Author: Sarah Curry, DBA

Repeat Offenders with Local Government Spending and Taxes

Repeat Offenders with Local Government Spending and Taxes

Seventeen local governments are going back to taxpayers for more after recent election asks.

Three cities, one county, and 13 schools are going back to taxpayers asking for more money in the November 2024 election despite their other recent ballot measures that asked taxpayers for more money. Six of these local governments recently enjoyed either passage of a bond measure or renewal of a property tax levy. The remaining 11 are returning to taxpayers who recently rejected either a tax increase or a bond proposal. Either way, taxpayers are not getting a break in these 17 jurisdictions.

Déjà Vu for Voters

In some cases, taxpayers see two proposals close together because state law requires a bond request and the tax increase to pay for the bond to be put forward in separate elections. Emmetsburg Community School District (CSD) and Van Buren CSD are in this position.  The fact that these districts have back-to-back ballot questions is a procedural matter, and not indicative of an unquenchable thirst for collecting more tax dollars.

That said, given the low cost and high reward of putting questions to taxpayers, local governments often seem inclined to ignore results they don’t like when taxpayers have voiced their opinions. One example is the City of Boone, which in 2022 asked voters for a $10 million bond to build a recreational complex. When that failed, the city tried again in 2023, but community pushback limited the city council to creating a task force to study the issue, instead. Now (surprise, surprise) Boone is back in 2024, looking for a do-over of the 2022 vote.

Many public-school districts have responded to voters’ rejection with a sort of serial negotiation, scaling back projects and reducing the amounts they are requesting with their bond proposals. Lewis Central CSD is the best example of this. After failing to receive $90 million last year, the district is giving $30 million a try this year, with the deal sweetened by avoiding an immediate property tax increase.  In instances like that, maybe the system is working as the elected leaders at least seem to be taking voter input into account.

On the other side of the coin is brazen disrespect for taxpayers when a local government responds to ballot defeat by asking for more than the original proposal in a subsequent election. Lawton-Bronson CSD is guilty of this behavior during this election cycle.  That school district had a $15.5 million bond measure fail, and now they are back asking for nearly $17 million just one year later.

Spending Adds Up

At a time when a majority of Iowans favor limits on their annual property tax burdens, local voters must remember how the accumulation of numerous small proposals can add up to substantially higher property tax bills over the years. For example, multiple school districts successfully renewed their physical plant and equipment levies (PPELs) recently, but now these same districts are asking for bonds. If the bonds pass, property taxes are likely to increase to pay for the debt, as either the rate goes up or the valuation increases without an automatic reduction in the rate.

Some communities have bonds nearing expiration, and instead of allowing taxpayers to benefit from the resulting savings, officials are replacing them with new bonds while promoting the fact that tax rates will remain unchanged. This is similar to a consumer whose car loan is almost paid off. Rather than enjoying the extra savings from no longer having a monthly payment, they rush to the dealership to make a new purchase, feeling satisfied that their monthly payment hasn’t increased.

Use the menu bar at the top of this page to learn more about your community’s spending and taxing decisions before the November election.

Property Tax Increases on the Ballot in 12 Counties

Property Tax Increases on the Ballot in 12 Counties

Voters will be asked to approve funding for emergency medical services (EMS), more commonly referred to as “the ambulance tax.”

Current law (federal, state, and local) allows variation in how government entities provide (or do not provide) emergency medical services (EMS), including ambulance services. Iowa’s statutes require local delivery of law enforcement and fire protection, which may deliver first-responder medical services in some instances. However, townships and city governments have historically collected the financial resources and infrastructure for Iowa’s EMS protection, with most of the actual service coming from volunteers. In more-urban areas, paid ambulance services provide reliable care, with most crews staffed at paramedic level.

