SIOUX CITY, Iowa (KCAU) — Iowa Governor Kim Reynolds signed a bill that would take $133 million from residents’ property tax bills.
The law now leaves cities and counties scrambling to rearrange their budgets along with adjusting for the drop in funds they were expecting. The law is supposed to fix errors from previous property tax bills passed in 2013 and 2021.
In Fall 2022, the legislative service agency found a mistake, where residential property owners were grouped in with multi-residential property owners. In some cases, this caused residential property owners to pay more in taxes. The legislation is intended to fix the unintentional tax increase. The law will alter the rollback for fiscal year 2023-24.
At Tuesday night’s Woodbury County Board of Supervisors meeting, Matthew Ung said the county will be using money from the reserves to offset this for now.
“And we have those reserves because we have budgeted as a county, according to what we think is right and our multi-year outlook, so it wasn’t the state that built up these reserves that we’re using to fix their mistakes, it was Woodbury County and our board of supervisors, so I don’t want that to be lost on anyone,” said Ung.
Ung said the cost for the county is estimated to be nearly $1 million to the budget. He added that the problem will continue year after year until there’s money to fill the gaps.
Meanwhile, the City of Sioux City’s budgeting process was also affected by the state error. Council members approved a 21.46% increase over the fiscal year 2023 levy.
Mayor Bob Scott said he hopes the city never has to raise property taxes that high. He added that the city does not have the budget that says those taxes will be raised to 21%.
“Totally irresponsible for the state to put us in the position that they have put us in and then we catch the brunt. When the reality is most of this problem is because they can’t even get their numbers right down there and that’s unfortunate, but it’s the truth and they need to do a better job down there, so we know what our base is here,” said Scott.
Scott said he hopes to get the budget somewhere manageable to where it’s at currently.