S.F. 2388 Section 1. Section 29C.24, subsection 3, paragraph a, 1 subparagraph (6), Code 2018, is amended to read as follows: 2 (6) The assessment of property taxes by the department 3 of revenue under sections 428.24 through 428.26 , 428.28 , and 4 428.29 , or chapters 433 , 434 , 435 , and 437 through 438 , or by 5 a local assessor under another provision of law, on property 6 brought into the state to aid in the performance of disaster 7 or emergency-related work during a disaster response period if 8 such property does not remain in the state after the conclusion 9 of the disaster response period. 10 Sec. 2. Section 331.401, subsection 1, paragraph k, Code 11 2018, is amended to read as follows: 12 k. Levy taxes as certified to it by tax-certifying bodies 13 in the county, in accordance with the statutes authorizing the 14 levies and in accordance with chapter 24 and sections 444.1 to 15 444.8 , and levy taxes as required in chapters 433 , 434 , 437 , 16 and 438 . 17 Sec. 3. Section 331.427, subsection 1, unnumbered paragraph 18 1, Code 2018, is amended to read as follows: 19 Except as otherwise provided by state law, county revenues 20 from taxes and other sources for general county services shall 21 be credited to the general fund of the county, including 22 revenues received under sections 9I.11 , 101A.3 , 101A.7 , 123.36 , 23 123.143 , 142D.9 , 176A.8 , 321.105 , 321.152 , 321G.7 , 321I.8 , 24 section 331.554, subsection 6 , sections 341A.20 , 364.3 , 368.21 , 25 423A.7 , 428A.8 , 433.15 , 434.19 , 445.57 , 453A.35 , 458A.21 , 26 483A.12 , 533.329 , 556B.1 , 583.6 , 602.8108 , 904.908 , and 906.17 , 27 and the following: 28 Sec. 4. Section 331.512, subsection 7, Code 2018, is amended 29 by striking the subsection. 30 Sec. 5. Section 331.559, subsection 17, Code 2018, is 31 amended by striking the subsection. 32 Sec. 6. Section 427.1, subsection 2, Code 2018, is amended 33 to read as follows: 34 2. Municipal and military property. The property of a 35 -1- LSB 5182SV (2) 87 md/rn 1/ 14

S.F. 2388 county, township, city, school corporation, levee district, 1 drainage district, district organized under chapter 357E , or 2 the Iowa national guard, when devoted to public use and not 3 held for pecuniary profit, except property of a municipally 4 owned electric utility held under joint ownership and property 5 of an electric power facility financed under chapter 28F or 6 476A that shall be subject to taxation under chapter 437A 7 and facilities of a municipal utility that are used for the 8 provision of local exchange services pursuant to chapter 476 , 9 but only to the extent such facilities are used to provide such 10 services , which shall be subject to taxation under chapter 433 , 11 except that section 433.11 shall not apply . The exemption for 12 property owned by a city or county also applies to property 13 which is operated by a city or county as a library, art 14 gallery or museum, conservatory, botanical garden or display, 15 observatory or science museum, or as a location for holding 16 athletic contests, sports or entertainment events, expositions, 17 meetings or conventions, or leased from the city or county for 18 any such purposes, or leased from the city or county by the 19 Iowa national guard or by a federal agency for the benefit of 20 the Iowa national guard when devoted for public use and not 21 for pecuniary profit. Food and beverages may be served at the 22 events or locations without affecting the exemptions, provided 23 the city has approved the serving of food and beverages on the 24 property if the property is owned by the city or the county 25 has approved the serving of food and beverages on the property 26 if the property is owned by the county. The exemption for 27 property owned by a city or county also applies to property 28 which is located at an airport and leased to a fixed base 29 operator providing aeronautical services to the public. 30 Sec. 7. Section 427.1, subsection 40, paragraph a, Code 31 2018, is amended to read as follows: 32 a. The owner of broadband infrastructure shall be entitled 33 to an exemption from taxation to the extent provided in this 34 subsection for assessment years beginning before January 35 -2- LSB 5182SV (2) 87 md/rn 2/ 14

