Iowa has long been recognized for its first-in-the-nation caucuses during election season, but when it comes to policy, the state has traditionally gone unnoticed. However, after Republicans gained unified control of Iowa’s house, senate, and governor’s mansion in 2016, the state has begun to implement strong conservative reforms, setting it on a path of limited-government-policy victories. Other states should take notice of Iowa’s progress.
Iowa has passed headline-grabbing legislation in the economic area, including collective-bargaining reform, multiple income tax cuts, and universal education-savings accounts (ESAs). Additionally, several key components of a property-tax-reform package were enacted at the end of this year’s legislative session, which could serve as a model for other states.
Inflationary pressure caused by the Consumer Price Index (CPI) has put many Americans under pressure as property-value assessments rose, and property-tax hikes followed. As a result, several states, including Iowa, have enacted property tax-related legislation. However, Iowa stands out as the only state that has avoided the tax-swap trap. Instead, Iowa lawmakers found fiscally responsible policies that don’t pass the local burden on to state taxpayers.
The reform package includes intricate details that straighten out some of Iowa’s property-tax system’s idiosyncrasies, making it more transparent and efficient. For example, consolidating the assortment of levies local governments can impose and requiring direct notification to registered voters about impending tax increases ought to rein them in and ultimately lighten the burden on local taxpayers.
One subtle reform related to elections in particular should become a model for other states. Iowa has moved all municipal bond elections to November-only dates. While this sort of good-government adjustment may not grab as many headlines as tax-reform and universal ESA legislation, its benefit for Iowans may be no less profound.
Research by Iowans for Tax Relief Foundation demonstrates that voter turnout in elections taking place outside of November is typically less than half the traditional November results. Consequently, Iowa’s local governments have been able to amass $14.5 billion in outstanding debt, mostly paid with local property-tax dollars. The November requirement works in combination with another unique mandate that each bonding jurisdiction sends direct notification to registered voters, making citizens aware of elections, their details, and their effects on taxpayers’ bank accounts.
When it comes to taxes, local bond issues are too often ignored, despite their cost and potential to strangle funding for basic government services. Advocates for smaller, more efficient government need to do a better job educating the public about the principles of prudent finance, but first, they must ensure that people know when to vote. Iowa’s first-mover status recognizing this priority in 2023 should draw just as many eyes as our election season will in 2024.
