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Senate
File
2228
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Introduced
SENATE
FILE
2228
BY
QUIRMBACH
A
BILL
FOR
An
Act
relating
to
school
district
funding
provisions,
1
including
reducing
the
foundation
property
tax
and
repealing
2
the
education
savings
account
program,
and
including
3
effective
date
and
applicability
provisions.
4
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
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DIVISION
I
1
SCHOOL
FOUNDATION
PROPERTY
TAX
2
Section
1.
Section
257.3,
subsection
1,
paragraph
a,
Code
3
2026,
is
amended
to
read
as
follows:
4
a.
Except
as
provided
in
subsections
2
and
3
,
a
school
5
district
shall
cause
to
be
levied
each
year,
for
the
school
6
general
fund,
a
foundation
property
tax
equal
to
five
four
7
dollars
and
forty
four
cents
per
thousand
dollars
of
assessed
8
valuation
on
all
taxable
property
in
the
district.
The
county
9
auditor
shall
spread
the
foundation
levy
over
all
taxable
10
property
in
the
district.
11
Sec.
2.
Section
257.3,
subsection
2,
paragraphs
a
and
b,
12
Code
2026,
are
amended
to
read
as
follows:
13
a.
Notwithstanding
subsection
1
,
a
reorganized
school
14
district
shall
cause
a
foundation
property
tax
of
four
three
15
dollars
and
forty
four
cents
per
thousand
dollars
of
assessed
16
valuation
to
be
levied
on
all
taxable
property
which,
in
the
17
year
preceding
a
reorganization,
was
within
a
school
district
18
affected
by
the
reorganization
as
defined
in
section
275.1
,
19
or
in
the
year
preceding
a
dissolution
was
a
part
of
a
school
20
district
that
dissolved
if
the
dissolution
proposal
has
21
been
approved
by
the
director
of
the
department
of
education
22
pursuant
to
section
275.55
.
23
b.
In
succeeding
school
years,
the
foundation
property
tax
24
levy
on
that
portion
shall
be
increased
to
the
rate
of
four
25
three
dollars
and
ninety
fifty-four
cents
per
thousand
dollars
26
of
assessed
valuation
the
first
succeeding
year,
five
three
27
dollars
and
fifteen
seventy-nine
cents
per
thousand
dollars
of
28
assessed
valuation
the
second
succeeding
year,
and
five
four
29
dollars
and
forty
four
cents
per
thousand
dollars
of
assessed
30
valuation
the
third
succeeding
year
and
each
year
thereafter.
31
Sec.
3.
Section
425A.3,
subsection
1,
Code
2026,
is
amended
32
to
read
as
follows:
33
1.
The
family
farm
tax
credit
fund
shall
be
apportioned
34
each
year
in
the
manner
provided
in
this
chapter
so
as
to
give
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a
credit
against
the
tax
on
each
eligible
tract
of
agricultural
1
land
within
the
several
school
districts
of
the
state
in
which
2
the
levy
for
the
general
school
fund
exceeds
five
dollars
and
3
forty
cents
per
thousand
dollars
of
assessed
value
the
levy
4
rate
under
section
257.3,
subsection
1,
paragraph
“a”
.
The
5
amount
of
the
credit
on
each
eligible
tract
of
agricultural
6
land
shall
be
the
amount
the
tax
levied
for
the
general
school
7
fund
exceeds
the
amount
of
tax
which
would
be
levied
on
each
8
eligible
tract
of
agricultural
land
were
the
levy
for
the
9
general
school
fund
five
dollars
and
forty
cents
per
thousand
10
dollars
of
assessed
value
the
levy
rate
under
section
257.3,
11
subsection
1,
paragraph
“a”
,
for
the
previous
year.
However,
12
in
the
case
of
a
deficiency
in
the
family
farm
tax
credit
fund
13
to
pay
the
credits
in
full,
the
credit
on
each
eligible
tract
14
of
agricultural
land
in
the
state
shall
be
proportionate
and
15
applied
as
provided
in
this
chapter
.
