SENATE FILE 395

BY  COMMITTEE ON COMMERCE

(SUCCESSOR TO SSB 1102)

A BILL FOR

An Act relating to the assessment of certain subdivided real property and including applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

   Section 1.  Section 405.1, Code 2011, is amended to read as follows:
   405.1  Housing development —— tax status —— limitation.
   1.  The board of supervisors of a countywith a population of less than twenty thousand may adopt an ordinance providing that property acquired and subdivided for development of housing shall continue to be assessed for taxation in the manner that it was prior to the acquisition for housing. Each lot shall continue to be taxed in the manner it was prior to its acquisition for housing until the lot is sold for construction or occupancy of housing or five years from the date of subdivision, whichever is shorter. Upon the sale or the expiration of the five-year period, the property shall be assessed for taxation as residential or commercial multifamily property, whichever is applicable.
   2.  The board of supervisors of a county with a population of twenty thousand or more may adopt an ordinance providing that property acquired and subdivided for development of housing shall continue to be assessed for taxation in the manner that it was prior to the acquisition for housing. Each lot shall continue to be taxed in the manner it was prior to its acquisition for housing until the lot is sold for construction or occupancy of housing or three years from the date of subdivision, whichever is shorter. Upon the sale or the expiration of the three-year period, the property shall be assessed for taxation as residential or commercial multifamily property, whichever is applicable.
   Sec. 2.  Section 441.72, Code 2011, is amended to read as follows:
   441.72  Assessment of platted lots.
   When a subdivision plat is recorded pursuant to chapter 354, the individual lots within the subdivision plat shall not be assessed in excess of the total assessment of the land as acreage or unimproved property for three years after the recording of the plat or until the lot is actually improved with permanent construction, whichever occurs first. When an individual lot has been improved with permanent construction, the lot shall be assessed for taxation purposes as provided in chapter 428 and this chapter. This section does not apply to special assessment levies.
   Sec. 3.  APPLICABILITY.  This Act applies to assessment years beginning on or after January 1, 2012.
EXPLANATION
   Currently, a platted lot for which a subdivision plat has been recorded will be assessed for property tax purposes as acreage or unimproved property for three years or until the lot is actually improved with permanent construction, whichever occurs first. This bill removes the three-year time limit and provides that a platted lot will be assessed as acreage or unimproved property until the lot is actually improved with permanent construction.
   The bill also repeals a provision that allowed a county of 20,000 or more to adopt an ordinance providing for assessment of subdivided lots acquired for development of housing in the manner they were assessed prior to acquisition for three years from the date of subdivision or until the lot is sold for construction or occupancy of housing, whichever is sooner. The bill also amends a similar provision that allowed counties with a population of less than 20,000 to adopt the same ordinance but with a five-year assessment period, by removing the five-year time limit and providing that such an ordinance may allow each lot to be taxed in the manner it was prior to its acquisition until the lot is sold for construction or occupancy of housing.
   The bill applies to assessment years beginning on or after January 1, 2012.