Background

With voter approval, local governments can generate local funds for EMS in the form of local income surtaxes, local property taxes, or a combination of both. In 1992, the Iowa Legislature authorized the creation of EMS districts. For their support, voters may pass property tax levies of not more than $1.00 per $1,000 of assessed value on all the taxable property within the district. Later, the Legislature permitted a 1% local income surtax for counties to utilize for EMS. The tax revenue may be used to purchase or rent EMS apparatus, equipment, and material and to employ EMS and other personnel.

The first county to implement local taxes specifically to support EMS was Appanoose County, which imposed the maximum 1% surtax on its residents in 1994. The first cities to use the EMS property tax were Riceville and Sheffield.

In 2021, Iowa legislators changed the law pertaining to EMS to allow counties to seek voter approval for a local income surtax up to 1% and a property tax up to $0.75 per $1,000 of taxable valuation. The legislation still did not mandate EMS at the state level, instead maintaining local decision-making to ensure sufficient interest among residents in increasing their tax burdens for such services.

The ballot questions facing voters in 2024 reflect the most-recent EMS property tax law changes.

Counties Currently with EMS Levies

Shortly after the enactment of the 2021 law, eight counties placed referenda to introduce the new taxes on their November 2022 ballots, and five reached the required 60% threshold for passage: Jones, Kossuth, Osceola, Pocahontas, and Winnebago. Populations in the three other counties, Calhoun, Floyd, and Worth, did not.

Voters in Cedar, Benton, Ida, and Shelby Counties joined those with approved EMS property taxes in November 2023. Additional counties imposed the tax in 2024, with Louisa County voters approving the measure in March and voters in Henry and parts of Worth County doing so in September. According to the Iowa Department of Management, 12 counties currently use the EMS property tax for the 2025 fiscal year.

A Clarification of “EMS”

Iowa budget documents use the acronym, EMS, for two purposes. Emergency management services refer to all frontline response organizations and personnel who provide immediate assistance and support during emergencies. The primary objective of these agencies is to save lives, protect property, and ensure public safety during the immediate response phase of emergencies. This broader EMS includes police, fire departments, search and rescue teams, specialized response units, and emergency medical services.

Across Iowa, more than 3,000 separate entities govern and tax for emergency management services, including approximately 870 cities, 1,700 townships, several hundred emergency medical services departments, legacy benefitted fire districts and fire boards, 28E agencies,1 and non-profit corporations. Today, most fire departments list emergency medical calls as their most voluminous activity, in many cases comprising 70% or more of those departments’ annual responses. 

To learn more about how your county funds emergency management, select the county name from the menu bar at the top of this page. Ambulance services are included in the “public safety & legal services” category. 


1 28E references Iowa Code Chapter 28E, which permits the merging of two governmental entities to create a new “agency” that becomes its own governmental body with the purpose of providing a particular service, in this case fire and/or EMS protection.

New Debt Proposals Exceed $1 Billion for November Election

New Debt Proposals Exceed $1 Billion for November Election

Taxpayers across 59 counties, representing 82% of the state’s population, will be asked to increase their debt burden.

The November 5, 2024, general election ballots in 59 counties will have bond questions. This potential new spending of $1.13 billion would, if enacted, directly affect 82.4% of the state’s population.

The bond questions cover a variety of local government types: Nine are for cities; one is for a community college; five are for counties; and the remaining 31 are for public school districts. The largest request is $165 million for Waterloo Community School District (CSD) to convert a middle school into a high school. The smallest request comes from the City of State Center, with a proposal to build an addition to its municipal fire station for $1,500,000.

Since Iowans for Tax Relief Foundation began tracking local bond elections, school districts (collectively) have frequently asked the most of taxpayers. This election cycle is no different, as the proposals from schools total $860 million. That amount far surpasses the debt proposals of counties ($129 million), cities ($91 million), and community colleges ($55 million).

Effect of 2023 Property Tax Law

In 2023, a wide-ranging package of property tax reforms passed through the Iowa State Capitol (HF 718), winning overwhelming bipartisan support in both legislative chambers. One of the legislation’s major provisions is the restriction of bond elections to November each year, with the goal of increasing voter turnout for issues that have a direct effect on property taxes.

