Senate Study Bill 3207 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON DAWSON) A BILL FOR An Act relating to state and local finances by modifying 1 individual and alternate income tax rates, withholding 2 credits, franchise tax deductions, methodologies for 3 determining property taxes, and property tax assessment 4 limitations, changing methods of determining compensation 5 of county officials, making contingent transfers from the 6 taxpayer relief fund, and making corrections, and including 7 effective date and applicability provisions. 8 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 9 TLSB 6385XC (8) 90 jm/jh

S.F. _____ DIVISION I 1 SINGLE INDIVIDUAL AND ALTERNATE INCOME TAX RATES BEGINNING IN 2 TAX YEAR 2025 3 Section 1. Section 421.27, subsection 9, paragraph a, 4 subparagraph (3), Code 2024, is amended to read as follows: 5 (3) In the case of all other entities, including 6 corporations described in section 422.36, subsection 5 , and all 7 other entities required to file an information return under 8 section 422.15, subsection 2 , the entity’s Iowa net income 9 after the application of the Iowa business activity ratio, 10 if applicable, multiplied by the top income tax rate imposed 11 under section 422.5A 422.5 for the tax year, less any Iowa tax 12 credits available to the entity. 13 Sec. 2. Section 422.5, subsection 1, paragraph a, Code 2024, 14 is amended to read as follows: 15 a. A tax is imposed upon every resident and nonresident 16 of the state which tax shall be levied, collected, and paid 17 annually upon and with respect to the entire taxable income 18 as defined in this subchapter at rates as provided in section 19 422.5A a rate of three and eight-tenths percent . 20 Sec. 3. Section 422.5, subsection 2, paragraph b, Code 2024, 21 is amended to read as follows: 22 b. (1) In lieu of the computation in subsection 1 , or 23 in paragraph “a” of this subsection , if the married persons’ 24 filing jointly, head of household’s, or surviving spouse’s net 25 income exceeds thirteen thousand five hundred dollars, the 26 regular tax imposed under this subchapter shall be the lesser 27 of the alternate state individual income tax rate specified in 28 subparagraph (2) of four and three-tenths percent times the 29 portion of the net income in excess of thirteen thousand five 30 hundred dollars or the regular tax liability computed without 31 regard to this sentence. Taxpayers electing to file separately 32 shall compute the alternate tax described in this paragraph 33 using the total net income of the spouses. The alternate tax 34 described in this paragraph does not apply if one spouse elects 35 -1- LSB 6385XC (8) 90 jm/jh 1/ 49

S.F. _____ to carry back or carry forward a net operating loss as provided 1 under the Internal Revenue Code or in section 422.9 . 2 (2) (a) (i) (A) For the tax year beginning on or after 3 January 1, 2023, but before January 1, 2024, the alternate tax 4 rate is 6.00 percent. 5 (B) For the tax year beginning on or after January 1, 2024, 6 but before January 1, 2025, the alternate tax rate is 5.70 7 percent. 8 (C) For the tax year beginning on or after January 1, 2025, 9 but before January 1, 2026, the alternate tax rate is 5.20 10 percent. 11 (ii) This subparagraph division (a) is repealed January 1, 12 2026. 13 (b) For tax years beginning on or after January 1, 2026, the 14 alternate tax rate is 4.40 percent. 15 Sec. 4. Section 422.5, subsection 3, paragraph b, Code 2024, 16 is amended to read as follows: 17 b. (1) In lieu of the computation in subsection 1 or 2 , 18 if the married persons’ filing jointly, head of household’s, 19 or surviving spouse’s net income exceeds thirty-two thousand 20 dollars, the regular tax imposed under this subchapter shall be 21 the lesser of the alternate state individual income tax rate 22 specified in subparagraph (2) of four and three-tenths percent 23 times the portion of the net income in excess of thirty-two 24 thousand dollars or the regular tax liability computed without 25 regard to this sentence. Taxpayers electing to file separately 26 shall compute the alternate tax described in this paragraph 27 using the total net income of the spouses. The alternate tax 28 described in this paragraph does not apply if one spouse elects 29 to carry back or carry forward a net operating loss as provided 30 under the Internal Revenue Code or in section 422.9 . 31 (2) (a) (i) (A) For the tax year beginning on or after 32 January 1, 2023, but before January 1, 2024, the alternate tax 33 rate is 6.00 percent. 34 (B) For the tax year beginning on or after January 1, 2024, 35 -2- LSB 6385XC (8) 90 jm/jh 2/ 49

