SENATE FILE 2083

BY  CHELGREN

A BILL FOR

An Act relating to property taxation by modifying assessment limitations on classifications of property, by modifying the method for valuing agricultural property, and including applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 403.20, Code 2011, is amended to read as follows:
   403.20  Percentage of adjustment considered in value assessment.
   In determining the assessed value of property within an urban renewal area which is subject to a division of tax revenues pursuant to section 403.19, the difference between the actual value of the property as determined by the assessor each year and the percentage of adjustment certified for that year by the director of revenue on or before November 1 pursuant to
 
specified in section 441.21, subsection 9
 
1,
 
paragraph “a”, multiplied by the actual value of the property as determined by the assessor, shall be subtracted from the actual value of the property as determined pursuant to section 403.19, subsection 1. If the assessed value of the property as determined pursuant to section 403.19, subsection 1, is reduced to zero, the additional valuation reduction shall be subtracted from the actual value of the property as determined by the assessor.
    Sec. 2.  Section 441.21, subsection 1, paragraph a, Code Supplement 2011, is amended to read as follows:
   a.  All property subject to taxation shall be valued at its actual value which shall be entered opposite each item, and, except as otherwise provided in this section, shall be assessed at one hundred
 
fifty percent of its actual value, and the value so assessed shall be taken and considered as the assessed value and taxable value of the property upon which the levy shall be made.
    Sec. 3.  Section 441.21, subsection 1, paragraphs e and f, Code Supplement 2011, are amended by striking the paragraphs.
    Sec. 4.  Section 441.21, subsection 1, paragraph g, Code Supplement 2011, is amended to read as follows:
   g.  Notwithstanding any other provision of this section, the actual value of any property shall not exceed its fair and reasonable market value, except agricultural property which shall be valued exclusively as provided in paragraph “e” of this subsection.
    Sec. 5.  Section 441.21, subsection 6, Code Supplement 2011, is amended to read as follows:
   6.  Beginning with valuations established as of January 1, 1978, the assessors shall report the aggregate taxable values and the number of dwellings located on agricultural land and the aggregate taxable value of all other structures on agricultural land. Beginning with valuations established as of January 1, 1981, the agricultural dwellings located on agricultural land shall be valued at their market value as defined in this section and agricultural dwellings shall be valued as rural residential property and shall be assessed at the same percentage of actual value as is all other
 
classified as residential property.
    Sec. 6.  Section 441.21, subsections 4, 5, 9, and 10, Code Supplement 2011, are amended by striking the subsections.
    Sec. 7.  APPLICABILITY.  This Act applies to assessment years beginning on or after January 1, 2013.
EXPLANATION
   This bill strikes the current methodology used to calculate the assessment limitations (rollback) under Code section 441.21 for residential property, agricultural property, commercial property, industrial property, and property valued by the department of revenue pursuant to Code chapters 428, 433, 434, 437, and 438. The bill provides that all property subject to taxation shall be valued at its actual value and shall be assessed at 50 percent of its actual value. Code section 441.21 defines “actual value” to mean market value.
   The bill also strikes provisions requiring that the actual value of agricultural property be determined on the basis of productivity and net earning capacity of the property. Under the bill, agricultural property shall be valued based on market value.
   The bill also makes corresponding changes to other provisions of law to reflect the stricken methodology used to calculate the assessment limitations under Code section 441.21.
   The bill applies to assessment years beginning on or after January 1, 2013.