STATEHOUSE (March 14, 2008) - Hoosier taxpayers will see immediate property tax relief, and the process for permanent property tax reform has begun. The Indiana General Assembly created a property tax plan that includes most of the House Republicans' 10 Standards for Success.
The House of Representatives voted to pass committee reports for House Bill 1001 (82-17) and Senate Joint Resolution 1 (79-20).
The immediate relief is in the form of homestead property tax credits at a statewide average of almost 30 percent, $1 billion removed from property taxes, strict caps on property tax rates and controls on public spending.
Permanent reform is contained in Senate Joint Resolution 1, which begins the process of adding permanent rate caps to the Indiana Constitution.
"The pace of this legislative session was remarkably fast as we worked to provide immediate relief and reform to protect Hoosier homeowners. We were not able to get everything we'd hoped for, but every property owner will experience a significant reduction on property tax bills," said Rep. Amos Thomas (R-Brazil).
"The most important part of the property tax plan, caps on residential, rental and business properties based on assessed value, is intact. Additionally, we took the first step toward constitutionally protecting these caps. If we vote to pass SJR 1 in the 2009 session, Hoosier homeowners will be able to take the final step by voting to write the caps into our state constitution, where they will be permanently protected from future increases."
House Bill 1001, which was based on the House Republicans' Standards for Success and Gov. Mitch Daniels' property tax blueprint, empowers voters to control local spending through referenda, and it closes spending loopholes and improves oversight on local budgets.
These are highlights of the property tax plan:
Help for Hoosier homeowners. The plan features $620 million in immediate relief for 2008, $1 billion removed from property tax levies, referenda that empower voters to control or allow spending and a constitutional guarantee of property tax caps. There also is $140 million of relief in 2009, and $80 million of relief in 2010.
Help for all Hoosier property-tax payers. Cut now and cap forever. The plan, in addition to immediate relief, forwards the process of permanent caps through a constitutional guarantee of property tax caps. SJR 1 begins the process of permanent caps of 1 percent of assessed value for homesteads, 2 percent for rental and agricultural properties and 3 percent for all others.
Help for local governments. The plan, at the county level, removes from property taxes the costs of four child-welfare levies, juvenile incarceration and health care for the indigent. At the municipal level, it removes the remaining pre-1977 police and fire pensions from property taxes, and it includes support for police and fire services.
Help for Hoosier schools. The plan removes school operations and special education preschool costs from property taxes. It also includes $120 million in circuit-breaker relief and $400 million in tuition reserve fund money.
Help for low-income Hoosiers. The plan includes an overall decrease in taxes for low-income taxpayers, renters' deductions, caps for low-income senior-citizen homeowners and earned income credits.
HB 1001 now goes to Gov. Daniels, who has expressed support for the plan.
SJR 1 will be presented to the next General Assembly. If the same version passes that Legislature, it will be placed on the statewide ballot for all Hoosier voters. If they approve it, the caps will become part of the state Constitution.
Rep. Thomas encourages constituents to contact him with questions or concerns through e-mail at firstname.lastname@example.org, by calling the Statehouse at 1-800-382-9841 or by writing him at 200 W. Washington St, Indianapolis, IN 46204.