House File 2577 - Introduced HOUSE FILE 2577 BY GOLDING A BILL FOR An Act relating to property taxes and local government funding 1 by modifying the methodology for determining actual value 2 of property, certain levy rates, bonding procedures, 3 assessment protests, and assessment limitations of certain 4 classes of property, and including retroactive applicability 5 provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 5441YH (4) 91 ms/md

H.F. 2577 DIVISION I 1 ACTUAL VALUATION LIMITATION 2 Section 1. Section 441.21, subsection 1, paragraph a, Code 3 2026, is amended to read as follows: 4 a. (1) All property subject to taxation shall be valued 5 at its actual value which shall be entered opposite each item, 6 and, except as otherwise provided in this section , shall be 7 assessed at one hundred percent of its actual value, and the 8 value so assessed shall be taken and considered as the assessed 9 value and taxable value of the property upon which the levy 10 shall be made. 11 (2) For assessment years beginning on or after January 12 1, 2027, but before January 1, 2030, and notwithstanding any 13 provision of law to the contrary, the actual value of each 14 individual residential, commercial, or industrial property, 15 including after adjustments to actual values made as the result 16 of equalization, shall not exceed one hundred percent of the 17 actual value of the property for the immediately preceding 18 assessment year unless the property was not assessed in 19 the immediately preceding assessment year, ownership of the 20 property changes, the property’s boundaries change, there is a 21 change to the property’s classification, or new construction, 22 additions, or improvements have been made to the property other 23 than normal and necessary maintenance or repairs, not amounting 24 to structural replacements or modification, and cost of the 25 construction, additions, or improvements exceeds five percent 26 of the property’s actual value. 27 (3) For assessment years beginning on or after January 1, 28 2030, and notwithstanding any provision of law to the contrary, 29 the actual value of each individual residential, commercial, 30 or industrial property, including after adjustments to actual 31 values made as the result of equalization, shall not exceed 32 the product of the annual inflation factor multiplied by the 33 actual value of the property for the immediately preceding 34 assessment year unless the property was not assessed in 35 -1- LSB 5441YH (4) 91 ms/md 1/ 25

H.F. 2577 the immediately preceding assessment year, ownership of the 1 property changes, the property’s boundaries change, there is a 2 change to the property’s classification, or new construction, 3 additions, or improvements have been made to the property 4 other than normal and necessary maintenance or repairs, not 5 amounting to structural replacements or modification, and 6 cost of the construction, additions, or improvements exceeds 7 five percent of the property’s actual value. For purposes 8 of this subparagraph, “annual inflation factor” means an 9 index, expressed as a percentage, determined by the department 10 of management based upon the consumer price for all urban 11 consumers for the midwest region for the twelve-month period 12 ending six months prior to January 1 of the assessment year 13 for which the factor is determined. In determining the annual 14 inflation factor, the department of management shall use the 15 annual percent change in the United States department of labor, 16 bureau of labor statistics, consumer price index for all urban 17 consumers for the midwest region, all items, or its successor 18 index in the applicable twelve-month period and shall add all 19 of that percent change to one hundred percent. The annual 20 inflation factor shall be expressed as a percentage rounded to 21 the nearest one-tenth of one percent. The annual inflation 22 factor shall not be less than one hundred percent nor greater 23 than one hundred three percent. 24 Sec. 2. Section 441.21, subsection 1, paragraph b, 25 subparagraph (1), Code 2026, is amended to read as follows: 26 (1) The Subject to the limitation under paragraph “a” , the 27 actual value of all property subject to assessment and taxation 28 shall be the fair and reasonable market value of such property 29 except as otherwise provided in this section . “Market value” 30 is defined as the fair and reasonable exchange in the year in 31 which the property is listed and valued between a willing buyer 32 and a willing seller, neither being under any compulsion to buy 33 or sell and each being familiar with all the facts relating 34 to the particular property. Sale prices of the property or 35 -2- LSB 5441YH (4) 91 ms/md 2/ 25