S.F. 2388 1, 2019 . For the purposes of this subsection , “broadband 1 infrastructure” and “targeted service area” mean the same as 2 defined in section 8B.1 . 3 Sec. 8. Section 427.1, subsection 40, Code 2018, is amended 4 by adding the following new paragraph: 5 NEW PARAGRAPH . i. This subsection is repealed July 1, 2021. 6 Sec. 9. Section 427A.1, subsection 1, paragraphs c and d, 7 Code 2018, are amended to read as follows: 8 c. Buildings, structures or improvements, any of which are 9 constructed on or in the land, attached to the land, or placed 10 upon a foundation whether or not attached to the foundation. 11 However, property taxed under chapter 435 , and property that is 12 a concrete batch plant as that term is defined in subsection 13 4 , and property that is transmission property as defined in 14 subsection 6A shall not be assessed and taxed as real property. 15 d. Buildings, structures, equipment, machinery or 16 improvements, any of which are attached to the buildings, 17 structures, or improvements defined in paragraph “c” of this 18 subsection . However, property that is transmission property 19 as defined in subsection 6A shall not be assessed and taxed as 20 real property. 21 Sec. 10. Section 427A.1, subsection 1, paragraph h, Code 22 2018, is amended to read as follows: 23 h. Property assessed by the department of revenue pursuant 24 to sections 428.24 to 428.29 , or chapters 433 , 434 , 437 , 437A , 25 437B , and 438 . 26 Sec. 11. Section 427A.1, Code 2018, is amended by adding the 27 following new subsection: 28 NEW SUBSECTION . 6A. For purposes of this section, 29 “transmission property” means cable and wire facilities, 30 poles, aerial cable, underground cable, buried cable, 31 intrabuilding network cable, or aerial wire within the meaning 32 of and for purposes of the uniform system of accounts for 33 telecommunication companies in 47 C.F.R. pt. 32, in effect on 34 the effective date of this Act. “Transmission property” also 35 -3- LSB 5182SV (2) 87 md/rn 3/ 14

S.F. 2388 includes lines, electronic equipment, headend electronics, 1 towers, poles, aerial cable, cable drops, lasers, fiber optics, 2 underground cable, and any electronics attached thereto used to 3 provide telecommunications service, cable television signals, 4 or internet service to subscribers. 5 Sec. 12. Section 427B.17, subsection 8, paragraph a, Code 6 2018, is amended to read as follows: 7 a. This section shall not apply to property assessed by the 8 department of revenue pursuant to sections 428.24 to 428.29 , or 9 chapters 433 , 434 , 437 , 437A , 437B , and 438 , and such property 10 shall not receive the benefits of this section . 11 Sec. 13. Section 429.1, Code 2018, is amended to read as 12 follows: 13 429.1 Notice of assessment. 14 The department of revenue shall, at the time of making 15 the assessment of property as provided in chapters 428 , 433 , 16 434 , 437 , and 438 , inform the person assessed, by mail, of 17 the valuation put upon the taxpayer’s property. The notice 18 shall contain a notice of the taxpayer’s right of appeal to the 19 director of revenue as provided in section 429.2 . 20 Sec. 14. NEW SECTION . 433.16 Applicability —— future 21 repeal. 22 1. This chapter applies to the assessment and taxation of 23 telephone and telegraph company property for assessment years 24 beginning before January 1, 2019. 25 2. This chapter is repealed on July 1, 2021. 26 Sec. 15. Section 437.15, Code 2018, is amended to read as 27 follows: 28 437.15 Reassessment —— procedure and requirements. 29 Sections 433.14 , and 433.15 , Code 2018, and sections 439.1 , 30 and 439.2 shall apply to the property of transmission lines 31 which are referred to in section 437.2 . 32 Sec. 16. Section 441.19, subsection 1, paragraph a, Code 33 2018, is amended to read as follows: 34 a. Supplemental and optional to the procedure for the 35 -4- LSB 5182SV (2) 87 md/rn 4/ 14

