning on or after 4 25 January 1, 2010. 4 26 LSB 2286YH 83 4 27 md/mg:sc/24.1