H.F. 2577 comparable property in normal transactions reflecting market 1 value, and the probable availability or unavailability of 2 persons interested in purchasing the property, shall be 3 taken into consideration in arriving at its market value. In 4 arriving at market value, sale prices of property in abnormal 5 transactions not reflecting market value shall not be taken 6 into account, or shall be adjusted to eliminate the effect 7 of factors which distort market value, including but not 8 limited to sales to immediate family of the seller, foreclosure 9 or other forced sales, contract sales, discounted purchase 10 transactions or purchase of adjoining land or other land to be 11 operated as a unit. 12 Sec. 3. Section 441.21, subsection 1, paragraph g, Code 13 2026, is amended to read as follows: 14 g. Notwithstanding any other provision of this section , 15 the actual value of any property shall not exceed its fair 16 and reasonable market value, subject to paragraph “a” , except 17 agricultural property which shall be valued exclusively as 18 provided in paragraph “e” and paragraph “a” , of this subsection . 19 Sec. 4. Section 441.21, subsection 2, Code 2026, is amended 20 to read as follows: 21 2. In the event market value of the property being assessed 22 cannot be readily established in the foregoing manner, then 23 the assessor may , subject to the limitation under subsection 24 1, paragraph “a” , determine the value of the property using the 25 other uniform and recognized appraisal methods including its 26 productive and earning capacity, if any, industrial conditions, 27 its cost, physical and functional depreciation and obsolescence 28 and replacement cost, and all other factors which would assist 29 in determining the fair and reasonable market value of the 30 property but the actual value shall not be determined by use 31 of only one such factor. The following shall not be taken into 32 consideration: Special value or use value of the property to 33 its present owner, and the goodwill or value of a business 34 which uses the property as distinguished from the value of 35 -3- LSB 5441YH (4) 91 ms/md 3/ 25

H.F. 2577 the property as property. In addition, for assessment years 1 beginning on or after January 1, 2018, and unless otherwise 2 required for property valued by the department of revenue 3 pursuant to chapters 428 , 437 , and 438 , the assessor shall not 4 take into consideration and shall not request from any person 5 sales or receipts data, expense data, balance sheets, bank 6 account information, or other data related to the financial 7 condition of a business operating in whole or in part on the 8 property if the property is both classified as commercial or 9 industrial property and owned and used by the owner of the 10 business. However, in assessing property that is rented or 11 leased to low-income individuals and families as authorized by 12 section 42 of the Internal Revenue Code, as amended, and which 13 section limits the amount that the individual or family pays 14 for the rental or lease of units in the property, the assessor 15 shall, unless the owner elects to withdraw the property from 16 the assessment procedures for section 42 property, use the 17 productive and earning capacity from the actual rents received 18 as a method of appraisal and shall take into account the extent 19 to which that use and limitation reduces the market value of 20 the property. The assessor shall not consider any tax credit 21 equity or other subsidized financing as income provided to 22 the property in determining the assessed value. The property 23 owner shall notify the assessor when property is withdrawn 24 from section 42 eligibility under the Internal Revenue Code 25 or if the owner elects to withdraw the property from the 26 assessment procedures for section 42 property under this 27 subsection . The property shall not be subject to section 42 28 assessment procedures for the assessment year for which section 29 42 eligibility is withdrawn or an election is made. This 30 notification must be provided to the assessor no later than 31 March 1 of the assessment year or the owner will be subject to a 32 penalty of five hundred dollars for that assessment year. The 33 penalty shall be collected at the same time and in the same 34 manner as regular property taxes. An election to withdraw 35 -4- LSB 5441YH (4) 91 ms/md 4/ 25

