In Livingood v. City of Des Moines, No. 22-0586 (June 9, 2023), the Iowa Supreme Court held that the city's use of the Iowa's process by which the government can satisfy all or part of a taxpayer's debt to a public agency by grabbing someone's tax refund. In a nutshell, after trying to collect the debt by more conventional means:
the income offset program allows the department of administrative services to collect debts for public agencies by offsetting the debts against any income tax refund owed to a taxpayer. The city entered into a memorandum of understanding with the department of administrative services to use the income offset program.
Slip op. at 4-5.
The debt owed in Livingood is for traffic violations caught on camera.
Is it a taking under the Iowa Constitution to not give the taxpayer/cam-violator the full amount of tax refund?
No. First, the court held that someone's income tax refund is "property" protected from uncompensated takings. So far so good for the plaintiffs. But the court held that this isn't a taking, because money property claims are treated differently under the takings clause. For that proposition, the court relied almost exclusively on authority interpreting the U.S. Constitution. And here, the city isn't taking property for a public use, and is not requiring the plaintiffs to bear a burden that should be borne by the public as a whole.
Because they are traffic violators, and the city has the power to impose a fee for driving badly and violating the law, and in keeping tax refunds it is merely collecting what's owed for the penalty. Thus, "[t]he government's collection of money for the payment of fines in the exercise of its police power is not a 'taking' for 'public use' and does not implicate the takings clause." Slip op. at 12.
Livingood v. City of Des Moines, No 22-0586 (Iowa, June 9, 2023)
