A bill for an act modifying provisions governing the taxation of forest reservations and fruit-tree reservations, and including effective date and retroactive applicability provisions.

Senate

File

17

-

Introduced

SENATE

FILE

17

BY

SINCLAIR

A

BILL

FOR

An

Act

modifying

provisions

governing

the

taxation

of

forest

1

reservations

and

fruit-tree

reservations,

and

including

2

effective

date

and

retroactive

applicability

provisions.

3

BE

IT

ENACTED

BY

THE

GENERAL

ASSEMBLY

OF

THE

STATE

OF

IOWA:

4

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17

Section

1.

Section

427C.3,

Code

2025,

is

amended

to

read

as

1

follows:

2

427C.3

Forest

reservation.

3

A

forest

reservation

shall

contain

not

less

than

two

hundred

4

growing

forest

trees

on

each

acre.

If

the

area

selected

is

a

5

forest

containing

the

required

number

of

growing

forest

trees,

6

it

shall

be

accepted

as

a

forest

reservation

under

this

chapter

7

provided

a

qualifying

application

under

section

427C.12

is

made

8

or

on

file

on

or

before

February

1

of

the

exemption

year.

If

9

any

buildings

are

standing

on

an

area

selected

as

a

forest

10

reservation

under

this

section

or

a

fruit-tree

reservation

11

under

section

427C.7

,

one

acre

of

that

area

shall

be

excluded

12

from

the

tax

exemption.

However,

the

exclusion

of

that

acre

13

shall

not

affect

the

area’s

meeting

the

acreage

requirement

of

14

section

427C.2

.

15

Sec.

2.

Section

427C.12,

Code

2025,

is

amended

to

read

as

16

follows:

17

427C.12

Application

——

inspection

——

continuation

of

18

exemption

——

recapture

of

tax.

19

1.

It

shall

be

the

duty

of

the

assessor

to

secure

the

facts

20

relative

to

fruit-tree

and

forest

reservations

by

taking

the

21

sworn

statement,

or

affirmation,

of

the

owner

or

owners

making

22

an

application

under

this

chapter

;

and

to

make

special

report

23

to

the

county

auditor

of

all

reservations

made

in

the

county

24

under

the

provisions

of

this

chapter

.

25

2.

a.

The

board

of

supervisors

shall

designate

the

county

26

conservation

board

or

the

assessor

who

shall

inspect

the

area

27

for

which

an

application

is

filed

for

a

fruit-tree

or

forest

28

reservation

tax

exemption

before

the

application

is

accepted.

29

Use

of

aerial

photographs

may

be

substituted

for

on-site

30

inspection

when

appropriate.

31

b.

The

application

can

shall

only

be

accepted

if

it

meets

32

all

of

the

criteria

following

conditions:

33

(1)

Any

criteria

established

by

the

natural

resource

34

commission

to

be

a

fruit-tree

or

forest

reservation.

35

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(2)

The

owner

or

owners

are

receiving

a

homestead

tax

credit

1

under

chapter

425

at

the

time

of

the

application.

2

c.

Once

the

application

has

been

accepted,

the

area

shall

3

continue

to

receive

the

tax

exemption

during

each

year

in

which

4

the

area

is

maintained

as

a

fruit-tree

or

forest

reservation

5

without

the

owner

having

to

refile

,

if

the

fruit-tree

or

forest

6

reservation

continues

to

meet

all

of

the

conditions

under

7

paragraph

“b”

,

including

that

the

owner

or

owners

continue

to

8

receive

a

homestead

credit

for

each

applicable

assessment

year

.

9

d.

If

the

property

is

sold

or

transferred,

the

seller

10

shall

notify

the

buyer

that

all,

or

part

of,

the

property

11

is

in

fruit-tree

or

forest

reservation

and

subject

to

the

12

recapture

tax

provisions

of

this

section

.