S.F. _____ but before January 1, 2025, the alternate tax rate is 5.70 1 percent. 2 (C) For the tax year beginning on or after January 1, 2025, 3 but before January 1, 2026, the alternate tax rate is 5.20 4 percent. 5 (ii) This subparagraph division (a) is repealed January 1, 6 2026. 7 (b) For tax years beginning on or after January 1, 2026, the 8 alternate tax rate is 4.40 percent. 9 Sec. 5. Section 422.5, subsection 6, Code 2024, is amended 10 by striking the subsection. 11 Sec. 6. Section 422.16, subsection 2, paragraph e, Code 12 2024, is amended to read as follows: 13 e. For the purposes of this subsection , state income tax 14 shall be withheld at the highest rate described in section 15 422.5A 422.5 from supplemental wages of an employee in those 16 circumstances in which the employer treats the supplemental 17 wages as wholly separate from regular wages for purposes 18 of withholding and federal income tax is withheld from the 19 supplemental wages under section 3402(g) of the Internal 20 Revenue Code. 21 Sec. 7. Section 422.16B, subsection 2, paragraph a, Code 22 2024, is amended to read as follows: 23 a. (1) A pass-through entity shall file a composite return 24 on behalf of all nonresident members and shall report and pay 25 the income or franchise tax imposed under this chapter at the 26 maximum state income or franchise tax rate applicable to the 27 member under section 422.5A 422.5 , 422.33 , or 422.63 on the 28 nonresident members’ distributive shares of the income from the 29 pass-through entity. 30 (2) The tax rate applicable to a tiered pass-through entity 31 shall be the maximum state income tax rate under section 422.5A 32 422.5 . 33 Sec. 8. Section 422.16C, subsection 4, paragraph a, Code 34 2024, is amended to read as follows: 35 -3- LSB 6385XC (8) 90 jm/jh 3/ 49

S.F. _____ a. A taxpayer making an election under this section shall 1 be subject to tax in an amount equal to the maximum rate under 2 section 422.5A 422.5 , imposed against the taxable income of the 3 taxpayer for the taxable year properly determined under this 4 chapter and allocated and apportioned to the state under the 5 rules adopted by the department. The tax shall be due with the 6 taxpayer’s return required under this chapter . 7 Sec. 9. Section 422.16C, subsection 5, paragraph a, 8 subparagraph (2), Code 2024, is amended to read as follows: 9 (2) The difference between one hundred percent and the 10 highest individual income tax rate in effect for the tax year. 11 Sec. 10. Section 422.21, subsection 5, Code 2024, is amended 12 to read as follows: 13 5. The director shall determine for the 2023 calendar year 14 and each subsequent calendar year the annual and cumulative 15 inflation factors for each calendar year to be applied to tax 16 years beginning on or after January 1 of that calendar year. 17 The director shall compute the new dollar amounts as specified 18 to be adjusted in section 422.5 by the latest cumulative 19 inflation factor and round off the result to the nearest one 20 dollar. The annual and cumulative inflation factors determined 21 by the director are not rules as defined in section 17A.2, 22 subsection 11 . 23 Sec. 11. Section 422.25A, subsection 5, paragraph c, 24 subparagraphs (3), (4), and (5), Code 2024, are amended to read 25 as follows: 26 (3) Determine the total distributive share of all final 27 federal partnership adjustments and positive reallocation 28 adjustments as modified by this title that are reported to 29 nonresident individual partners and nonresident fiduciary 30 partners and allocate and apportion such adjustments as 31 provided in section 422.33 at the partnership or tiered partner 32 level, and multiply the resulting amount by the maximum highest 33 individual income tax rate pursuant to section 422.5A for the 34 reviewed year. 35 -4- LSB 6385XC (8) 90 jm/jh 4/ 49

