The Iowa Senate has passed a bill with bipartisan support aimed at overhauling Iowa’s property tax system.
The bill (SF 2472) would cap city and county revenue growth between 2% and 5% based on inflation. It would replace Iowa’s “rollback” system with a 50% homestead tax exemption, and that exemption would grow for seniors as they advance in age.
Sen. Dan Dawson, R-Council Bluffs, said Iowa’s property taxes will remain some of the highest in the country unless something dramatically changes. He said passing this bill sets the stage for finding an agreement with the House and governor.
“Bandage approaches and simple approaches are not going to work,” Dawson said. “That’s what we tried in the past, and we’ve got to rebuild the darn system. It all starts with dealing with the rollback and dealing with the revenue limitation. If we can achieve those things, everything else can come into place in a negotiation.”
The bill would also tie the gas tax to inflation, using automatic tax increases to boost funding for road construction.