S.F. 2388 assessment of property by the assessor as provided in this 1 chapter , the assessor may require from all persons required 2 to list their property for taxation as provided by sections 3 428.1 and 428.2 , a supplemental return to be prescribed by 4 the director of revenue upon which the person shall list 5 the person’s property. The supplemental return shall be in 6 substantially the same form as now prescribed by law for 7 the assessment rolls used in the listing of property by the 8 assessors. However, for assessment years beginning on or after 9 January 1, 2018, and unless otherwise required for property 10 valued by the department of revenue pursuant to chapters 428 , 11 433 , 437 , and 438 , a supplemental return shall not request, 12 and a person shall not be otherwise required to provide to the 13 assessor for property assessment purposes, sales or receipts 14 data, expense data, balance sheets, bank account information, 15 or other data related to the financial condition of a business 16 operating in whole or in part on the property if the property 17 is both classified as commercial or industrial property and 18 owned and used by the owner of the business. Every person 19 required to list property for taxation shall make a complete 20 listing of the property upon supplemental forms and return the 21 listing to the assessor as promptly as possible. The return 22 shall be verified over the signature of the person making the 23 return and section 441.25 applies to any person making such 24 a return. The assessor shall make supplemental return forms 25 available as soon as practicable after the first day of January 26 of each year. The assessor shall make supplemental return 27 forms available to the taxpayer by mail, or at a designated 28 place within the taxing district. 29 Sec. 17. Section 441.21, subsection 2, Code 2018, is amended 30 to read as follows: 31 2. In the event market value of the property being assessed 32 cannot be readily established in the foregoing manner, then 33 the assessor may determine the value of the property using the 34 other uniform and recognized appraisal methods including its 35 -5- LSB 5182SV (2) 87 md/rn 5/ 14

S.F. 2388 productive and earning capacity, if any, industrial conditions, 1 its cost, physical and functional depreciation and obsolescence 2 and replacement cost, and all other factors which would assist 3 in determining the fair and reasonable market value of the 4 property but the actual value shall not be determined by use 5 of only one such factor. The following shall not be taken into 6 consideration: Special value or use value of the property to 7 its present owner, and the goodwill or value of a business 8 which uses the property as distinguished from the value of 9 the property as property. In addition, for assessment years 10 beginning on or after January 1, 2018, and unless otherwise 11 required for property valued by the department of revenue 12 pursuant to chapters 428 , 433 , 437 , and 438 , the assessor 13 shall not take into consideration and shall not request from 14 any person sales or receipts data, expense data, balance 15 sheets, bank account information, or other data related to 16 the financial condition of a business operating in whole or 17 in part on the property if the property is both classified as 18 commercial or industrial property and owned and used by the 19 owner of the business. However, in assessing property that 20 is rented or leased to low-income individuals and families 21 as authorized by section 42 of the Internal Revenue Code, 22 as amended, and which section limits the amount that the 23 individual or family pays for the rental or lease of units 24 in the property, the assessor shall, unless the owner elects 25 to withdraw the property from the assessment procedures for 26 section 42 property, use the productive and earning capacity 27 from the actual rents received as a method of appraisal and 28 shall take into account the extent to which that use and 29 limitation reduces the market value of the property. The 30 assessor shall not consider any tax credit equity or other 31 subsidized financing as income provided to the property in 32 determining the assessed value. The property owner shall 33 notify the assessor when property is withdrawn from section 42 34 eligibility under the Internal Revenue Code or if the owner 35 -6- LSB 5182SV (2) 87 md/rn 6/ 14