Another provision of the legislation is for direct notification about bond elections. The commissioner of elections or auditor for each county conducting a bond election must mail every registered voter a notice that includes the full text of the public measure to be voted on not less than 10 days or more than 20 days prior to election day.

Voter Education

To ensure efficient, accountable government, voters in districts with bond proposals must educate themselves about public projects and spending in their communities. Use the menu bar at the top of this page to explore your community’s spending, debt, and property tax collections as you decide how to vote on these debt proposals.

Majority of Special Elections Approve Property Taxes; Low Turnout the Norm

Majority of Special Elections Approve Property Taxes; Low Turnout the Norm

Voter turnout for city and county measures was 10.5%, while school measures drew only 8.5%.

On September 10, 2024, twenty-one local governments held special elections with property tax measures on the ballot. Unofficial results show most of the measures passed, adding up to nearly $14 million in property tax costs. Ten of the 13 participating school districts succeeded with their public measures, and voters in both Henry and Worth Counties approved new emergency management taxes. Meanwhile, three public measures involving property taxes failed on Tuesday.

Turnout was in the single digits for most school districts in which the measures succeeded. County and city emergency management property tax decisions generated much more engagement. Statewide, the turnout for September’s special elections for city and county issues was 10.5%, while school measures saw turnout of only 8.5%.

School Elections

Eleven school districts sought renewal of, or increases in, physical plant and equipment levies (PPELs), which generate local property tax dollars for infrastructure and equipment repairs. The ten measures that passed did so with collective support of nearly 80%.

Only Clarinda Community School District (CSD) voters said “no” to their PPEL proposal, which was for $1.34 per thousand dollars of valuation. In that Southwest Iowa community, 54% of the voters were against the tax increase. Interestingly, Clarinda voters had already rejected two bond issue referendums for building projects in 2023, while also defeating an earlier PPEL proposal in March, which was defeated by only six votes.

When it comes to debt service levies, two additional school district proposals were turned down by voters. Emmetsburg CSD and Van Buren CSD asked voters for increases ahead of a bond referendum scheduled for November. Both measures failed by strong margins. Emmetsburg CSD faced nearly 59% of voters’ saying NO, while 82% of Van Buren CSD voters rejected a property tax increase for debt service.

Voter turnout showed significantly higher engagement in districts where residents rejected the public measures than those in which the governments’ proposals were successful. Clarinda CSD (31.3%) and Van Buren CSD (37.3%) had the largest turnouts. All other districts, except for Emmetsburg CSM and Montezuma CSD, experienced single-digit turnout figures, with one as low as 3.5%, amounting to only 37 voters interested in voicing their opinions in that election. In total, school public measures produced turnout of only 8.5%, or 10,496 of the more than 123,000 registered voters.

City and County Elections

All of the city and county elections on September 10 were related to county emergency management services (EMS), and each of them were successes for the government agencies.  This will result in $850,000 in new property taxes in Henry County and Worth County. Five small cities within Worth County also solidly passed EMS-related property taxes. Overall, the support margin for these EMS public measures was almost 95%. Upon passage of an EMS tax, all generated revenue is put into a dedicated trust fund to be used solely for such services as ambulance transport.

Voter turnout was also high for these EMS public measures. More than 50% of Henry County voters weighed in, while Worth County cities and districts saw turnout range from about 22% in the West Worth County EMS district to more than 40% in the City of Grafton.

Results from September 10, 2024, Public Measures Affecting Property Taxes

Property Tax Increases Take Center Stage on March 5th Special Election Ballots

Some local governments say if you vote to renew a levy, taxes won’t go up.

But it’s like finishing paying for a car and then buying another with the same monthly payment. This hides the option of saving money instead!

