Senate Study Bill 3012 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON VETERANS AFFAIRS BILL BY CHAIRPERSON BEALL) A BILL FOR An Act relating to the military service property tax exemption 1 and credit by increasing the exemption amount, and including 2 applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5681SC (4) 83 md/sc

S.F. _____ Section 1. Section 25B.7, subsection 2, paragraph c, Code 1 2009, is amended to read as follows: 2 c. Military service property tax credit and exemption 3 pursuant to chapter 426A , to the extent of six dollars and 4 ninety-two cents per thousand dollars of assessed value of the 5 exempt property . 6 Sec. 2. Section 426A.2, Code 2009, is amended to read as 7 follows: 8 426A.2 Military service tax credit. 9 The moneys shall be apportioned each year so as to replace 10 all or a portion of the tax which would be due on property 11 eligible for military service tax exemption in the state, 12 if the property were subject to taxation , the amount of the 13 credit to be not more than six dollars and ninety-two cents 14 per thousand dollars of assessed value of property which would 15 be subject to the tax, except for the military service tax 16 exemption . 17 Sec. 3. Section 426A.11, subsections 1 and 2, Code 18 Supplement 2009, are amended to read as follows: 19 1. The property, not to exceed two thousand seven hundred 20 seventy-eight sixteen thousand three hundred dollars in taxable 21 value of any veteran, as defined in section 35.1, of the First 22 World War. 23 2. The property, not to exceed one thousand eight hundred 24 fifty-two sixteen thousand three hundred dollars in taxable 25 value of an honorably separated, retired, furloughed to a 26 reserve, placed on inactive status, or discharged veteran, as 27 defined in section 35.1. 28 Sec. 4. APPLICABILITY. This Act applies to property taxes 29 due and payable in fiscal years beginning on or after July 1, 30 2011. 31 EXPLANATION 32 Under current law, veterans of the First World War are 33 entitled to a property tax exemption of $2,778 and honorably 34 discharged veterans that serve during other specific time 35 -1- LSB 5681SC (4) 83 md/sc 1/ 2

S.F. _____ periods are entitled to a property tax exemption of $1,852. 1 This bill increases the exemption amount for all eligible 2 veterans to $16,300. 3 Under current law, the state provides funding to local 4 governments for the military service property tax exemption and 5 credit up to $6.92 per $1,000 of assessed value of the exempt 6 property. The bill strikes this state funding limitation 7 and makes the property tax exemption and credit funding 8 requirements of Code section 25B.7 applicable to the increased 9 military service exemption and credit amounts. Code section 10 25B.7 provides that if a state appropriation made to fund the 11 credit or exemption is not sufficient to fully fund the credit 12 or exemption, the political subdivision shall be required to 13 extend to the taxpayer only that portion of the credit or 14 exemption estimated by the department of revenue to be funded 15 by the state appropriation. 16 The bill applies to property taxes due and payable in fiscal 17 years beginning on or after July 1, 2011. 18 -2- LSB 5681SC (4) 83 md/sc 2/ 2