The issue of property tax relief has dominated the discussion of this budget session of the Indiana General Assembly
Though everyday Hoosiers are thrilled at the prospect of paying less in property taxes, local leaders of cities and towns across the state are concerned that the proposed cuts will mean less revenue to work with in order to maintain the basic services they provide, such as public safety,
“The next budget year 2026 (the property tax cuts) will cost us between $2.8 million and $5 million,” said Zionsville mayor John Stehr (R) on All Indiana Politics. “There is not a lot of fluff in our budget. Over fifty percent of our budget is in public safety.”
Still, Stehr understands that there is a give and take in this process with many people paying an exorbitant amount more in property taxes.
“I think property taxes have grown at an exponential rate,” he said. “As the value of property has. It’s great to see the value of your house go up, but it doesn’t really mean that much to you unless you are selling it.”
Governor Mike Braun (R) plans to cap property taxes based on whether you are working or retired.
With state lawmakers and local government leaders trying to find common ground, Indiana’s treasurer, Daniel Elliott, believes he has a solution that can help solve both sides of the problem.
It’s a program that has been a round for a while but has not gotten a lot of attention. It’s called “Trust Indiana”, a program that allows local municipalities to invest money in a commercial paper portfolio set up by the state. That money then compounds and builds interest quickly, which can then be used to help pay for the services they provide.
“If they are able to raise revenue (through Trust Indiana), make a better return, that means that is less taxes that they have to put onto the citizens,” Elliott told Indy Politics. “This is an escape valve that allows these local units of government to raise money without raising taxes.”
Elliott said the state itself has been able to raise millions of dollars through a similar commercial paper fund.
