Iowa Republicans halt move to revive local library tax

DES MOINES — House Republican lawmakers have halted a proposal that would help Iowa’s public libraries reverse anticipated financial losses under a property tax reform measure signed into law last year.

House lawmakers held a subcommittee hearing Tuesday on House File 2442. The bill would enable cities to reinstate the library tax that was constrained by last year's property tax bill.

Doing so, under the proposal, would require the approval of a majority of voters during a regular city election. If approved, the tax could be collected for 10 years and extended for additional 10-year periods if reauthorized by voters at election. A city council could discontinue the tax by a majority vote of council members.

A total of 97 communities across the state have voted to pass a library levy, including Iowa City and Marion. Voters in Cedar Rapids, however, in 2015 rejected it.

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“The loss of these levies have had tremendous unintended consequences,” said Sam Helmick, past-president of the Iowa Library Association who served on the Governor’s Commission of Libraries as a Republican. “ … It will have material damage. Our libraries are community anchor institutions” that provide essential services and resources that support job seeking and entrepreneurial, workforce and economic development as well as lifelong learning and social welfare.

“And losing them is like losing” a major employer in the community, Helmick said.

Iowa lawmakers last year passed and Gov. Kim Reynolds signed House File 718, which introduced major overhauls to the state’s property tax system aimed at reducing future property tax bills. That proposal earned strong bipartisan support, passing in the Iowa House 93-1 and the Iowa Senate 49-0.

Among the law’s many provisions were limitations on cities’ collection and use of several tax levies, some of them approved by voters, and devoted to specific purposes such as facilities for veterans, free municipal band concerts or public library operations.

HF 718 rolled the dedicated tax levies into cities’ and counties’ overall general tax rate, which are capped and where they must now be budgeted alongside all other services.

That will result in a large financial blow to Iowa libraries, museums, municipal bands and facilities, according to city leaders and library officials across the state.

“The passage of HF 718 has been devastating since it has taken away the guarantee of funding that so many libraries, especially small and rural ones, depend on,” Roslin Thompson, director of the Knoxville Public Library, wrote to lawmakers in support of the new proposal. “Bigger libraries are also going to lose funding that will lead to cuts in services and programs that are essential in our communities. Please reconsider HF 2442: eliminate the need for a sunset clause to these levies and eliminate the need for a mandatory revote, while retaining the voters' authority to make decisions for their communities that they love. Reinstate all previously voted levies where the people have spoken.”

The Iowa Library Association, Iowa League of Cities and League of Women Voters of Iowa were all registered in support of the bill.

Local communities still are collecting property tax dollars to support public library operations. The money, though, is being deposited into general operating budgets, which allows cities to shift funds from libraries to other projects that would typically be funded by increased taxes. The result eliminates the option for communities to create future library levies, and has led to disagreements among library boards, directors and city councils as to how the money is used amid competing needs.

“If you’re asking me to no longer codify those dollars that were hard-won on the cachet and value of libraries, and I can give them to a firefighter, as a mayor, that’s what I’m going to do,” Helmick told lawmakers. “This is why we created special library levies so we didn’t have to have these difficult fiscal conversations. And in dozens of the 97 libraries, we’re told they won’t be re-appropriated back” for library services.

Additionally, the levies sunset in two years, which means the money now diverted into a city's general fund will go away completely.

That will significantly diminish the impact and capacity of Iowa libraries, striping away local control and voter autonomy in those 97 communities, Helmick said.

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In Cedar Rapids, last year’s property tax law also affects levies used to fund operations and maintenance of the Veterans Memorial Building on May's Island and the Veterans Memorial Commission. In Iowa City, that affects funding for climate action steps and library operations.

Billie Bailey, former executive director of the Grout Museum District in Waterloo, urged lawmakers to reinstate all previously voter-approved levies, not just those supporting public libraries.

“This is a levy that the community spoke, and they said that these institutions and our libraries are important to our community and we would like them preserved and funded,” Bailey said. “ … I don’t think anybody really, truly intended for this to hurt libraries and museums. I think it was a case of unintended consequences, and we just would like to have you work with us to fix it.”

The bill was introduced by Rep. Matthew Rinker, R-Burlington. The two Republican members on the three-member subcommittee, however, declined to advance the bill, stating it would undermine lawmakers’ efforts with the passage of last year’s law to simplify and bolster transparency in the state’s property tax system.

“Part of that simplification process is to get rid of levies,” said Rep. John Wills, R-Spirit Lake. “ … By adding the levy back, that kind of goes against what we were looking at last year.”

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Rep. Austin Harris, R-Moulton, agreed with Wills.

“The No. 1 issue we are hearing back from constituents is issues with property taxes. And we had a massive bill that we did last year that we still need to see how it continues to take effect,” said Harris, who chaired the subcommittee. “I appreciate Rep. Rinker bringing this legislation forward, but I do not believe this is the solution to what he was trying to accomplish.”

Rep. Kenan Judge, of Waukee, the lone Democrat on the subcommittee, said he was willing to work with majority Republicans to continue the conversation and keep working on the issue.

“Because I think our libraries need this money to be effective,” Judge said. “ … I think protecting that library is very important, and I hope we can continue to have that conversation.”

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