2026 Iowa Legislative Session – Second Funnel Week – Week 10

The second funnel week began with a snow day on Monday, and both chambers rescheduled short debate calendars for Tuesday ahead of committee meetings. The focus of the week was passing policy bills out of committee, with special attention given to property tax and health maintenance organizations (HMOs) before budget season fully kicks off.

Iowa Property Taxes

The House version of the property tax bill (HSB 596) passed out of the House Ways and Means Committee on Wednesday with a significant amendment. The amendment keeps key provisions, such as a 102% growth cap for local governments and an amended version of the House’s $25,000 property tax exemption. It also includes certain provisions from the Governor’s version of the bill (SSB 3034/HSB 563), including the first-time homebuyer’s program and a new limit on tax increment financing for data centers from the Senate property tax bill (SF 2472). The amendment maintains a middle ground with respect to tax increment financing restrictions between the House’s initial proposal and the Governor’s initial proposal. While the bill is not in its final form, the amendment represents a step toward compromise between the three bills put forth by the House, Senate, and Governor.

Health Maintenance Organizations (HMOs)

Additionally, HF 2739 passed the full House with an amendment on Thursday afternoon on a 53-40 vote after passing it through subcommittee week before last and the full Ways and Means Committee on Monday. The legislation would change the current tax on HMO premiums, replacing it with a tax on HMO taxable funds. On the floor, Democrats proposed a series of amendments that failed, and the bill was ultimately amended to increase the one-time transfer of approximately $350 million from the Taxpayer Relief Fund to the General Fund and to increase the supplemental appropriation to $89 million to HHS for Medicaid.

Representative Shannon Lundgren, the floor manager of the bill, reiterated the importance of passing HF 2739 to ensure Medicaid is fully funded and to continue to provide health care to vulnerable Iowans. The Senate version of the bill (SF 2464) passed through committee in week nine, and identical versions must pass both chambers before becoming law.

2026 Subcommittee Summary

For a policy bill to survive the second funnel, it must pass through a committee in the opposite chamber of origination. Before it can be addressed by the full committee, a bill must pass through a subcommittee. Between the first and second funnel (weeks six through ten), there were significantly fewer subcommittees scheduled than in the first weeks of session.

The light subcommittee schedule means that many bills failed to pass through the second funnel and will no longer be eligible for consideration in 2026. That being the case, policy is never fully dead under the golden dome and may appear in an amendment to a related bill still eligible for passage.

2026 Election Update

The filing period of the 2026 primary elections opened on Monday, February 23, for state and federal offices and closed on Friday, March 13. Friday, March 20, was the final day to file written objections to nomination petitions for state and federal offices. Individuals may be taken off the June 2 primary ballot if their petitions do not hold up to the objections. The Secretary of State regularly updates the list of primary candidates.

What’s next?

With the second funnel deadline in the rearview mirror, legislators will focus on the policy bills still eligible for consideration. Greater attention will be paid to ways and means bills, as well as the state budget and policy appropriations. Property taxes and the budget shortfall are expected to move to the forefront of conversations under the golden dome as April 21, the scheduled 100th day of session, rapidly approaches. After April 21, per diem expenses end and legislators have to cover their expenses.