The first in-depth hearing into a bill geared towards lowering property taxes in Indiana happened on Tuesday.
State Senators on the Senate Tax and Fiscal Policy Committee hear testimony from dozens of citizens, local leaders, and fellow lawmakers on what the impacts of the bill, as it’s currently written, may have.
In its current form, the measure would allow homeowners to either file for a 60% homestead deduction or have their tax bill reset to 2021 levels. It also would require property tax referendum votes to occur during general elections in even-numbered years, when voter turnout is higher for presidential and midterm elections.
Property taxes increased in a big way after the COVID pandemic subsided. Governor Braun’s team shared data with the committee Tuesday which showed that property taxes spiked by 5.6% for taxes paid in 2021, then another 49% for 2022 and 10.2% in 2023.
“We’re looking at property in Alabama, Tennessee, places like that where they treat retirees properly. They appreciate their people and they are not taxing them to death,” said Larry Cooper, a retired public safety officer in Indianapolis. “We have one of the highest gasoline taxes in the country. Our property taxes keep going up!”
Franklin resident Mark Gross testified that he pays at least $1,000 a year more now than in 2021.
Even with citizens detailing how much more they are paying in property taxes, leaders of local governments including county commissioners, mayors, and township trustees all testified that they are concerned the bill will see drastic cuts to funding for local governments.
“The negative impacts of this bill would likely lead to a mandated 10 to 15 percent (spending) cut,” said Terre Haute Brandon Sakbun (D). “That would put the city of Terre Haute in a very poor position from a public safety standpoint.”
Sakbun said his city has already had to downsize quite a bit over the last decade, especially when it comes to public works and public safety.
The concern is bipartisan.
“Our consultant’s estimate shows that in year one (the bill) will eliminate $2.7 billion in assessed value, erase $26.1 million from our general fund, and revert out property tax revenue back to 2019 levels,” said Carmel mayor Sue Finkam (R). “While we could dramatically cut services or drastically raise tax rates for the non-homestead taxpayers, either of these actions would hurt Carmel.”
Governor Braun said he understands the concerns of local government leaders.
“This is an issue about listening to the taxpayers – some of them now feel that they may not be able to keep their home – and listening to the folks that we all want to be healthy and survive,” Braun said, adding he wants to make sure local governments weren’t simply taking advantage of a tax revenue windfall.
The author of the property tax bill, State Sen. Travis Holdman (R-Markle), says he plans to drafted several amendments to the bill based on testimony heard on Tuesday. He hopes to hold another hearing on the amended bill next week.
2 comments
The current property tax system was supposed to use market value to determine the tax. But our taxes go up every time a neighboring property is sold. Yet no one knows for sure what our property is worth until IT IS SOLD. So we are being taxed on the future. It truly is the ROYAL TAX. Plus the unjustified hike in the tax does not take into account any downturn in the economy. Remember the disastrous Obama economy??? We bought our place because the price was low because of that very economy. In 10 years the assessed valuation has nearly TRIPLED! The tax hasn’t tripled but almost. We downsized from our previous home. e are now on fixed incomes. This is a dastardly way to treat retirees who worked hard and paid their bills for more than 50 years. Our kids long ago left the nest but we’re still paying an exorbitant 80% of our property tax for the failing school system. We interact with their failed students every day. No question the system has failed. Where is the USAID money when we really need it?
Notice how politicians always threaten public safety, fire, police, etc. when talk comes to reducing taxes. Never do they consider and across the budget cut or looking to see if there is waste that could be gotten rid of. I’ll be if the State of Indiana had a group similar to DOGE it could find lot’s of wasteful spending.