The Iowa Senate has advanced an amended property tax proposal. Though the House in Des Moines states that substantial negotiations remain before a final bill is agreed to. The passage of the bill by the Senate reiterates the state legislature’s intention to pass property tax reform this session. 

The bill is Senate File 2472 and it passed in a vote of 41-4 as amended. 

The initial bill proposed entirely eliminating Iowa’s “rollback” system for calculating property taxes based on a percentage of a property’s value. The new measure makes adjustments to how residential, commercial and multi-residential properties are assessed under this system.

The bill would repeal the property tax measure passed by Republican legislators and signed by the governor in 2023 that set levy rate caps for cities and counties. Instead, it will set a “soft cap” on the levy system, while excluding certain levies like tort, hazard, health insurance and pensions. Other changes made in the amendment include keeping some of the residential rollback, adding changes to tax-increment-financing (TIF), striking the senior unencumbered home exemption, maintaining the school foundation levy at current levies, and adding the First Home Account program from the Governor’s and House’s bills.

Both chambers and the Governor must now reach a solution between their proposals before the end of the session. The final day of the legislators’ per diem is April 21st.