S.F. _____ (4) For the total distributive share of all final federal 1 partnership adjustments and positive reallocation adjustments 2 as modified by this title that are reported to tiered partners: 3 (a) Determine the amount of such adjustments which are of a 4 type that would be subject to sourcing to Iowa under section 5 422.8, subsection 2 , paragraph “a” , as a nonresident, and then 6 determine the portion of this amount that would be sourced to 7 Iowa under those provisions as if the tiered partner were a 8 nonresident. 9 (b) Determine the amount of such adjustments which are of 10 a type that would not be subject to sourcing to Iowa under 11 section 422.8, subsection 2 , paragraph “a” , as a nonresident. 12 (c) Determine the portion of the amount in subparagraph 13 division (b) that can be established, as prescribed by the 14 department by rule, to be properly allocable to indirect 15 partners that are nonresident partners or other partners not 16 subject to tax on the adjustments. 17 (d) Multiply the total of the amounts determined in 18 subparagraph divisions (a) and (b), reduced by any amount 19 determined in subparagraph division (c), by the highest 20 individual income tax rate pursuant to section 422.5A for the 21 reviewed year. 22 (5) For the total distributive share of all final federal 23 partnership adjustments and positive reallocation adjustments 24 as modified by this title that are reported to resident 25 individual partners and resident fiduciary partners, multiply 26 that amount by the highest individual income tax rate pursuant 27 to section 422.5A for the reviewed year. 28 Sec. 12. RATE OF WITHHOLDING. Notwithstanding any other 29 provision of law to the contrary, for tax years beginning on 30 or after January 1, 2025, any required rate of withholding 31 shall not be higher than the rate for the applicable tax year 32 pursuant to section 422.5 as amended by this division of this 33 Act. 34 Sec. 13. REPEAL. 2022 Iowa Acts, chapter 1002, sections 19, 35 -5- LSB 6385XC (8) 90 jm/jh 5/ 49

S.F. _____ 20, 21, 22, 23, and 24, are repealed. 1 Sec. 14. REPEAL. 2023 Iowa Acts, chapter 115, sections 20 2 and 21, are repealed. 3 Sec. 15. REPEAL. Section 422.5A, Code 2024, is repealed. 4 Sec. 16. EFFECTIVE DATE. This division of this Act takes 5 effect January 1, 2025. 6 Sec. 17. APPLICABILITY. This division of this Act applies 7 to tax years beginning on or after January 1, 2025. 8 DIVISION II 9 TARGETED JOBS WITHHOLDING CREDIT 10 Sec. 18. Section 403.19A, subsection 3, paragraph c, 11 subparagraphs (1) and (2), Code 2024, are amended to read as 12 follows: 13 (1) The pilot project city and the economic development 14 authority shall enter into a withholding agreement with each 15 employer concerning the targeted jobs withholding credit. The 16 withholding agreement shall provide for the total amount of 17 withholding credits awarded, as negotiated by the economic 18 development authority, the pilot project city, and the 19 employer. An agreement shall not provide for an amount of 20 withholding credits that exceeds the amount of the qualifying 21 investment made in the project. An agreement shall not be 22 entered into with a business currently located in this state 23 unless the business either creates or retains ten jobs or makes 24 a qualifying investment of at least five hundred thousand 25 one million dollars within the pilot project city. The 26 withholding agreement may have a term of years negotiated by 27 the economic development authority, the pilot project city, 28 and the employer, of up to ten years. A withholding agreement 29 specifying a term of years or a total amount of withholding 30 credits shall terminate upon the expiration of the term of 31 years specified in the agreement or upon the award of the total 32 amount of withholding credits specified in the agreement, 33 whichever occurs first. An employer shall not be obligated to 34 enter into a withholding agreement. An agreement shall not be 35 -6- LSB 6385XC (8) 90 jm/jh 6/ 49