H.F. 2577 from the assessment procedures for section 42 property is 1 irrevocable. Property that is withdrawn from the assessment 2 procedures for section 42 property shall be classified and 3 assessed as residential property unless the property otherwise 4 fails to meet the requirements of subsection 14 . Upon 5 adoption of uniform rules by the department of revenue or 6 succeeding authority covering assessments and valuations of 7 such properties, the valuation on such properties shall be 8 determined in accordance with such rules and in accordance with 9 forms and guidelines contained in the real property appraisal 10 manual prepared by the department as updated from time to time 11 for assessment purposes to assure uniformity, but such rules, 12 forms, and guidelines shall not be inconsistent with or change 13 the foregoing means of determining the actual, market, taxable, 14 and assessed values. 15 DIVISION II 16 MODIFICATION OF ASSESSMENT LIMITATIONS 17 Sec. 5. Section 441.21, subsection 4, Code 2026, is amended 18 to read as follows: 19 4. For valuations established as of January 1, 1979 2026 , 20 the percentage of actual value at which agricultural and 21 residential property shall be assessed shall be the quotient of 22 the dividend and divisor as defined in this section determined 23 under this subsection . 24 a. (1) The percentage of actual value at which agricultural 25 property shall be assessed shall be the quotient of the 26 dividend and divisor as defined in this paragraph. The 27 dividend for each class of property shall be the dividend 28 as determined for each class of agricultural property for 29 valuations established as of January 1, 1978 2025 , adjusted by 30 the product obtained by multiplying the percentage determined 31 for that year by the amount of any additions or deletions to 32 actual value, excluding those resulting from the revaluation 33 of existing properties, as reported by the assessors on the 34 abstracts of assessment for 1978 2025 , plus six three percent 35 -5- LSB 5441YH (4) 91 ms/md 5/ 25

H.F. 2577 of the amount so determined. 1 (2) However, if the difference between the dividend so 2 determined for either class of property and the dividend for 3 that class of property for valuations established as of January 4 1, 1978, adjusted by the product obtained by multiplying 5 the percentage determined for that year by the amount of 6 any additions or deletions to actual value, excluding those 7 resulting from the revaluation of existing properties, as 8 reported by the assessors on the abstracts of assessment for 9 1978, is less than six percent, the 1979 dividend for the other 10 class of property shall be the dividend as determined for that 11 class of property for valuations established as of January 12 1, 1978, adjusted by the product obtained by multiplying 13 the percentage determined for that year by the amount of 14 any additions or deletions to actual value, excluding those 15 resulting from the revaluation of existing properties, as 16 reported by the assessors on the abstracts of assessment for 17 1978, plus a percentage of the amount so determined which is 18 equal to the percentage by which the dividend as determined 19 for the other class of property for valuations established 20 as of January 1, 1978, adjusted by the product obtained by 21 multiplying the percentage determined for that year by the 22 amount of any additions or deletions to actual value, excluding 23 those resulting from the revaluation of existing properties, as 24 reported by the assessors on the abstracts of assessment for 25 1978, is increased in arriving at the 1979 dividend for the 26 other class of property. 27 (3) For valuations established for assessment years 28 beginning on or after January 1, 2022, the calculation of the 29 dividend for residential property under this subsection shall 30 exclude the value of all property described in subsection 14 , 31 paragraph “a” , subparagraphs (2), (3), (4), (5), and (6), 32 and the property described in subsection 14 , paragraph “a” , 33 subparagraph (7), that contains three or more separate dwelling 34 units. 35 -6- LSB 5441YH (4) 91 ms/md 6/ 25