The March 5, 2024, special election in 13 school districts and one county will put property tax increase questions before voters. The school districts are looking for increases in their physical plant and equipment levies (PPELs), which generate local property tax dollars for infrastructure and equipment repairs, and one district is also asking for an increase of its debt service levy (i.e., for bonds). Louisa County is asking voters for a 15-year tax increase to fund emergency medical services (EMS).

How Much Will Property Taxes Increase?

If these public measures were to pass, the total would increase next year’s property tax collections by $12.1 million. Even worse, these property tax increases are scheduled to last for 10 years or more. The total taxpayer commitment would be more than $137.4 million — and that is a conservative estimate because nobody can predict property valuation increases a decade from now.

The following table provides the details for each public measure.

What Is PPEL?

PPEL stands for “physical plant and equipment levy.” The Iowa Legislature created the tax in the early 1990s as a local funding stream to support school district facilities and equipment. One type of PPEL allows annual school board approval, while the other, including those listed above, requires public votes. Voted PPELs can be authorized for a maximum of 10 years and $1.34 per $1,000 of taxable value and are distinctive because school boards may issue bonds against them and repay the debt with interest from the revenue.

PPEL funds may only be used for maintenance projects and equipment. For the current fiscal year, 49 districts do not use this property tax levy, while 100 districts are at the maximum rate of $1.34. The statewide average tax rate is 81 cents, and it generates $206.7 million per year.

Not Telling the Whole Truth

Anytime government agencies hold a vote to increase spending or keep it the same, the burden on taxpayers increases because home values continue to go up year after year. Some districts are forthcoming about the effect on taxpayers and admit they are asking for more money; others use careful wording to convince voters the tax increase doesn’t exist.

One of the most common statements school districts will use is, “This will not cause an increase in the school district property tax rate.”

The claim is that the current tax rate includes a PPEL, and if voters agree to keep it the same, then taxes do not go up. The principle is similar to paying off a car only to run out to buy a new one at the same monthly payment. The continuing payments disguise the alternative: saving the money.

Another way to say the same thing points to a second misleading aspect, “The district believes this will not cause an increase in the school district property tax rate. This will extend the voter PPEL the district currently has for an additional 10 years. The district has had a voter PPEL since 1992.” Over time, keeping the rate the same produces inevitable increases as property values rise. Since 1992, Iowa residential property valuations have increased 274%, meaning the district has been effectively raising taxes for 30+ years.

Some districts go so far as to deploy scare tactics against voters like, “If the PPEL is not renewed, the district would need to use general fund or SAVE money to support building upkeep, transportation, and technology, delaying potential projects planned from SAVE funding.” Translation: the school would have to budget and spend money on its planned projects. State Secure an Advanced Vision for Education (SAVE) money is already earmarked for infrastructure purposes, so using it is not unreasonable.

Another common tactic is to claim, “The current PPEL rate is $0.67 per $1,000 of taxable property value. We are asking voters to consider raising that to $1.34. Despite the increase, the district is positioned financially to make changes that allow the district’s overall tax levy rate to remain flat, meaning an increase of the voted PPEL will not raise taxes.” Notice the details. The district is positioned to make changes, which doesn’t mean it will. Total spending will likely increase, meaning the burden on property owners will also increase.

Voter Resources

Click on your school or county in the table above or use the menu at the top of this page to visit your community's page to learn more about its property taxes and spending.

What Is a Revenue Purpose Statement?

What Is a Revenue Purpose Statement?

Simply put, if the voters of your district do not approve of a Revenue Purpose Statement (RPS), your property taxes will be lower. If they approve an RPS, your school district can spend more money and keep taxes higher. All school districts receive the corresponding funds from the state regardless of RPS status; the question is where the money goes.

Details

Revenue Purpose Statement (RPS) is a ballot measure describing how a school district will spend sales tax funds the State of Iowa has dedicated to public schools through a program called Secure an Advanced Vision for Education (SAVE). State law mandates that all SAVE money must be used to pay for local property tax relief or school infrastructure needs. If a district wants to utilize its SAVE funds on infrastructure projects by spending that money or bonding against it, officials must ask voters to approve an RPS allowing them to forgo property tax relief.