S.F. _____ entered into with an employer not already located in a pilot 1 project city when another Iowa community is competing for the 2 same project and both the pilot project city and the other Iowa 3 community are seeking assistance from the authority. 4 (2) The pilot project city and the economic development 5 authority shall not enter into a withholding agreement after 6 June 30, 2024 2027 . 7 Sec. 19. Section 403.19A, subsection 3, paragraph f, Code 8 2024, is amended to read as follows: 9 f. Pursuant to rules adopted by the economic development 10 authority, the pilot project city employer shall provide on an 11 annual basis to the economic development authority information 12 documenting the employer’s compliance of each employer with 13 each requirement of the withholding agreement, including but 14 not limited to the number of jobs created or retained and 15 the amount of investment made by the employer. The economic 16 development authority shall, in response to receiving such 17 information from the pilot project city employer , assess the 18 level of compliance by each employer and provide to the pilot 19 project city recommendations for either maintaining employer 20 compliance with the withholding agreement or terminating the 21 agreement for noncompliance under paragraph “g” . The economic 22 development authority shall also provide each such assessment 23 and recommendation report to the department of revenue. 24 DIVISION III 25 FRANCHISE TAX —— INVESTMENT SUBSIDIARIES 26 Sec. 20. Section 422.34, subsection 1, Code 2024, is amended 27 to read as follows: 28 1. All state, national, private, cooperative, and savings 29 banks, credit unions, title insurance and trust companies, 30 federally chartered savings and loan associations, production 31 credit associations, insurance companies or insurance 32 associations, reciprocal or inter-insurance exchanges, and 33 fraternal beneficiary associations , and investment subsidiaries 34 included on a return due to an election under section 422.60, 35 -7- LSB 6385XC (8) 90 jm/jh 7/ 49

S.F. _____ subsection 1, paragraph “b” . 1 Sec. 21. Section 422.60, subsection 1, Code 2024, is amended 2 to read as follows: 3 1. a. A franchise tax according to and measured by net 4 income is imposed on financial institutions for the privilege 5 of doing business in this state as financial institutions. 6 b. (1) A financial institution with an investment 7 subsidiary may elect under the regulations of the director to 8 include the income and expenses of an investment subsidiary 9 on the franchise tax return for the purpose of imposing the 10 franchise tax in paragraph “a” . 11 (2) An election made under this paragraph shall require 12 the inclusion of the income and expenses of the investment 13 subsidiary on all subsequent returns of the financial 14 institution so long as the investment subsidiary remains a 15 subsidiary of the financial institution unless the director 16 determines that the filing of separate returns will more 17 clearly disclose the taxable income of the investment 18 subsidiary or financial institution. This determination shall 19 be made after specific request by the taxpayer for the filing 20 of separate returns. 21 Sec. 22. Section 422.61, subsection 3, paragraph f, Code 22 2024, is amended to read as follows: 23 f. (1) A Except as provided in subparagraph (2), a 24 deduction shall not be allowed for that portion of the 25 taxpayer’s expenses computed under this paragraph which is 26 allocable to an investment in an investment subsidiary. The 27 portion of the taxpayer’s expenses which is allocable to an 28 investment in an investment subsidiary is an amount which bears 29 the same ratio to the taxpayer’s expenses as the taxpayer’s 30 average adjusted basis, as computed pursuant to section 1016 31 of the Internal Revenue Code, of investment in that investment 32 subsidiary bears to the average adjusted basis for all assets 33 of the taxpayer. The portion of the taxpayer’s expenses that 34 is computed and disallowed under this paragraph shall be added. 35 -8- LSB 6385XC (8) 90 jm/jh 8/ 49

S.F. _____ (2) A deduction shall not be disallowed and may be 1 subtracted for that portion of the taxpayer’s expenses computed 2 under this paragraph which is allocable to an investment in 3 an investment subsidiary if the taxpayer makes an election to 4 include the investment subsidiary on the same return required 5 of the taxpayer pursuant to section 422.62. 6 Sec. 23. Section 422.63, subsection 1, Code 2024, is amended 7 to read as follows: 8 1. a. The franchise tax is imposed annually in an amount 9 equal to the percent specified in subsection 2 of the net 10 income received or accrued during the taxable year. If the 11 net income of the financial institution is derived from its 12 business carried on entirely within the state, the tax shall 13 be imposed on the entire net income, but if the business is 14 carried on partly within and partly without the state, the 15 portion of net income reasonably attributable to the business 16 within the state shall be specifically allocated or equitably 17 apportioned within and without the state under rules of the 18 director. 19 b. For purposes of apportioning income within and without 20 the state, if an election is made pursuant to section 422.60, 21 subsection 1, paragraph “b” , the commercial domicile of an 22 investment subsidiary included on the return of the financial 23 institution pursuant to the election shall be that of the 24 financial institution rather than the investment subsidiary. 25 Sec. 24. EFFECTIVE DATE. This division of this Act takes 26 effect January 1, 2025. 27 Sec. 25. APPLICABILITY. This division of this Act applies 28 to tax years beginning on or after January 1, 2025. 29 DIVISION IV 30 PROPERTY TAX PROCEDURES 31 Sec. 26. Section 24.2A, subsection 2, paragraph a, Code 32 2024, is amended to read as follows: 33 a. On or before 4:00 p.m. on March 15 5 of each year, 34 each political subdivision shall file with the department 35 -9- LSB 6385XC (8) 90 jm/jh 9/ 49

