With only a few days left in the 2007 legislative session at the Indiana Statehouse, the time has come to make a final push to provide Hoosiers with some measure of property tax relief, full-day kindergarten, an effective health insurance initiative, and an honestly balanced budget. While much legislation has already completed the process, it is crucial that we complete these important issues by this weekend.
Legitimate property tax relief must be accomplished due to the possibility of unheralded growth, including an estimated 23.6% increase because of trending complications. At the Statehouse, the attitude for substantial reform is positive. House Bill 1478 is currently in the conference committee process, and I am encouraging additions to the bill that give local governments more control to move away from property taxes. Because not every community in Indiana has similar needs, state leaders should consider creating a system that allows each community to focus on the priorities of local residents. Many of our local communities, like LaPorte County, will not be able to repair long standing debt issues without the state legislature enacting some relief.
In a manner of bipartisanship, legislators are discussing the best details to accomplish this goal. To promote true reform that allows communities to adopt flexible property tax relief, I support a number of ideas that would provide immediate property tax relief while restructuring the way local taxes are collected and distributed.
Immediate Cut in Property Taxes. As a means of providing immediate but sensible property tax relief, the final bill must utilize state funding to increase the homestead credit and provide a reduction in property taxes for 2007 while still remaining within the parameters of an honestly balanced budget.
School Construction Income Tax. Legislators must allow local communities the opportunity to spread the burden of school construction costs away from property taxes. These costs account for about 37% of property tax growth throughout our state. The idea of an Incremental Local Option Income Tax (LOIT) reduces dependence on property taxes to fund government services and should be adopted. While the LOIT is a county-wide option, the amount would vary slightly depending on the school district within which a property taxpayer lives, creating additional transparency in the amount levied for school construction.
2% of AV Circuit Breaker Remains Intact. The current 2% circuit breaker protection should be safeguarded for property owners in order to provide a degree of continuity that will benefit Hoosier taxpayers. We must encourage localities to hold spending levels to a more acceptable level. However, throughout the conference committee process, the measure should be altered in a manner that balances property owner interests, yet keeps the plan from unduly harming schools.
In addition to property tax relief, legislators must continue the positive work already accomplished on our state budget. Once the final budget bill is passed out of conference committee and sent to my desk for a final vote, I will study the bill to ensure that the budget is honestly balanced, provides increased funding for our schools, and phases in an effective full-day kindergarten program for Indiana schools Â¿ including state funding for schools in LaPorte and Pulaski Counties, which already offer full-day kindergarten.
Additionally, discussions continue during this last week on a health care program for those who fall outside of the gaps of Medicaid, yet are still between 150-200% of the federal poverty level. The authors of the legislation may decide to increase the cigarette tax to pay for the program in order to keep overall taxes from growing for average Hoosiers. Before I support the measure, I will need to make sure that the largest number of Hoosiers will be assisted and that the operation costs of the program stay low.
Overall, I am frustrated with a legislative process that bunches up the most important issues at the end. Legislators must work together to make the right decisions for our local residents, understand that those decisions might not always be easy to make, and balance the competing interests of Hoosiers in a manner that keeps our state taxes from increasing. If you have questions or concerns during this last week, IÂ¿ll be here at the Statehouse all weekend. Email me at email@example.com or call at 1-800-382-9841 ext. 9793.