16
Sec.
4.
Section
425A.5,
Code
2026,
is
amended
to
read
as
17
follows:
18
425A.5
Computation
by
county
auditor.
19
The
family
farm
tax
credit
allowed
each
year
shall
be
20
computed
as
follows:
On
or
before
April
1,
the
county
auditor
21
shall
list
by
school
districts
all
tracts
of
agricultural
22
land
which
are
entitled
to
credit,
the
taxable
value
for
the
23
previous
year,
the
budget
from
each
school
district
for
the
24
previous
year,
and
the
tax
rate
determined
for
the
general
25
fund
of
the
school
district
in
the
manner
prescribed
in
26
section
444.3
for
the
previous
year,
and
if
the
tax
rate
is
in
27
excess
of
five
dollars
and
forty
cents
per
thousand
dollars
of
28
assessed
value
the
levy
rate
under
section
257.3,
subsection
29
1,
paragraph
“a”
,
the
auditor
shall
multiply
the
tax
levy
which
30
is
in
excess
of
five
dollars
and
forty
cents
per
thousand
31
dollars
of
assessed
value
the
levy
rate
under
section
257.3,
32
subsection
1,
paragraph
“a”
,
by
the
total
taxable
value
of
the
33
agricultural
land
entitled
to
credit
in
the
school
district,
34
and
on
or
before
April
1,
certify
the
total
amount
of
credit
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and
the
total
number
of
acres
entitled
to
the
credit
to
the
1
department
of
revenue.
2
Sec.
5.
Section
426.3,
Code
2026,
is
amended
to
read
as
3
follows:
4
426.3
Where
credit
given.
5
The
agricultural
land
credit
fund
shall
be
apportioned
each
6
year
in
the
manner
hereinafter
provided
so
as
to
give
a
credit
7
against
the
tax
on
each
tract
of
agricultural
lands
within
the
8
several
school
districts
of
the
state
in
which
the
levy
for
9
the
general
school
fund
exceeds
five
dollars
and
forty
cents
10
per
thousand
dollars
of
assessed
value
the
levy
rate
under
11
section
257.3,
subsection
1,
paragraph
“a”
;
the
amount
of
such
12
credit
on
each
tract
of
such
lands
shall
be
the
amount
the
tax
13
levied
for
the
general
school
fund
exceeds
the
amount
of
tax
14
which
would
be
levied
on
said
tract
of
such
lands
were
the
15
levy
for
the
general
school
fund
five
dollars
and
forty
cents
16
per
thousand
dollars
of
assessed
value
the
levy
rate
under
17
section
257.3,
subsection
1,
paragraph
“a”
,
for
the
previous
18
year,
except
in
the
case
of
a
deficiency
in
the
agricultural
19
land
credit
fund
to
pay
said
credits
in
full,
in
which
case
the
20
credit
on
each
eligible
tract
of
such
lands
in
the
state
shall
21
be
proportionate
and
shall
be
applied
as
hereinafter
provided.
22
Sec.
6.
Section
426.6,
subsection
1,
Code
2026,
is
amended
23
to
read
as
follows:
24
1.
The
agricultural
land
tax
credit
allowed
each
year
25
shall
be
computed
as
follows:
On
or
before
April
1,
the
26
county
auditor
shall
list
by
school
districts
all
tracts
of
27
agricultural
lands
which
are
entitled
to
credit,
together
with
28
the
taxable
value
for
the
previous
year,
together
with
the
29
budget
from
each
school
district
for
the
previous
year,
and
the
30
tax
rate
determined
for
the
general
fund
of
the
district
in
31
the
manner
prescribed
in
section
444.3
for
the
previous
year,
32
and
if
such
tax
rate
is
in
excess
of
five
dollars
and
forty
33
cents
per
thousand
dollars
of
assessed
value
the
levy
rate
34
under
section
257.3,
subsection
1,
paragraph
“a”
,
the
auditor
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shall
multiply
the
tax
levy
which
is
in
excess
of
five
dollars
1
and
forty
cents
per
thousand
dollars
of
assessed
value
the
2
levy
rate
under
section
257.3,
subsection
1,
paragraph
“a”
,
by
3
the
total
taxable
value
of
the
agricultural
lands
entitled
to
4
credit
in
the
district,
and
on
or
before
April
1,
certify
the
5
amount
to
the
department
of
revenue.
