House File 207 - Introduced HOUSE FILE 207 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HSB 64) A BILL FOR An Act relating to the assessment and taxation of certain 1 sanitary sewage and storm water drainage property and 2 including effective date and retroactive applicability 3 provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 1203HV (2) 90 md/jh

H.F. 207 Section 1. Section 427.1, Code 2023, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 42. Sanitary sewage or storm water drainage 3 property. Property owned or operated by a public utility, as 4 defined in section 476.1, subsection 3, that is directly and 5 primarily used for the purposes specified under section 476.1, 6 subsection 3, paragraph “d” . 7 Sec. 2. CHAPTER 476 UTILITY TARIFFS. Each public utility, 8 as defined in section 476.1, subsection 3, that owns or 9 operates property exempted from tax under this Act for the 10 assessment year beginning January 1, 2023, shall file revised 11 tariffs under chapter 476 on or before October 1, 2023, 12 to reflect the exemption provided under this Act and, if 13 applicable, provide a credit to ratepayers for the change in 14 charged rates during the applicable time period. 15 Sec. 3. IMPLEMENTATION. Section 25B.7 shall not apply to 16 this Act. 17 Sec. 4. EFFECTIVE DATE. This Act, being deemed of immediate 18 importance, takes effect upon enactment. 19 Sec. 5. RETROACTIVE APPLICABILITY. This Act applies 20 retroactively to assessment years beginning on or after January 21 1, 2023. 22 EXPLANATION 23 The inclusion of this explanation does not constitute agreement with 24 the explanation’s substance by the members of the general assembly. 25 This bill amends Code section 427.1 to establish a property 26 tax exemption for property owned or operated by a public 27 utility that is directly and primarily used for furnishing 28 sanitary sewage or storm water drainage disposal by piped 29 collection system to the public for compensation. Under the 30 bill, “public utility” means the same as defined in Code 31 section 476.1. Under Code section 421.17, the director of 32 revenue has the authority to issue rules as are necessary to 33 provide for the uniform application of the exemptions provided 34 in Code section 427.1 in all assessor jurisdictions in the 35 -1- LSB 1203HV (2) 90 md/jh 1/ 2

H.F. 207 state. 1 The bill requires public utilities that own or operate the 2 property exempted under the bill to file revised tariffs under 3 Code chapter 476 on or before October 1, 2023, to reflect the 4 exemption in the bill and, if applicable, provide a credit to 5 ratepayers. 6 The bill makes inapplicable Code section 25B.7. Code 7 section 25B.7 provides that for a property tax credit or 8 exemption enacted on or after January 1, 1997, if a state 9 appropriation made to fund the credit or exemption is not 10 sufficient to fully fund the credit or exemption, the political 11 subdivision shall be required to extend to the taxpayer only 12 that portion of the credit or exemption estimated by the 13 department of revenue to be funded by the state appropriation. 14 The bill takes effect upon enactment and applies 15 retroactively to assessment years beginning on or after January 16 1, 2023. 17 -2- LSB 1203HV (2) 90 md/jh 2/ 2