In a recent work session, Blackhawk County officials discussed the upcoming fiscal year 2026 budget, highlighting significant challenges stemming from recent state legislative changes and fluctuations in the local tax base. Tim, a county representative, outlined the impact of these changes on property taxes and local revenue.

One of the key issues addressed was the state's decision to phase out reimbursements for property tax credits that had previously supported local governments. In 2021, the legislature voted to gradually reduce funding for the business property tax credit, which has resulted in a projected loss of approximately $120,000 in revenue for the upcoming budget year. This reduction follows a trend of diminishing state support, as local governments are now required to absorb the financial impact of these legislative changes.

Additionally, the recent House File 718 introduced new exemptions for homeowners aged 65 and older, which further complicates the budget landscape. While the state provides a homestead credit that benefits many residents, the new exemption removes taxable value from the county's revenue stream without reimbursement. This is expected to cost the county around $478,000 in lost tax revenue for the next fiscal year.

The meeting also touched on the military service exemption, which has increased in value but lacks state reimbursement, resulting in additional revenue losses for the county. The cumulative effect of these legislative changes is a significant strain on Blackhawk County's budget, necessitating careful planning and potential adjustments to property tax rates.

Officials emphasized the importance of understanding these fiscal challenges as they prepare for the upcoming budget session, indicating that the county may need to make difficult decisions to maintain financial stability in light of reduced state funding and increased exemptions.