Senate District 22 Special Election: Candidates Agree Commercial Property Tax Reform is Imperative, Differ on Solutions

The two candidates for Senate District 22 differ on the issue of commercial property tax reform, sure to be a key issue when the 85th Iowa General Assembly convenes in January.

Candidates in the special election, called after the Sen. Pat Ward’s death in mid-October, are Democrat Desmund Adams and Republican Charles Schneider, who was nominated to replace Ward in a special convention just days after the general election.

Ward’s death after a months-long bout with breast cancer occurred too late for her name to be removed from the ballot for Senate District 22, which includes Waukee, Clive and part of West Des Moines.

Gov. Terry Branstad has said commercial property tax reform will be one of his top priorities in 2013. He says the state’s commercial property tax rate is the third-highest in the nation, and local governments' objections that halted reform efforts in both 2011 and 2012 can be answered with a balanced budget and increasing revenues.

Last year, West Des Moines officials estimated Branstad’s proposal could cost the city up to $9 million because the city’s commercial property tax base is growing and the state-allocated “backfill” provision intended to help cities recoup their losses would not be available.

West Des Moines leaders and officials from other cities said that such a revenue shortfall would force them to either make up for the shortfall by increasing residential property taxes or cut some of the quality-of-life services that make cities attractive to businesses.

Schneider, who was elected to his second term as a ward representative on the West Des Moines City Council in 2011, said reducing the property tax rate is important. He said he’ll withhold specific comment until he sees the final version of the governor’s proposal, but said reform is “imperative” to even the playing field between and Iowa and states with “natural beauty” like oceans and mountains.

At a forum on Saturday, the only joint appearance by the two candidates in advance of Tuesday’s election, Schneider said both Republicans and Democrats have put forth good ideas on the issue of commercial property taxes.

As part of commercial property tax reform, Schneider said he favors taking a look at corporate tax reform.

Adams was more specific. He said property tax reform is a “hot button issue” and it should be considered as part of a broader issue.

“Clearly, commercial property tax reform is a change everyone agrees we need,” he said. “It’s how to address the issue that’s the question.”

“We’re at 12 percent on corporate income taxes,” Adams said.

He favors cutting that rate in half, then making up the shortfall by closing loopholes. Commercial property tax is an area that requires a “scalpel” rather than a “hatchet” to level the playing field “for real,” he said.

Without such an approach, commercial property tax would leave an “indelible mark on residential homeowners and city and county governments and their ability to provide adequate services,” he said.

Come back to Patch in the coming days for more coverage of the Dec. 11 special election.