House File 2274 - Introduced HOUSE FILE 2274 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HSB 519) A BILL FOR An Act relating to property taxation and local government 1 budgets by increasing the regular program foundation base 2 percentage, establishing a property tax exemption for 3 certain commercial and industrial property, establishing 4 and modifying property assessment limitations, providing 5 for certain property tax replacement payments, modifying 6 the assessment and taxation of telecommunications company 7 property, establishing budget limitations for counties 8 and cities, eliminating certain reporting requirements, 9 making appropriations, and including effective date and 10 applicability provisions. 11 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 12 TLSB 5399HV (7) 84 md/sc

H.F. 2274 DIVISION I 1 EDUCATION FINANCE 2 Section 1. Section 257.1, subsection 2, paragraph b, Code 3 2011, is amended by striking the paragraph and inserting in 4 lieu thereof the following: 5 b. (1) The regular program foundation base per pupil is the 6 following: 7 (a) For the budget year commencing July 1, 2012, and the 8 budget year commencing July 1, 2013, the regular program 9 foundation base per pupil is eighty-seven and five-tenths 10 percent of the regular program state cost per pupil. 11 (b) For the budget year commencing July 1, 2014, the regular 12 program foundation base per pupil is eighty-nine and six 13 hundredths percent of the regular program state cost per pupil. 14 (c) For the budget year commencing July 1, 2015, the regular 15 program foundation base per pupil is ninety and sixty-three 16 hundredths percent of the regular program state cost per pupil. 17 (d) For the budget year commencing July 1, 2016, the regular 18 program foundation base per pupil is ninety-two and nineteen 19 hundredths percent of the regular program state cost per pupil. 20 (e) For the budget year commencing July 1, 2017, the 21 regular program foundation base per pupil is ninety-three and 22 seventy-five hundredths percent of the regular program state 23 cost per pupil. 24 (f) For the budget year commencing July 1, 2018, the regular 25 program foundation base per pupil is ninety-five and thirty-one 26 hundredths percent of the regular program state cost per pupil. 27 (g) For the budget year commencing July 1, 2019, the 28 regular program foundation base per pupil is ninety-six and 29 eighty-eight hundredths percent of the regular program state 30 cost per pupil. 31 (h) For the budget year commencing July 1, 2020, the 32 regular program foundation base per pupil is ninety-eight and 33 forty-four hundredths percent of the regular program state cost 34 per pupil. 35 -1- LSB 5399HV (7) 84 md/sc 1/ 47

H.F. 2274 (i) For the budget year commencing July 1, 2021, and 1 succeeding budget years, the regular program foundation base 2 per pupil is one hundred percent of the regular program state 3 cost per pupil. 4 (2) For each budget year, the special education support 5 services foundation base is seventy-nine percent of the special 6 education support services state cost per pupil. The combined 7 foundation base is the sum of the regular program foundation 8 base, the special education support services foundation base, 9 the total teacher salary supplement district cost, the total 10 professional development supplement district cost, the total 11 early intervention supplement district cost, the total area 12 education agency teacher salary supplement district cost, 13 and the total area education agency professional development 14 supplement district cost. 15 Sec. 2. Section 257.4, subsection 1, paragraph b, Code 2011, 16 is amended to read as follows: 17 b. For the budget year beginning July 1, 2008, and 18 succeeding budget years beginning before July 1, 2021 , the 19 department of management shall annually determine an adjusted 20 additional property tax levy and a statewide maximum adjusted 21 additional property tax levy rate, not to exceed the statewide 22 average additional property tax levy rate, calculated by 23 dividing the total adjusted additional property tax levy 24 dollars statewide by the statewide total net taxable valuation. 25 For purposes of this paragraph, the adjusted additional 26 property tax levy shall be that portion of the additional 27 property tax levy corresponding to the state cost per pupil 28 multiplied by a school district’s weighted enrollment, and then 29 multiplied by one hundred percent less the regular program 30 foundation base per pupil percentage pursuant to section 31 257.1 . The For budget years beginning before July 1, 2021, the 32 district shall receive adjusted additional property tax levy 33 aid in an amount equal to the difference between the adjusted 34 additional property tax levy rate and the statewide maximum 35 -2- LSB 5399HV (7) 84 md/sc 2/ 47

