[Nameplate] Overcast ~ 52°F  
High: 63°F ~ Low: 54°F
Thursday, May 5, 2016

Legislative session is over, but work remains

Thursday, April 15, 2010

INDIANAPOLIS -- It has only been a few weeks since our legislative session ended, but our work across the district is busier than ever.

As I talk with people in the district, I find that the discussions are focused on the passage of the recent health care bill at the national level, education and the need to focus on the future of our State.

Information is important. As we work through the details of the health care plan as it becomes available from the federal government, it will be important to share the facts so people can understand what to expect.

Looking at the recent work of the state Legislature, many people graded the 2010 session of the Indiana General Assembly on the passage of property taxes.

During this session, House Joint Resolution 1 passed both the House and Senate. This resolution enables the people of our state to vote on an amendment to our constitution that will limit the assessment of property taxes.

Understanding the provisions of this language will be imperative as we start to assess its effect on local government services.

A plus to the property tax cap legislation is the fact that voters will have the opportunity to cast their opinion in a statewide referendum to decide whether the 1-2-3 percent property tax caps that are currently in state law should be amended permanently into the Indiana Constitution.

The following is a brief overview of the past and issues that still need to be addressed.

The property tax caps will limit tax bills for homes at 1 percent of the gross assessed value, while the caps for farmland and rental properties are at 2 percent, businesses & farm personal property at 3 percent.

Lawmakers initially put the caps into our state laws back in 2008, but it was agreed that they would be phased in over a two-year period in order to prepare and gauge the impact on local units of government, including schools and libraries.

2010 is the first year to have the 1-2-3 percent levels applied to the formula for calculating tax bills.

Supporters of the plan wanted to amend the caps into the Indiana Constitution to make it more difficult for future lawmakers to legislate them out of existence. Additionally, there was a desire to control the amount of taxes collected.

I do expect to hear from the supporters and opponents of this effort as they make their cases in the months to come.

Keep in mind that there is one thing to note about the proposed caps.

There is no restriction on the annual growth in tax bills for homes, farms or businesses. If your property tax bill is less than 1 percent of your home's assessed valuation, then your property taxes can go up. Even if your bill is at the 1 percent level, an increase in the assessed valuation on your property could mean an increase in your bill.

This "gap in the caps" was recognized in the House, and there was an effort made to close it through legislation designed to limit the annual growth in annual tax bills for homes, farms and businesses. Unfortunately, it died in the final hours of the 2010 session.

When the debate over property taxes resumes in 2011, I suspect that closing the gaps in the caps will be among the first subjects up for discussion. I also believe members need to take a hard look at how we pay for government services. That was a conversation that has been lacking along the way.

Property tax relief is a common subject that never dies in the halls of the state and local government. I look forward to talking with people in the district to get your views on this issue.

There was another development on the property tax issue that should answer a question that has been expressed to me by many homeowners and business owners through the year.

Starting in 2011, sending out provisional bills will be required of a county to avoid any delay in tax collections.

This will only happen if the county is behind in the process. In essence, homeowners will know before May 10 an amount due on their spring tax bill every year, and the balance on their fall tax bill prior to November 10 every year.

This has become a bigger problem in recent years, due to the many changes in the way property taxes are assessed and levied. Last year, some taxpayers got their spring bills in November and their fall bills in December. As a result, local government entities borrowed money for cash flow that ultimately costs the taxpayers thousands of dollars in interest payments.

Homeowners in counties where spring tax bills are expected to be behind schedule will receive provisional tax bills in which 50 percent of the previous year's total tax liability would be due on May 10, with the remaining 50 percent due on November 10. If the county is able to reconcile in the fall, homeowners will receive a fall bill with their true tax liability.

These changes will make sure homeowners get their tax bills in a timely fashion and help local units of government get their budgeting done on time.

Next week, we'll take a brief look at some of the other bills that passed during the 2010 legislative session.

If you need to contact me, you can call the toll-free Statehouse telephone number at 1-800-382-9842, write to me in care of the Indiana House of Representatives, 200 W. Washington St., Indianapolis, IN 46204, or send a message to my web site at www.in.gov/H44. While visiting my web site, you also can sign up to receive regular e-mail updates from the Legislature.