FY2022

100.00% Taxable % of Multi-residential Residential Properties

90.00%

80.00%

70.00%

60.00%

50.00%

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 Taxable % of Multi-Family 100.00% 95.00% 90.00% 86.25% 82.50% 78.75% 75.00% 71.25% 67.50% 63.75% 40.00%

Please note that after Fiscal Year 2023, the taxable percentage of multi-residential properties will drop to match the residential taxable percentage. This percentage has been as low as 44% in past years and has more recently been in the mid-fifties, which would mean the taxable percentage of multi-residential properties would see a drop that is nearly double the percentage decreases seen in recent years. The property tax reform legislation clearly has provided significant benefit to owners of multi-residential residential properties. However, it will place great strain on the City’s budget as it is fully implemented. The reduction in the taxable percentage of apartment building value reduced the City’s overall taxable valuation by over $123 million for Fiscal Year 2022. Property Tax Overview The taxable valuation of property subject to all levies in Iowa City increased 3.2% for Fiscal Year 2022, despite a reduction in the taxable proportion of multi-residential residential properties. New construction and higher property values have fortunately been sufficient in recent years to make up for the reduction in house and apartment taxability, though we do not anticipate that trend to continue in future years. The budget reflects a reduction of $0.10 in the property tax levy rate, all of which comes from a reduction in the debt service levy. The emergency levy remains unchanged from Fiscal Year 2021, which is a $0.24 levy generating approximately $1 million for climate action initiatives. This marks the tenth straight year of property tax rate decreases. We are unaware of any city in Iowa that has been able to implement tax rate decreases during each of the last ten years. The reduction in the debt service portion of the property tax levy was largely achieved through recent debt restructuring and early bond retirement strategies, in addition to the taxable valuation growth.

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