H.F. 2373 Section 1. Section 427.1, subsection 21A, Code 2018, is 1 amended to read as follows: 2 21A. Dwelling unit property owned by community housing 3 development organization. 4 a. Dwelling unit property owned and managed by a community 5 housing development organization, as recognized by the state 6 of Iowa and the federal government pursuant to criteria 7 for community housing development organization designation 8 contained in the HOME program of the federal National 9 Affordable Housing Act of 1990, if the organization is also a 10 nonprofit organization exempt from federal income tax under 11 section 501(c)(3) of the Internal Revenue Code and owns and 12 manages more than one hundred fifty dwelling units that are 13 located in a city with a population of more than one hundred 14 ten thousand. 15 b. For assessment years beginning on or after January 16 1, 2019, dwelling unit property that is constructed or 17 substantially rehabilitated on or after July 1, 2018, is 18 eligible for the exemption under this subsection if such 19 property is owned, managed, or controlled by a community 20 housing development organization that is a nonprofit 21 organization exempt from federal income tax under section 22 501(c)(3) of the Internal Revenue Code, that meets the 23 community housing development organization designation 24 criteria contained in the HOME program of the federal National 25 Affordable Housing Act of 1990, and that owns and manages 26 more than one hundred fifty dwelling units. The exemption 27 authorized under this paragraph shall be allowed for each 28 eligible property unless specifically disapproved by resolution 29 of the city council for property located in a city or by 30 resolution of the board of supervisors for property located in 31 the unincorporated area of a county. 32 c. For the 2005 and 2006 assessment years beginning January 33 1, 2005, and January 1, 2006 , an application is not required 34 to be filed to receive the exemption. For the assessment year 35 -1- LSB 6071YH (3) 87 md/jh 1/ 8

H.F. 2373 beginning January 1, 2007 , and subsequent assessment years, 1 an application for exemption must be filed with the assessing 2 authority not later than February 1 of the assessment year for 3 which the exemption is sought. Upon the filing and allowance 4 of the claim, the claim shall be allowed on the property for 5 successive years without further filing as long as the property 6 continues to qualify for the exemption. 7 Sec. 2. Section 428.4, subsection 1, Code 2018, is amended 8 to read as follows: 9 1. Property shall be assessed for taxation each year. 10 Real estate shall be listed and assessed in 1981 and every 11 two years thereafter. The assessment of real estate shall 12 be the value of the real estate as of January 1 of the year 13 of the assessment. The year 1981 and each odd-numbered year 14 thereafter shall be a reassessment year. In any even-numbered 15 year, after the year in which an assessment has been made 16 of all the real estate in an assessing jurisdiction, the 17 assessor shall value and assess or revalue and reassess, as 18 the case may require, any individual real estate parcel that 19 the assessor finds was incorrectly valued or assessed for more 20 than the value authorized by law , or was not listed , valued, 21 and assessed, in the assessment year immediately preceding, 22 also any real estate the assessor finds has changed in value 23 subsequent to January 1 of the preceding real estate assessment 24 year in accordance with subsection 3 . However, a percentage 25 increase on a class of property shall not be made in a year 26 not subject to an equalization order unless ordered by the 27 department of revenue , and any such increase must apply to 28 all property within the class . A percentage increase for an 29 even-numbered year shall be applied to all property within the 30 class and shall not be applied only to a subset of the class 31 unless approved by the department of revenue. The assessor 32 shall determine the actual value and compute the taxable value 33 thereof as of January 1 of the year of the revaluation and 34 reassessment of all real estate . The assessment shall be 35 -2- LSB 6071YH (3) 87 md/jh 2/ 8

H.F. 2373 completed as specified in section 441.28 , but no reduction or 1 increase in actual value shall be made for prior years. If an 2 assessor makes a change in the valuation of the real estate as 3 provided for, sections 441.23 , 441.37 , 441.37A , 441.37B , and 4 441.38 apply. 5 Sec. 3. Section 441.21, subsection 3, Code 2018, is amended 6 to read as follows: 7 3. a. “Actual value” , “taxable value” , or “assessed value” 8 as used in other sections of the Code in relation to assessment 9 of property for taxation shall mean the valuations as 10 determined by this section ; however . However , other provisions 11 of the Code providing special methods or formulas for assessing 12 or valuing specified property shall remain in effect, but this 13 section shall be applicable to the extent consistent with such 14 provisions. The assessor and department of revenue shall 15 disclose at the written request of the taxpayer all information 16 in any formula or method used to determine the actual value of 17 the taxpayer’s property. 18 b. (1) For assessment years beginning before January 19 1, 2018, the burden of proof shall be upon any complainant 20 attacking such valuation as excessive, inadequate, inequitable, 21 or capricious. However, in protest or appeal proceedings when 22 the complainant offers competent evidence by at least two 23 disinterested witnesses that the market value of the property 24 is less than the market value determined by the assessor, the 25 burden of proof thereafter shall be upon the officials or 26 persons seeking to uphold such valuation to be assessed. 27 (2) For the assessment years year beginning on or after 28 January 1, 2018, the burden of proof shall be upon any 29 complainant attacking such valuation as excessive, inadequate, 30 inequitable, or capricious. However, in protest or appeal 31 proceedings when the complainant offers competent evidence 32 that the market value of the property is different than the 33 market value determined by the assessor, the burden of proof 34 thereafter shall be upon the officials or persons seeking to 35 -3- LSB 6071YH (3) 87 md/jh 3/ 8