Importance

Simply put, if the voters of your district do not approve of a Revenue Purpose Statement (RPS), your property taxes will be lower. If they approve an RPS, your school district can spend more money and keep taxes higher. All school districts receive the corresponding funds from the state regardless of RPS status; the question is where the money goes.

How Property Taxes Are Lowered

If a school district does not have an RPS, the SAVE revenue generated from the sales tax must be used to reduce specific local property tax levies. The only exception is if voters previously approved an RPS and the district used it for revenue bonding, then that debt must be paid off before SAVE revenue can be directed towards tax relief. The district must apply the money in the following order:

  1. To any debt service levy for general obligation bonds until it is reduced to zero. The maximum rate is $4.05 per $1,000 of taxable valuation.
  2. To any board-imposed physical plant and equipment levy (PPEL) until it is reduced to zero.
    The maximum rate is $0.33.
  3. To any voter-approved physical plant and equipment levy (PPEL) and income surtax until it is reduced to zero. The maximum rate is $1.34 and income surtax is 20%.
  4. To any public educational and recreational levy (PERL) until it is reduced to zero. The maximum rate is $0.135.
  5. To any authorized school infrastructure purpose.

Use the menu at the top of this page to see how much your district is spending.

RPS on the Ballot

Every March and September a handful of districts submit RPSs to voters. Voters should pay attention to why a district wants an RPS and what it intends to do with the proceeds.

Glenwood CSD, for example, failed to win approval of a general obligation bond in November, and officials have been very open about their plan to leverage SAVE money to build some of the facilities voters turned down last fall.  By using SAVE dollars this time around, they can bypass voter approval. Woodward-Granger CSD simply wants to extend its RPS because the current one is expiring. Meanwhile, Williamsburg CSD has listed examples of its past SAVE spending to imply how it will use funds moving forward.

The following table puts the seven pending RPS questions in context of whether the district placed a bond initiative on the November 2023 ballot as well as the growth (or decline) of local property taxes and student enrollment.

Misleading Comments by School Districts

Leading up to an election, school district officials attempt to make the case for their intentions, but their statements can sometimes be misleading.

The most common example is that “renewal of the district’s RPS will not lead to a property tax increase and will not extend an existing tax.” This is disingenuous because absent an RPS, the district’s property taxes would be decreased if all revenue bonds have been paid off. By enacting an RPS, the district extends its current property tax burden into the future. Variations on this misleading statement are that the RPS is “not endorsing a new tax burden” or that “the revenue generated has been used to meet our evolving needs while minimizing the burden on local taxpayers.”

Another misconception is that failure to approve an RPS means the district cannot access the SAVE funds. One example: “[we] ask voters to approve our Revenue Purpose Statement, a resolution necessary for districts to access sales tax revenue for a variety of purposes.” Districts receive SAVE funds with and without RPSs, it is only the use of those SAVE dollars that might be limited.

Revenue Purpose Statement Expiration

Legislation in 2019 set all RPSs voted on before July 1, 2019, to expire on January 1, 2031. For districts to continue spending SAVE funds as they wish, each must secure new RPSs approved by voters. Any new RPS will stay in effect through December 31, 2050, unless amended or repealed. For more information on the use of SAVE funds and Revenue Purpose Statements, click here.

County Tax Relief Is Not Deprivation

County Tax Relief Is Not Deprivation

Counties are cashing in on hefty property taxes from high assessments, and reducing rates won’t halt financial gains.

You might hear your county officials complaining they are facing dire straits this year because of the new property tax law. The truth is that too many counties have been cashing in on hefty property taxes from rapidly increasing assessments, and redirecting some of these financial gains toward rate reductions shouldn’t affect the services they offer.