H.F. 2274 adjusted additional property tax levy rate, as applied per 1 thousand dollars of assessed valuation on all taxable property 2 in the district. The statewide maximum adjusted additional 3 property tax levy rate shall be annually determined by the 4 department taking into account amounts allocated pursuant to 5 section 257.15, subsection 4 . The For budget years beginning 6 before July 1, 2021, the statewide maximum adjusted additional 7 property tax levy rate shall be annually determined by the 8 department taking into account amounts allocated pursuant to 9 section 257.15, subsection 4 , and the balance of the property 10 tax equity and relief fund created in section 257.16A at the 11 end of the calendar year. 12 Sec. 3. Section 257.15, subsection 4, Code 2011, is amended 13 to read as follows: 14 4. a. Allocations for maximum adjusted additional property 15 tax levy rate calculation and adjusted additional property 16 tax levy aid. The For fiscal years beginning before July 1, 17 2021, the department of management shall allocate from amounts 18 appropriated pursuant to section 257.16, subsection 1 , and from 19 funds appropriated from the property tax equity and relief 20 fund created in section 257.16A for the purpose of calculating 21 the statewide maximum adjusted additional property tax levy 22 rate and providing adjusted additional property tax levy aid 23 as provided in section 257.4, subsection 1 , paragraph “b” , 24 an amount equal to the sum of subparagraphs (1) and (2) as 25 follows: 26 (1) From the amount appropriated from the general fund of 27 the state pursuant to section 257.16, subsection 1 , equal to 28 the following: 29 (a) For the budget year beginning July 1, 2006, six million 30 dollars. 31 (b) For the budget year beginning July 1, 2007, twelve 32 million dollars. 33 (c) For the budget year beginning July 1, 2008, eighteen 34 million dollars. 35 -3- LSB 5399HV (7) 84 md/sc 3/ 47

H.F. 2274 (d) For the budget year beginning July 1, 2009, and 1 succeeding budget years beginning before July 1, 2021 , 2 twenty-four million dollars. 3 (2) From the amount appropriated from the property tax 4 equity and relief fund created in section 257.16A . 5 b. After lowering all school district additional property 6 tax levy rates to the statewide maximum adjusted additional 7 property tax levy rate under paragraph “a” , the department of 8 management shall use any remaining funds at the end of the 9 calendar year to further lower additional property taxes by 10 increasing for the budget year beginning the following July 11 1, the state foundation base percentage. If, however, the 12 state foundation base percentage is one hundred percent, the 13 department of management shall deposit those remaining funds 14 in the taxpayers trust fund created in section 8.57E. Moneys 15 used pursuant to this paragraph shall supplant an equal amount 16 of the appropriation made from the general fund of the state 17 pursuant to section 257.16 that represents the increase in 18 state foundation aid. 19 Sec. 4. Section 257.16A, subsections 2 and 3, Code 2011, are 20 amended to read as follows: 21 2. There For fiscal years beginning before July 1, 2021, 22 there is appropriated annually all moneys in the fund to the 23 department of management for purposes of section 257.15, 24 subsection 4 . 25 3. Notwithstanding Except as provided in subsection 4, 26 and notwithstanding section 8.33 , any moneys remaining in the 27 property tax equity and relief fund at the end of a fiscal year 28 shall not revert to any other fund but shall remain in the 29 property tax equity and relief fund for use as provided in this 30 section for the following fiscal year. 31 Sec. 5. Section 257.16A, Code 2011, is amended by adding the 32 following new subsection: 33 NEW SUBSECTION . 4. Any moneys in the property tax equity 34 and relief fund on June 30, 2021, shall be deposited by the 35 -4- LSB 5399HV (7) 84 md/sc 4/ 47

