Iowa Extension Council Conference - Fiscal Law & Policy 2017

1. Inaugural Extension Council Conference March 4, 2017

2. Fiscal Law & Policy 2017 Iowa Extension Council Association Annual Conference Gene Mohling, Regional Director Region 15

3. Presentation includes: Fiscal Oversight Role of Council Members Tax Levy for Tax Sub-fund, Tort & Unemployment IDOM Site-Property Values, Archive, Submit Budget Amending Your Budget Time Table Chart of Accounts Property Classes & Taxing Authorities, Productivity Questions

4. From Section 2.3 of “your” fiscal PolicyPublic Funds, as defined in Chapter 12C.1 of the Code of Iowa, are those funds owned by a public entity such as a County Extension District. This includes both tax and non-tax monies. All monies generated by users of the district entity are owned by the district, not the user, and are under the control of the local Extension Council.

5. All public funds are the legal responsibility of the Extension Council. Legal responsibility assigned by law cannot be transferred by Extension Council action.

6. All public funds have the same legal requirements for accounting, reporting, auditing, proper signatures, segregation of duties, publishing, bonding, investing and uniform financial accounting procedures.

7. Iowa Code176A.8.2. To serve as an agency of the state and to manage and transact all of the business and affairs of its district and have control of all of the property acquired by it and necessary for the conduct of the business of the district for the purposes of this chapter.

8. Revenues -- Actuals FYE 2016

9. Extension Law Taxation CapsFY 17 & 18

10. Tax Law – Effective Valuations:

11. Where Do Districts Stand in FY17 Tax Revenue? • 59 Districts currently have a single cap - $ only • 41 Districts now have the “double cap” – both $ and levy cap • 22 of those districts can not raise even 75% of the dollar cap • 10 of those districts can not raise even 50% of the dollar cap • Another 12 Districts vulnerable to levy cap within 3 years if no significant valuation changes in their county • Almost all of the Districts with these double cap challenges are in the “below 30,000 population bracket” with majority of counties below 11,000 in population

12. Tort & Unemployment Subfunds Districts qualify for the funding when $ or mil rate caps are reached Resources are restricted for use for in these expense lines including carryover Expense lines can be negative at year end for these 2 subfunds; if negative balance, levy funds in next cycle Tort subfund covers General & Excess Liability, Auto, D&O, Professional, and Employee Dishonesty

13. Tort Liability & Unemployment

14. Iowa Department of Management Web Sitehttps://dom.iowa.gov/agricultural-ext-district

16. Property Valuations

17. Must be filed on or before May 15, follows public hearing process for notification 10-20 days prior to the hearing..... https://dom.iowa.gov/document/miscellaneous-budget-amendment-form-653a

18. Amending Current Year Budget The public hearing and budget amendment process MUST be completed and filed before your expenses exceed the budget limit that was previously approved. Districts have until May 15 of the current budget year to hold a public hearing and file the amended budget documents. The hearing notice must be published 10-20 days before the date of the hearing.

20. Time LineNov.-Dec. Develop draft budgetJanuary- IDOM entry, modify/accept estimate, set hearing date, publish 10-20 days before hearingFebruary- hold hearing, adopt budget on-lineMarch 15-finish filing documents

21. 5719-0-1-000-101-2Ag Fee Exp - PPAT 5000-3-0-000-000-1Payroll - Office Assistants

22. Summary on Tax Revenues 1/3 ---of the counties levy 100% for Extension Education fund as well as levy foreither Tort, Unemployment, or both 1/3 ---of the counties levy 100% of the Extension Education fund but did not levy for Tort Liability fund or the Unemployment Compensation fund this past year 1/3 ---of the counties did not levy to their first cap -- $600,000 left just in the Extension Education fund

23. “Tax” Expenses – Actuals FY16 Note: Tax sub-fund includes interest, rental, resale & other revenues

24. Iowa Property Tax by Property Class FY16/17 = $5.463 billion (Jeff Robinson, Iowa Legislature Fiscal Services)

25. Iowa Property Tax by Taxing Authority FY16/17 = $5.463 billion (Jeff Robinson, Iowa Legislature Fiscal Services)

26. Agricultural Productivity • Agricultural property is not assessed on its market value. Instead, a productivity value is calculated based on the net earning capacity of the land. • Net earning capacity for productivity purposes means the landlord share of crop revenue, minus the expenses of growing the crop. • Productivity is calculated county-by-county. The assessed value of individual properties within the county is set by the assessor based on the total value of the ag property in the county and the soil conditions and other factors of individual properties. • The annual net revenue per acre is calculated on a five year average and the average is then capitalized at a statutory rate of 7.0%. • A county with a five-year per acre revenue of $150, divided by 7.0%, would have an average productivity value of $2,143 per acre. • Any agricultural rollback is then applied to the county number, so if the rollback for ag property was 60.0%, the taxed value per acre would equal $1,286.

27. Thank you for attending today! Questions?mohling@iastate.edu 319-330-4681