S.F. _____ of management a report containing all necessary information 1 for the department of management to compile and calculate 2 amounts required to be included in the statements mailed under 3 paragraph “b” . If a county or city fails to file all necessary 4 information with the department of management by 4:00 p.m. on 5 March 5, taxes levied by the county or city shall be limited to 6 the prior year’s budget amount. 7 Sec. 27. Section 24.2A, subsection 2, paragraph b, 8 unnumbered paragraph 1, Code 2024, is amended to read as 9 follows: 10 Not later than March 20 15 , the county auditor, using 11 information compiled and calculated by the department of 12 management under paragraph “a” , shall send to each property 13 owner or taxpayer within the county by regular mail an 14 individual statement containing all of the following for 15 each of the political subdivisions comprising the owner’s or 16 taxpayer’s taxing district: 17 Sec. 28. Section 24.2A, subsection 2, paragraph b, 18 subparagraphs (5) and (6), Code 2024, are amended to read as 19 follows: 20 (5) An For the budget for the fiscal year beginning July 21 1, 2024, an example comparing the amount of property taxes on 22 a residential property with an actual value of one hundred 23 thousand dollars in the current fiscal year and such amount 24 on the residential property using the proposed property 25 tax dollars for the budget year, including the percentage 26 difference percent change in such amounts. For the budget for 27 fiscal years beginning on or after July 1, 2025, an example 28 comparing the amount of property taxes on a residential 29 property with an actual value of one hundred thousand dollars 30 in the current fiscal year and one hundred ten percent of such 31 amount on the residential property using the proposed property 32 tax dollars for the budget year, including the percent change 33 in such amounts. 34 (6) An For the budget for the fiscal year beginning July 35 -10- LSB 6385XC (8) 90 jm/jh 10/ 49

S.F. _____ 1, 2024, an example comparing the amount of property taxes 1 on a commercial property with an actual value of one hundred 2 thousand dollars in the current fiscal year and such amount on 3 the commercial property using the proposed property tax dollars 4 for the budget year, including the percentage difference 5 percent change in such amounts. For the budget for fiscal 6 years beginning on or after July 1, 2025, an example comparing 7 the amount of property taxes on a commercial property with an 8 actual value of three hundred thousand dollars in the current 9 fiscal year and one hundred ten percent of such amount on the 10 commercial property using the proposed property tax dollars for 11 the budget year, including the percent change in such amounts. 12 Sec. 29. Section 24.2A, subsection 2, paragraph b, Code 13 2024, is amended by adding the following new subparagraph: 14 NEW SUBPARAGRAPH . (10) A link to the department of 15 management’s internet site where the property owner or taxpayer 16 may view an example of the statement and a brief explanation of 17 the information included on the statement. 18 Sec. 30. Section 24.2A, subsection 4, paragraph a, Code 19 2024, is amended to read as follows: 20 a. Each political subdivision shall set a time and place 21 for a public hearing on the political subdivision’s proposed 22 property tax amount for the budget year and the political 23 subdivision’s information included in the statements under 24 subsection 2 . The proposed property tax hearing shall be set 25 on a date on or after March 20 of the budget year immediately 26 preceding the budget year for which the tax is being proposed. 27 At the hearing, the governing body of the political subdivision 28 shall receive oral or written testimony from any resident or 29 property owner of the political subdivision. This public 30 hearing shall be separate from any other meeting of the 31 governing body of the political subdivision, including any 32 other meeting or public hearing relating to the political 33 subdivision’s budget, and other business of the political 34 subdivision that is not related to the proposed property tax 35 -11- LSB 6385XC (8) 90 jm/jh 11/ 49