H.F. 2274 department of management in the taxpayers trust fund created 1 in section 8.57E. 2 Sec. 6. Section 423F.2, subsection 3, Code 2011, is amended 3 to read as follows: 4 3. The moneys available in a fiscal year in the secure an 5 advanced vision for education fund shall be distributed by the 6 department of revenue to each school district in an amount 7 equal to the amount the school district would have received 8 pursuant to the formula in section 423E.4 as if the local 9 sales and services tax for school infrastructure purposes was 10 imposed. Moneys collected in a fiscal year beginning before 11 July 1, 2019, that are in excess of that needed to provide each 12 school district with its formula amount shall be distributed 13 and credited to the property tax equity and relief fund 14 created in section 257.16A . Moneys collected in a fiscal year 15 beginning on or after July 1, 2019, that are in excess of that 16 amount needed to provide each school district with its formula 17 amount shall be deposited in the taxpayers trust fund created 18 in section 8.57E. 19 DIVISION II 20 PROPERTY TAX EXEMPTION AND ASSESSMENT LIMITATIONS —— PROPERTY 21 TAX REPLACEMENT 22 Sec. 7. Section 257.3, subsection 1, Code 2011, is amended 23 by adding the following new paragraph: 24 NEW PARAGRAPH . d. The amount paid to each school district 25 for the commercial and industrial property tax replacement 26 claim under section 441.21A shall be regarded as property tax. 27 The portion of the payment which is foundation property tax 28 shall be determined by applying the foundation property tax 29 rate to the amount computed under section 441.21A, subsection 30 4, paragraph “a” , and such amount shall be prorated pursuant to 31 section 441.21A, subsection 2, if applicable. 32 Sec. 8. Section 331.512, Code 2011, is amended by adding the 33 following new subsection: 34 NEW SUBSECTION . 13A. Carry out duties relating to the 35 -5- LSB 5399HV (7) 84 md/sc 5/ 47

H.F. 2274 calculation and payment of commercial and industrial property 1 tax replacement claims under section 441.21A. 2 Sec. 9. Section 331.512, Code 2011, is amended by adding the 3 following new subsection: 4 NEW SUBSECTION . 13B. Carry out duties relating to the 5 commercial and industrial property tax exemption as provided in 6 section 427.1, subsection 38. 7 Sec. 10. Section 331.559, Code 2011, is amended by adding 8 the following new subsection: 9 NEW SUBSECTION . 25A. Carry out duties relating to the 10 calculation and payment of commercial and industrial property 11 tax replacement claims under section 441.21A. 12 Sec. 11. Section 427.1, Code Supplement 2011, is amended by 13 adding the following new subsection: 14 NEW SUBSECTION . 38. Commercial and industrial property. 15 a. Property that is not located in an urban renewal area 16 for which an ordinance providing for a division of revenue 17 was adopted before January 1, 2012, and is in effect on the 18 date of the assessment and that is classified for property tax 19 purposes as either commercial property or industrial property. 20 For assessment years beginning on or after January 1, 2013, 21 but before January 1, 2018, the exemption provided under 22 this subsection is limited to an amount of actual value of 23 the property equal to fifteen percent of either four hundred 24 thousand dollars or the actual value of the property, whichever 25 is less. For the assessment year beginning on January 1, 2018, 26 the exemption provided under this subsection is limited to an 27 amount of actual value of the property equal to ten percent 28 of either four hundred thousand dollars or the actual value 29 of the property, whichever is less. For the assessment year 30 beginning on January 1, 2019, the exemption provided under 31 this subsection is limited to an amount of actual value of the 32 property equal to five percent of either four hundred thousand 33 dollars or the actual value of the property, whichever is less. 34 b. If property that is eligible for the exemption under this 35 -6- LSB 5399HV (7) 84 md/sc 6/ 47

