Bill Text: IA HSB65 | 2023-2024 | 90th General Assembly | Introduced
Bill Title: A bill for an act relating to the determination of market value for property tax assessment purposes and including applicability provisions.
Spectrum: Committee Bill
Status: (Introduced - Dead) 2023-02-08 - Subcommittee Meeting: 02/09/2023 12:30PM House Lounge (Cancelled). [HSB65 Detail]
Download: Iowa-2023-HSB65-Introduced.html
House
Study
Bill
65
-
Introduced
HOUSE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
WAYS
AND
MEANS
BILL
BY
CHAIRPERSON
KAUFMANN)
A
BILL
FOR
An
Act
relating
to
the
determination
of
market
value
for
1
property
tax
assessment
purposes
and
including
applicability
2
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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Section
1.
Section
441.21,
subsection
1,
paragraph
b,
1
subparagraph
(1),
Code
2023,
is
amended
to
read
as
follows:
2
(1)
(a)
The
actual
value
of
all
property
subject
to
3
assessment
and
taxation
shall
be
the
fair
and
reasonable
market
4
value
of
such
property
except
as
otherwise
provided
in
this
5
section
.
“Market
value”
is
defined
as
the
fair
and
reasonable
6
exchange
value-in-exchange
of
the
fee
simple
interest
of
the
7
property
in
the
year
in
which
the
property
is
listed
and
valued
8
between
a
willing
buyer
and
a
willing
seller,
neither
being
9
under
any
compulsion
to
buy
or
sell
and
each
being
familiar
10
with
all
the
facts
relating
to
the
particular
property
and
does
11
not
include
an
exchange
that
is
value-in-use
.
Sale
prices
of
12
the
property
or
comparable
property
in
normal
transactions
13
reflecting
market
value,
and
the
probable
availability
14
or
unavailability
of
persons
interested
in
purchasing
the
15
property,
shall
be
taken
into
consideration
in
arriving
at
its
16
market
value.
In
arriving
at
market
value,
sale
prices
of
17
property
in
abnormal
transactions
not
reflecting
market
value
18
shall
not
be
taken
into
account
,
or
.
If,
however,
transactions
19
reflecting
market
value
of
the
property
or
comparable
property
20
are
not
available,
transactions
not
reflecting
market
value
21
may
be
used,
but
shall
be
adjusted
to
eliminate
the
effect
of
22
factors
which
distort
market
value,
including
but
not
limited
23
to
build-to-suit,
sale-leaseback
transactions;
leased
fee
24
sales;
sales
to
involving
immediate
family
of
the
seller,
or
25
related
parties;
foreclosure
or
other
forced
sales
,
;
contract
26
sales
,
;
discounted
purchase
transactions
;
or
purchase
of
27
adjoining
land
or
other
land
to
be
operated
as
a
unit.
28
(b)
“Fee
simple”
means
absolute
ownership
unencumbered
by
29
any
other
interest
or
estate,
subject
only
to
the
limitations
30
imposed
by
the
governmental
powers
of
taxation,
eminent
domain,
31
police
power,
and
escheat.
32
Sec.
2.
Section
441.21,
subsection
2,
Code
2023,
is
amended
33
to
read
as
follows:
34
2.
In
the
event
market
value
of
the
property
being
assessed
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cannot
be
readily
established
in
the
foregoing
manner,
then
1
the
assessor
may
determine
the
value
of
the
property
using
2
the
other
uniform
and
recognized
appraisal
methods
including
3
its
productive
and
earning
capacity,
if
any,
industrial
4
conditions,
its
cost,
physical
and
functional
depreciation
5
and
obsolescence
and
replacement
cost,
and
all
other
factors
6
which
would
assist
in
determining
the
fair
and
reasonable
7
market
value
of
the
property
but
the
actual
value
shall
not
8
be
determined
by
use
of
only
one
such
factor.
