Five Johnson County cities to vote on 1% local-option sales tax

Five Johnson County cities will look to join the rest of the cities in the county that have implemented a 1 percent local-option sales tax this November.

Voters in Coralville, Iowa City, North Liberty, Oxford and Shueyville will vote on the tax in the Nov. 4 election. To pass, the ballot initiatives must get more than 50 percent approval.

The taxes would go into effect July 1, 2026.

Under state law, 50 percent of the revenue must be put toward property tax relief. Local municipalities have discretion over how the other 50 percent is used. Each city has its own ballot language and voters in each city must approve passage of the tax.

All local-option sales taxes are collected at the county level and then distributed to participating cities using a formula from the Iowa Department of Revenue that takes into account population and property valuations.

That means the expected revenue each city can collect from the tax depends on which cities’ voters approve the tax.

The cities of Hills, Lone Tree, Solon, Swisher, Tiffin, University Heights and West Branch already have a local-option sales tax. If all five cities voting on the tax this year approve it, every incorporated city in Johnson County will have a local-option sales tax.

Diversifying city revenue, supporting projects

Outside of the metro area, both Oxford and Shueyville’s ballot language calls for the 50 percent of tax revenue up to the city’s discretion to be used “for any lawful purpose,” which can include capital projects and day to day city operations.

Cities typically use local-option sales taxes as a way to diversify revenue sources. It also can be used to dedicate funding to specific community priorities. In Iowa, 93 percent of cities have a 1 percent local-option sales tax in addition to the statewide sales tax.

In Coralville, the tax revenue would be used to help fund a new $50 million recreation center. While North Liberty would use its share for a new fire station and community center upgrades.

The Iowa City Council has proposed the 50 percent of tax revenue not dedicated to property tax relief be split, with 25 percent directed toward affordable housing initiatives, 10 percent toward public infrastructure, and 15 percent toward community partnerships.

Past Johnson County LOST initiatives

Voters in Swisher, Solon, Lone Tree and Hills passed local-option sales tax measures in the mid-2010s. Tiffin passed a local-option sales tax in fall 2023, and West Branch and University Heights in fall 2024.

In 2014, due to state laws at the time, the cities of Iowa City, Coralville, North Liberty, Tiffin and University Heights voted on a local-option sales tax as one bloc. The measure was rejected by 54 percent of voters.

Early voting underway

Voting is available in the Johnson County Administration Building lobby, 913 S. Dubuque St., Iowa City, from now through Monday, Nov. 3. Voters can cast ballots every weekday, from 8 a.m.-5 p.m.

Voting also will be available at the lobby Saturday, Nov. 1 from 8 a.m.-5 p.m., and Sunday, Nov. 2 from 11 a.m.-5 p.m.

Voters can drive through to vote at the Health and Human Services Building parking ramp, 855 S. Dubuque St., Iowa City, from now through Monday, Nov. 3. Drive-thru voting is available 8 weekdays from 8 a.m.-5 p.m.

Drive-thru voting also will be available Saturday, Nov. 1, 8 a.m.-5 p.m., and Sunday, Nov. 2, 11 a.m.-5 p.m.

Comments: megan.woolard@thegazette.com

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