H.F. 2274 subsection also receives a property tax exemption under another 1 provision of law for the same assessment year, the amount of 2 the exemption determined under this subsection shall be reduced 3 by the amount of the other exemption. 4 c. Wind energy conversion property as defined in section 5 427B.26 is not eligible for the exemption provided under this 6 subsection. 7 d. Upon receiving the appropriate valuation information and 8 data from the assessor, the county auditor shall calculate the 9 amount of each exemption under this subsection and shall enter 10 such exemption amounts in the county system. 11 Sec. 12. Section 441.21, subsection 4, Code Supplement 12 2011, is amended to read as follows: 13 4. For valuations established as of January 1, 1979, 14 the percentage of actual value at which agricultural and 15 residential property shall be assessed shall be the quotient 16 of the dividend and divisor as defined in this section . The 17 dividend for each class of property shall be the dividend 18 as determined for each class of property for valuations 19 established as of January 1, 1978, adjusted by the product 20 obtained by multiplying the percentage determined for that 21 year by the amount of any additions or deletions to actual 22 value, excluding those resulting from the revaluation of 23 existing properties, as reported by the assessors on the 24 abstracts of assessment for 1978, plus six percent of the 25 amount so determined. However, if the difference between the 26 dividend so determined for either class of property and the 27 dividend for that class of property for valuations established 28 as of January 1, 1978, adjusted by the product obtained by 29 multiplying the percentage determined for that year by the 30 amount of any additions or deletions to actual value, excluding 31 those resulting from the revaluation of existing properties, 32 as reported by the assessors on the abstracts of assessment 33 for 1978, is less than six percent, the 1979 dividend for the 34 other class of property shall be the dividend as determined for 35 -7- LSB 5399HV (7) 84 md/sc 7/ 47

H.F. 2274 that class of property for valuations established as of January 1 1, 1978, adjusted by the product obtained by multiplying 2 the percentage determined for that year by the amount of 3 any additions or deletions to actual value, excluding those 4 resulting from the revaluation of existing properties, as 5 reported by the assessors on the abstracts of assessment for 6 1978, plus a percentage of the amount so determined which is 7 equal to the percentage by which the dividend as determined 8 for the other class of property for valuations established 9 as of January 1, 1978, adjusted by the product obtained by 10 multiplying the percentage determined for that year by the 11 amount of any additions or deletions to actual value, excluding 12 those resulting from the revaluation of existing properties, 13 as reported by the assessors on the abstracts of assessment 14 for 1978, is increased in arriving at the 1979 dividend for 15 the other class of property. The divisor for each class 16 of property shall be the total actual value of all such 17 property in the state in the preceding year, as reported by 18 the assessors on the abstracts of assessment submitted for 19 1978, plus the amount of value added to said total actual 20 value by the revaluation of existing properties in 1979 as 21 equalized by the director of revenue pursuant to section 22 441.49 . The director shall utilize information reported on 23 abstracts of assessment submitted pursuant to section 441.45 24 in determining such percentage. For valuations established 25 as of January 1, 1980, and each assessment year thereafter 26 beginning before January 1, 2013 , the percentage of actual 27 value as equalized by the director of revenue as provided 28 in section 441.49 at which agricultural and residential 29 property shall be assessed shall be calculated in accordance 30 with the methods provided herein including the limitation of 31 increases in agricultural and residential assessed values to 32 the percentage increase of the other class of property if the 33 other class increases less than the allowable limit adjusted to 34 include the applicable and current values as equalized by the 35 -8- LSB 5399HV (7) 84 md/sc 8/ 47