H.F. 2577 b. (1) The divisor for each class of property shall be 1 the total actual value of all such agricultural property in 2 the state in the preceding year, as reported by the assessors 3 on the abstracts of assessment submitted for 1978 2025 , plus 4 the amount of value added to said total actual value by the 5 revaluation of existing properties in 1979 2026 as equalized 6 by the director of revenue pursuant to section 441.49 . The 7 director shall utilize information reported on abstracts of 8 assessment submitted pursuant to section 441.45 in determining 9 such percentage. For valuations established as of January 10 1, 2027, and each assessment year thereafter, the percentage 11 of actual value as equalized by the department of revenue as 12 provided in section 441.49 at which agricultural property shall 13 be assessed shall be calculated in accordance with the methods 14 provided in this paragraph. 15 (2) For valuations established for assessment years 16 beginning on or after January 1, 2022, the calculation of the 17 divisor for residential property under this subsection shall 18 exclude the value of all property described in subsection 14 , 19 paragraph “a” , subparagraphs (2), (3), (4), (5), and (6), 20 and the property described in subsection 14 , paragraph “a” , 21 subparagraph (7), that contains three or more separate dwelling 22 units. 23 c. (1) For valuations established as of January 1, 1980, 24 and each assessment year thereafter beginning before January 25 1, 2013, the percentage of actual value as equalized by the 26 director of revenue as provided in section 441.49 at which 27 agricultural and residential property shall be assessed shall 28 be calculated in accordance with the methods provided in 29 this subsection , including the limitation of increases in 30 agricultural and residential assessed values to the percentage 31 increase of the other class of property if the other class 32 increases less than the allowable limit adjusted to include 33 the applicable and current values as equalized by the director 34 of revenue, except that any references to six percent in this 35 -7- LSB 5441YH (4) 91 ms/md 7/ 25

H.F. 2577 subsection shall be four percent. 1 (2) For valuations established as of January 1, 2013, and 2 each assessment year thereafter, the percentage of actual 3 value as equalized by the department of revenue as provided in 4 section 441.49 at which agricultural and residential property 5 shall be assessed shall be calculated in accordance with the 6 methods provided in this subsection , including the limitation 7 of increases in agricultural and residential assessed values to 8 the percentage increase of the other class of property if the 9 other class increases less than the allowable limit adjusted 10 to include the applicable and current values as equalized by 11 the department of revenue, except that any references to six 12 percent in this subsection shall be three percent. 13 b. (1) For valuations established for the assessment year 14 beginning January 1, 2026, the percentage of actual value as 15 equalized by the department of revenue as provided in section 16 441.49 at which residential property shall be assessed shall 17 be forty-four and five thousand three hundred and forty-five 18 ten thousandths percent. 19 (2) For valuations established for the assessment year 20 beginning January 1, 2027, the percentage of actual value as 21 equalized by the department of revenue as provided in section 22 441.49 at which residential property shall be assessed shall 23 be forty-seven percent. 24 (3) For valuations established for the assessment year 25 beginning January 1, 2028, and each assessment year thereafter, 26 the percentage of actual value as equalized by the department 27 of revenue as provided in section 441.49 at which residential 28 property shall be assessed shall be fifty percent. 29 Sec. 6. RETROACTIVE APPLICABILITY. This division of this 30 Act applies retroactively to January 1, 2026, for assessment 31 years beginning on or after that date. 32 DIVISION III 33 PROPERTY TAX LEVY RATES 34 Sec. 7. Section 331.422, unnumbered paragraph 1, Code 2026, 35 -8- LSB 5441YH (4) 91 ms/md 8/ 25

