House GOP scales back property tax relief package


June 7th, 2011 by Ric Hanson

House Republicans have significantly scaled-back their property tax relief package in an effort appease city and county officials and try to convince Democrats to embrace the bill. Nearly a month ago, Republicans in the Iowa House voted to cut commercial and industrial property taxes by 40 percent over five years.

House Republicans are now proposing a 25 percent reduction instead. Representative Tom Sands, a Republican from Wapello, is chairman of the House committee that crafts tax policy.   “It’s a step in the direction of trying to address some of the concerns that we had heard,” Sands says. But Democrats like Representative Dave Jacoby,  of Coralville aren’t convinced.

“It still kicks the middle class in the kneecaps and the home owners because it’s going to raise our taxes,” Jacoby says. The original bill, which reduced property taxes by an estimated 800 million dollars over eight years, included a significant increase in state support of public schools in an effort to replace property taxes that are collected for K-through-12 schools. The scaled-back version would reduce property taxes by 340-million over five years, but Jacoby argues cities and counties will replace the lost revenue they’ve been getting from commercial and industrial property owners by raising property taxes on home owners.

“I just don’t see any way that this is not going to raise the average Iowan’s taxes over the next year,” Jacoby says. Sands says he and his fellow Republicans believe cutting commercial and industrial property taxes will spur economic growth. “I think anytime that you let any business have more of the money that they’re paying in (taxes), I think it will definitely have an impact on local economies,” Sands says.

House leaders have set Wednesday as the day to debate this property tax proposal, combined with a bill that outlines state spending for the next two years. Today (Tuesday), a hearing is scheduled at the statehouse from four ’til six p.m. to give the public a chance to speak out about the taxing and spending proposals.

(Radio Iowa)