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SF 436

A bill for an act removing the maximum annual amount of real estate transfer tax receipts that may be transferred into the housing trust fund.

2025-2026 Regular Session Introduced by Claire Celsi and 8 co-sponsors

Iowa bill removes the annual cap on real estate transfer tax revenue directed to the housing trust fund, potentially increasing affordable housing funding but reducing state general revenue.

Subcommittee: Rowley, Bisignano, and Dawson.
#communitydevelopment #housing #housingtrustfund #propertytaxes #realestatetransfertaxes #receipts #revenuedepartment
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Bill Summary · SF 436

Legislative bill overview

SF 436 removes a statutory cap on how much revenue from Iowa's real estate transfer tax can be directed annually into the state's housing trust fund. Currently, there is a maximum limit on these transfers; this bill eliminates that ceiling, allowing potentially larger amounts of transfer tax revenue to fund affordable housing initiatives.

Why is this important

Housing affordability is a significant policy challenge in Iowa. By uncapping transfer tax revenue flowing to the housing trust fund, the bill could substantially increase funding available for affordable housing programs, homeless services, and related initiatives. However, this directly affects state budget priorities since transfer tax revenue would be redirected rather than available for general state operations.

Potential points of contention

  • Budget trade-offs: Removing the cap means less transfer tax revenue available for other state programs and services; lawmakers must decide if housing funding justifies reduced revenue elsewhere
  • Real estate market impact: Some argue that higher transfer taxes (or increased dedication of existing taxes) could slightly dampen real estate transactions, potentially affecting construction industry activity and related jobs
  • Fiscal uncertainty: Without a cap, housing trust fund receipts become unpredictable year-to-year, complicating long-term budget planning and state financial forecasting

Compiled from official sources — confirm details with the bill’s official record.

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