H.F. 2274 director of revenue, except that any references to six percent 1 in this subsection shall be four percent. For valuations 2 established as of January 1, 2013, and each assessment year 3 thereafter, the percentage of actual value as equalized by the 4 director of revenue as provided in section 441.49 at which 5 agricultural and residential property shall be assessed shall 6 be calculated in accordance with the methods provided herein 7 including the limitation of increases in agricultural and 8 residential assessed values to the percentage increase of the 9 other class of property if the other class increases less 10 than the allowable limit adjusted to include the applicable 11 and current values as equalized by the director of revenue, 12 except that any references to six percent in this subsection 13 shall be two percent. However, for valuations established 14 as of January 1, 2013, and each assessment year thereafter, 15 the percentage of actual value as equalized by the director 16 of revenue as provided in section 441.49 at which residential 17 property shall be assessed, as calculated in accordance with 18 the methods provided herein, shall not exceed the percentage of 19 actual value at which property assessed as commercial property 20 is assessed under subsection 5, paragraph “b” , for the same 21 assessment year. 22 Sec. 13. Section 441.21, subsection 5, Code Supplement 23 2011, is amended to read as follows: 24 5. a. For valuations established as of January 1, 1979, 25 commercial property and industrial property, excluding 26 properties referred to in section 427A.1, subsection 8 , shall 27 be assessed as a percentage of the actual value of each class 28 of property. The percentage shall be determined for each 29 class of property by the director of revenue for the state in 30 accordance with the provisions of this section . For valuations 31 established as of January 1, 1979, the percentage shall be 32 the quotient of the dividend and divisor as defined in this 33 section . The dividend for each class of property shall be the 34 total actual valuation for each class of property established 35 -9- LSB 5399HV (7) 84 md/sc 9/ 47

H.F. 2274 for 1978, plus six percent of the amount so determined. The 1 divisor for each class of property shall be the valuation 2 for each class of property established for 1978, as reported 3 by the assessors on the abstracts of assessment for 1978, 4 plus the amount of value added to the total actual value by 5 the revaluation of existing properties in 1979 as equalized 6 by the director of revenue pursuant to section 441.49 . For 7 valuations established as of January 1, 1979, property valued 8 by the department of revenue pursuant to chapters 428 , 433 , 9 437 , and 438 shall be considered as one class of property and 10 shall be assessed as a percentage of its actual value. The 11 percentage shall be determined by the director of revenue in 12 accordance with the provisions of this section . For valuations 13 established as of January 1, 1979, the percentage shall be 14 the quotient of the dividend and divisor as defined in this 15 section . The dividend shall be the total actual valuation 16 established for 1978 by the department of revenue, plus ten 17 percent of the amount so determined. The divisor for property 18 valued by the department of revenue pursuant to chapters 428 , 19 433 , 437 , and 438 shall be the valuation established for 1978, 20 plus the amount of value added to the total actual value by 21 the revaluation of the property by the department of revenue 22 as of January 1, 1979. For valuations established as of 23 January 1, 1980, commercial property and industrial property, 24 excluding properties referred to in section 427A.1, subsection 25 8 , shall be assessed at a percentage of the actual value of 26 each class of property. The percentage shall be determined 27 for each class of property by the director of revenue for the 28 state in accordance with the provisions of this section . For 29 valuations established as of January 1, 1980, the percentage 30 shall be the quotient of the dividend and divisor as defined in 31 this section . The dividend for each class of property shall 32 be the dividend as determined for each class of property for 33 valuations established as of January 1, 1979, adjusted by the 34 product obtained by multiplying the percentage determined 35 -10- LSB 5399HV (7) 84 md/sc 10/ 47

H.F. 2274 for that year by the amount of any additions or deletions to 1 actual value, excluding those resulting from the revaluation 2 of existing properties, as reported by the assessors on the 3 abstracts of assessment for 1979, plus four percent of the 4 amount so determined. The divisor for each class of property 5 shall be the total actual value of all such property in 1979, 6 as equalized by the director of revenue pursuant to section 7 441.49 , plus the amount of value added to the total actual 8 value by the revaluation of existing properties in 1980. The 9 director shall utilize information reported on the abstracts of 10 assessment submitted pursuant to section 441.45 in determining 11 such percentage. For valuations established as of January 1, 12 1980, property valued by the department of revenue pursuant 13 to chapters 428 , 433 , 437 , and 438 shall be assessed at a 14 percentage of its actual value. The percentage shall be 15 determined by the director of revenue in accordance with the 16 provisions of this section . For valuations established as of 17 January 1, 1980, the percentage shall be the quotient of the 18 dividend and divisor as defined in this section . The dividend 19 shall be the total actual valuation established for 1979 by 20 the department of revenue, plus eight percent of the amount so 21 determined. The divisor for property valued by the department 22 of revenue pursuant to chapters 428 , 433 , 437 , and 438 shall be 23 the valuation established for 1979, plus the amount of value 24 added to the total actual value by the revaluation of the 25 property by the department of revenue as of January 1, 1980. 26 For valuations established as of January 1, 1981, and each 27 year thereafter, the percentage of actual value as equalized 28 by the director of revenue as provided in section 441.49 at 29 which commercial property and industrial property, excluding 30 properties referred to in section 427A.1, subsection 8 , shall 31 be assessed shall be calculated in accordance with the methods 32 provided herein, except that any references to six percent 33 in this subsection shall be four percent. For valuations 34 established as of January 1, 1981, and each year thereafter, 35 -11- LSB 5399HV (7) 84 md/sc 11/ 47