The
following
9
shall
not
be
taken
into
consideration:
Special
value
or
use
10
value
,
value-in-use,
or
present
use
of
the
property
to
its
11
present
owner
,
and
the
intangibles,
goodwill
,
or
going
concern
12
value
of
a
business
which
uses
the
property
as
distinguished
13
from
the
value
of
the
property
as
property.
In
addition,
14
for
assessment
years
beginning
on
or
after
January
1,
2018
15
2024
,
and
unless
otherwise
required
for
property
valued
by
the
16
department
of
revenue
pursuant
to
chapters
428
,
433
,
437
,
and
17
438
,
the
assessor
shall
not
take
into
consideration
and
shall
18
not
request
from
any
person
property
insurance
policies;
loan,
19
mortgage,
or
other
financing
information;
franchise
agreements;
20
sales
or
receipts
data
,
;
expense
data
,
;
balance
sheets
,
;
bank
21
account
information
,
;
or
other
data
related
to
the
financial
22
condition
of
a
business
operating
in
whole
or
in
part
on
the
23
property
if
the
property
is
both
classified
as
commercial
or
24
industrial
property
and
owned
and
used
by
the
owner
of
the
25
business
.
However,
in
assessing
property
that
is
rented
or
26
leased
to
low-income
individuals
and
families
as
authorized
by
27
section
42
of
the
Internal
Revenue
Code,
as
amended,
and
which
28
section
limits
the
amount
that
the
individual
or
family
pays
29
for
the
rental
or
lease
of
units
in
the
property,
the
assessor
30
shall,
unless
the
owner
elects
to
withdraw
the
property
from
31
the
assessment
procedures
for
section
42
property,
use
the
32
productive
and
earning
capacity
from
the
actual
rents
received
33
as
a
method
of
appraisal
and
shall
take
into
account
the
extent
34
to
which
that
use
and
limitation
reduces
the
market
value
of
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the
property.
The
assessor
shall
not
consider
any
tax
credit
1
equity
or
other
subsidized
financing
as
income
provided
to
2
the
property
in
determining
the
assessed
value.
The
property
3
owner
shall
notify
the
assessor
when
property
is
withdrawn
4
from
section
42
eligibility
under
the
Internal
Revenue
Code
5
or
if
the
owner
elects
to
withdraw
the
property
from
the
6
assessment
procedures
for
section
42
property
under
this
7
subsection
.
The
property
shall
not
be
subject
to
section
42
8
assessment
procedures
for
the
assessment
year
for
which
section
9
42
eligibility
is
withdrawn
or
an
election
is
made.
This
10
notification
must
be
provided
to
the
assessor
no
later
than
11
March
1
of
the
assessment
year
or
the
owner
will
be
subject
to
a
12
penalty
of
five
hundred
dollars
for
that
assessment
year.
The
13
penalty
shall
be
collected
at
the
same
time
and
in
the
same
14
manner
as
regular
property
taxes.
An
election
to
withdraw
15
from
the
assessment
procedures
for
section
42
property
is
16
irrevocable.
Property
that
is
withdrawn
from
the
assessment
17
procedures
for
section
42
property
shall
be
classified
and
18
assessed
as
residential
property
unless
the
property
otherwise
19
fails
to
meet
the
requirements
of
subsection
14
.
Upon
20
adoption
of
uniform
rules
by
the
department
of
revenue
or
21
succeeding
authority
covering
assessments
and
valuations
of
22
such
properties,
the
valuation
on
such
properties
shall
be
23
determined
in
accordance
with
such
rules
and
in
accordance
with
24
forms
and
guidelines
contained
in
the
real
property
appraisal
25
manual
prepared
by
the
department
as
updated
from
time
to
time
26
for
assessment
purposes
to
assure
uniformity,
but
such
rules,
27
forms,
and
guidelines
shall
not
be
inconsistent
with
or
change
28
the
foregoing
means
of
determining
the
actual,
market,
taxable
29
and
assessed
values.
30
Sec.
3.
APPLICABILITY.