S.F. 2388 elects to withdraw the property from the assessment procedures 1 for section 42 property under this subsection . The property 2 shall not be subject to section 42 assessment procedures 3 for the assessment year for which section 42 eligibility is 4 withdrawn or an election is made. This notification must 5 be provided to the assessor no later than March 1 of the 6 assessment year or the owner will be subject to a penalty of 7 five hundred dollars for that assessment year. The penalty 8 shall be collected at the same time and in the same manner 9 as regular property taxes. An election to withdraw from the 10 assessment procedures for section 42 property is irrevocable. 11 Property that is withdrawn from the assessment procedures 12 for section 42 property shall be classified and assessed as 13 multiresidential property unless the property otherwise fails 14 to meet the requirements of section 441.21, subsection 13 . 15 Upon adoption of uniform rules by the department of revenue 16 or succeeding authority covering assessments and valuations 17 of such properties, the valuation on such properties shall be 18 determined in accordance with such rules and in accordance with 19 forms and guidelines contained in the real property appraisal 20 manual prepared by the department as updated from time to time 21 for assessment purposes to assure uniformity, but such rules, 22 forms, and guidelines shall not be inconsistent with or change 23 the foregoing means of determining the actual, market, taxable , 24 and assessed values. 25 Sec. 18. Section 441.21, subsection 5, paragraph a, Code 26 2018, is amended to read as follows: 27 a. For valuations established as of January 1, 1979, 28 property valued by the department of revenue pursuant to 29 chapters 428 , 433 , 437 , and 438 shall be considered as one 30 class of property and shall be assessed as a percentage of 31 its actual value. The percentage shall be determined by the 32 director of revenue in accordance with the provisions of this 33 section . For valuations established as of January 1, 1979, the 34 percentage shall be the quotient of the dividend and divisor 35 -7- LSB 5182SV (2) 87 md/rn 7/ 14

S.F. 2388 as defined in this section . The dividend shall be the total 1 actual valuation established for 1978 by the department of 2 revenue, plus ten percent of the amount so determined. The 3 divisor for property valued by the department of revenue 4 pursuant to chapters 428 , 433 , 437 , and 438 shall be the 5 valuation established for 1978, plus the amount of value added 6 to the total actual value by the revaluation of the property 7 by the department of revenue as of January 1, 1979. For 8 valuations established as of January 1, 1980, property valued 9 by the department of revenue pursuant to chapters 428 , 433 , 10 437 , and 438 shall be assessed at a percentage of its actual 11 value. The percentage shall be determined by the director of 12 revenue in accordance with the provisions of this section . For 13 valuations established as of January 1, 1980, the percentage 14 shall be the quotient of the dividend and divisor as defined in 15 this section . The dividend shall be the total actual valuation 16 established for 1979 by the department of revenue, plus eight 17 percent of the amount so determined. The divisor for property 18 valued by the department of revenue pursuant to chapters 428 , 19 433 , 437 , and 438 shall be the valuation established for 1979, 20 plus the amount of value added to the total actual value by the 21 revaluation of the property by the department of revenue as of 22 January 1, 1980. For valuations established as of January 1, 23 1981, and each year thereafter, the percentage of actual value 24 at which property valued by the department of revenue pursuant 25 to chapters 428 , 433 , 437 , and 438 shall be assessed shall be 26 calculated in accordance with the methods provided herein, 27 except that any references to ten percent in this subsection 28 shall be eight percent. For valuations established on or after 29 January 1, 2013, property valued by the department of revenue 30 pursuant to chapter 434 shall be assessed at a percentage of 31 its actual value equal to the percentage of actual value at 32 which property assessed as commercial property is assessed 33 under paragraph “b” for the same assessment year. 34 Sec. 19. Section 441.21, subsections 9 and 10, Code 2018, 35 -8- LSB 5182SV (2) 87 md/rn 8/ 14

S.F. 2388 are amended to read as follows: 1 9. Not later than November 1, 1979, and November 1 of each 2 subsequent year, the director shall certify to the county 3 auditor of each county the percentages of actual value at 4 which residential property, agricultural property, commercial 5 property, industrial property, multiresidential property, 6 property valued by the department of revenue pursuant to 7 chapter 434 , and property valued by the department of revenue 8 pursuant to chapters 428 , 433 , 437 , and 438 in each assessing 9 jurisdiction in the county shall be assessed for taxation. The 10 county auditor shall proceed to determine the assessed values 11 of agricultural property, residential property, commercial 12 property, industrial property, multiresidential property, 13 property valued by the department of revenue pursuant to 14 chapter 434 , and property valued by the department of revenue 15 pursuant to chapters 428 , 433 , 437 , and 438 by applying such 16 percentages to the current actual value of such property, 17 as reported to the county auditor by the assessor, and the 18 assessed values so determined shall be the taxable values of 19 such properties upon which the levy shall be made. 20 10. The percentage of actual value computed by the 21 department of revenue for agricultural property, residential 22 property, commercial property, industrial property, 23 multiresidential property, property valued by the department 24 of revenue pursuant to chapter 434 , and property valued by the 25 department of revenue pursuant to chapters 428 , 433 , 437 , and 26 438 and used to determine assessed values of those classes 27 of property does not constitute a rule as defined in section 28 17A.2, subsection 11 . 29 Sec. 20. Section 441.73, subsection 1, Code 2018, is amended 30 to read as follows: 31 1. A litigation expense fund is created in the state 32 treasury. The litigation expense fund shall be used for the 33 payment of litigation expenses incurred by the state to defend 34 property valuations established by the director of revenue 35 -9- LSB 5182SV (2) 87 md/rn 9/ 14

