Get ready for headlines about local officials proudly saying they aren't increasing property tax rates. Does this mean your tax bill will stay the same too? Not likely. We call this an honesty gap.
Property tax bills continue to grow when the tax rate doesn't change because local elected officials don't make hard decisions and instead ride the wave of increased assessments. When that happens, people incorrectly blame the county assessor for larger tax bills.
Property tax increases come directly from one group of people: the local elected officials who determine what to spend and create budgets. For most Iowans, this is their:
They are creating budgets that determine your tax bill right now.
The property tax transparency reform passed two years ago requires public notice and an extra hearing if a taxing authority's budget is two percent greater than the previous year’s budget.
While this was a significant step forward, few Iowans have taken advantage of this new process to voice their concerns.
Most Iowans do not follow their local governments’ meeting agendas and are unaware of the budget process. They may not know when or where they may voice opposition to a property tax increase.
When you get your bill, it's too late.
As mentioned earlier, your local school board, city council, and county supervisors are currently building the budget that will determine your next property tax bill.
It is crucial that you contact these elected officials now if you want to change your next property tax bill. Don't let them widen the honesty gap by simply saying the rate won't change.
Government must explain why they need your dollars more than you do.
Ask them why spending is increasing. There might be a good reason or they might not want to make hard decisions. Either way, taxpayers deserve to know.
Don't know who to contact? Click the button below to send us a message and we will look them up for you.
What can legislators at the Capitol do to help control property taxes?
In Utah, as valuations increase, property tax rates are automatically decreased. If a local government wants to increase its revenue, it must increase the tax rate. When they do, parcel-specific notifications are sent to property owners. Taxpayers are informed about:
How much their property tax bill will increase
The date and time of the budget hearing
This process has been successful in Utah and it will work in Iowa too. Property owners will be empowered to voice their opinions when it is possible to have their voices heard—not after the fact when they receive their property tax bill. Send a message to your legislators and ask them to follow Utah's Truth-in-Taxation example.
This year, legislators need to strengthen the 2019 property tax transparency reform by adding accountability. The best approach may be to just copy Utah's process.
Capitol Update: Legislative Issue Status
Below are bills ITR's lobbyists have registered for or against that have been introduced and their current status.
When people inherit assets like land or a small business, they could potentially be forced to sell off pieces of the land or of the business in order to pay the taxes on it. Which is the opposite effect that good tax policy should have.
Iowans don’t need industry insiders forcing months or years of training before starting careers. An example: 2,100 hours of school to cut or shampoo hair.
SSB 1046 Review and sunset of professional licenses
1/19/21 - Introduced; Assigned to a subcommittee
HF 132 Remote continuing education credits
1/21/21 - Assigned to a subcommittee
SF 163 Continuing education requirement deadline 1/26/21 - Introduced
Tax Increase Supermajority Amendment
This amendment to Iowa's Constitution would require approval by at least two-thirds of both the Iowa House and Senate to increase the individual income tax.
1/26/21 - Introduced; Assigned to a subcommittee
Increase Government Efficiency
This bill would allow two or more counties to jointly appoint a county assessor.
1/25/21 - Subcommittee meeting scheduled for 2/1/21
Links of Interest
Unacceptable use of property tax dollars by the Des Moines Public Schools. Documents on their website listed names of alleged bullying, assault, and rape victims. Then they denied the student's open-enrollment requests. - Kirkwood Institute & TEF Iowa
More mitten info: The maker of Bernie Sanders' mittens no longer has a side business due to high taxation, and state lawmakers should take note of her story.
- ITR's Victoria Sinclair/Iowa Torch
Both President Biden and Senator Wyden (the likely Senate Finance Committee chair) are pushing for a capital gains tax at death or any transfer to a non-spouse while living. - Ag Web
Interest groups from opposite ends of the political spectrum, including the Christian conservative Family Leader and LGBTQ advocacy organization One Iowa, joined together Wednesday in support of a bill aimed at a common goal: protecting the privacy of their donors.
- Iowa Capital Dispatch
An individual’s property is not just land or a house, but also earnings. High property taxes not only threaten an individual’s or business’s property but their earnings as well. - TEF Iowa's John Hendrickson/Iowa Torch
Medicaid, the healthcare program for the poor made more than $86 billion in “improper payments” this year. That’s one-fifth of its total spending. States and the federal government must crack down on this waste by ensuring that Medicaid enrolls only those who are truly eligible.
- Inside Sources