Every county is supposed to be allowed a maximum general services property tax levy of $3.50 per $1,000 in valuation, with another $3.95 for the rural area of the county.[1] Over time, special provisions in state law have given counties ways to exceed those rates. To make the property tax structure easier to understand and more predictable for taxpayers, the new law consolidates some levies and requires counties gradually to reduce their top rate to the $3.50 and $3.95 maximums.

Counties Raised Their Rates

While the legislation was working its way through the system before being enacted in May 2023, county officials knew it would eventually become law. In their final budgets before implementation, many counties made changes to hedge against future cuts.

They certainly had room to do so. Iowa property valuations increased as much as 22% above the prior year in some areas, so counties have no need for increased levy rates, given these extraordinary assessment bumps. Many of them were already enjoying the advantages of rates above the supposed maximums.

In fiscal year 2023 (FY23), 30 counties charged more than the maximum general services rate of $3.50, and three of them were above $3.95 for rural services.

For FY24, the number above the maximum for general services jumped to 40 counties, with rural rates above the maximum in five counties. The statewide average general county services rate rose over the same period from $3.55 to $3.78. Growth of the average rural addition was from $3.18 for FY23 to $3.27 for FY24.

To put that into perspective, Decatur County has the highest general services rate, and it jumped 12 cents to $6.71 for FY24. On the rural side, Audubon has the highest rate, which increased another 2 cents, to $5.38 on top of the general services rate in that county. Even so, Audubon comes nowhere near the highest total rate. The combined basic rate (general services and rural) in Clarke County is $9.64 for FY24.

Another key statistic is the county with the largest increase over the one-year timeframe; Lee County raised its general services rate from $3.50 to $5.85, a $2.35 jump in one year, which was the largest in the state.

Keep in mind that counties impose other levies on taxpayers, too, pushing total tax rates even higher. The highest-taxed residents in the state at the county level are currently the rural residents of Winnebago, who pay $15.52 per $1,000 of property, all in.

How the Legislation Works

The recent legislation reduces property tax levies by requiring counties to apply new growth toward lowering their levy rates. If a county experiences growth in property valuations, it can no longer keep the entire windfall but must adjust its rates.

Triggers vary this requirement based on the non-TIF taxable valuation growth.[2] If a county’s non-TIF taxable growth is 3% or less, it can maintain its current levy rate and collect the increase. If a county’s non-TIF taxable valuation growth is between 3% and 6%, it must reduce its total property tax collections by 2% by adjusting its rate downward. If a county’s tax base grows at 6% or more, the mandatory reduction is 3%.

For simplicity, the following examples consider only the general services levy:

  1. County A has a general services levy rate of $3.50, and its non-TIF taxable valuations increase from $1.00 billion to $1.02 billion, which is up 2% year-over-year.
    a. The county can keep its tax rate and all property tax growth that year.
  2. County B has a general services levy rate of $4.50, and its non-TIF taxable valuations increase from $1.00 billion to $1.04 billion, which is up 4% year-over-year.
    a. The county is required to reduce its total tax dollars collected by 2% while keeping the rest of the increase.
  3. County C has a general services levy rate of $4.50, and its non-TIF taxable valuations increase from $1.00 billion to $1.07 billion, which is up 7% year-over-year.
    a. The county is required to reduce its total tax dollars collected by 3% while keeping the rest of the increase.

How Much in Savings?

From 2017 to 2023, county valuations went up an average of 4.3%. Every county saw its valuations grow by at least 3% during one of those years, and 70 saw valuations increase by more than 6%. In rural areas, the average growth across the state from 2017 to 2023 was 4.2%. Again, every county’s rural property values went up by at least 3% during one of those years, and 78 saw valuations increase by more than 6%.

The new county tax rate restrictions will lower property taxes statewide. Exactly how great an effect taxpayers see depends on how much the general and rural tax bases of each county grow from FY25 to FY28. The benefit will be most substantial in the 40 counties currently above $3.50 for general services and five counties currently above $3.95 for rural services, but any county with a big increase in property values will enjoy a tax reduction from what their taxes would otherwise have been.