6
Sec.
7.
ADJUSTMENT
OF
CALCULATIONS.
For
property
tax
7
credits
under
chapters
425A
and
426
for
property
taxes
due
and
8
payable
in
the
fiscal
year
beginning
July
1,
2026,
the
tax
rate
9
determined
for
the
general
fund
of
the
school
district
in
the
10
manner
prescribed
in
section
444.3
for
the
previous
year
shall
11
be
determined
using
the
property
tax
levy
rate
under
section
12
257.3,
as
amended
in
this
division
of
this
Act.
13
Sec.
8.
EFFECTIVE
DATE.
This
division
of
this
Act,
being
14
deemed
of
immediate
importance,
takes
effect
upon
enactment.
15
Sec.
9.
APPLICABILITY.
The
following
apply
July
1,
2026,
16
for
school
budget
years
beginning
on
or
after
that
date:
17
1.
The
section
of
this
division
of
this
Act
amending
section
18
257.3,
subsection
1,
paragraph
“a”.
19
2.
The
section
of
this
division
of
this
Act
amending
section
20
257.3,
subsection
2,
paragraphs
“a”
and
“b”.
21
DIVISION
II
22
REPEAL
OF
THE
EDUCATION
SAVINGS
ACCOUNT
PROGRAM
23
Sec.
10.
Section
256.9,
subsection
66,
Code
2026,
is
amended
24
by
striking
the
subsection.
25
Sec.
11.
Section
257.10,
subsection
9,
paragraph
c,
26
subparagraph
(1),
Code
2026,
is
amended
to
read
as
follows:
27
(1)
The
unadjusted
teacher
salary
supplement
district
cost
28
is
the
teacher
salary
supplement
district
cost
per
pupil
for
29
each
school
district
for
a
budget
year
multiplied
by
the
sum
30
of
the
budget
enrollment
for
that
school
district
plus
the
31
number
of
resident
pupils
in
the
school
district
that
received
32
an
education
savings
account
payment
under
section
257.11B
for
33
the
base
year
.
34
Sec.
12.
Section
257.10,
subsection
10,
paragraph
c,
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subparagraph
(1),
Code
2026,
is
amended
to
read
as
follows:
1
(1)
The
unadjusted
professional
development
supplement
2
district
cost
is
the
professional
development
supplement
3
district
cost
per
pupil
for
each
school
district
for
a
budget
4
year
multiplied
by
the
sum
of
the
budget
enrollment
for
that
5
school
district
plus
the
number
of
resident
pupils
in
the
6
school
district
that
received
an
education
savings
account
7
payment
under
section
257.11B
for
the
base
year
.
8
Sec.
13.
Section
257.10,
subsection
11,
paragraph
c,
9
subparagraph
(1),
Code
2026,
is
amended
to
read
as
follows:
10
(1)
The
unadjusted
early
intervention
supplement
district
11
cost
is
the
early
intervention
supplement
district
cost
per
12
pupil
for
each
school
district
for
a
budget
year
multiplied
13
by
the
sum
of
the
budget
enrollment
for
that
school
district
14
plus
the
number
of
resident
pupils
in
the
school
district
that
15
received
an
education
savings
account
payment
under
section
16
257.11B
for
the
base
year
.
17
Sec.
14.
