News From Terre Haute, Indiana

Local & Bistate

March 25, 2008

Legislators discuss Indiana’s ‘new era’

Thomas, Borders, Bosma host town hall meeting in Terre Haute

TERRE HAUTE — Local government must find creative ways to deliver services with less resources as a result of statewide property tax restructuring, said Indiana House Republican Leader Rep. Brian Bosma.

Bosma, R-Indianapolis, along with state Reps. Bruce Borders, R-Jasonville, and Amos Thomas, R-Brazil, staged a town hall meeting Tuesday in the Vigo County Annex, discussing “a new era” for Indiana taxpayers because of property tax relief adopted by the Indiana General Assembly.

“It is the strongest and most historic property tax relief package that has been adopted in my 22 years in the General Assembly and some have said in two generations,” Bosma said. “It was truly a historic event which will significantly benefit taxpayers in western Indiana today and also cap their property taxes in the future.”

Bosma said House Republicans sought to measure the tax relief plan, in part, by an immediate property tax cut of at least 25 percent to homeowners.

“For folks in Vigo County, that property tax cut for homesteads will be 36.2 percent. In Clay [County] it will be nearly 30 percent and Sullivan [County] will hit nearly 25 percent,” Bosma said.

The property tax cap next year is 1.5 percent for homesteads; 2.5 percent for apartment owners and farmland; and 3.5 percent for business, industry and farm equipment. Then by 2010, those statutory caps are 1 percent cap on residential homestead; 2 percent on apartment owners and farm land; and 3 percent on business, industry and farm equipment.

The first of three steps to make the caps part of the state’s constitution has been done. The plan must again pass the General Assembly next year, then, “if all goes as planned, there will be a referendum in 2010 that will permanently enact 1, 2 and 3 percent caps in the Indiana Constitution,” Bosma said.

Indiana cities, counties, towns and schools will face the biggest funding challenges, especially beginning in 2010, Bosma said.

“They will have to look for creative ways at all levels of government to deliver the same services that are being delivered today with less resources,” Bosma said. “That was one of the messages that I think the governor and General Assembly desired to send to local governments and schools … we will all have to do more with less. That includes the state,” he said, as the state picks up seven different property tax levies, removing them from local property tax levies.

“We are raising fewer taxes than the cost of picking those levies up and that means the state will have to tighten its belt as well across the board to be sure those critical services of school operating funds, child welfare and health care for the indigent are met,” he said.

Borders said the property tax relief law “gives some of the dollar” back to the taxpayer.

“We did raise the [state] sales tax, but for each dollar of new taxation [in the sales tax], there was about $1.70 of [property tax] savings, so there is still a net savings,” Borders said.

“For the first time in decades, the taxpayer has a right to say ‘this is all I can reasonably afford to pay’ ” through the new property tax caps, “and ‘you are going to have to live within in your means, government, and not keep coming after my money’. I am excited about that,” he said.

Thomas said the bill still allows some local government control as taxpayers, through voting in referendums, can decide on individual projects such as new schools, which can raise a county’s property tax.

The new law, which eliminates most township assessors, will make a county assessor responsible for assessments in each county. The exception is in townships with more than 15,000 parcels, such as Harrison Township in Vigo County. Voters in the November election will determine whether or not to keep the Harrison Township assessor or turn over those duties to the county assessor.

Bosma said county assessors likely will have to contract out assessment work. “In my experience, the private sector is more efficient than the public” sector, he said. Any company contracted to conduct assessments for counties must have workers who are certified assessors.

Howard Greninger can be reached at (812) 231-4204 or howard.greninger@tribstar.com.

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