House File 485 - Introduced HOUSE FILE 485 BY KELLEY A BILL FOR An Act establishing a property tax exemption for property used 1 for certain gardening activities within a city and including 2 applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2512YH (3) 86 md/sc

H.F. 485 Section 1. Section 427.1, subsection 2, Code 2015, is 1 amended to read as follows: 2 2. Municipal and military property. The property of a 3 county, township, city, school corporation, levee district, 4 drainage district, district organized under chapter 357E , or 5 the Iowa national guard, when devoted to public use and not 6 held for pecuniary profit, except property of a municipally 7 owned electric utility held under joint ownership and property 8 of an electric power facility financed under chapter 28F or 9 476A that shall be subject to taxation under chapter 437A 10 and facilities of a municipal utility that are used for the 11 provision of local exchange services pursuant to chapter 476 , 12 but only to the extent such facilities are used to provide such 13 services, which shall be subject to taxation under chapter 433 , 14 except that section 433.11 shall not apply. The exemption for 15 property owned by a city or county also applies to property 16 which is operated by a city or county as a library, art 17 gallery or museum, conservatory, botanical garden or display, 18 observatory or science museum, or as a location for holding 19 athletic contests, sports or entertainment events, expositions, 20 meetings or conventions, or leased from the city or county for 21 any such purposes, or leased from the city or county by the 22 Iowa national guard or by a federal agency for the benefit of 23 the Iowa national guard when devoted for public use and not 24 for pecuniary profit. Food and beverages may be served at the 25 events or locations without affecting the exemptions, provided 26 the city has approved the serving of food and beverages on the 27 property if the property is owned by the city or the county 28 has approved the serving of food and beverages on the property 29 if the property is owned by the county. The exemption for 30 property owned by a city or county also applies to property 31 which is located at an airport and leased to a fixed base 32 operator providing aeronautical services to the public. The 33 exemption for property owned by a city also applies to land 34 operated by the city as a fruit or vegetable garden or leased 35 -1- LSB 2512YH (3) 86 md/sc 1/ 3

H.F. 485 from the city by a nonprofit corporation for use as a fruit or 1 vegetable garden, and the sale of fruits or vegetables grown 2 on the land by the city or the lessee shall not affect the 3 exemption. 4 Sec. 2. Section 427.1, Code 2015, is amended by adding the 5 following new subsection: 6 NEW SUBSECTION . 40. Nonprofit fruit and vegetable 7 gardens. Land owned by a nonprofit corporation and located 8 within the corporate boundaries of a city, not exceeding five 9 acres, if devoted to public use by the nonprofit corporation as 10 a fruit or vegetable garden. The sale of fruits or vegetables 11 grown on the land shall not affect the exemption. To be 12 allowed the exemption under this subsection, the nonprofit 13 corporation that owns the land shall have as one of its 14 objectives or purposes the cultivation and sale of fresh fruits 15 and vegetables to residents of the community and shall not be a 16 political organization as defined in section 13C.1. 17 Sec. 3. IMPLEMENTATION. Section 25B.7 does not apply to the 18 property tax exemption enacted in this Act. 19 Sec. 4. APPLICABILITY. This Act applies to assessment years 20 beginning on or after January 1, 2016. 21 EXPLANATION 22 The inclusion of this explanation does not constitute agreement with 23 the explanation’s substance by the members of the general assembly. 24 This bill provides a property tax exemption for certain 25 property located in a city used as a fruit or vegetable garden. 26 The bill modifies the current municipal property tax 27 exemption under Code section 427.1(2) to include land operated 28 by the city as a fruit or vegetable garden or leased from 29 the city by a nonprofit corporation for use as a fruit or 30 vegetable garden. The bill provides that the sale of fruits 31 or vegetables grown on such land by the city or the nonprofit 32 corporation lessee shall not affect the exemption. 33 The bill also establishes a property tax exemption for 34 land owned by a nonprofit corporation and located within the 35 -2- LSB 2512YH (3) 86 md/sc 2/ 3

H.F. 485 corporate boundaries of a city, not exceeding five acres, 1 if the property is devoted to public use by the nonprofit 2 corporation as a fruit or vegetable garden. The bill provides 3 that the sale of fruits or vegetables grown on the land shall 4 not affect the exemption. To be allowed the exemption under 5 the bill, the nonprofit corporation that owns the land must 6 have as one of its objectives or purposes the cultivation 7 and sale of fresh fruits and vegetables to residents of the 8 community and shall not be a political organization as defined 9 in the bill. 10 Code section 25B.7 provides that for a property tax credit 11 or exemption enacted on or after January 1, 1997, if a state 12 appropriation made to fund the credit or exemption is not 13 sufficient to fully fund the credit or exemption, the political 14 subdivision shall be required to extend to the taxpayer only 15 that portion of the credit or exemption estimated by the 16 department of revenue to be funded by the state appropriation. 17 The bill provides that Code section 25B.7 does not apply to the 18 exemption in the bill. 19 The bill applies to assessment years beginning on or after 20 January 1, 2016. 21 -3- LSB 2512YH (3) 86 md/sc 3/ 3