Diverting Taxpayer Relief Fund dollars to property tax relief would simply be another instance of the state subsidizing local government spending growth.
During the 2023 legislative session, the Iowa Legislature began to consider two important constitutional amendments that would provide protection for Iowa taxpayers. If lawmakers are interested in continuing to stand up for the taxpayer, they should again contemplate similar measures in 2024.
One needed safeguard would require a supermajority (two-thirds majority) vote of both chambers of the legislature to approve a tax increase. While this would be a strong taxpayer protection, it would not be unique to Iowa. Currently, 16 states have some form of supermajority requirement for tax increases, including seven with that protection enshrined in their constitutions.
The second pro-taxpayer amendment Iowans need is related to the Taxpayer Relief Fund. Because it belongs to the taxpayer, this fund — like others in the Iowa Constitution — deserves protection. Originally created for the specific purpose of income tax relief, the fund now has such an enormous balance ($3.6 billion in fiscal year 2024) that policymakers and special interests are tempted to spend the money rather than to honor its intent.
If the Taxpayer Relief Fund is ultimately enshrined in the Constitution, there is one key tenant it must contain: the Taxpayer Relief Fund should not be used for property tax relief until the income tax is eliminated. Diverting Taxpayer Relief Fund dollars to property tax relief would simply be another instance of the state subsidizing local government spending growth.
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