Lawmakers in the statehouse appear poised to tackle more legislation to limit property tax collection by cities and counties in the 2025 session.
No specific proposals have yet been floated by lawmakers, but the prospect of further limits has some local government officials concerned about continuing to fund services and amenities into the future.
State Rep. Bobby Kaufmann, a Republican from Wilton who chairs the House taxing committee Ways and Means, said “everything is on the table” for property tax proposals.
“I come to it with an open mind,” Kaufmann said. “I have met with cities, I have met with counties, I have met with supervisors, and I’m telling everyone the same thing. The people of Iowa are expecting an aggressive approach to property tax reduction, but I am open to how we do it."
In 2023, legislation passed that Republicans estimated would save taxpayers $100 million by consolidating and capping levy rates for cities and counties. Lawmakers also passed a new $6,500 homestead property tax exemption for Iowa seniors and an $8,000 exemption for veterans.
Kaufmann said he still hears from Iowans, “particularly those on a fixed income, that have been dealing with increased tax bills, and they're having to start thinking about making decisions like what medications to buy versus whether they can stay in their home.”
A proposal by Iowans for Tax Relief, an organization that advocates for cutting taxes, would limit cities and counties’ property tax growth to 2%.
It’s not clear if lawmakers favor that proposal. Kaufmann said he would entertain any organization’s ideas, but that addressing property taxes is a complicated problem looking at differences in urban and rural areas that requires nuance. Kaufmann said he’s also open to ideas on “how to make cities and counties more financially whole based on their different growth structures.”
Davenport Mayor Mike Matson, the chair of the Metro Coalition, an organization that advocates for the policy priorities of Iowa’s largest cities, laid out his views of the potential consequences of a 2% cap proposal during an early December meeting of the Davenport City Council.
Davenport Mayor Mike Matson asks Scott County lawmakers to avoid more property tax cuts, which stress city budgets, promote more affordable child care, for $5 million for victim services, and for help in holding slumlords accountable. Matson made the requests at a legislative forum at the Hotel Blackhawk on Friday, Jan. 19, 2024.
SARAH WATSON, QUAD-CITY TIMES
Matson said that the bulk of property taxes go toward the general fund and the bulk of the general fund pays for public safety — police and fire departments.
“We all know things cost more,” Matson said. “I’m not a mathematician, but I can do math. If I only am allowed to collect 2% (growth) but bills cost more than that, i.e. salaries or GWIs (general wage increases) or other things. I can’t provide that. So, am I decrementing? I hate the word decrement. Firing. Laying off people. Am I cutting services?”
Public safety is typically a top priority set by the council and by city residents in community surveys. In fiscal 2025, the city’s general fund budget was about $60 million. About three-quarters of the general fund revenue comes from property taxes. The general fund paid for $22.26 million of the city’s police budget and about $14.8 million of the fire department’s budget.
Davenport's fiscal 2025 budget is about $239 million, a decrease of 1.42% from the previous year, driven mostly by less spending on capital projects. The operating budget is about $168 million, which increased by 4.3%. The general fund, about $60 million, increased by about $2.79 million, or 4.8%, which the city's budget documents state was because of rising personnel costs from collective bargaining agreements for public safety and moderate increases in professional service contracts.
If lawmakers do pursue further cuts to property taxes and cities don't look at cutting public safety, Matson said, "Is it parks maintenance? Is it building inspections? Hmm, that’s interesting around here. Is it neighborhood services? Even garbage collection. I don’t know, you tell me ... that’s what we’re talking about. So we’re doing everything we can to make our voices heard."
Kaufmann said blanket criticism and fearmongering about legislation that doesn't exist yet is not helpful.
"I can tell you that if you go straight to 'oh we're going to cut cops, you will not have a seat at the table because that means their door is closed and that they're unwilling to be at that table ... the whole point of this is for us to find collaborative solutions and reduce Iowa's property tax burdens."
Davenport reduced its tax levy rate because of the 2023 legislation to $16.61 per $1,000 of taxable value in the fiscal year that started July 1. In fiscal 2024, Davenport’s tax levy rate was $16.78.
State lawmakers changed the state's property tax formula and eliminated special levies such as the library and emergency levies, which Davenport used, and combined them into a general levy.
