In recent years the E-Submission service has received the most recognition as its adoption has grown year-over-year. However, the search engine tool continues to be a core service for ESS and Iowa Land Records (ILR). In 2019, an average of over 7,750 users per month conducted more than 3.8 million county searches for land records and other recorded public documents.
More resources are needed to replenish the redaction reserve fund as well as to modernize and improve the land records database and search engine. The integration of data concerning recorded land records with other property information could provide significant benefits for the real estate industry, but resources and a planning structure are needed in order to proceed.
The proposed legislation would not increase fees but would authorize the ESS 28E organization to use revenue from the E-Submission service fee for other items such as redaction, improvement of land records search tools, and collaboration with other land records systems. Current statutes require that E-Submission service fees only be used to support the E-Submission service and related infrastructure and activities. The current E-Submission service fee is $3.00 per document, which has not changed since December, 2015.
Fees and Funding Explained
An electronic recording service fee of $1.50 per recorded document was authorized at the inception of the E-Submission service in 2005. The initial adoption rate for E-Submission was low so the service fee did not generate much revenue, but this grew as more real estate professionals adopted electronic recording methods. In contrast, the income supporting the base operations for ESS and Iowa Land Records declined as overall recording activity diminished. The purchasing power of the $1.00 per document fee supporting ESS and ILR also declined during the 15-year period.
During the 2015 legislative session, Iowa county recorders and ESS proposed legislation to increase the base recording fee supporting the county land record information system from $1.00 to $2.00 to provide long-term stability for the operation of the system. Plans were also made to reduce the E-Submission service fee if the base fee was increased. Legislation (HF 561) was advanced by the House Local Government Committee, but it failed to be approved by the House Ways and Means Committee.
The prospects for revisiting the proposal to increase the base recording fee in subsequent years were viewed to be very poor, yet ESS and ILR required resources to sustain operations, to keep up with current website standards, and to improve services for customers.
For these reasons, the governing board of ESS, after extensive communications with users and stakeholders, increased the E-Submission service fee to $3.00 per document in December 2015. As a result of this change, along with increasing adoption of the service, income from the E-Submission fee has increased.
No further changes in E-Submission fees have been made, and there are no plans to increase this fee in the foreseeable future.
Limited E-Submission Service Fee Uses
Iowa statutes requires income acquired through the E-Submission service be used directly or indirectly to support the E-Submission service. Currently, the budget for the county land records information system is structured to ensure the E-Submission service fees are not used for development activities relating to the land records search engine or system integration. E-Submission service fees are also not used to fund redaction activities, as redaction is not a part of the E-Submission service. INCREASED FLEXIBILITY REQUESTED Under current Iowa law, there is no funding mechanism for redaction, search engine improvements, or systems integration, but these services are valuable to real estate professionals and the citizens of Iowa. For this reason, a statutory amendment is requested to grant ESS and ILR the authority to use E-Submission service fee income for services.
Proposed Legislation
Section 331.604, Subsection 3b(5), is amended to read as follows:
Recording and filing fees.
(5) Fees collected in excess of the amount needed for the purposes specified in this subsection shall be used by the county land record information system to reduce or eliminate service fees for electronic submission of documents and instruments. In addition to use of the fees for the maintenance and operation of the statewide E-Submission service, E-Submission service fees may also be used to fund the processing of documents to identify and redact any personally identifiable information in recorded documents, to improve the consistency and searchability of land records information, or to facilitate integrations with other land records information systems.