S.F. _____ amounts and the information in the statements shall not be 1 conducted at the public hearing. After all testimony has been 2 received and considered, the governing body may decrease, but 3 not increase, the proposed property tax amount to be included 4 in the political subdivision’s budget. 5 Sec. 31. Section 24.2A, subsection 4, paragraph b, Code 6 2024, is amended by adding the following new subparagraph: 7 NEW SUBPARAGRAPH . (4) Failure of a newspaper to publish a 8 required notice under this paragraph shall not be considered a 9 failure of a political subdivision to provide required notice 10 under this paragraph if all of the following conditions are 11 met: 12 (a) Notice of the public hearing was provided to each 13 property owner and each taxpayer within the political 14 subdivision in statements required under subsection 2, 15 paragraph “b” . 16 (b) The political subdivision can demonstrate to the county 17 auditor that the political subdivision provided sufficient time 18 for the newspaper to publish the notice. 19 Sec. 32. Section 24.2A, subsection 4, paragraph c, Code 20 2024, is amended to read as follows: 21 c. Notice of the hearing shall also be posted and clearly 22 identified on the political subdivision’s internet site 23 for public viewing beginning on the date of the newspaper 24 publication and shall be maintained on the political 25 subdivision’s internet site with all such prior year notices 26 and copies of the statements mailed under subsection 2 . 27 Additionally, if the political subdivision maintains a social 28 media account on one or more social media applications, the 29 public hearing notice or an electronic link to the public 30 hearing notice shall be posted on each such account on the same 31 day as the a date no later than the date of publication of the 32 notice. 33 Sec. 33. Section 176A.8, subsection 6, Code 2024, is amended 34 to read as follows: 35 -12- LSB 6385XC (8) 90 jm/jh 12/ 49

S.F. _____ 6. To prepare annually before March 15 April 30 a budget for 1 the fiscal year beginning July 1 and ending the following June 2 30, in accordance with the provisions of chapter 24 and certify 3 the budget to the board of supervisors of the county of their 4 extension district as required by law. 5 Sec. 34. Section 176A.10, subsection 1, unnumbered 6 paragraph 1, Code 2024, is amended to read as follows: 7 The extension council of each extension district shall, at 8 a meeting held before March 15 April 30 , estimate the amount 9 of money required to be raised by taxation for financing the 10 county agricultural extension education program authorized in 11 this chapter . The annual tax levy and the amount of money to 12 be raised from the levy for the county agricultural extension 13 education fund shall not exceed the following: 14 Sec. 35. Section 257.19, subsection 2, Code 2024, is amended 15 to read as follows: 16 2. Certification of a board’s intent to participate for a 17 budget year, the method of funding, and the amount to be raised 18 shall be made to the department of management not later than 19 April 15 30 of the base year. Funding for the instructional 20 support program shall be obtained from instructional support 21 state aid and from local funding using either an instructional 22 support property tax or a combination of an instructional 23 support property tax and an instructional support income 24 surtax. 25 Sec. 36. Section 309.93, unnumbered paragraph 1, Code 2024, 26 is amended to read as follows: 27 On or before April 15 30 of each year, the board of 28 supervisors, with the assistance of the county engineer, shall 29 adopt and submit to the department for approval the county 30 secondary road budget for the next fiscal year. The budget 31 shall include an itemized statement of: 32 Sec. 37. Section 331.301, Code 2024, is amended by adding 33 the following new subsection: 34 NEW SUBSECTION . 9A. Pursuant to the general grant of home 35 -13- LSB 6385XC (8) 90 jm/jh 13/ 49