H.F. 2373 uphold such valuation to be assessed. 1 (3) For assessment years beginning on or after January 1, 2 2019, when a valuation is attacked by a complainant, the burden 3 of proof shall be upon the office of assessor to demonstrate 4 that such valuation is not excessive, inadequate, inequitable, 5 or capricious. 6 (3) (4) If the classification of a property has been 7 previously adjudicated by the property assessment appeal board 8 or a court as part of an appeal under this chapter , there 9 is a presumption that the classification of the property has 10 not changed for each of the four subsequent assessment years, 11 unless a subsequent such adjudication of the classification of 12 the property has occurred, and the burden of demonstrating a 13 change in use shall be upon the person asserting a change to 14 the property’s classification. 15 Sec. 4. Section 441.37A, subsection 3, paragraph e, Code 16 2018, is amended to read as follows: 17 e. Each Except as provided in section 441.40A, each party 18 to the appeal shall be responsible for the costs of the appeal 19 incurred by that party. 20 Sec. 5. NEW SECTION . 441.40A Reimbursement of owner or 21 taxpayer reasonable costs. 22 1. a. If the amount of a property’s assessment following 23 disposition of all protests or appeals for an assessment year 24 is less than the amount of the assessment specified on the 25 assessment roll provided to the owner or taxpayer under section 26 441.26, the office of assessor shall reimburse a percentage of 27 the property owner’s or aggrieved taxpayer’s reasonable costs 28 incurred in all such protests or appeals, excluding those costs 29 apportioned to the board of review or a taxing body pursuant to 30 section 441.40, if any, equal to the percentage by which the 31 assessment is reduced. 32 b. The property owner or aggrieved taxpayer may request 33 reimbursement from the office of assessor for such reasonable 34 costs on a form prescribed by the department of revenue. Upon 35 -4- LSB 6071YH (3) 87 md/jh 4/ 8

H.F. 2373 receipt of a reimbursement request under this section, such 1 reimbursement amounts shall be paid from the assessment expense 2 fund under section 441.16. 3 2. For purposes of this section, costs include but are not 4 limited to legal fees, appraisal fees, and witness fees. 5 3. The requirement to reimburse a percentage of a property 6 owner’s or aggrieved taxpayer’s reasonable costs shall not 7 apply to costs incurred by the property owner or aggrieved 8 taxpayer for the first assessment year beginning on or after 9 January 1, 2019, for which the owner or taxpayer protests or 10 appeals the assessment of the property and a reduction in the 11 assessment occurs as provided in subsection 1. 12 Sec. 6. Section 441.41, Code 2018, is amended to read as 13 follows: 14 441.41 Legal counsel. 15 In the case of cities having an assessor, the city legal 16 department shall represent the assessor and board of review 17 in all litigation dealing with assessments. In the case of 18 counties, the county attorney shall represent the assessor and 19 board of review in all litigation dealing with assessments. 20 Any taxing district interested in the taxes received from such 21 assessments may be represented by an attorney and shall be 22 required to appear by attorney upon written request of the 23 assessor to the presiding officer of any such taxing district. 24 The Subject to review and approval by the city legal department 25 or the county attorney, as applicable, the conference board may 26 employ special counsel to assist the city legal department or 27 county attorney as the case may be , including employing special 28 counsel if the city legal department or county attorney is 29 disqualified because of a conflict of interest . 30 Sec. 7. IMPLEMENTATION. Section 25B.7 shall not apply to 31 the amendment to section 427.1, subsection 21A, in this Act. 32 EXPLANATION 33 The inclusion of this explanation does not constitute agreement with 34 the explanation’s substance by the members of the general assembly. 35 -5- LSB 6071YH (3) 87 md/jh 5/ 8