The

If

the

new

owner

13

or

owners

satisfy

the

homestead

credit

requirement,

the

tax

14

exemption

shall

continue

to

be

granted

for

the

remainder

of

15

the

eight-year

period

for

fruit-tree

reservation

and

for

the

16

following

years

for

forest

reservation

or

until

the

property

no

17

longer

qualifies

as

a

fruit-tree

or

forest

reservation.

18

e.

The

area

may

be

inspected

each

year

by

the

county

19

conservation

board

or

the

assessor

to

determine

if

the

area

is

20

maintained

as

a

fruit-tree

or

forest

reservation.

If

the

owner

21

or

owners

fail

to

satisfy

the

homestead

credit

requirement

22

or

the

area

is

not

maintained

or

is

used

for

economic

gain

23

other

than

as

a

fruit-tree

reservation

during

any

year

of

the

24

eight-year

exemption

period

and

any

year

of

the

following

five

25

years

or

as

a

forest

reservation

during

any

year

for

which

26

the

exemption

is

granted

and

any

of

the

five

years

following

27

those

exemption

years,

the

assessor

shall

assess

the

property

28

for

taxation

at

its

fair

market

value

as

of

January

1

of

that

29

year

and

in

addition

the

area

shall

be

subject

to

a

recapture

30

tax.

However,

the

area

shall

not

be

subject

to

the

recapture

31

tax

if

the

owner,

including

one

possessing

under

a

contract

32

of

sale,

and

the

owner’s

direct

antecedents

or

descendants

33

have

owned

the

area

for

more

than

ten

years.

The

tax

shall

be

34

computed

by

multiplying

the

consolidated

levy

for

each

of

those

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17

years,

if

any,

of

the

five

preceding

years

for

which

the

area

1

received

the

exemption

for

fruit-tree

or

forest

reservation

2

times

the

assessed

value

of

the

area

that

would

have

been

taxed

3

but

for

the

tax

exemption.

This

tax

shall

be

entered

against

4

the

property

on

the

tax

list

for

the

current

year

and

shall

5

constitute

a

lien

against

the

property

in

the

same

manner

as

6

a

lien

for

property

taxes.

The

tax

when

collected

shall

be

7

apportioned

in

the

manner

provided

for

the

apportionment

of

the

8

property

taxes

for

the

applicable

tax

year.

9

Sec.

3.

EFFECTIVE

DATE.

This

Act,

being

deemed

of

immediate

10

importance,

takes

effect

upon

enactment.

11

Sec.

4.

RETROACTIVE

APPLICABILITY.

This

Act

applies

12

retroactively

to

existing

and

new

exemptions

under

chapter

427C

13

for

assessment

years

beginning

on

or

after

January

1,

2025.

14

EXPLANATION

15

The

inclusion

of

this

explanation

does

not

constitute

agreement

with

16

the

explanation’s

substance

by

the

members

of

the

general

assembly.

17

This

bill

modifies

provisions

governing

the

taxation

of

18

forest

reservations

and

fruit-tree

reservations.

19

Current

Code

chapter

427C

authorizes

a

property

tax

20

exemption

for

certain

forest

reservations

and

fruit-tree

21

reservations,

if

the

owner

meets

certain

criteria

established

22

by

the

natural

resource

commission

to

be

a

forest

or

fruit-tree

23

reservation.

24

In

addition

to

meeting

the

criteria

established

by

the

25

natural

resource

commission

to

be

a

forest

or

fruit-tree

26

reservation,

the

bill

requires

the

owner

to

also

be

receiving

27

the

homestead

tax

credit

under

Code

chapter

425

in

each

28

assessment

year

the

forest

or

fruit-tree

tax

exemption

is

29

received

by

the

owner.

30

The

bill

takes

effect

upon

enactment

and

applies

31

retroactively

to

existing

and

new

exemptions

under

Code

chapter

32

427C

for

assessment

years

beginning

on

or

after

January

1,

33

2025.

34

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