S.F. _____ rule power conferred by the Constitution of the State of Iowa 1 and if not inconsistent with the laws of the general assembly, 2 a county that has designated more than one city to be a county 3 seat may consolidate or reduce the number of county seats by 4 ordinance. 5 Sec. 38. Section 331.434, subsection 7, Code 2024, is 6 amended by striking the subsection and inserting in lieu 7 thereof the following: 8 7. a. A county may collect taxes for a fiscal year for 9 which no budget has been certified, but the county shall not 10 distribute any funds collected for a fiscal year until the 11 county certifies its budget and transmits the certified budget 12 to the county auditor. 13 b. Taxes levied by a county whose budget is certified after 14 April 30 shall be limited to the taxes levied for the previous 15 fiscal year subject to applicable levy rate limits in this 16 chapter. However, that amount shall not exceed the amount the 17 county could collect based on property assessments for the 18 fiscal year for which the county failed to certify property 19 taxes. 20 c. The department of management may waive the limitation 21 in paragraph “b” for a county if the department of management 22 finds, after a showing of evidence by the county, that failure 23 to certify the budget by April 30 was caused by one or more of 24 the following: 25 (1) A newspaper failed to publish a notice of hearing 26 as required under section 24.2A after the county gave the 27 newspaper sufficient time to publish the notice. 28 (2) A verifiable public emergency or weather-related event 29 which forced the cancellation of a public hearing as required 30 under section 24.2A. 31 (3) An illness or unexpected vacancy of one or more board 32 members caused a lack of a quorum necessary to hold a hearing 33 as required under section 24.2A. 34 (4) A failure of state software or a state process caused 35 -14- LSB 6385XC (8) 90 jm/jh 14/ 49

S.F. _____ the board to miss the required date to certify the county’s 1 budget. 2 Sec. 39. Section 331.510, subsection 3, Code 2024, is 3 amended to read as follows: 4 3. An annual report not later than January 1 to the 5 department of management of the valuation by class of property 6 for each taxing district in the county as instructed by and on 7 forms provided by the department of management. The valuations 8 reported shall be those valuations used for determining 9 the levy rates necessary to fund the budgets of the taxing 10 districts for the following fiscal year. Each annual report 11 under this subsection for assessment years beginning on 12 or after January 1, 2024, shall distinguish such values as 13 revaluation or other type of addition to value, as defined 14 and submitted in the assessor’s abstract transmitted to the 15 department of revenue under section 441.45 . 16 Sec. 40. Section 384.1, subsection 3, paragraph c, Code 17 2024, is amended by adding the following new subparagraph: 18 NEW SUBPARAGRAPH . (4) Notwithstanding other provisions of 19 this paragraph, if a city’s actual levy rate for the current 20 fiscal year is zero dollars per thousand dollars of assessed 21 value and the total assessed value used to calculate taxes 22 under this paragraph for the budget year exceeds one hundred 23 two and seventy-five hundredths percent, the city’s tax levy 24 imposed by this paragraph may be levied at a rate not to exceed 25 eight dollars and ten cents per thousand dollars of assessed 26 valuation. 27 Sec. 41. Section 384.16, subsection 6, Code 2024, is amended 28 by striking the subsection and inserting in lieu thereof the 29 following: 30 6. a. Taxes from a city levy may be collected for a fiscal 31 year for which no budget has been certified, but the county 32 shall not distribute any funds collected from the levies to 33 the city until the city certifies its budget and transmits the 34 certified budget to the county auditor. 35 -15- LSB 6385XC (8) 90 jm/jh 15/ 49

S.F. _____ b. Taxes levied by a city whose budget is certified after 1 April 30 shall be limited to the taxes levied for the previous 2 fiscal year subject to applicable levy rate limits in this 3 chapter. However, that amount shall not exceed the amount the 4 city could collect based on property assessments for the fiscal 5 year for which the city failed to certify property taxes. 6 c. The department of management may waive the limitation 7 in paragraph “b” for a city if the department of management 8 finds, after a showing of evidence by the city, that failure 9 to certify the budget by April 30 was caused by one or more of 10 the following: 11 (1) A newspaper failed to publish a notice of hearing as 12 required under section 24.2A after the city gave the newspaper 13 sufficient time to publish the notice. 14 (2) A verifiable public emergency or weather-related event 15 which forced the cancellation of a public hearing as required 16 under section 24.2A. 17 (3) An illness or unexpected vacancy of one or more council 18 members caused a lack of a quorum necessary to hold a hearing 19 as required under section 24.2A. 20 (4) A failure of state software or a state process caused 21 the council to miss the required date to certify the city’s 22 budget. 23 Sec. 42. Section 403.22, subsection 5, Code 2024, is amended 24 to read as follows: 25 5. a. Except for a municipality with a population under 26 fifteen thousand, the division of the revenue under section 27 403.19 for each project under this section shall be limited 28 to tax collections for ten fiscal years beginning with the 29 second fiscal year after the year in which the municipality 30 first certifies to the county auditor the amount of any loans, 31 advances, indebtedness, or bonds which qualify for payment from 32 the division of the revenue in connection with the project. 33 b. A municipality with a population under fifteen thousand 34 may, with the approval of the governing bodies of all other 35 -16- LSB 6385XC (8) 90 jm/jh 16/ 49

