Rollback is the common name for statewide limitations on the annual growth of property assessments. First enacted by the State of Iowa in 1977 to counter the effects of inflation, many provisions have been in place since the 1980 assessment year; the law was substantially amended in 2013. Under the current formula, agricultural and residential growth is limited to 3% annually as applied to statewide aggregate property values. In addition, residential and agricultural property values are linked; if annual growth in one class outstrips that of the other, it may only increase at the lower rate. In other words, if agricultural value grows by 2%, residential property increases are limited to 2%. If agricultural land value decreases, allowable growth for residential property is zero. More information about assessment limitations for particular property classes can be found one Iowa Department of Revenue website and Code of Iowa.
Each November, the Iowa Department of Revenue certifies the limitation percentages to the county auditors. The rollback percentage is multiplied by the actual (assessed) value to obtain the value of the property that is subject to taxation.