H.F. 2577 is amended to read as follows: 1 Subject to this section and sections 331.423 through 331.425 2 331.424 or as otherwise provided by state law, the board of 3 each county shall certify property taxes annually at its April 4 session to be levied for county purposes as follows: 5 Sec. 8. Section 331.434, unnumbered paragraph 1, Code 2026, 6 is amended to read as follows: 7 Annually, the board of each county, subject to section 8 331.403, subsection 4 , sections 331.423 through 331.425 9 331.424 , the applicable portions of chapter 24 , and other 10 applicable state law, shall prepare and adopt a budget, certify 11 taxes, and provide appropriations as follows: 12 Sec. 9. Section 331.435, subsection 1, Code 2026, is amended 13 to read as follows: 14 1. The board may amend the adopted county budget, subject to 15 sections 331.423 through 331.425 331.424 and other applicable 16 state law, to permit increases in any class of proposed 17 expenditures contained in the budget summary published under 18 section 331.434, subsection 3 . 19 Sec. 10. Section 384.12, subsection 4, Code 2026, is amended 20 by striking the subsection. 21 Sec. 11. NEW SECTION . 444.25 Maximum property tax levy 22 dollars. 23 1. For purposes of this section, unless the context 24 otherwise requires: 25 a. “Budget year” is the fiscal year beginning during the 26 calendar year in which a budget is certified. 27 b. “Governmental entity” means any unit of government 28 or other public body or public corporation, including any 29 intergovernmental entity or special purpose district, that 30 has the power to impose or certify a property tax levy. 31 “Governmental entity” does not include a school district. 32 c. “Property tax levy” means each ad valorem property tax 33 authorized by law to be imposed by a governmental entity, but 34 excluding any levy the revenue from which is specified by law 35 -9- LSB 5441YH (4) 91 ms/md 9/ 25

H.F. 2577 for debt service or required to be used exclusively for the 1 repayment of bonds or other indebtedness. The levy under 2 section 384.1, subsection 2, on tracts of land and improvements 3 thereon used and assessed for agricultural or horticultural 4 purposes, shall be considered a separate property tax levy 5 under this section. 6 2. a. For the budget year beginning July 1, 2027, and each 7 budget year thereafter, and notwithstanding any provision of 8 law to the contrary, the maximum levy rate that may be imposed 9 for a property tax levy by a governmental entity shall not 10 exceed the levy rate for such property tax levy imposed by the 11 governmental subdivision for the budget year beginning July 1, 12 2026, unless a higher levy rate is approved at election under 13 subsection 3. 14 b. If the budget year includes a voter-approved property 15 tax levy that was not approved for imposition in the budget 16 year beginning July 1, 2026, the maximum property tax levy rate 17 for the governmental entity under paragraph “a” for the budget 18 year shall be the levy rate approved at election or the levy 19 rate necessary to levy the amount of property taxes approved at 20 election, as applicable. 21 3. a. The limitation on any property tax levy rate under 22 subsection 2, paragraph “a” , may be increased provided the 23 question has been submitted at the election under section 39.1 24 and received sixty percent of the votes cast on the proposition 25 to authorize the levy rate increase for the proposed budget 26 year. 27 b. If the governmental entity is located in an area that 28 is the subject of a governor’s proclamation of a state of 29 disaster emergency or the declaration of a major disaster by 30 the president of the United States, the limitation on any 31 property tax levy rate under subsection 2, paragraph “a” , may 32 be temporarily increased for a budget year, unless approved at 33 election for additional years under paragraph “a” . 34 c. If the governmental entity is a city with a population 35 -10- LSB 5441YH (4) 91 ms/md 10/ 25

H.F. 2577 of five thousand or less according to the most recent federal 1 decennial census, the city council may certify levy rates in 2 excess of the rate limitation under subsection 2, paragraph “a” , 3 without an election. However, if at any time within twenty 4 days following certification of the city’s budget, a petition 5 is filed with the clerk of the city in the manner provided by 6 section 362.4, asking that the question of exceeding the levy 7 rate limit be submitted to the registered voters of the city, 8 the council shall direct the county commissioner of elections 9 to call a special election upon the question of exceeding the 10 levy rate limitation. 11 4. If a governmental entity certifies a budget that violates 12 this section, the department of management shall reduce the 13 applicable governmental entity’s property tax levies so that 14 the governmental entity is in compliance with this section. 15 Sec. 12. REPEAL. Sections 24.48 and 331.425, Code 2026, 16 are repealed. 17 DIVISION IV 18 PROPERTY ASSESSMENT PROTESTS 19 Sec. 13. Section 441.33, subsection 1, Code 2026, is amended 20 to read as follows: 21 1. The board of review shall be in session from a date 22 determined by the board that is on or after May 1 but not 23 later than May 7 through the period of time necessary to 24 act on all protests filed under section 441.37 but not later 25 than May 31 June 15 each year and for an additional period as 26 required under section 441.37 and shall hold as many meetings 27 as are necessary to discharge its duties. On or before May 28 31 in those years in which a session has not been extended 29 as required under section 441.37 , the board shall return all 30 books, records, and papers to the assessor except undisposed 31 of protests and records pertaining to those protests. If 32 it has not completed its work by May 31, in those years in 33 which the session has not been extended under section 441.37 , 34 the director of revenue may authorize the board of review 35 -11- LSB 5441YH (4) 91 ms/md 11/ 25

