"State lawmakers play the blame game
In the wake of tremendous public outcry and numerous protests, Gov. Mitch Daniels has ordered a reassessment of all real property in Marion County based on evidence that business assessments were either left undone or performed inaccurately, contributing to an unfair tax burden on homeowners.
The governor also said he will freeze tax bills for Marion County at 2006 amounts and recommended that the county issue provisional bills until the reassessment is completed and new bills are issued.
“We’re here to solve problems, and we’re beginning with the immediate — at least in Marion County — today. People need relief now, and we can’t have people losing their homes because of unfair taxes,” Daniels said in a prepared statement.
As he addressed immediate property tax problems in Marion County, Daniels also announced the formation of a new “Blue Ribbon” commission comprised of state leaders who have been charged with developing a plan to seek long-term solutions for reform and restructuring of local civil and school government.
Indiana Supreme Court Chief Justice Randall T. Shepard and former Gov. Joe Kernan will co-chair the commission that will examine and make recommendations on such topics as what local government offices could be eliminated to achieve efficiencies and cost-savings and how local governments might restructure or consolidate to reduce overhead and other expenses.
Other members of the commission include Sue Anne Gilroy, vice president of development of St. Vincent Hospital, who served as Indiana secretary of state from 1994 to 2002; former IU President Dr. Adam Herbert, who holds a doctorate in urban affairs and public administration; Louis Mahern, who served in the Indiana Senate from 1976 to 1992; Ian M. Rolland, retired chair and chief executive officer of Lincoln Financial Group; and John Stafford, director of the Community Research Institute at Indiana University-Purdue University Fort Wayne.
“I’m appreciative that these highly respected and superbly qualified individuals have agreed to serve on the commission,” Daniels said. “Hoosiers will greatly benefit from their recommendations on how local governments can increase the efficiency and effectiveness of their operations to lower taxpayer costs.”
The commission is currently scheduled to begin meeting in August. Daniels has asked that they prepare a report on their findings in December that will be available for the Indiana General Assembly to discuss during its next session beginning in January 2008.
Meanwhile, Senate Democrats held a press conference blaming Republicans and the most recent state budget as the catalysts of the current property tax crisis.
“The Senate Democrats stand prepared to do whatever possible to help bring relief to Hoosiers now facing unreasonable property tax increases, even if that means returning to Indianapolis this summer for a special session,” Senate Minority Leader Richard Young said last week.
“As fellow taxpayers, many of whom face increases in our own property tax bills, we empathize with our fellow citizens and understand their frustration. However, the portrayal by Governor Daniels and our colleagues in the General Assembly that this situation has come as a surprise is unfair to the people of Indiana who are truly suffering.”
According to Young, the governor’s freeze of property taxes and the new “Blue Ribbon” panel he’s appointed are too little, too late.
“The governor should have engaged on the issue long ago,” Young believes. “In April, I personally and directly requested the governor’s attention to this matter. I asked him to use his authority to bring together the stakeholders, including schools, public agencies, local communities and the Legislature, to craft a lasting solution that will make our state a leader on this issue.
“It is unfortunate that the motivation to help our homeowners has only arrived after the bills have been delivered and not when we could have avoided the crisis altogether,” according to Young.
Democratic Speaker of the House Patrick Bauer doesn’t believe the governor’s actions go far enough either, especially for Indiana residents outside of the state capital. Bauer, from Northern Indiana, is calling for a statewide freeze on property tax bills, as well as state funds to alleviate the pressure on taxpayers.
“The governor ordered a new property reassessment in Marion County, based on the mistakes that were made at the local level and the Department of Local Government Finance’s approval of flawed rates skewed against homeowners,” Bauer said. “I applauded the governor’s decision.
“At the same time, as I have listened to the concerns expressed to me by legislators from both parties, it is becoming apparent that Marion County is not an isolated situation. It appears that many counties across Indiana failed to handle business assessments properly, shifting the tax burden to homeowners and farmers.
“We must help all Hoosiers faced with unfair taxation, not just Hoosiers living in Indianapolis,” according to Bauer.
Bauer, however, is not enthusiastic about legislators returning to the state capital before the start of the next regular session.
“I will not support a special session of the Legislature until there is a bipartisan plan on the table that provides lasting property tax relief for all Hoosiers. Let’s see if we can get a plan that makes sense first, then bring in lawmakers to approve it.”
The system is broken
House Republicans, led by Rep. Brian Bosma of Indianapolis, have also released their plan to fix the tax crisis.
“The property tax system is broken,” Bosma said. “It is time to lift the property tax burden.”
Bosma and fellow House Republicans believe there are steps that can be taken immediately either at the local level or the state executive level to address the property tax crisis and other measures that may be taken in the event of a special session.
“We are taking up where we left off at the end of this year’s legislative session — calling for more property tax relief immediately,” Bosma said.
“House Republicans predicted these dire consequences and collectively opposed the current budget bill because of its weakness in providing meaningful property tax relief,” Bosma was quick to point out.
“Now that taxpayers are getting their bills, they may understand why House Republicans opposed this property tax plan. Although we warned against these property tax calamities, clearly the amount of increases that have occurred in some parts of the state have far exceeded everyone’s worst fears.
“Hoosiers want and deserve action that alleviates their distress and protects them from this ever occurring again. House Republicans are again prepared to act with a plan that will help Hoosiers immediately while reforming the property tax system for Indiana’s future,” Bosma concluded. “This must never happen again.”
This past Monday, Republican Sens. Teresa Lubbers and Patricia Miller held a commission hearing on property taxes by the Commission on State Tax and Financing Policy. Over 300 taxpayers showed up to protest the increases and hear proposed solutions to the crisis. Both legislators have called for a partial or complete elimination of property taxes.
While no action was taken or specific recommendations made this week, the Commission on State Tax and Financing Policy is scheduled to meet again next week and Sen. Luke Kenley, R-Noblesville, chairman of the commission, said the hearing will focus on two issues: assessment practices and whether to change the property tax relief the Legislature approved this year from rebate checks to credits.
While property owners protest a rise in property taxes, the City-County Council approved an income tax hike of 65 percent on Monday to support Mayor Peterson’s new $90 million public safety plan, which includes hiring 100 new police officers.
The council voted 15-13 to pass the proposal. Two Democrats opposed the plan, and two Republicans joined 13 Democrats to support it. The tax increase goes into effect on Oct. 1, 2007.
Over 200 protestors attended Monday’s hearing, with many being escorted out of the hearing after disrupting the proceedings with chants of “No new taxes!”