2008 ASSESSMENT LIMITATIONS ORDER (ROLLBACK)

Media contact:
Dale Hyman
Property Tax Administrator
Iowa Department of Revenue
515/281-3362
dale.hyman@iowa.gov

On October 27, 2008 , the Iowa Department of Revenue issued an assessment limitations order in compliance with Iowa Code section 441.21. It has percentages to be applied by county auditors to the 2008 assessed values of agricultural, residential, commercial, industrial, railroad, and utility property for computing the taxable values used for property taxes.

These adjustments in value are necessary to comply with the state law that allows no more than a 4% increase in taxable values from 2007 to 2008 for each class of property except utility property, which is limited to an 8% annual growth.

The taxable value of residential realty will be 45.5893% of the assessed value. This percentage also applies to farm dwellings. No adjustments are being ordered for commercial, industrial, railroad, and utility property because there were not sufficient increases in values to qualify for reductions. These properties are assessed on the basis of their market value. Agricultural property will be limited to 93.8568% of the assessed value. Agricultural property, excluding agricultural dwellings, is assessed according to its productivity value.

The effect of this action is a reduction of actual assessments of residential realty including farm dwellings from approximately $129.0 billion to $58.8 billion. Agricultural values will be reduced from $25.6 billion to $24.1 billion.

Specific tax liabilities based on these reduced assessments and payable in fiscal year 2009-10 cannot be determined until local taxing bodies establish their property tax needs early next year.

Assessment limitations began when legislation was enacted in 1978 to limit the impact of inflation on agricultural and residential property values by restricting their statewide annual growth in taxable values to 6%. For 1979, the assessment limitations were extended to include commercial, industrial, utility, and railroad properties. For 1980 and subsequent years, the assessment limitation allowable annual growth was reduced from 10% to 8% for utility properties and from 6% to 4% for the other classes of property.

Past years' rollback percentages and additional information about assessment limitations are at http://www.state.ia.us/tax/locgov/propequalroll.html .