H.F. 2577 to continue in session for a period necessary to complete 1 its work, but the director of revenue shall not approve a 2 continuance extending beyond July 15. On or before May 31 3 or on the final day of any extended session required under 4 section 441.37 or authorized by the director of revenue, the 5 board of review shall adjourn until the date determined by the 6 board that is on or after May 1 but not later than May 7 of the 7 following year. It shall adopt its own rules of procedure, 8 elect its own chairperson from its membership, and keep minutes 9 of its meetings. The board shall appoint a clerk who may be 10 a member of the board or any other qualified person, except 11 the assessor or any member of the assessor’s staff. It may be 12 reconvened by the director of revenue. All undisposed protests 13 in its hands on July 15 shall be automatically overruled and 14 returned to the assessor together with its other records. 15 Sec. 14. Section 441.37, subsection 1, paragraph a, 16 subparagraph (1), unnumbered paragraph 1, Code 2026, is amended 17 to read as follows: 18 Any property owner or aggrieved taxpayer who is dissatisfied 19 with the owner’s or taxpayer’s assessment may file a protest 20 against such assessment with the board of review on or after 21 April 2, to and including April May 30, of the year of the 22 assessment. In any county which has been declared to be a 23 disaster area by proper federal authorities or that is the 24 subject of a state of disaster emergency proclamation by the 25 governor after March 1 and prior to May 20 of said year of 26 assessment, the board of review shall be authorized to remain 27 in session until July 15 and the time for filing a protest 28 shall be extended to and include the period from May June 1 29 to June 5 20 of such year. The protest shall be in writing 30 on forms prescribed by the director of revenue and, except as 31 provided in subsection 3 , signed by the one protesting or by 32 the protester’s duly authorized agent. The taxpayer may have 33 an oral hearing on the protest if the request for the oral 34 hearing is made in writing at the time of filing the protest. 35 -12- LSB 5441YH (4) 91 ms/md 12/ 25

H.F. 2577 The protest must be confined to one or more of the following 1 grounds: 2 Sec. 15. Section 441.45, subsection 2, Code 2026, is amended 3 to read as follows: 4 2. If a board of review continues in session beyond June 1 5 15 , under sections 441.33 and 441.37 , the abstract of the real 6 property shall be made out and transmitted to the department of 7 revenue within fifteen days after the date of final adjournment 8 by the board. 9 DIVISION V 10 BONDING 11 Sec. 16. Section 39.2, subsection 4, paragraph d, Code 2026, 12 is amended to read as follows: 13 d. For any political subdivision of this state, if the 14 special election is in whole or in part for the question of 15 issuing bonds or other indebtedness, the first Tuesday after 16 the first Monday in November in an even-numbered year . 17 Sec. 17. Section 75.1, subsection 1, Code 2026, is amended 18 to read as follows: 19 1. When a proposition to authorize an issuance of bonds by 20 a county, township, school corporation, merged area, city, or 21 by any political subdivision or local board or commission, is 22 submitted to the electors, such proposition shall not be deemed 23 carried or adopted, anything in the statutes to the contrary 24 notwithstanding, unless the vote in favor of such authorization 25 is equal to at least sixty percent of the total vote cast for 26 and against said proposition at said election. All elections 27 on such proposition shall be held on the date specified in 28 section 39.2, subsection 4 , paragraph “d” . 29 Sec. 18. Section 296.2, Code 2026, is amended to read as 30 follows: 31 296.2 Petition for election. 32 Before indebtedness can be contracted in excess of one 33 and one-quarter percent of the assessed value of the taxable 34 property , a petition signed by eligible electors equal 35 -13- LSB 5441YH (4) 91 ms/md 13/ 25

