From the Executive Director: Week of January 27, 2020

As legislative committees in the House and Senate wind down the annual rules review process, the pace of the Legislative Session is about to pick up. IAC expects to introduce five legislative proposals this week, three related to elections in Senate State Affairs, and two in the Senate Judiciary Committee, one related to courts fees and the other adding a clerk to the magistrate commission. I expect other legislation impacting counties to be introduced, including proposals to further cap local government property tax budgets. Three such proposals were introduced this last week. Two of the proposals introduced aim to further restrict local government property tax increases while the third alters the process for reserving forgone property taxes for future use. Below is a summary of the three proposals:

• House Bill 353 proposes a freeze in local government property tax budget increases for fiscal year 2021. Under H0353, the property tax portion of local government budgets would be frozen in place for one year. During this one year freeze, counties and other local governments would not be allowed to budget the annual 3% increase nor would they be allowed to budget new construction or forgone property taxes.
• House Bill 354 alters the annual budget process by establishing procedures for “reserving” forgone property taxes for future use. Currently, taxing districts do not need to take action for forgone property taxes to be reserved for future use. Under H0354 local taxing districts electing not to budget the full 3% would need to pass a resolution reserving the amount of property taxes forging for future use. Failure to reserve forgone property taxes by resolution would result in a forfeiture of forgone property taxes.
• House Bill 355 establishes a revised 3% cap on annual local government property tax budget increases. The revised 3% cap would apply to both base budget increases and increases associated with new construction. Essentially, a county would have to choose between taking the base 3% increase, up to 3% of available new construction, or a combination of the two. Local taxing districts would still be allowed to budget forgone property taxes. Aside from forgone property taxes, the only way a local taxing district could increase its property tax budget above the new 3% cap would be through a two-third (2/3) voter-approved override.

Property tax bills weren’t the only bills introduced last week impacting counties. Two separate distracted driving bills preempting local ordinance authority were introduced, one in the House and one in the Senate. The two bills are not compatible with one another. House Bill 346 adds the definition of distracted driving without specifically defining the use of handheld devices while driving as distracted driving. Senate Bill 1250 specifically prohibits the use of handheld devices while driving, making such use a primary infraction. The Senate bill includes exclusions for law enforcement, emergencies, and use of hands-free devices. It also mirrors local ordinances enacted by several cities and counties across the state.

The IAC Legislative Committee will meet via conference call on Wednesday to take positions on these and other legislative proposals impacting counties. Please reach out to your district and affiliate IAC Legislative Committee representatives with comments regarding items on the agenda. You can view IAC Legislative Committee agendas, minutes, and the IAC bill tracker on the IAC website by clicking here.