Senate File 633 - Introduced SENATE FILE 633 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO SSB 1150) A BILL FOR An Act relating to the assessment of certain subdivided real 1 property and including applicability provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 2382SV (2) 88 md/jh

S.F. 633 Section 1. Section 441.72, Code 2019, is amended to read as 1 follows: 2 441.72 Assessment of platted lots and subdivided property . 3 1. Except as provided in subsection 2 , when When a 4 subdivision plat is recorded pursuant to chapter 354 , the 5 individual lots within the subdivision plat shall not be 6 assessed in excess of the total assessment of the land as 7 acreage or unimproved property for five years after the 8 recording of the plat or continue to be assessed for taxation 9 in the manner that they were prior to subdivision and shall not 10 be assessed in excess of either the total assessment of the 11 land as acreage or unimproved property or the total assessment 12 under the lot’s use prior to subdivision, as applicable, until 13 the lot is actually improved with permanent construction , 14 whichever occurs first . When an individual lot has been 15 improved with permanent construction, the lot shall be assessed 16 for taxation purposes as provided in chapter 428 and this 17 chapter . 18 2. For subdivision plats recorded pursuant to chapter 19 354 on or after January 1, 2004, but before January 1, 2011, 20 the individual lots within the subdivision plat shall not 21 be assessed in excess of the total assessment of the land 22 as acreage or unimproved property for eight years after the 23 recording of the plat or until the lot is actually improved 24 with permanent construction, whichever occurs first. When an 25 individual lot has been improved with permanent construction, 26 the lot shall be assessed for taxation purposes as provided in 27 chapter 428 and this chapter . 28 3. 2. This section does not apply to special assessment 29 levies. 30 Sec. 2. REPEAL. Section 405.1, Code 2019, is repealed. 31 Sec. 3. IMPLEMENTATION. 32 1. This Act shall not be construed to require the refund 33 or modification of property taxes that are attributable to 34 assessment years beginning before January 1, 2020, or the 35 -1- LSB 2382SV (2) 88 md/jh 1/ 3

S.F. 633 adjustment of property assessments for assessment years 1 beginning before January 1, 2020. 2 2. Ordinances adopted under section 405.1 in effect on the 3 effective date of this Act shall be invalid for purposes of 4 assessment years beginning on or after January 1, 2020. 5 Sec. 4. APPLICABILITY. This Act applies to assessment years 6 beginning on or after January 1, 2020. 7 EXPLANATION 8 The inclusion of this explanation does not constitute agreement with 9 the explanation’s substance by the members of the general assembly. 10 This bill relates to the assessment of certain subdivided 11 real property. 12 The bill repeals Code section 405.1, which authorizes a 13 county board of supervisors to adopt an ordinance providing 14 that property acquired and subdivided for development of 15 housing shall continue to be assessed for taxation in the 16 manner that it was prior to the acquisition for housing until 17 the lot is sold for construction or occupancy of housing or 18 five years from the date of subdivision, whichever is shorter. 19 Code section 405.1 also authorizes time extensions of certain 20 ordinances that affect the assessment of property subdivided 21 for development of housing and authorizes the time extensions 22 of certain ordinances by counties and by cities in the portion 23 of the applicable area located in the incorporated area of 24 the city. Additionally, the Code section authorizes cities 25 and counties to adopt, amend, or extend such ordinances and 26 provides that property acquired and subdivided for development 27 of housing shall continue to be assessed for taxation and taxed 28 in the manner it was prior to its acquisition for housing until 29 the lot is sold for construction or occupancy of housing. 30 Code section 441.72 provides that a platted lot for which 31 a subdivision plat was recorded is assessed for property tax 32 purposes as acreage or unimproved property for five years or 33 until the lot is actually improved with permanent construction, 34 whichever occurs first. However, for subdivision plats 35 -2- LSB 2382SV (2) 88 md/jh 2/ 3

S.F. 633 recorded on or after January 1, 2004, but before January 1, 1 2011, the time limit is eight years. 2 The bill strikes the portions of Code section 441.72 3 relating to the five-year limitation and the eight-year 4 limitation and provides that when a subdivision plat is 5 recorded, the individual lots within the subdivision plat 6 shall continue to be assessed for taxation in the manner that 7 they were prior to subdivision and shall not be assessed in 8 excess of either the total assessment of the land as acreage or 9 unimproved property or the total assessment under the lot’s use 10 prior to subdivision, as applicable, until the lot is actually 11 improved with permanent construction. 12 The bill shall not be construed to require the refund 13 or modification of property taxes that are attributable to 14 assessment years beginning before January 1, 2020, or the 15 adjustment of property assessments for assessment years 16 beginning before January 1, 2020. The bill also provides that 17 local ordinances adopted under existing Code section 405.1 18 in effect on the effective date of the bill are invalid for 19 purposes of assessment years beginning on or after January 1, 20 2020. 21 The bill applies to assessment years beginning on or after 22 January 1, 2020. 23 -3- LSB 2382SV (2) 88 md/jh 3/ 3