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No specific proposals have yet been floated by lawmakers, but the prospect of further limits has some local government officials concerned about continuing to fund services and amenities into the future.
State Rep. Bobby Kaufmann, a Republican from Wilton who chairs the House taxing committee Ways and Means, said “everything is on the table” for property tax proposals.
“I come to it with an open mind,” Kaufmann said. “I have met with cities, I have met with counties, I have met with supervisors, and I’m telling everyone the same thing. The people of Iowa are expecting an aggressive approach to property tax reduction, but I am open to how we do it."
In 2023, legislation passed that Republicans estimated would save taxpayers $100 million by consolidating and capping levy rates for cities and counties. Lawmakers also passed a new $6,500 homestead property tax exemption for Iowa seniors and an $8,000 exemption for veterans.
Kaufmann said he still hears from Iowans, “particularly those on a fixed income, that have been dealing with increased tax bills, and they're having to start thinking about making decisions like what medications to buy versus whether they can stay in their home.”
A proposal by Iowans for Tax Relief, an organization that advocates for cutting taxes, would limit cities and counties’ property tax growth to 2%.
It’s not clear if lawmakers favor that proposal. Kaufmann said he would entertain any organization’s ideas, but that addressing property taxes is a complicated problem looking at differences in urban and rural areas that requires nuance. Kaufmann said he’s also open to ideas on “how to make cities and counties more financially whole based on their different growth structures.”
Davenport Mayor Mike Matson, the chair of the Metro Coalition, an organization that advocates for the policy priorities of Iowa’s largest cities, laid out his views of the potential consequences of a 2% cap proposal during an early December meeting of the Davenport City Council.
Davenport Mayor Mike Matson asks Scott County lawmakers to avoid more property tax cuts, which stress city budgets, promote more affordable child care, for $5 million for victim services, and for help in holding slumlords accountable. Matson made the requests at a legislative forum at the Hotel Blackhawk on Friday, Jan. 19, 2024.
SARAH WATSON, QUAD-CITY TIMES
Matson said that the bulk of property taxes go toward the general fund and the bulk of the general fund pays for public safety — police and fire departments.
“We all know things cost more,” Matson said. “I’m not a mathematician, but I can do math. If I only am allowed to collect 2% (growth) but bills cost more than that, i.e. salaries or GWIs (general wage increases) or other things. I can’t provide that. So, am I decrementing? I hate the word decrement. Firing. Laying off people. Am I cutting services?”
Public safety is typically a top priority set by the council and by city residents in community surveys. In fiscal 2025, the city’s general fund budget was about $60 million. About three-quarters of the general fund revenue comes from property taxes. The general fund paid for $22.26 million of the city’s police budget and about $14.8 million of the fire department’s budget.
Davenport's fiscal 2025 budget is about $239 million, a decrease of 1.42% from the previous year, driven mostly by less spending on capital projects. The operating budget is about $168 million, which increased by 4.3%. The general fund, about $60 million, increased by about $2.79 million, or 4.8%, which the city's budget documents state was because of rising personnel costs from collective bargaining agreements for public safety and moderate increases in professional service contracts.
If lawmakers do pursue further cuts to property taxes and cities don't look at cutting public safety, Matson said, "Is it parks maintenance? Is it building inspections? Hmm, that’s interesting around here. Is it neighborhood services? Even garbage collection. I don’t know, you tell me ... that’s what we’re talking about. So we’re doing everything we can to make our voices heard."
Kaufmann said blanket criticism and fearmongering about legislation that doesn't exist yet is not helpful.
"I can tell you that if you go straight to 'oh we're going to cut cops, you will not have a seat at the table because that means their door is closed and that they're unwilling to be at that table ... the whole point of this is for us to find collaborative solutions and reduce Iowa's property tax burdens."
Davenport reduced its tax levy rate because of the 2023 legislation to $16.61 per $1,000 of taxable value in the fiscal year that started July 1. In fiscal 2024, Davenport’s tax levy rate was $16.78.
State lawmakers changed the state's property tax formula and eliminated special levies such as the library and emergency levies, which Davenport used, and combined them into a general levy.
Iowa lawmakers expect 'aggressive approach' property tax cuts
“The people of Iowa are expecting an aggressive approach to property tax reduction, but I am open to how we do it," State Rep. Bobby Kaufmann says.