S.F. _____ affected taxing districts, extend the division of revenue under 1 section 403.19 for up to five years if necessary to adequately 2 fund the project. 3 c. Notwithstanding other time limitations provided by this 4 subsection, for urban renewal areas established before January 5 1, 2018, a municipality may, with the approval of the governing 6 bodies of all other affected taxing districts, extend the 7 division of revenue under section 403.19 for up to three years 8 if necessary to adequately fund the project. 9 d. The portion of the urban renewal area which is involved 10 in a project under this section shall not be subject to any 11 subsequent division of revenue under section 403.19 . 12 Sec. 43. Section 425.1A, Code 2024, is amended by adding the 13 following new subsection: 14 NEW SUBSECTION . 3. The list of the names, addresses, 15 and dates of birth of individuals allowed an exemption 16 under this section and maintained by the county recorder, 17 county treasurer, county assessor, city assessor, or other 18 governmental body and obtained for purposes of allowing an 19 exemption under this section is confidential information and 20 shall not be disseminated to any person unless otherwise 21 ordered by a court or released by the lawful custodian of 22 the records pursuant to state or federal law. The county 23 recorder, county treasurer, county assessor, city assessor, 24 or other governmental body responsible for maintaining the 25 names, addresses, and dates of birth of individuals allowed 26 an exemption under this section may display such exemption on 27 individual paper records and individual electronic records, 28 including display on an internet site. 29 Sec. 44. Section 441.45, Code 2024, is amended by adding the 30 following new subsection: 31 NEW SUBSECTION . 3. An assessor shall report valuations 32 of real property by parcel, including identifying additions 33 by revaluation or other type of addition to value, and shall 34 transmit and maintain the data in a manner that is compatible 35 -17- LSB 6385XC (8) 90 jm/jh 17/ 49

S.F. _____ with software used by the county auditor and that allows the 1 county auditor to use the data to file the reports required by 2 section 331.510, subsections 3 and 4. 3 Sec. 45. 2023 Iowa Acts, chapter 71, section 137, is amended 4 to read as follows: 5 SEC. 137. Section 8.6 , Code 2023, is amended by adding the 6 following new subsection: 7 NEW SUBSECTION . 17. County and city bond issuance. To 8 annually prepare and file with the general assembly by December 9 January 1 a report specifying the updated population thresholds 10 as adjusted under section 331.442, subsection 5 , and section 11 384.26, subsection 5 , and detailing the use of the bond 12 issuance procedures under section 331.442, subsection 5 , and 13 section 384.26, subsection 5 , including the usage of such 14 procedures by counties and cities based on the population-based 15 limitations and the amount of bonds issued for each such usage. 16 Sec. 46. REPEAL. 1848 Iowa Acts, First Extraordinary 17 Session, chapter 52, is repealed. 18 Sec. 47. EFFECTIVE DATE. The following, being deemed of 19 immediate importance, take effect upon enactment: 20 1. The section of this division of this Act enacting section 21 24.2A, subsection 2, paragraph “b”, subparagraph (10). 22 2. The section of this division of this Act enacting section 23 24.2A, subsection 4, paragraph “b”, subparagraph (4). 24 3. The section of this division of this Act amending section 25 24.2A, subsection 4, paragraph “c”. 26 4. The section of this division of this division of this Act 27 amending section 176A.8, subsection 6. 28 5. The section of this division of this Act amending section 29 176A.10, subsection 1, unnumbered paragraph 1. 30 6. The section of this division of this Act amending section 31 257.19, subsection 2. 32 7. The section of this division of this Act amending section 33 309.93, unnumbered paragraph 1. 34 8. The section of this division of this Act enacting section 35 -18- LSB 6385XC (8) 90 jm/jh 18/ 49