Iowa’s 2026 legislative session wrapped up Sunday after lawmakers worked late into the weekend to settle on a property tax deal and pass budget bills.
Over the course of the session, the Legislature passed major bills, including the governor’s wide-ranging health bill, immigration and citizenship verification requirements, and childcare assistance.
Republican leaders waited until the 11th hour to unveil a compromise property tax plan that the Department of Management estimates would save taxpayers $4.2 billion over six years.
The final agreement would cap revenue growth under city and county general levies at 2% beginning in the 2027-2028 fiscal year. County hospitals would be capped at 4%, and emergency management agencies at 3%. There would be no cap on revenue for school funding.
Sen. Dan Dawson, R-Council Bluffs, said GOP leaders accomplished what they set out to do.
“No longer can windfall assessments come in which results in windfall revenues to local government, and people go out there and say we kept your levy the same and the property taxpayer gets stuck in the end,” Dawson said. “From here on forward when inflation goes up, your rates come down.”
The bill would establish a homestead exemption worth at least $5,500, or 10% of a home’s value up to $20,000 dollars. The maximum exemption would rise with inflation. Tax increment financing agreements that local governments use to leverage property taxes to attract development would be limited to 23 years.
The plan extends the state sales tax another 20 years and directs more of the revenue toward property tax relief – up to 25% by the 2030-2031 fiscal year. The proposal also reinstates a separate property class for multi-residential buildings, like apartment buildings, and increases their amount of assessed value over three years.
House Speaker Pat Grassley, R-New Hartford, said Republicans wanted to deliver immediate and long-term tax relief to Iowans.
“When we started session, we were extremely clear about what we wanted to achieve, which was putting the taxpayer first,” he said. “I think this was a tremendous step in that direction.”
Rep. Aime Wichtendahl, D–Hiawatha, criticized Republicans for taking negotiations down to the wire, leaving no time for more input.
“This bill does nothing to address the actual singular cause of increasing property taxes, which is rising valuations,” she said. “As long as valuations continue to rise faster than inflation, there can be no true property tax relief. And this bill will join its predecessors by failing to deliver property tax relief to Iowans.”
House Minority Leader Brian Meyer, D-Des Moines, said he doesn’t believe the plan will provide necessary relief for Iowans.
“Unfortunately, I don't think it'll do much to actually lower property taxes,” he said. “I think it's a Band-Aid, another Band-Aid that is not going to do much, and I don't think people will see actual results.”
In a statement, Gov. Kim Reynolds praised Republicans for delivering for Iowans.
“We kept our promise by passing meaningful property tax relief and reform, estimating nearly $4 billion in savings over the next six years. By capping local government revenue growth at 2% with clear and responsible guardrails, this plan brings certainty and discipline to a system that needed both.”
Bills that beat the deadline
In the waning moments of the 2026 session, lawmakers pushed through measures to expand funding for water quality projects, tax the sale of vapes to fund pediatric cancer research and increase mandatory prison sentences for repeat offenders.
Here are some of the bills that were sent to the governor before the House and Senate adjourned for the year.
-Abortion pill: Under the proposal, patients could only be dispensed abortion medication in a healthcare setting – curbing access to the medications via mail and telehealth.
-Water quality funding: A Republican water quality funding package sets aside $25 million in one-time funds for Central Iowa Water Works to double the utility’s nitrate removal capacity within three years. It also gives an additional $500,000 annually to the Iowa DNR for water quality monitoring, on top of the nearly $3 million already allocated.
The budget does not direct funds to the water quality monitoring program at the University of Iowa, but it includes another $300,000 in one-time funds for the Iowa DNR, which it says could be used to provide grants to organizations for monitoring.
-Governor powers limits: The proposal blocks the governor from closing or restricting places of worship for any reason, including during emergencies. It places other restrictions on the governor’s emergency powers, such as blocking changes to voting procedures without approval from the Legislature. The proposal also blocks the Department of Health and Human Services from ordering people to be vaccinated during public health disasters.
-Requiring a supermajority to raise certain taxes: If approved by voters, the constitutional amendment would require the approval of two-thirds of lawmakers in both the House and Senate to raise income or corporate tax rates. Voters will see the constitutional amendment question on their ballot in November.
-Vape tax for pediatric cancer research: The bill would place a 5-cent tax on vape products and alternative nicotine products. Up to $3 million of the collected funds would go toward pediatric cancer research at the University of Iowa annually. A separate bill provides $3 million for the upcoming fiscal year, before the tax begins to generate revenue.