Section
257.10,
subsection
12,
paragraph
c,
18
subparagraph
(1),
Code
2026,
is
amended
to
read
as
follows:
19
(1)
The
unadjusted
teacher
leadership
supplement
district
20
cost
is
the
teacher
leadership
supplement
district
cost
per
21
pupil
for
each
school
district
for
a
budget
year
multiplied
22
by
the
sum
of
the
budget
enrollment
for
that
school
district
23
plus
the
number
of
resident
pupils
in
the
school
district
that
24
received
an
education
savings
account
payment
under
section
25
257.11B
for
the
base
year
.
26
Sec.
15.
Section
422.7,
subsection
43,
Code
2026,
is
amended
27
by
striking
the
subsection.
28
Sec.
16.
REPEAL.
Section
257.11B,
Code
2026,
is
repealed.
29
Sec.
17.
EFFECTIVE
DATE.
This
division
of
this
Act,
being
30
deemed
of
immediate
importance,
takes
effect
upon
enactment.
31
Sec.
18.
APPLICABILITY.
This
division
of
this
Act
applies
32
July
1,
2026,
for
school
budget
years
beginning
on
or
after
33
that
date.
34
EXPLANATION
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The
inclusion
of
this
explanation
does
not
constitute
agreement
with
1
the
explanation’s
substance
by
the
members
of
the
general
assembly.
2
This
bill
relates
to
school
district
funding,
including
3
reducing
the
foundation
property
tax
and
repealing
the
4
education
savings
account
program.
5
DIVISION
I.
As
part
of
Iowa’s
system
for
funding
school
6
districts,
Code
section
257.3
requires
each
school
district
7
to
levy
each
year,
for
the
school
general
fund,
a
foundation
8
property
tax
equal
to
$5.40
per
$1,000
of
assessed
valuation
9
on
all
taxable
property
in
the
district.
The
bill
reduces
10
the
foundation
property
tax
rate
from
$5.40
to
$4.04.
An
11
exception
to
the
$5.40
levy
rate
under
current
law
is
for
12
recently
reorganized
and
dissolved
school
districts.
For
such
13
districts,
the
initial
year
requires
a
rate
of
$4.40,
the
first
14
succeeding
year
requires
a
rate
of
$4.90,
the
second
succeeding
15
year
requires
a
rate
of
$5.15,
and
for
the
third
succeeding
16
year
and
thereafter,
a
rate
of
$5.40.
The
bill
reduces
all
of
17
the
applicable
foundation
property
tax
rates
to
correspond
with
18
the
reduction
in
the
foundation
property
tax.
19
The
bill
provides
for
an
adjustment
of
property
tax
credit
20
calculations
under
Code
chapters
425A
(family
farm
tax
credit)
21
and
426
(agricultural
land
tax
credit)
for
property
taxes
due
22
and
payable
in
the
fiscal
year
beginning
July
1,
2026,
to
23
account
for
the
change
to
the
property
tax
levy
rate
under
Code
24
section
257.3
in
the
bill.
25
Division
I
takes
effect
upon
enactment.
26
The
sections
of
division
I
that
amend
Code
section
257.3
27
apply
July
1,
2026,
for
school
budget
years
beginning
on
or
28
after
that
date.
29
DIVISION
II.
The
education
savings
account
program
is
a
30
program
that
provides
funds
to
pupils
who
attend
nonpublic
31
schools
to
pay
for
qualified
educational
expenses
including
32
but
not
limited
to
tuition,
tutoring
or
cognitive
skill
33
training
fees,
educational
therapy
costs,
software
expenses,
34
and
expenses
related
to
course
materials.
For
school
years
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beginning
on
or
after
July
1,
2025,
each
student
eligible
to
1
enroll
in
kindergarten
through
grade
12
is
eligible
for
the
2
education
savings
account
program.
3
Division
II
repeals
the
education
savings
account
program
4
and
makes
conforming
changes.
5
Division
II
takes
effect
upon
enactment
and
applies
July
1,
6
2026,
for
school
budget
years
beginning
on
or
after
that
date.
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7/
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