Senate File 2240 - Introduced SENATE FILE 2240 BY COMMITTEE ON LOCAL GOVERNMENT (SUCCESSOR TO SSB 3138) A BILL FOR An Act relating to the powers and duties of county treasurers 1 related to real property by modifying provisions for the 2 payment of taxes and assessments in installments, modifying 3 provisions providing for the apportionment of installment 4 payments on delinquent taxes, and modifying certain tax 5 payment provisions following a tax sale. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 5734SV (2) 84 md/sc

S.F. 2240 Section 1. Section 161A.35, unnumbered paragraph 1, Code 1 2011, is amended to read as follows: 2 If the owner of any premises against which a levy exceeding 3 one five hundred dollars has been made and certified shall, 4 within thirty days from the date of such levy, agree in writing 5 in a separate agreement, that in consideration of having a 6 right to pay the owner’s assessment in installments, the 7 owner will not make any objection as to the legality of the 8 assessment for benefit, or the levy of the taxes against the 9 owner’s property, then such owner shall have the following 10 options: 11 Sec. 2. Section 311.17, subsection 1, Code 2011, is amended 12 to read as follows: 13 1. If an owner other than the state or a county or city, 14 of any tracts of land on which the assessment is more than 15 one five hundred dollars, shall, within twenty days from the 16 date of the assessment, agree in writing filed in the office 17 of the county auditor, that in consideration of the owner 18 having the right to pay the assessment in installments, the 19 owner will not make any objection of illegality or irregularity 20 as to the assessment upon the real estate, and will pay the 21 assessment plus interest, the assessment shall be payable in 22 ten equal installments. The first installment shall be payable 23 on the date of the agreement. The other installments shall be 24 paid annually at the same time and in the same manner as the 25 September semiannual payment of ordinary taxes with interest 26 accruing as provided in section 384.65, subsection 3 . The 27 rate of interest shall be as established by the board, but not 28 exceeding that permitted by chapter 74A . 29 Sec. 3. Section 311.19, unnumbered paragraph 1, Code 2011, 30 is amended to read as follows: 31 Assessments of one five hundred dollars or less against 32 any tract of land, and assessments against lands owned by the 33 state, county , or city, shall be due and payable from the date 34 of levy by the board of supervisors, or in the case of any 35 -1- LSB 5734SV (2) 84 md/sc 1/ 9

S.F. 2240 appeal, from the date of final confirmation of the levy by the 1 court. 2 Sec. 4. Section 331.384, subsection 3, Code 2011, is amended 3 to read as follows: 4 3. If any amount assessed against property under this 5 section exceeds one five hundred dollars, a county may permit 6 the assessment to be paid in up to ten annual installments 7 in the same manner and with the same interest rates provided 8 for assessments against benefited property under chapter 384, 9 division IV . 10 Sec. 5. Section 357.20, Code 2011, is amended to read as 11 follows: 12 357.20 Due date —— bonds. 13 Assessments of less than one five hundred dollars or less 14 will come due at the first taxpaying date after the approval of 15 the final assessment, and assessments of one hundred dollars 16 or more than five hundred dollars may be paid in ten annual 17 installments with interest on the unpaid balance at a rate 18 not exceeding that permitted by chapter 74A . The board of 19 supervisors shall issue bonds against the completed assessment 20 in an amount equal to the total cost of the project, so that 21 the amount of the assessment will be approximately ten percent 22 greater than the amount of the bonds. 23 Sec. 6. Section 358.16, subsection 3, Code 2011, is amended 24 to read as follows: 25 3. If any amount assessed against property pursuant to 26 this section will exceed one five hundred dollars, the board 27 of trustees may permit the assessment to be paid in up to ten 28 annual installments, in the manner and with the same interest 29 rates as provided for assessments against benefited property 30 under chapter 384, division IV . 31 Sec. 7. Section 364.13, Code 2011, is amended to read as 32 follows: 33 364.13 Installments. 34 If any amount assessed against property under section 364.12 35 -2- LSB 5734SV (2) 84 md/sc 2/ 9

