Local Government Spending Limitations

Spending limits are similar to speed limits in a school zone, both are designed to protect. In the case of local governments, they apply the brakes to slow spending down. BACKGROUND One solution for property tax relief is strengthening the 2 percent “soft cap” placed on city and county budgets through the 2019 property tax reform law. A stronger spending […]

Recent Changes to Iowa’s Property Tax

Even with the extensive reforms as of late and the elimination of the county health levy, property taxes still remain a top concern of taxpayers with much work left to be done.   In 2013, the legislature enacted a comprehensive property tax reform measure directed at providing commercial property tax relief. Some of the major reforms of the legislation included:  […]

Iowa’s Property Tax History

Iowa’s property tax was first enacted in 1839.  Although it has undergone several changes over the years, it continues to be a substantial burden to taxpayers across the state.   Iowa’s property tax has had a tumultuous history. Iowa’s territorial legislature enacted the first revenue act in 1839, creating a tax levy on real and personal property. This form of […]

The Assessor is NOT to Blame

Don’t miss who is truly in charge of your property taxes. When county board, city council, and school board members increase spending, taxes go up; when their spending decreases, taxes go down. It’s as simple as that. We’ve all heard it around our communities: “Watch out: the assessor is coming around, which means property taxes are going up!” or “Don’t […]

A New Sales Tax is a LOST Opportunity

Increasing an existing tax or creating new ones rarely provides tax relief. The government tends to benefit more than the taxpayer. When cities sent local option sales tax (LOST) increases to the ballot, they told residents half of the new revenue would be directed toward property tax relief. To the contrary, as one frustrated Iowan in the Des Moines metro […]

Giving Property Tax Protection “Teeth”

In 2019, Iowa lawmakers passed a property tax accountability and transparency law. Any city or county government with a proposed budget increase of more than 2% above the previous year must now hold a public hearing first. Then, if the elected body still wishes to raise taxes after holding that hearing, it must achieve a supermajority vote of its members.

While this law is a good start, huge property tax increases in recent years prove that more needs to be done to slow the growth. ITR Foundation is both monitoring legislators’ plans to “give teeth” to the 2019 reforms and investigating other states with similar laws on the books. Nebraska, for instance, just implemented a tax accountability and transparency policy, so we traveled to Omaha for the first related public hearing.

Avoiding “Tax Shifts” for a Taxpayer Win

Politicians’ talk about tax relief doesn’t always mean the taxpayer wins in the end. Not all tax relief is created equally, as a comparison of Iowa with its neighbor to the west will show.

Iowa enacted historic tax reforms in March that significantly cut income taxes and reduced taxpayers’ liability. This change was possible because the state had been prudent with its dollars. Iowa did not increase spending, has fully funded reserves, and is experiencing a billion-dollar budget surplus. That is what a taxpayer victory looks like.

Lessons Learned from Iowa Tax History

By Sarah Curry, DBA At the end of the 19th Century, Iowa levied property taxes on just about everything. Yes, real estate and homes like we do today, but also jewelry and other personal property, household goods, and intangibles such as mortgages, bonds, and stock holdings. Taxes were widely felt to be burdensome, unequal, and unfair, leading many Iowans to […]

Combating Runaway Property Taxes

Recent headlines in Central Iowa are focused on an upcoming round of real estate assessments for properties in Polk County.  Long-time Polk County assessor Randy Ripperger estimates that residential assessments will increase by 22% next year.  We doubt Polk County residents will be the only Iowans experiencing a large jump in their assessed values; anyone who has tried to purchase […]

Did Your County Pass on Mental Health Savings?

Local governments in Iowa started a new fiscal year on July 1.  Those new fiscal years bring new budgets, and many times, new tax rates.  What’s unique about this fiscal year (2023), however, is that Iowa counties are no longer tasked with paying the bill for mental health services.  One key feature of 2021’s tax relief package was the phase out of the mental health levy from county property taxes, as the responsibility of mental health was shifted from counties to the state.

Guaranteed Income Veers Away From Role of Local Government

This week’s episode of ITR Live included a discussion of the city of Des Moines’s decision to participate in a pilot program that aims to provide guaranteed income to low-income residents of central Iowa.  While this calls to mind Andrew Yang’s universal basic income proposal from 2020’s Democratic presidential primaries, one significant difference appears to be that this program is being driven by mayors across the country, rather than by the federal government.   In a city that already has a heavy property tax burden, the Des Moines City Council has committed $500,000 to a program that doesn’t fit within the traditional role of local government.

“It’s Easy” To Spend Taxpayer Dollars

Why do local governments believe they need so much of your money? In recent years, Iowa property valuations have increased considerably. Large valuation increases usually translate into increased revenue for local governments in the form of property taxes. Given the impact of inflation, we can expect this trend to continue.  It will be interesting to see how Iowans manage to bear a growing property tax burden while paying more for gas, groceries, and everything else.

What Drives Citizens to Move?

Do you ever get together with friends and instead of socializing about normal topics, you get thrown into a conversation about taxes?  Well, that is exactly what happened to me the other day.  Admittedly, having spent most of my career in public policy, it happens to me a lot.  This time, however, I wasn’t the one who started it.

WHO’S GETTING THE BIGGEST SLICE OF PROPERTY TAX PIE?

Iowa has a long history with property taxes and it is one of the most debated issues, even dating back to before statehood. The very first Legislative Assembly of the Territory of Iowa met in 1838 in Burlington, and one of their primary goals was to develop a revenue system. A few short months later the Iowa Territory created a property tax for residents, levied and collected by the counties – a function which the county still performs to this day.

How Does Your Property Tax Bill Compare?

How’s your property tax bill?  If you tell us it’s too high, we won’t argue with you.  In fact, we keep proposing solutions to deliver stronger taxpayer protections.  But property taxes exist to fund our K-12 education system and city and county governments, as well as other services we all have access to; they are never going away.  So maybe […]

Drive A Tesla, Get Free Property Taxes

Maybe you missed it, but April 3-9 was Affordable Housing Week in Iowa, where one of the main takeaways was that Iowa needs to increase its housing supply. It’s no secret that many states, including Iowa, have a housing shortage. Housing advocacy groups have identified a particular shortage of affordable homes, especially for lower-income Iowa families. In fact, it is such a pressing need that the State has designated $330 million over a five-year period to help aid in the issue.

The Growing Cost of Municipal Debt

With inflation and rising interest rates, it’s normal to worry about the national debt and what that means for our country. But what about Iowa and our local communities?

During the last few years, the state of Iowa tightened its belt and has reduced its overall debt burden. However, the combined total of state and local government debt increased by 5.3% to $18.8 billion in FY2021, the highest percentage increase in a decade.

Truth-in-Taxation: A Rock Chalk Taxpayer Protection

March Madness wrapped up last week with the Kansas Jayhawks being crowned National Champions.  While there may not be many Iowans who joined Jayhawk fans in celebrating that victory, there was another win in Kansas that we can all be happy about: property taxes.  The map above identifies 21 Kansas counties that actually experienced a decline in property taxes this year.

Before examining what caused the big win in Kansas (the property taxes, not the basketball), we should reflect on the property tax situation in our state.  Iowans are demanding property tax relief and nobody can blame them.  Even before inflation reached record highs, putting a major squeeze on household budgets, Iowans felt the pain of having a heavier property tax burden than 40 other states.