H.F. 2274 the percentage of actual value at which property valued by 1 the department of revenue pursuant to chapters 428 , 433 , 437 , 2 and 438 shall be assessed shall be calculated in accordance 3 with the methods provided herein, except that any references 4 to ten percent in this subsection shall be eight percent. 5 Beginning with valuations established as of January 1, 1979, 6 and each assessment year thereafter beginning before January 7 1, 2013 , property valued by the department of revenue pursuant 8 to chapter 434 shall also be assessed at a percentage of its 9 actual value which percentage shall be equal to the percentage 10 determined by the director of revenue for commercial property, 11 industrial property, or property valued by the department of 12 revenue pursuant to chapters 428 , 433 , 437 , and 438 , whichever 13 is lowest. For valuations established on or after January 1, 14 2013, property valued by the department of revenue pursuant 15 to chapter 434 that is not located in an urban renewal area 16 for which an ordinance providing for a division of revenue was 17 adopted before January 1, 2012, and is in effect on the date 18 of the assessment shall be assessed at a percentage of its 19 actual value equal to the percentage of actual value at which 20 property assessed as commercial property is assessed for the 21 same assessment year under paragraph “b” . 22 b. For valuations established on or after January 1, 2013, 23 commercial property that is not located in an urban renewal 24 area for which an ordinance providing for a division of revenue 25 was adopted before January 1, 2012, and is in effect on the 26 date of the assessment, and excluding properties referred 27 to in section 427A.1, subsection 8, shall be assessed as a 28 percentage of its actual value, as determined in this paragraph 29 “b” . For valuations established for the assessment year 30 beginning January 1, 2013, the percentage of actual value as 31 equalized by the director of revenue as provided in section 32 441.49 at which such commercial property shall be assessed 33 shall be ninety-five percent. For valuations established for 34 the assessment year beginning January 1, 2014, the percentage 35 -12- LSB 5399HV (7) 84 md/sc 12/ 47

H.F. 2274 of actual value as equalized by the director of revenue as 1 provided in section 441.49 at which such commercial property 2 shall be assessed shall be ninety percent. For valuations 3 established for the assessment year beginning January 1, 2015, 4 the percentage of actual value as equalized by the director of 5 revenue as provided in section 441.49 at which such commercial 6 property shall be assessed shall be eighty-five percent. For 7 valuations established for the assessment year beginning 8 January 1, 2016, the percentage of actual value as equalized by 9 the director of revenue as provided in section 441.49 at which 10 such commercial property shall be assessed shall be eighty 11 percent. For valuations established for the assessment year 12 beginning January 1, 2017, the percentage of actual value as 13 equalized by the director of revenue as provided in section 14 441.49 at which such commercial property shall be assessed 15 shall be seventy-five percent. For valuations established for 16 the assessment year beginning January 1, 2018, the percentage 17 of actual value as equalized by the director of revenue as 18 provided in section 441.49 at which such commercial property 19 shall be assessed shall be seventy percent. For valuations 20 established for the assessment year beginning January 1, 2019, 21 the percentage of actual value as equalized by the director of 22 revenue as provided in section 441.49 at which such commercial 23 property shall be assessed shall be sixty-five percent. For 24 valuations established for the assessment year beginning 25 January 1, 2020, and each assessment year thereafter, the 26 percentage of actual value as equalized by the director of 27 revenue as provided in section 441.49 at which such commercial 28 property shall be assessed shall be sixty percent. 29 c. For valuations established on or after January 1, 30 2013, industrial property that is not located in an urban 31 renewal area for which an ordinance providing for a division 32 of revenue was adopted before January 1, 2012, and is in 33 effect on the date of the assessment, and excluding properties 34 referred to in section 427A.1, subsection 8, shall be assessed 35 -13- LSB 5399HV (7) 84 md/sc 13/ 47

