House File 643 - Introduced HOUSE FILE 643 BY COMMITTEE ON AGRICULTURE (SUCCESSOR TO HF 395) A BILL FOR An Act relating to determinations of actual value of certain 1 agricultural property based on productivity and net earning 2 capacity. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1176HV (1) 89 md/jh

H.F. 643 Section 1. Section 441.21, subsection 1, paragraph e, Code 1 2021, is amended to read as follows: 2 e. (1) The actual value of agricultural property shall 3 be determined on the basis of productivity and net earning 4 capacity of the property determined on the basis of its use 5 for agricultural purposes capitalized at a rate of seven 6 percent and applied uniformly among counties and among classes 7 of property. Any formula or method employed to determine 8 productivity and net earning capacity of property shall be 9 adopted in full by rule. 10 (2) For assessment years beginning on or after January 11 1, 2022, in addition to adjustments to productivity and net 12 earning capacity based on the per acre drainage and levee 13 district taxes in the county assessed under chapter 468 in the 14 rules adopted by the department under subparagraph (1), the 15 actual value of each acre of agricultural property subject 16 to drainage and levee district taxes for the assessment year 17 shall be reduced by an amount equal to the difference, but 18 not less than zero, between the actual per acre drainage and 19 levee district taxes imposed on the property for the assessment 20 year minus the per acre drainage and levee district taxes in 21 the county used to determine productivity and net earning 22 capacity for the assessment year under the rules adopted by the 23 department under subparagraph (1). 24 EXPLANATION 25 The inclusion of this explanation does not constitute agreement with 26 the explanation’s substance by the members of the general assembly. 27 Code section 441.21 provides that the actual value of 28 agricultural property shall be determined on the basis 29 of productivity and net earning capacity of the property 30 determined on the basis of its use for agricultural purposes 31 capitalized at a rate of 7 percent and applied uniformly among 32 counties and among classes of property. 33 This bill provides that for assessment years beginning 34 on or after January 1, 2022, in addition to adjustments to 35 -1- LSB 1176HV (1) 89 md/jh 1/ 2

H.F. 643 productivity and net earning capacity based on the per acre 1 drainage and levee district taxes in the county assessed under 2 Code chapter 468, the actual value of each acre of agricultural 3 property subject to drainage and levee district taxes for the 4 assessment year shall be reduced by an amount equal to the 5 difference, but not less than zero, between the actual per 6 acre drainage and levee district taxes imposed on the property 7 for the assessment year minus the per acre drainage and levee 8 district taxes in the county used to determine productivity and 9 net earning capacity for the assessment year. 10 -2- LSB 1176HV (1) 89 md/jh 2/ 2