On April 4, 2008, Judge Darrell Goodhue issued a ruling in Polk County District Court striking down portions of Iowa Administrative Code 701-71.1. As unexciting as that sounds, the issues underlying the case are actually fascinating as they involve a battle between the Polk County Assessor and Iowa Department of Revenue ("IDR") over how assessors are to value real property for tax purposes.
In early 2007, the IDR adopted a new rule requiring county assessors to "classify and value property according to its current use and not according to its highest and best use." The Polk County Assessor argued, and the Court agreed, that the Rule was contrary to the Iowa Code which requires assessors to value property according to market value (i.e., highest and best use) and specifically not to assess based on current use.
Prior to the Rule's adoption, and up through the date of trial, the Polk County Assessor attempted to reach an agreement with IDR to remove language from the over-broad Rule to bring it into compliance with Iowa law; however, no agreement was ever reached and the Court was ultimately "inclined to believe [the IDR] has attempted to kill an ant with a shotgun."
The IDR has yet to state publicly if they intend to appeal the decision. If the Judge's decision stands, assessments based on this rule will need to change in the near future.