H.F. 2274 as a percentage of its actual value, as determined in this 1 paragraph “c” . For valuations established for the assessment 2 year beginning January 1, 2013, the percentage of actual value 3 as equalized by the director of revenue as provided in section 4 441.49 at which such industrial property shall be assessed 5 shall be ninety-five percent. For valuations established for 6 the assessment year beginning January 1, 2014, the percentage 7 of actual value as equalized by the director of revenue as 8 provided in section 441.49 at which such industrial property 9 shall be assessed shall be ninety percent. For valuations 10 established for the assessment year beginning January 1, 2015, 11 the percentage of actual value as equalized by the director of 12 revenue as provided in section 441.49 at which such industrial 13 property shall be assessed shall be eighty-five percent. For 14 valuations established for the assessment year beginning 15 January 1, 2016, the percentage of actual value as equalized by 16 the director of revenue as provided in section 441.49 at which 17 such industrial property shall be assessed shall be eighty 18 percent. For valuations established for the assessment year 19 beginning January 1, 2017, the percentage of actual value as 20 equalized by the director of revenue as provided in section 21 441.49 at which such industrial property shall be assessed 22 shall be seventy-five percent. For valuations established for 23 the assessment year beginning January 1, 2018, the percentage 24 of actual value as equalized by the director of revenue as 25 provided in section 441.49 at which such industrial property 26 shall be assessed shall be seventy percent. For valuations 27 established for the assessment year beginning January 1, 2019, 28 the percentage of actual value as equalized by the director of 29 revenue as provided in section 441.49 at which such industrial 30 property shall be assessed shall be sixty-five percent. For 31 valuations established for the assessment year beginning 32 January 1, 2020, and each assessment year thereafter, the 33 percentage of actual value as equalized by the director of 34 revenue as provided in section 441.49 at which such industrial 35 -14- LSB 5399HV (7) 84 md/sc 14/ 47

H.F. 2274 property shall be assessed shall be sixty percent. 1 Sec. 14. NEW SECTION . 441.21A Commercial and industrial 2 property tax replacement fund —— replacement claims. 3 1. a. The commercial and industrial property tax 4 replacement fund is created in the state treasury under 5 the control of the department of revenue for the payment of 6 commercial and industrial property tax replacement claims in 7 fiscal years beginning on or after July 1, 2014. 8 b. For the fiscal year beginning July 1, 2014, there 9 is appropriated from the general fund of the state to the 10 department of revenue to be credited to the fund, one hundred 11 million dollars. For the fiscal year beginning July 1, 2015, 12 there is appropriated from the general fund of the state to 13 the department of revenue to be credited to the fund, one 14 hundred fifty million dollars. For the fiscal year beginning 15 July 1, 2016, there is appropriated from the general fund of 16 the state to the department of revenue to be credited to the 17 fund, one hundred eighty million dollars. For the fiscal year 18 beginning July 1, 2017, there is appropriated from the general 19 fund of the state to the department of revenue to be credited 20 to the fund, two hundred ten million dollars. For the fiscal 21 year beginning July 1, 2018, and each fiscal year thereafter, 22 there is appropriated from the general fund of the state to the 23 department of revenue to be credited to the fund, two hundred 24 forty million dollars. 25 2. Beginning with the fiscal year beginning July 1, 2014, 26 each county treasurer shall be paid from the commercial and 27 industrial property tax replacement fund an amount equal to 28 the amount of the commercial and industrial property tax 29 replacement claims in the county, as calculated in subsection 30 4. If an amount appropriated for a fiscal year is insufficient 31 to pay all replacement claims, the director of revenue 32 shall prorate the disbursements from the fund to the county 33 treasurers and shall notify the county auditors of the pro rata 34 percentage on or before September 30. Any unspent balance in 35 -15- LSB 5399HV (7) 84 md/sc 15/ 47