S.F. 2388 pursuant to section 428.24 and chapters 433 , 434 , 437 , 437A , 1 437B , and 438 , and for the payment of litigation expenses 2 incurred by the state to defend the imposition of replacement 3 taxes and statewide property taxes under chapters 437A and 4 437B . 5 Sec. 21. Section 476.1D, subsection 10, Code 2018, is 6 amended by striking the subsection. 7 Sec. 22. FUTURE ASSESSMENT YEARS. Telephone and telegraph 8 company property subject to assessment under chapter 433 for 9 assessment years beginning before January 1, 2019, shall be, 10 for assessment years beginning on or after January 1, 2019, 11 assessed by local assessors under chapters 427, 427A, 427B, 12 428, and 441, and any other applicable provision of law in the 13 same manner and on the same basis as other commercial property 14 located in the assessing jurisdiction where situated. 15 Sec. 23. SAVINGS PROVISION. This Act, pursuant to section 16 4.13, does not affect the operation of, or prohibit the 17 application of, prior provisions of chapter 433, or rules 18 adopted under chapter 17A to administer prior provisions of 19 chapter 433, for assessment years beginning before January 1, 20 2019, and for duties, powers, protests, appeals, proceedings, 21 actions, or remedies attributable to an assessment year 22 beginning before January 1, 2019. 23 Sec. 24. IMPLEMENTATION. Section 25B.7 shall not apply to 24 this Act. 25 Sec. 25. EFFECTIVE DATE. The following take effect July 1, 26 2021: 27 1. The section of this Act amending section 29C.24. 28 2. The section of this Act amending section 331.401. 29 3. The section of this Act amending section 331.427. 30 4. The section of this Act amending section 331.512. 31 5. The section of this Act amending section 331.559. 32 6. The section of this Act amending section 427.1, 33 subsection 2. 34 7. The section of this Act amending section 427A.1, 35 -10- LSB 5182SV (2) 87 md/rn 10/ 14

S.F. 2388 subsection 1, paragraph “h”. 1 8. The section of this Act amending section 427B.17. 2 9. The section of this Act amending section 429.1. 3 10. The section of this Act amending section 437.15. 4 11. The section of this Act amending section 441.19. 5 12. The section of this Act amending section 441.21, 6 subsection 2. 7 13. The section of this Act amending section 441.21, 8 subsection 5. 9 14. The section of this Act amending section 441.21, 10 subsections 9 and 10. 11 15. The section of this Act amending section 441.73. 12 Sec. 26. APPLICABILITY. The following apply to assessment 13 years beginning on or after January 1, 2019: 14 1. The section of this Act amending section 427A.1, 15 subsection 1, paragraphs “c” and “d”. 16 2. The section of this Act enacting section 427A.1, 17 subsection 6A. 18 3. The section of this Act amending section 476.1D. 19 EXPLANATION 20 The inclusion of this explanation does not constitute agreement with 21 the explanation’s substance by the members of the general assembly. 22 Current Code chapter 433 requires the department of revenue 23 to centrally assess the property of telegraph and telephone 24 companies that is used by the companies in the transaction of 25 telegraph and telephone business. The assessment conducted by 26 the department of revenue using information provided by the 27 companies is required to include all property of every kind 28 and character whatsoever, real, personal, or mixed, used by 29 the companies in the transaction of telegraph and telephone 30 business. In valuing such property, the department of revenue 31 is required to take into consideration the valuation of all 32 property of the companies, including franchises and the use of 33 the property in connection with lines outside the state, and 34 making these deductions as may be necessary on account of extra 35 -11- LSB 5182SV (2) 87 md/rn 11/ 14

