Governor Reynolds reveals property tax plan, other initiatives in annual speech to lawmakers

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January 14th, 2026 by Ric Hanson

(Radio Iowa) – Governor Kim Reynolds is proposing a property tax plan and new spending on cancer prevention, detection and treatment. Reynolds outlined these and other initiatives in the annual “Condition of the State” message Iowa governors deliver to legislators. Reynolds is calling for a two percent cap on property tax revenue growth for city and county budgets.

“Spending is what drives taxes — always has, always will — and the most reliable way to protect taxpayers is to limit the growth of government itself,” Reynolds said. “…When we were kids, our parents would tell us that money doesn’t grow on trees. Well, it’s time that government learned that, too.” The governor’s proposing a property tax freeze for Iowans above the age of 64 if their home’s value is less than 350-thousand dollars. “Because no one should be taxed out of their own front door,” Reynolds said.

And Reynolds is proposing tax-deductible accounts for Iowans saving for their first home, along with an expansion of Iowa’s beginning farmer tax credits.”Whatever their dream, let’s make sure it’s within their reach so more young Iowans will choose to build their future here,” Reynolds said. The state just received federal funding for rural health care initiatives and Reynolds is promising to dedicate 50 million dollars of it to expand cancer screening tests and treatment of cancer.

“We’re making early detection the norm, not the exception,” Reynolds said, “replacing fear with hope and making sure if families hear the word ‘cancer’ they also hear: ‘We caught it early and we can treat it.'” Reynolds began her speech by honoring Staff Sergeants Nate Howard of Marshalltown and Edgar Torres-Tovar of Des Moines, the two Iowa National Guard soldiers who were killed a month ago in Syria. “Our fallen soldiers served their state and their country with honor. As respected leaders they were models of courage, commitment and character,” Reynolds said.

“We don’t speak their names only in grief, but in honor…Please join me in honoring Staff Sergeant Howard, Staff Sergeant Torres-Tovar and their families with the applause of a free and grateful people.” Staff Sergeant Howard’s family was seated in the House gallery for the speech and they wiped tears from their eyes as the ovation lasted for well over a minute. The governor then revealed the two Iowa National Guard soldiers who were seriously wounded in that attack in Syria have been released from the hospital and are in outpatient treatment.

Reynolds says only 29 percent of the nearly 180-thousand veterans who live in Iowa are receiving the federal benefits they’re owed — and only six other states have a lower grade. “An outdated system that provides little accountability is leaving too many veterans and well-meaning county officials without the tools, training and consistency they need,” Reynolds said. She’s proposing that the Iowa Department of Veterans Affairs take over training of all 99 county Veterans Service Officers and that the state no longer provide 10-thousand dollars to each county to pay these employees.

That money would be pooled into a competitive grant program to reward counties based on how many veterans, per capita, have secured the benefits they earned. The state would also set up a computerized claims system that would be used for all 99 counties. Reynolds, who has been Iowa’s governor since mid-2017, is not seeking reelection. “As I enter into my final legislative session as governor, I do so deeply grateful, fully committed and determined to finish strong,” Reynolds said. “There’ll be time to look back and time to say, ‘Thank you,’ but tonight our focus is on forward, on what still needs to be done and doing it together.”

Reynolds has forwarded her state spending recommendations to legislators — for an overall budget that’s slightly less than two percent bigger than this year. It includes a two-and-a-half percent per pupil spending increase for Iowa’s K-12 public and private schools, along with a recommendation that state spending for community colleges and the three public universities increase one-and-a-half percent.