M-8 - Budget Special Report - FY 2024-2025

FY 2024 estimates from the IDR show a statewide increase of 11.6% in distributions for all local governments with a LOSST from the previous year. It is important to note that LOSST distributions are based on a formula that includes a variety of local factors, such as sales tax collections, populations, property values and more, resulting in different actual distributions for each city. The IDR has several helpful files regarding LOSST, including a history of revenues for each city, monthly estimates, and a tool that shows how distributions would be impacted by a city approving or rescinding a LOSST. Those files can be accessed at tax.iowa.gov/local-option-tax-information-local-government. More detailed information may be obtained by contacting the IDR at (800) 367-3388 or tax.iowa.gov. Hotel/Motel Tax A city may impose a hotel/motel tax at a rate not to exceed 7 percent after successful approval of a simple majority vote within the city. State law requires that 50 percent of such revenues are used for acquiring, improving, operating or improving recreational, cultural or entertainment facilities or for the promotion and encouragement of tourist and convention business. The remaining revenues may be spent on any other lawful purpose. The IDR has additional information, including files showing rates and quarterly payment distributions, at tax.iowa.gov/iowa-hotel-motel-tax. Enrich Iowa Funds for Libraries The Enrich Iowa Program includes Direct State Aid, Open Access and Interlibrary Loan. • Direct State Aid is a direct payment to public libraries and is intended to be used to improve and enhance library services. • Open Access provides a partial reimbursement to participating libraries to make it possible for patrons to check out materials at other participating libraries. • Interlibrary Loan provides partial reimbursement for interlibrary loans among all types of libraries. Additional information on these programs is available at the State Library of Iowa website, www.statelibraryofiowa.org/ld/e/enrich-ia.