S.F. 2240 will exceed one five hundred dollars, a city may permit the 1 assessment to be paid in up to ten annual installments, in 2 the same manner and with the same interest rates provided for 3 assessments against benefited property under chapter 384, 4 division IV . 5 Sec. 8. Section 384.60, subsection 1, paragraph b, Code 6 2011, is amended to read as follows: 7 b. State the number of annual installments, not exceeding 8 fifteen, into which assessments of one more than five hundred 9 dollars or more are divided. 10 Sec. 9. Section 384.65, subsection 1, Code 2011, is amended 11 to read as follows: 12 1. The first installment of each assessment, or the total 13 amount if less than one five hundred dollars or less , is due 14 and payable on July 1 next succeeding the date of the levy, 15 unless the assessment is filed with the county treasurer after 16 May 31 in any year. The first installment shall bear interest 17 on the whole unpaid assessment from the date of acceptance of 18 the work by the council to the first day of December following 19 the due date. 20 Sec. 10. Section 435.24, subsection 6, paragraph b, Code 21 2011, is amended to read as follows: 22 b. Partial payment of taxes which are delinquent may be 23 made to the county treasurer. For the installment being paid, 24 payment shall first be applied toward any interest, fees, and 25 costs accrued and the remainder applied to the tax due. A 26 partial payment must equal or exceed the interest, fees, and 27 costs of the installment being paid. A partial payment made 28 under this paragraph shall be apportioned in accordance with 29 section 445.57 , however, such partial payment may, at the 30 discretion of the county treasurer, be apportioned either on 31 or before the tenth day of the month following the receipt of 32 the partial payment or on or before the tenth day of the month 33 following the due date of the next semiannual tax installment . 34 If the payment does not include the whole of any installment 35 -3- LSB 5734SV (2) 84 md/sc 3/ 9

S.F. 2240 of the delinquent tax, the unpaid tax shall continue to accrue 1 interest pursuant to section 445.39 . Partial payment shall not 2 be permitted in lieu of redemption if the property has been 3 sold for taxes under chapter 446 and under any circumstances 4 shall not constitute an extension of the time period for a sale 5 under chapter 446 . 6 Sec. 11. Section 445.36A, subsection 2, Code 2011, is 7 amended to read as follows: 8 2. Partial payment of taxes which are delinquent may be 9 made to the county treasurer. For the installment being paid, 10 payment shall first be applied to any interest, fees, and costs 11 accrued and the remainder applied to the taxes due. A partial 12 payment must equal or exceed the amount of interest, fees, 13 and costs of the installment being paid. A partial payment 14 made under this subsection shall be apportioned in accordance 15 with section 445.57 , however, such partial payment may, at the 16 discretion of the county treasurer, be apportioned either on 17 or before the tenth day of the month following the receipt of 18 the partial payment or on or before the tenth day of the month 19 following the due date of the next semiannual tax installment . 20 If the payment does not include the whole of any installment 21 of the delinquent tax, the unpaid tax shall continue to accrue 22 interest pursuant to section 445.39 . Partial payment shall not 23 be permitted in lieu of redemption if the property has been 24 sold for taxes under chapter 446 and under any circumstances 25 shall not constitute an extension of the time period for a sale 26 under chapter 446 . 27 Sec. 12. Section 445.57, unnumbered paragraph 1, Code 2011, 28 is amended to read as follows: 29 On or before the tenth day of each month, the county 30 treasurer shall apportion all taxes collected during the 31 preceding month, except partial payment amounts collected 32 pursuant to section 445.36A, subsection 1 and , partial payments 33 collected and not yet designated by the county treasurer 34 for apportionment pursuant to section 445.36A, subsection 35 -4- LSB 5734SV (2) 84 md/sc 4/ 9