 [1] Certain county property tax levies apply to all taxed property within the county; these are called general levies, while other levies apply only to property that is outside of incorporated cities, which are called rural levies. Properties located in cities are only subject to the general levies, while rural properties are subject to both general and rural levies.

[2] This refers to the taxable valuation growth outside of specially designated districts with tax increment financing (TIF) programs. 

Assessment Rollback Protects Your Property Tax Bill

Assessment Rollback Protects Your Property Tax Bill

How much did your assessment increase?

Many people saw the value of their home increase by 20% or more, but that does not mean their property taxes are going to increase by 20% thanks to a law on Iowa’s books called the rollback.

The rollback percentage is adjusted each year by the Iowa Department of Revenue. Last year, the rollback rate was 54.6501%. This year, due to the growth in valuations across the state, the rollback rate dropped to 46.3428%.

The rollback percentage is a form of assessment limitation that helps keep property taxes from growing too fast.

The example below shows how the rollback is used to limit the property taxes paid by taxpayers when there are large increases in the assessed value.

As you can see from the above example, the property's assessment increased, but the tax bill decreased because of the rollback.

So, even though many properties across Iowa saw record assessment growth, taxes should not increase that much. However, many jurisdictions will choose to increase the levy rate to make you pay more.

The rollback was first applied in 1978, permitting a 6% growth in the taxable value of residential property. From 1980 through 2012, the allowable growth rate was reduced to 4%. Beginning in 2013, the growth limit is 3% statewide.

Below is a full history of Iowa’s residential rollback percentage. The steep drop from 2022 to 2023 shows that the rollback is reacting to the inflationary pressures on home values, which is what it is intended to do -- to protect property taxpayers.

November 2023 Local Bond Election Results

Iowa counties, cities, and schools put forward bond questions for the election yesterday across 50 counties, covering 75% of the state’s population and totaling a potential $1.72 billion in new spending. The decision facing taxpayers was whether or not they wanted to saddle themselves with new debt and higher property tax bills during a time of rising inflation and national economic uncertainty. Statewide, 366,488 ballots were cast, representing 16.68% voter turnout.

Results

A total of 45 bonds were on the ballots for six counties, four cities, and 35 public school districts. Only 22 of the bonds met the 60% threshold to pass. As shown in the following table, these results translate to $951.9 million in new spending, with the largest from the Polk County bond for Des Moines Airport.

Voters responsible for Cedar Rapids Community School District (CSD) overwhelmingly defeated the largest school bond proposal in state history. Other large requests, such as those from Dubuque CSD and Lewis Central CSD, received majority support but failed to achieve the supermajority of 60% to pass.

Many of the school districts whose bond proposals failed yesterday have experienced declining enrollment over the last 10 years. However, some with declining enrollment still found a way to win over taxpayers: Durant CSD, Harris-Lake Park CSD, Mid-Prairie CSD, and North Tama CSD. The school districts in the Des Moines metro area with increasing enrollment overwhelmingly approved their bond measures.

City bonds in Linn, Story, and Marshall County failed, leaving Burlington as the lone winner. Turning to counties, four will be receiving new jails and law enforcement centers, but Webster County failed to receive the supermajority to fund a new jail proposal.

Overall, the proposal with the strongest support was Van Meter’s CSD bond, at 86%, while the bond with the least support was Schaller-Crestland CSD’s, with only 35.5% support.

Effect of a New Property Tax Law

Earlier this year, the state government enacted a wide-ranging package of property tax reforms, with one major provision restricting bond elections to November each year. The intent was to increase voter turnout for issues that have a direct effect on property taxes. Governments that choose to try again for any bonds that failed yesterday must wait a calendar year before they can put them before voters again.