H.F. 2373 This bill relates to property taxation by modifying 1 provisions relating to assessment and exemption of certain 2 property, modifying provisions relating to property assessment 3 appeals, and providing for the reimbursement of certain appeal 4 costs. 5 Current law provides an exemption from property taxation 6 for dwelling unit property owned and managed by a nonprofit 7 community housing development organization if the organization 8 owns and manages more than 150 dwelling units located in a city 9 with a population of more than 110,000. The bill authorizes a 10 similar property tax exemption for assessment years beginning 11 on or after January 1, 2019, for dwelling unit property that 12 is constructed or substantially rehabilitated on or after July 13 1, 2018, if the property is owned, managed, or controlled 14 by a community housing development organization that owns 15 and manages more than 150 dwelling units. The exemption 16 established in the bill does not include a city population 17 requirement and provides that the exemption is allowed for 18 each eligible property unless specifically disapproved by the 19 city if located in a city or the county if located in the 20 unincorporated area of a county. 21 The bill modifies provisions relating to even-numbered 22 assessment years by providing that the assessor shall value 23 and assess or revalue and reassess, as the case may require, 24 any individual real estate parcel that the assessor finds was 25 assessed for more than the value authorized by law or was not 26 listed in the assessment year immediately preceding, and any 27 real estate the assessor finds has changed in value subsequent 28 to January 1 of the preceding real estate assessment year 29 based on buildings erected, improvements made, or buildings or 30 improvements removed in a year after the assessment. The bill 31 also provides that a percentage increase for an even-numbered 32 assessment year shall be applied to all property within the 33 class and shall not be applied only to a subset of the class 34 unless approved by the department of revenue. 35 -6- LSB 6071YH (3) 87 md/jh 6/ 8

H.F. 2373 Current Code section 441.21(3) specifies a burden of proof 1 for taxpayer protests or appeals of property assessments made 2 by local assessors. The current standard for assessment years 3 beginning on or after January 1, 2018, is that the burden of 4 proof shall be upon any complainant attacking such valuation as 5 excessive, inadequate, inequitable, or capricious. However, 6 in protest or appeal proceedings when the complainant offers 7 competent evidence that the market value of the property is 8 different than the market value determined by the assessor, 9 the burden of proof thereafter shall be upon the officials or 10 persons seeking to uphold such valuation to be assessed. 11 The bill provides that for assessment years beginning on 12 or after January 1, 2019, when a valuation is attacked by a 13 complainant, the burden of proof shall be upon the office of 14 assessor to demonstrate that such valuation is not excessive, 15 inadequate, inequitable, or capricious. 16 Under current law generally, each party to a property tax 17 appeal is responsible for the costs of the appeal incurred 18 by that party. The bill provides that if the amount of a 19 property’s assessment following disposition of all protests 20 or appeals for an assessment year is less than the amount of 21 the assessment specified on the assessment roll, the office of 22 assessor shall reimburse a percentage of the property owner’s 23 or aggrieved taxpayer’s reasonable costs incurred in all such 24 protests or appeals, excluding those costs apportioned to the 25 board of review or a taxing body pursuant to Code section 26 441.40, if any, equal to the percentage by which the assessment 27 is reduced. The reimbursement amounts required under the 28 bill are paid from the assessment expense fund under Code 29 section 441.16. However, the bill’s requirement to reimburse 30 a percentage of a property owner’s or aggrieved taxpayer’s 31 reasonable costs shall not apply to costs incurred by the 32 property owner or aggrieved taxpayer for the first assessment 33 year beginning on or after January 1, 2019, for which the owner 34 or taxpayer protests or appeals the assessment of the property 35 -7- LSB 6071YH (3) 87 md/jh 7/ 8

H.F. 2373 and a reduction in the assessment occurs. 1 Current Code section 441.41 authorizes the conference board 2 to employ special counsel to assist the city legal department 3 or the county attorney in litigation dealing with assessments. 4 The bill provides that such authority is subject to review and 5 approval by the city legal department or the county attorney, 6 as applicable, and includes situations where the city legal 7 department or county attorney is disqualified because of a 8 conflict of interest. 9 The bill makes inapplicable Code section 25B.7 to the 10 section of the bill amending Code section 427.1(21A). Code 11 section 25B.7 provides that for a property tax credit or 12 exemption enacted on or after January 1, 1997, if a state 13 appropriation made to fund the credit or exemption is not 14 sufficient to fully fund the credit or exemption, the political 15 subdivision shall be required to extend to the taxpayer only 16 that portion of the credit or exemption estimated by the 17 department of revenue to be funded by the state appropriation. 18 -8- LSB 6071YH (3) 87 md/jh 8/ 8