S.F. 2240 2, partial payments collected pursuant to section 435.24, 1 subsection 6 , paragraph “a” , and partial payments collected and 2 not yet designated by the county treasurer for apportionment 3 pursuant to section 435.24, subsection 6, paragraph “b” , among 4 the several funds to which they belong according to the amount 5 levied for each fund, and shall apportion the interest, fees, 6 and costs on the taxes to the general fund, and shall enter 7 those amounts upon the treasurer’s cash account, and report the 8 amounts to the county auditor. 9 Sec. 13. Section 446.32, Code 2011, is amended to read as 10 follows: 11 446.32 Payment of subsequent taxes by purchaser. 12 The county treasurer shall provide to the purchaser of a 13 parcel sold at tax sale a receipt for the total amount paid 14 by the purchaser after the date of purchase for a subsequent 15 year. Taxes for a subsequent year may be paid by the purchaser 16 beginning one month and fourteen days following the date 17 from which an installment becomes delinquent as provided in 18 section 445.37 . Notwithstanding any provision to the contrary, 19 a subsequent payment must be received and recorded by the 20 treasurer in the county system no later than five 5:00 p.m. on 21 the last business day of the month for interest for that month 22 to accrue and be added to the amount due under section 447.1 . 23 However, the treasurer may establish a deadline for receipt of 24 subsequent payments that is other than five 5:00 p.m. on the 25 last business day of the month to allow for timely processing 26 of the subsequent payments. Late interest shall be calculated 27 through the date that the subsequent payment is recorded by 28 the treasurer in the county system. In no instance shall the 29 date of postmark of a subsequent payment be used by a treasurer 30 either to calculate interest or to determine whether interest 31 shall accrue on the subsequent payment. 32 Sec. 14. Section 468.57, subsection 1, Code Supplement 33 2011, is amended to read as follows: 34 1. If the owner of any land against which a levy exceeding 35 -5- LSB 5734SV (2) 84 md/sc 5/ 9

S.F. 2240 one five hundred dollars has been made and certified shall, 1 within thirty days from the date of such levy, agree in 2 writing endorsed upon any improvement certificate referred 3 to in section 468.70 , or in a separate agreement, that in 4 consideration of having a right to pay the owner’s assessment 5 in installments, the owner will not make any objection as to 6 the legality of the assessment for benefit, or the levy of the 7 taxes against the property, then such owner shall have the 8 following options: 9 a. To pay one-third of the amount of the assessment at the 10 time of filing the agreement; one-third within twenty days 11 after the engineer in charge certifies to the auditor that the 12 improvement is one-half completed; and the remaining one-third 13 within twenty days after the improvement has been completed 14 and accepted by the board. All installments shall be without 15 interest if paid at said times, otherwise the assessments shall 16 bear interest from the date of the levy at a rate determined by 17 the board notwithstanding chapter 74A , payable annually, and 18 be collected as other taxes on real estate, with like interest 19 for delinquency. 20 b. To pay the assessments in not less than ten nor more 21 than twenty equal installments, with the number of payments and 22 interest rate determined by the board, notwithstanding chapter 23 74A . The first installment of each assessment, or the total 24 amount if less than one five hundred dollars or less , is due 25 and payable on July 1 next succeeding the date of the levy, 26 unless the assessment is filed with the county treasurer after 27 May 31 in any year. The first installment shall bear interest 28 on the whole unpaid assessment from the date of the levy as set 29 by the board to the first day of December following the due 30 date. The succeeding annual installments, with interest on the 31 whole unpaid amount, to the first day of December following the 32 due date, are respectively due on July 1 annually, and must 33 be paid at the same time and in the same manner as the first 34 semiannual payment of ordinary taxes. All future installments 35 -6- LSB 5734SV (2) 84 md/sc 6/ 9