Another new requirement in the legislation is direct notification about bond elections. The commissioner of elections or auditor for each county conducting a bond election must mail every registered voter a notice that includes the full text of the public measure to be voted on days prior to election day.

The Secretary of State reported the city and school election for the first time, allowing taxpayers to watch in real time as results were posted. Future years of November bond elections with statewide reporting and data will allow for better analysis for local governments and taxpayers alike.

School Districts Seek $1.2 Billion Amid Declining Enrollment

School Districts Seek $1.2 Billion Amid Declining Enrollment

At a time when the economic environment is forcing families to budget for gasoline and groceries while property taxes keep climbing, school districts would do well to focus on projects directly related to the education of children.

On November 7, 2023, 34 school districts will ask voters to approve bond questions totaling more than $1.2 billion across 50 counties in Iowa. Many districts claim the new debt will be revenue neutral from a taxpayer perspective, or only increase the property tax a little, but most Iowans want their taxes to go down, not stay the same or increase.

Half of these districts, 17, have overseen property tax increases of more than 40% in the last decade. At the same time, 15 of the 34 districts have experienced declines in enrollment over the same period. Only 10 have seen enrollment increase by double digits, mostly in the Des Moines metro area in Dallas and Polk Counties.

While some of the proposed projects are likely necessary in districts with increasing enrollment and/or aging facilities, many are not so obviously a wise decision for taxpayers given the current economic environment. For example, it is understandable that Adel-Desoto-Minburn Community School District (CSD) is proposing a bond to build a new high school and renovate its middle school, given an enrollment increase of nearly 44%. The same goes for Van Meter CSD, where enrollment has increased nearly 55%, potentially justifying $18 million to build new classroom additions and expanded parking.

In contrast, the Beaman-Conrad-Liscomb-Union-Whitten (BCLUW) School District has seen an enrollment decline exceeding 20% over the last decade, yet is asking voters to fund additions to the elementary and high school buildings. Easton Valley CSD wants to build a new athletic fieldhouse despite a 10-year decline of over 16%.

Some districts are returning to voters asking for more money mere months after a March 7 election that included bond questions. The Irwin-Kirkman-Manilla-Manning (IKM-Manning) CSD won a bond approval in March but now is back for more despite a 5.8% enrollment decrease over the last decade. Others, including Durant CSD, North Tama CSD, West Sioux CSD, and Clarinda CSD, lost their bond requests but are trying the same questions again, as detailed in the following table.

The nature of each project is also important to consider. Especially in an economic environment forcing families to budget for gasoline and groceries while property taxes keep climbing, school districts would do well to focus on projects directly related to the education of children. While sports are a valuable component of children’s educational experience, their value is worth examining when measured against adequate classroom space or essentials like functioning HVAC, electrical, and plumbing systems.

Nonetheless, 14 of the bond questions entail building or enhancing athletic facilities. These projects range from new baseball and softball complexes to tennis and pickleball courts to expansion of wrestling practice rooms. New facilities are on the ballot for an indoor batting/hitting area, a swimming pool, and a new concession/ticket booth, among others. These may be nice amenities to have, but at a time of high interest rates and declining enrollment are they reasonable to put on the back of the taxpayers?

For worthwhile projects, communities can always look to other sources of funding than bonds. Not only do they have property taxes to pay for infrastructure, but they also receive a penny of every dollar subject to the sales tax through the Secure and Advanced Vision for Education (SAVE) fund. In fiscal year 2022, total SAVE expenditures across the state amounted to more than $880 million. These sources are in addition to Physical Plant and Equipment Levies (PPELs) school boards impose.

As the facts highlighted above illustrate, voters in these districts must educate themselves. School finance is difficult even for those who work in the public policy world, which is why the Iowans for Tax Relief Local webpage has been enhanced with new information to help voters make informed decisions when it comes to local government spending.

Visit itrlocal.org to explore your community’s spending, debt, and property tax collections.

© 2024 Iowans for Tax Relief and ITR Foundation