Property Tax Backfill


The Iowa Legislature made changes to the current property tax system in Iowa in 2013 that included cuts to certain property taxes based on property tax classification. Alongside these cuts was a state appropriation to provide partial “backfill” payments to the local governments whose revenue would be impacted by these reductions. In this way, the State would defray the significant revenue reductions to local governments. In Fiscal Year 2021, the Iowa Legislature decided to phase-out these “backfill” funds over five to eight years. In Fiscal Year 2030, backfill will be gone entirely.

What determined the phase-out schedule?

Cities whose average property tax valuation growth rate increased by more than 34.14% for Fiscal Year 2021 compared to Fiscal Year 2014 will receive a 5-year phase-out of the backfill. Those cities with a rate lower than 34.14% will receive an 8-year phase-out of the backfill. These phase-out schedules will add a one-fifth or one-eighth decrease in backfill per year until zero.

Where can I find estimates of my city’s backfill payments?

The Iowa Department of Management website provides an estimate of backfill amounts through the Fiscal Year 2029 (fiscal year will be zero for all cities). You can download their spreadsheet https://dom.iowa.gov/document/commercial-industrial-replacement-payments.

Please note that this Excel file has multiple tabs. Be sure to click on the fourth tab labeled “City Payments” to view additional detail on the phase-out over time.




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