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GOP property tax plan may fall into one-size-fits-all trap

State lawmakers chafe when Congress imposes similar schemes

For as long as I can remember, I’ve listened to conservative politicians complain about one-size-fits-all laws and regulations.

Usually, it’s in the context of the federal government. Often, the complainers are at the state level who say Washington, D.C., shouldn’t infringe upon the so-called “laboratories of democracy.”

Now, Republicans in the Iowa Statehouse may violate their own rule. They may pass a big property tax cut this year with a very bad feature: A 2% cap on local revenues for cities and counties, excluding new growth and debt service.

Local governments say the cap is too low and won’t keep up with inflation. Eventually, some of them say, this cap will force them to cut services, like police officers and firefighters. But there is another reason why state lawmakers should not impose this uniform cap: Because Iowa’s 900-plus cities and 99 counties aren’t the same.

Not only do they have different needs and priorities, but they have vastly different records when it comes to taxes.

Just look at the evidence reported by the Iowa Department of Management.

Between 2016 and 2026, about 1/3 of all Iowa cities raised net current property taxes by less than the rate of inflation, while more than a quarter of Iowa cities raised those taxes in excess of twice the rate of inflation.

Yet, a hard, 2% cap would treat them all the same.

That doesn’t seem right. It would be like a business paying all of its employees the same, no matter their individual performance.

In fact, you could argue such an inflexible cap would actually punish local governments that have been successful at holding the line on taxes. (I should note the Senate plan isn’t as inflexible as the House’s plan or the governor’s.)

I don’t doubt that some in this state are experiencing a harsher bite from property taxes than others. But why not help those who are being hurt the most, instead of treating everybody the same? Besides, a one-size-fits-all approach is driven by the belief that local governments, on the whole, are spending on unneeded services. Or services people don’t want.

I’m not so sure about that.

A year ago, I looked at general fund spending at the state and city levels between 2019 and 2024. And what I found was that while cities, on average, raised spending at higher rates than the state, if you exclude additional city spending on cops, firefighters and ambulance services, their average annual rates of growth weren’t that much different: 2.96% for cites and 2.6% for the state.

You see the same patterns with Iowa’s 99 counties. About 25% of counties increased net current property taxes by less than the rate of inflation between 2016 and 2026, according to state figures. But about a dozen Iowa counties boosted their property taxes by more than twice the rate of inflation. Another half dozen counties came close to that mark.

So, why treat them all the same?

Why not come up with an approach that takes into account the varying performance of local governments? Or, why not let local voters decide whether their council members and supervisors are doing the right thing and treat them accordingly come election time?

The answer to these questions may be contained in a recent Des Moines Register article. According to the Register’s reporting, “House Speaker Pat Grassley, R-New Hartford, has said his caucus wanted a proposal that was ‘easy to understand’ and gives certainty to taxpayers.”

I can see why state lawmakers like the idea of an easy to understand 2% cap. It’s the kind of thing that fits on a bumper sticker or campaign flyer at election time. But following through with this uniform cap would be like Washington, D.C., imposing a single income tax restriction on all 50 states.

My guess is the folks in Des Moines wouldn’t like that much. It probably wouldn’t lead to a good outcome, either.

The fact is this cap would give state legislators a much bigger say in how local governments carry out their core functions– but without much understanding about what’s going on in those places. What does a legislator from Sheldon or Elkader know about Davenport?

Besides, I’m not that confident about the judgment of state lawmakers these days, given they’re in the midst of trying to dig the state out of a big budget hole they themselves created.

I will admit, like most Iowans, I would love to pay less in taxes, even though my property taxes in Davenport haven’t changed much over the last 10 years. But if this tax cut means I’ll get diminished public safety services, shabbier parks and a slower ambulance response, I won’t like it. I’m guessing neither will others in Davenport

And let’s face it: The real reason legislators in Des Moines are able to keep state spending down relative to local governments isn’t because they’re financial geniuses. It’s because they have shortchanged public schools for years.

This, by the way, has led to higher local property taxes.

I understand it is hard to design a tax cut that will fit the needs of all Iowans who live in very different communities. To say nothing of a legislator’s political needs. However, if Republican lawmakers were ever serious about their objections to one-size-fits-all rules being imposed on them by Washington, D.C., they would let voters in these places make their own choices. If they choose not to, then they should at least acknowledge they’ll be doing the same thing to cities and counties that they complain Washington, D.C., does to them.

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Ed Tibbetts, of Davenport, has covered politics, government and trends for more than three decades in the Quad-Cities.

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