-Public assistance changes: Lawmakers passed a proposal that would codify federal limits outlined in the 2025 One Big Beautiful Bill Act ending SNAP benefits for refugees and other types of immigrants into state law.
-Ban on warrant resolution clinics: Polk County held Iowa’s first-ever warrant resolution clinic in April. It gave people with warrants for low-level offenses an opportunity to meet with a judge and schedule a new court date. It came under the scrutiny of GOP lawmakers when one of the people who attended the clinic was later charged with murder. The bill headed to the governor would ban the clinics going forward.
-Repeat offender sentences: A compromise reached between the Senate and House increases the mandatory minimum sentence for repeat offenders. The bill would require a seven-year mandatory minimum for a person convicted of a third felony. The current minimum is three years. A minimum sentence could not be suspended or reduced.
-Hydrogen extraction: A bill passed as the session ended would establish rules for an emerging industry around drilling for hydrogen in Iowa. It includes some protections for landowners. For instance, a company would need written permission from a landowner before going onto their property.
-Early childhood: This bill creates a new early childhood and family services system within the Iowa Department of Health and Human Services. DHHS has said it will give the state access to more federal funding for early childhood services. Local boards can opt in to state management of home visitations in exchange for a share of additional federal funding.
-Double Up Food Bucks: Lawmakers approved $1 million per year in ongoing funding for a program that gives people enrolled in SNAP food assistance more purchasing power when they buy fresh fruits and vegetables.
Bills that came up short
-Eminent domain: A bill passed the House that would prohibit the use of eminent domain to construct a pipeline to transport carbon dioxide. Senate Majority Leader Mike Klimesh favored a proposal to expand the potential construction corridor for a pipeline project so that a company could negotiate with more landowners before pursuing eminent domain.
-Limiting WIC eligibility for immigrants: The stalled House proposal would have limited WIC — food assistance for pregnant and postpartum women, infants and young children — to citizens and qualified immigrants as defined by federal law. The bill also would have expanded Medicaid eligibility for disabled Iowans who work by raising income limits and exempting certain assets.
-Boy Scout abuse survivor statute of limitations: The bill would have extended the statute of limitations in state law for Iowans who were abused by Boy Scout leaders to ensure they could get their full payout as part of a national settlement. The limit was previously extended to the end of 2026.
-Legislator pay raise: Lawmakers will not receive the pay raise that came up in the Senate earlier in the session. That bill would have increased the salary of members of the Legislature from $25,000 to $45,000.
How did Reynolds’ priorities fare?
In Reynolds’ final legislative session as governor, the Legislature advanced several of her health, immigration and educational priorities.
Lawmakers passed the governor’s MAHA bill requiring state officials to seek limits on what can be bought with food assistance and permitting the purchase of ivermectin over the counter. The bill also banned certain food dyes from school meals.
“Limiting screentime and increasing daily physical activity for elementary students will help young Iowans establish lifelong healthy behaviors,” Reynolds said in a statement. “And by allowing psychologists licensed in other states to practice in Iowa, we will expand our health care workforce and improve access to care.”
Proposed increases on tobacco taxes — one of which was originally included in the governor’s health bill — did not make it to the governor’s desk.
The Legislature did pass some of the governor’s immigration priorities in a bill requiring the state, local governments and schools to use E-Verify to ensure new employees are authorized to work in the country.
The bill also requires people to swear they are citizens when they register to vote. And, it would make it harder for people charged with a forcible felony — and people without legal status charged with crimes above a simple misdemeanor — to be released on bail.
The Legislature passed Reynolds’ school choice priorities in a wide-ranging charter school bill which, among a host of provisions, would let charter school students participate in extracurricular activities in public schools and allow them to take college credit classes through their home district.
Reynolds signed a law restricting local governments from adopting civil rights protections broader than those in state code, after the state removed gender identity as a protected class in the Iowa Civil Rights Act last year.
Reynolds also signed a measure to temporarily increase taxes on HMO health insurance plans to help make up for the state’s Medicaid budget deficits. The Legislature followed up on that measure with a tax credit for health insurers worth a total of up to $3 million per year through 2034. Insurers could earn credit for things like expanding health access in rural areas.
“Throughout my time in office, the commonsense, conservative policies we’ve enacted will ensure our state remains strong, prosperous, and vibrant for generations to come,” Reynolds said. “That has been my commitment to Iowans since day one, and I will continue to serve with that same purpose during my final months in office.”
The governor has 30 days to sign the bills on her desk into law or veto them.