S.F. 2240 of an assessment may be paid on any date by payment of the then 1 outstanding balance plus interest to the next December 1, or 2 additional annual installments may be paid after the current 3 installment has been paid before December 1 without interest. 4 A payment must be for the full amount of the next installment. 5 If installments remain to be paid, the next annual installment 6 with interest added to December 1 will be due. After December 7 1, if a drainage assessment is not delinquent, a property owner 8 may pay one-half or all of the next annual installment of 9 principal and interest of a drainage assessment prior to the 10 delinquency date of the installment. When the next installment 11 has been paid in full, successive principal installments may 12 be prepaid. The county treasurer shall accept the payments 13 of the drainage assessment, and shall credit the next annual 14 installment or future installments of the drainage assessment 15 to the extent of the payment or payments, and shall remit the 16 payments to the drainage fund. If a property owner elects 17 to pay one or more principal installments in advance, the 18 pay schedule shall be advanced by the number of principal 19 installments prepaid. Each installment of an assessment with 20 interest on the unpaid balance is delinquent from October 1 21 after its due date. However, when the last day of September 22 is a Saturday or Sunday, that amount shall be delinquent from 23 the second business day of October. Taxes assessed pursuant 24 to this chapter which become delinquent shall bear the same 25 delinquent interest as ordinary taxes. When collected, the 26 interest must be credited to the same drainage fund as the 27 drainage special assessment. 28 EXPLANATION 29 This bill makes several changes to the powers and duties of 30 county treasurers relating to real property. 31 The bill amends Code section 161A.35, relating to 32 installment payments on amounts levied against property for 33 watershed protection and flood prevention improvements, by 34 increasing from $100 to $500 the amount levied against a 35 -7- LSB 5734SV (2) 84 md/sc 7/ 9

S.F. 2240 property in order to allow installment payments. 1 The bill amends Code section 311.17, relating to secondary 2 road assessment payments, by increasing from more than $100 3 to more than $500 the amount owed by the taxpayer before the 4 amount may be paid in installments. The bill also specifies 5 that such assessments of $500 or less are due and payable from 6 the date of levy by the board of supervisors, or in the case of 7 any appeal, from the date of final confirmation of the levy by 8 the court. 9 The bill amends Code sections 331.384 and 364.13, relating 10 to special assessments on property for the abatement of 11 specified public health and safety hazards, by increasing 12 from more than $100 to more than $500 the amount owed by the 13 taxpayer before the amount may be paid in installments. 14 The bill amends Code section 357.20 to increase from $100 or 15 more to $500 or more the amount owed by a taxpayer in a water 16 district before the amount may be paid in installments. 17 The bill amends Code section 358.16 to increase from $100 or 18 more to $500 or more the amount owed by a taxpayer in a sanitary 19 district before the amount may be paid in installments. 20 The bill amends Code chapter 384, relating to city special 21 assessments, to increase from $100 or more to $500 or more the 22 amount owed by a taxpayer for a city special assessment before 23 the amount may be paid in installments. 24 Current Code sections 435.24(6)(b) and 445.36A(2) allow 25 for the partial payment of taxes which are delinquent to the 26 county treasurer. Current Code section 445.57 provides that 27 such partial payments are to be apportioned monthly to the 28 various local taxing entities. The bill amends Code sections 29 435.24(6)(b) and 445.36A(2) to allow the county treasurer to 30 apportion such partial payments to the various local taxing 31 entities either on a monthly basis after such amounts are 32 collected or following the due date of the next semiannual tax 33 installment. 34 Current Code section 446.32 allows the purchaser of a 35 -8- LSB 5734SV (2) 84 md/sc 8/ 9

S.F. 2240 parcel sold at tax sale to pay taxes on the parcel for a 1 subsequent year beginning 14 days following the date from which 2 a subsequent year’s installment becomes delinquent as provided 3 in Code section 445.37. The bill changes the period of time 4 for when the purchaser may begin paying taxes for a subsequent 5 year to one month and 14 days following the date from which an 6 installment becomes delinquent. 7 -9- LSB 5734SV (2) 84 md/sc 9/ 9