H.F. 2577 in number to twenty-five percent of those voting at the 1 last election of school officials shall be filed with the 2 president of the board of directors, asking that an election 3 be called, stating the amount of bonds proposed to be issued , 4 and the purpose or purposes for which the indebtedness is 5 to be created , and that the purpose or purposes cannot be 6 accomplished within the limit of one and one-quarter percent 7 of the valuation . The petition may request the calling of an 8 election on one or more propositions separately and a each 9 proposition may include one or more purposes. 10 Sec. 19. Section 331.441, subsection 2, paragraph b, 11 subparagraphs (7), (12), and (14), Code 2026, are amended to 12 read as follows: 13 (7) Enlargement and improvement of a county hospital 14 acquired and operated under chapter 347A , subject to a maximum 15 of two percent of the assessed value of the taxable property in 16 the county. However, notice of the proposed bond issue shall 17 be published once each week for two consecutive weeks and if, 18 within twenty days following the date of the first publication, 19 a petition requesting an election on the proposal and signed 20 by eligible electors of the county equal in number to at least 21 twenty percent of the votes cast at the preceding election 22 for governor is filed with the county auditor, the proposal 23 is subject to the election requirements in section 331.442, 24 subsections 2, 3, and 4 , for general county purpose bonds. 25 (12) (a) Funding the acquisition, construction, 26 reconstruction, improvement, repair, or equipping of 27 waterworks, water mains and extensions, ponds, reservoirs, 28 capacity, wells, dams, pumping installations, real and personal 29 property, or other facilities available or used for the 30 storage, transportation, or utilization of water. 31 (a) (b) The county board of supervisors may on its 32 own motion or upon a written petition of a water supplier 33 established under chapter 357A or 504 direct the county 34 auditor to establish a special service area tax district for 35 -14- LSB 5441YH (4) 91 ms/md 14/ 25

H.F. 2577 the purpose of issuing general obligation bonds. The special 1 service area tax district shall include only unincorporated 2 portions of the county and shall be drawn according to 3 engineering recommendations provided by the water supplier or 4 the county engineer and, in addition, shall be drawn in order 5 that an election provided for in subparagraph division (b) 6 section 331.443 can be administered. The county’s debt service 7 tax levy for the county general obligation bonds issued for 8 the purposes set out in this subparagraph shall be levied only 9 against taxable property within the county which is included 10 within the boundaries of the special service area tax district. 11 An owner of property not included within the boundaries of 12 the special service area tax district may petition the board 13 of supervisors to be included in the special service area tax 14 district subsequent to its establishment. 15 (b) General obligation bonds for the purposes described 16 in this subparagraph are subject to an election held in the 17 manner provided in section 331.442, subsections 1 through 4 , 18 if not later than fifteen days following the action by the 19 county board of supervisors, eligible electors file a petition 20 with the county commissioner of elections asking that the 21 question of issuing the bonds be submitted to the registered 22 voters of the special service area tax district. The petition 23 must be signed by eligible electors equal in number to at 24 least five percent of the registered voters residing in the 25 special service area tax district. If the petition is duly 26 filed within the fifteen days, the board of supervisors shall 27 either adopt a resolution declaring that the proposal to issue 28 the bonds is abandoned, or direct the county commissioner of 29 elections to call a special election within a special service 30 area tax district upon the question of issuing the bonds. 31 (14) The aiding of the planning, undertaking, and carrying 32 out of urban renewal projects under the authority of chapter 33 403 and for the purposes set out in section 403.12 . However, 34 bonds issued for this purpose are subject to the right of 35 -15- LSB 5441YH (4) 91 ms/md 15/ 25