H.F. 2274 the fund as of June 30 of each year shall revert to the general 1 fund of the state as provided by section 8.33. 2 3. On or before July 1 of each fiscal year beginning on 3 or after July 1, 2014, the assessor shall determine the total 4 assessed value of all commercial property, industrial property, 5 and property assessed by the department of revenue pursuant to 6 chapter 434 assessed for taxes due and payable in that fiscal 7 year and the total assessed value of such property assessed 8 as of January 1, 2012, and shall report the valuations to the 9 county auditor. 10 4. On or before September 1 of each fiscal year beginning 11 on or after July 1, 2014, the county auditor shall prepare 12 a statement, based upon the report received pursuant to 13 subsection 3, listing for each taxing district in the county: 14 a. The difference between the assessed valuation of all 15 commercial property, industrial property, and property assessed 16 by the department of revenue pursuant to chapter 434 assessed 17 for the current assessment year, beginning with the assessment 18 year beginning January 1, 2013, and the assessed value of all 19 commercial property, industrial property, and property assessed 20 by the department of revenue pursuant to chapter 434 assessed 21 as of January 1, 2012. If the assessed value of all commercial 22 property, industrial property, and property assessed by the 23 department of revenue pursuant to chapter 434 assessed as of 24 January 1, 2012, is less than the assessed valuation of all 25 commercial property, industrial property, and property assessed 26 by the department of revenue pursuant to chapter 434 for the 27 current assessment year, there is no tax replacement for that 28 taxing district for the fiscal year. 29 b. The tax levy rate for each taxing district for that 30 fiscal year. 31 c. The commercial and industrial property tax replacement 32 claim for each taxing district. For fiscal years beginning on 33 or after July 1, 2014, the replacement claim is equal to the 34 amount determined pursuant to paragraph “a” , multiplied by the 35 -16- LSB 5399HV (7) 84 md/sc 16/ 47

H.F. 2274 tax rate specified in paragraph “b” . 1 5. For purposes of computing replacement amounts under 2 this section, that portion of an urban renewal area defined as 3 the sum of the assessed valuations defined in section 403.19, 4 subsections 1 and 2, shall not be considered a taxing district. 5 6. a. The county auditor shall certify and forward one copy 6 of the statement to the department of revenue not later than 7 September 1 of each year. 8 b. The replacement claims shall be paid to each county 9 treasurer in equal installments in September and March of each 10 year. The county treasurer shall apportion the replacement 11 claim payments among the eligible taxing districts in the 12 county. 13 Sec. 15. SAVINGS PROVISION. This division of this Act, 14 pursuant to section 4.13, does not affect the operation of, 15 or prohibit the application of, prior provisions of section 16 441.21, or rules adopted under chapter 17A to administer prior 17 provisions of section 441.21, for assessment years beginning 18 before January 1, 2013, and for duties, powers, protests, 19 appeals, proceedings, actions, or remedies attributable to an 20 assessment year beginning before January 1, 2013. 21 Sec. 16. IMPLEMENTATION. Section 25B.7 shall not apply to 22 this division of this Act. 23 Sec. 17. APPLICABILITY. This division of this Act applies 24 to assessment years beginning on or after January 1, 2013. 25 DIVISION III 26 TELECOMMUNICATIONS PROPERTY TAX 27 Sec. 18. Section 427A.1, subsection 1, paragraph h, Code 28 2011, is amended to read as follows: 29 h. Property assessed by the department of revenue pursuant 30 to sections 428.24 to 428.29 , or chapters 433 , 434 , 437 , 437A , 31 and 438 . 32 Sec. 19. Section 433.4, Code 2011, is amended to read as 33 follows: 34 433.4 Assessment. 35 -17- LSB 5399HV (7) 84 md/sc 17/ 47