S.F. 2388 value of property outside the state as compared with the value 1 of property in the state, in order that the actual value of the 2 property of the company within this state may be ascertained. 3 Code chapter 433 also provides for certain amounts of 4 property value to be exempt from taxation and establishes a 5 process by which the valuation of the company is allocated to 6 each county of the state into which the line of the company 7 extends. 8 This bill makes the current central assessment process under 9 Code chapter 433 applicable to property tax assessment years 10 beginning before January 1, 2019, and provides that telephone 11 and telegraph company property subject to assessment under Code 12 chapter 433 for assessment years beginning before January 1, 13 2019, shall be, for assessment years beginning on or after 14 January 1, 2019, assessed by local assessors in the same manner 15 and on the same basis as other commercial property located in 16 the assessing jurisdiction. 17 Code section 427A.1 requires certain property to be assessed 18 and taxed as real property, including the following: (1) 19 buildings, structures or improvements, any of which are 20 constructed on or in the land, attached to the land, or placed 21 upon a foundation whether or not attached to the foundation, 22 and (2) buildings, structures, equipment, machinery or 23 improvements, any of which are attached to the buildings, 24 structures, or improvements. The bill excludes transmission 25 property from being assessed and taxed as real property. 26 The bill defines “transmission property” as cable and wire 27 facilities, poles, aerial cable, underground cable, buried 28 cable, intrabuilding network cable, or aerial wire within the 29 meaning of and for purposes of the uniform system of accounts 30 for telecommunications companies in 47 C.F.R. pt. 32, in effect 31 on the effective date of the bill. “Transmission property” 32 also includes lines, electronic equipment, headend electronics, 33 towers, poles, aerial cable, cable drops, lasers, fiber optics, 34 underground cable, and any electronics attached thereto used to 35 -12- LSB 5182SV (2) 87 md/rn 12/ 14

S.F. 2388 provide telecommunications service, cable television signals, 1 or internet service to subscribers. 2 By operation of law, the removal of telecommunications 3 company property from assessment by the department of 4 revenue under Code chapter 433 and subsequent repeal of Code 5 chapter 433 removes the sale price from the sale of certain 6 telecommunications company machinery, equipment, and computers 7 from the provision of Code section 423.3, subsection 47, 8 paragraph “c”, subparagraph (3), that subjects such sales to 9 the state sales and use tax. 10 The bill makes corresponding changes to various provisions 11 of the Code relating to the central assessment of property 12 under Code chapter 433, sunsets a property tax exemption for 13 certain broadband infrastructure under Code section 427.1(40), 14 and strikes a provision in Code section 476.1D that allows 15 certain specified long-distance telephone company property to 16 be assessed for taxation as commercial property by the local 17 assessor. 18 The bill, pursuant to Code section 4.13, does not affect the 19 operation of, or prohibit the application of, prior provisions 20 of Code chapter 433, or rules adopted under Code chapter 17A to 21 administer prior provisions of Code chapter 433, for assessment 22 years beginning before January 1, 2019, and for duties, 23 powers, protests, appeals, proceedings, actions, or remedies 24 attributable to an assessment year beginning before January 1, 25 2019. 26 The bill provides that the provisions in Code section 25B.7, 27 relating to the obligation of the state to reimburse local 28 jurisdictions for property tax credits and exemptions, do not 29 apply to the bill. 30 The bill repeals Code chapter 433 on July 1, 2021, and makes 31 several corresponding amendment changes effective on July 1, 32 2021. 33 The sections of the bill amending Code section 427A.1, 34 subsection 1, paragraphs “c” and “d”, enacting Code section 35 -13- LSB 5182SV (2) 87 md/rn 13/ 14