This
Act
applies
to
assessment
years
31
beginning
on
or
after
January
1,
2024.
32
EXPLANATION
33
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
34
the
explanation’s
substance
by
the
members
of
the
general
assembly.
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Code
section
441.21
generally
governs
the
assessment
of
1
property
for
property
tax
purposes
and
provides
that
the
actual
2
value
of
all
property
subject
to
assessment
and
taxation
shall
3
be
the
fair
and
reasonable
market
value
of
such
property
except
4
as
provided
in
that
Code
section.
“Market
value”
is
defined
5
as
the
fair
and
reasonable
exchange
in
the
year
in
which
the
6
property
is
listed
and
valued
between
a
willing
buyer
and
a
7
willing
seller,
neither
being
under
any
compulsion
to
buy
8
or
sell
and
each
being
familiar
with
all
the
facts
relating
9
to
the
particular
property.
Sale
prices
of
the
property
or
10
comparable
property
in
normal
transactions
reflecting
market
11
value,
and
the
probable
availability
or
unavailability
of
12
persons
interested
in
purchasing
the
property,
shall
be
taken
13
into
consideration
in
arriving
at
its
market
value.
However,
14
sale
prices
of
property
in
abnormal
transactions
not
reflecting
15
market
value
shall
not
be
taken
into
account.
16
This
bill
modifies
the
definition
of
“market
value”
to
be
17
the
fair
and
reasonable
value-in-exchange
of
the
fee
simple
18
interest
of
property
in
the
year
in
which
the
property
is
19
listed
and
valued
between
a
willing
buyer
and
a
willing
seller,
20
neither
being
under
any
compulsion
to
buy
or
sell
and
each
21
being
familiar
with
all
the
facts
relating
to
the
particular
22
property,
but
excluding
an
exchange
that
is
value-in-use.
The
23
bill
includes
a
definition
of
fee
simple.
24
The
bill
also
modifies
the
conditions
under
which
25
transactions
that
do
not
reflect
market
value
may
be
used
26
by
the
assessor.
Under
the
bill,
in
arriving
at
market
27
value,
sale
prices
of
property
in
transactions
not
reflecting
28
market
value
shall
not
be
taken
into
account.
If,
however,
29
transactions
reflecting
market
value
of
the
property
or
30
comparable
property
are
not
available,
transactions
not
31
reflecting
market
value
may
be
used,
but
shall
be
adjusted
to
32
eliminate
the
effect
of
factors
which
distort
market
value.
33
The
bill
adds
build-to-suit,
sale-leaseback
transactions,
and
34
leased
fee
sales
to
the
list
of
such
transactions
and
modifies
35
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the
provision
governing
the
use
of
sales
to
immediate
family
1
of
the
seller.
2
The
bill
also
modifies
Code
section
441.21(2),
which
3
specifies
that
in
the
event
market
value
of
the
property
being
4
assessed
cannot
be
readily
established
using
transaction
data,
5
then
the
assessor
may
determine
the
value
of
the
property
using
6
the
other
uniform
and
recognized
appraisal
methods
including
7
its
productive
and
earning
capacity,
if
any,
industrial
8
conditions,
its
cost,
physical
and
functional
depreciation
and
9
obsolescence
and
replacement
cost,
and
all
other
factors
which
10
would
assist
in
determining
the
fair
and
reasonable
market
11
value
of
the
property,
so
long
as
the
actual
value
is
not
to
be
12
determined
by
use
of
only
one
such
factor.
The
bill
adds
to
the
13
prohibited
considerations
the
value-in-use
or
present
use
of
14
the
property,
intangibles,
or
going
concern
value
of
a
business
15
which
uses
the
property.
The
bill
also
adds
property
insurance
16
policies;
loan,
mortgage,
or
other
financing
information;
and
17
franchise
agreements
to
the
list
of
prohibited
considerations
18
and
things
that
may
not
be
requested
by
the
assessor
and
19
modifies
conditions
for
other
items
prohibited
under
current
20
law.
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