H.F. 2577 petition for an election as provided in section 331.442, 1 subsection 5 , without limitation on the amount of the bond 2 issue or the population of the county, and the board shall 3 include notice of the right of petition in the notice of 4 proposed action required under section 331.443, subsection 2 . 5 Sec. 20. Section 331.443, subsections 2 and 3, Code 2026, 6 are amended to read as follows: 7 2. Before the board may institute proceedings for the 8 issuance of bonds for an essential county purpose, a notice 9 of the proposed action, including a statement of the amount 10 and purposes of the bonds, an estimate of the annual increase 11 in property taxes as the result of the bond issuance on a 12 residential property with an actual value of one hundred 13 thousand dollars, a statement of the right to petition for 14 an election under subsection 3, and the time and place of 15 the meeting at which the board proposes to take action for 16 the issuance of the bonds, shall be published as provided in 17 section 331.305 . At the meeting, the board shall receive oral 18 or written objections from any resident or property owner 19 of the county. After all objections have been received and 20 considered, the board, at that meeting or a date to which it is 21 adjourned, may take additional action for the issuance of the 22 bonds or abandon the proposal to issue the bonds. Any resident 23 or property owner of the county may appeal the decision of 24 the board to take additional action to the district court of 25 the county, within fifteen days after the additional action 26 is taken, but the additional action of the board is final and 27 conclusive unless the court finds that the board exceeded its 28 authority. The provisions of this subsection with respect to 29 notice, hearing, and appeal, are in lieu of any other law. 30 3. a. Notwithstanding subsection 2 , a board may institute 31 proceedings for the issuance of bonds for an essential county 32 purpose specified in section 331.441, subsection 2 , paragraph 33 “b” , subparagraph (18) or (19), in an amount equal to or greater 34 than three million dollars by causing a notice of the proposal 35 -16- LSB 5441YH (4) 91 ms/md 16/ 25

H.F. 2577 to issue the bonds, including a statement of the amount 1 and purpose of the bonds, together with the maximum rate of 2 interest which the bonds are to bear, and the right to petition 3 for an election, to be published at least once in a newspaper 4 of general circulation within the county at least ten days 5 prior to the meeting at which it is proposed to take action for 6 the issuance of the bonds. 7 b. a. If at any time before the date fixed for taking 8 action for the issuance of the bonds, a petition is filed with 9 the county auditor, signed by eligible electors of the county 10 equal in number to twenty ten percent of the persons in the 11 county who voted for the office of president of the United 12 States at the last preceding general election that had such 13 office on the ballot, asking that the question of issuing the 14 bonds be submitted to the registered voters of the county, the 15 board shall either by resolution declare the proposal to issue 16 the bonds to have been abandoned or shall direct the county 17 commissioner of elections to call a special election upon the 18 question of issuing the bonds. Notice of the election and its 19 conduct shall be in the manner provided in section 331.442 . 20 c. b. If a petition is not filed, or if a petition is 21 filed and the proposition of issuing the bonds is approved at 22 an election, the board may proceed with the authorization and 23 issuance of the bonds. 24 Sec. 21. Section 384.24, subsection 3, paragraph q, Code 25 2026, is amended to read as follows: 26 q. The aiding in the planning, undertaking, and carrying out 27 of urban renewal projects under the authority of chapter 403 , 28 and all of the purposes set out in section 403.12 . However, 29 bonds issued for this purpose are subject to the right of 30 petition for an election as provided in section 384.26 , without 31 limitation on the amount of the bond issue or the size of 32 the city, and the council shall include notice of the right 33 of petition in the notice required under section 384.25, 34 subsection 2 . 35 -17- LSB 5441YH (4) 91 ms/md 17/ 25