The leader of the Indiana House expects some kind of proposal adjusting local property taxes will advance out of the Republican-controlled chamber during the second half of the state's annual legislative session.
House Speaker Todd Huston, R-Fishers, told reporters Monday he's recently begun evaluating Senate Bill 1 -- as approved by the Republican-controlled Senate -- as well the much more significant property tax revenue reductions proposed by Republican Gov. Mike Braun.
"I have a lot to learn and I will continue to have a lot to learn," Huston said. "I'm looking forward to collaborating with Governor Braun and his team, and the Senate, and I feel like we're going to get someplace really good. It's going to take time and effort and a lot of work to get there. But I'm very optimistic."
Huston declined to identify specific provisions he would like to see included or removed from the property tax legislation. He said those details initially will be addressed by the House Ways and Committee, which is scheduled to hear public testimony on the measure beginning at 12:30 p.m. Region time Wednesday at the Statehouse.
"I've made it very clear, and will continue to make it clear, we can't break a system (such) that we can't get (property tax) bills out. We have to make sure that (local governments and school corporations) can pay their existing debt obligations and those types of things. So a lot of factors in all this," Huston said.
"We want to make sure that we have a system that's fair to the individual taxpayer and then also provides the local governments and those who actually receive the property taxes — as you know, zero dollars actually goes to the state from property taxes — that local governments have the resources they need to provide the type of communities that their constituents expect."
As it currently stands, Senate Bill 1 would cost public schools and local governments an estimated $1.4 billion over three years by capping operating fund property tax collections and providing tax incentives to senior citizens, military veterans, first-time home buyers and farmers.
Braun's proposal, on the other hand, would reduce local property tax revenue statewide by more than $4 billion over three years by immediately resetting residential property tax bills to 2021 levels, reducing the amount of a home's assessed value subject to tax, strictly limiting future property tax increases and making it more difficult for taxing units to temporarily increase property tax revenue through a voter referendum.
The difference between the two is significant. For example, Valparaiso Community School Corp. would lose $3.5 million in 2026 out of its $11.5 million operating property tax levy (30%) under Braun's legislation, while the school district's 2026 losses only would total $500,000, or 4%, under the Senate measure. The operations fund pays for student transportation, building maintenance, capital purchases, technology and district office staff.
The nonpartisan Legislative Services Agency projects the Valparaiso school district's property tax revenue losses would accelerate in subsequent years under either plan — growing to $4.8 million in 2028 under Braun's proposal, and $1.5 million under the Senate's legislation.
Braun confirmed Monday he has no issues with the Senate measure. He simply wants the provisions the Senate cut from it put back in.
"We just need to amend to it to where we need to be, and I feel confident that we'll get there," Braun said.
The first-year governor previously has threatened to veto any property tax legislation that doesn't meet his expectations. Huston doesn't expect that will be necessary.
"I don't think we'll ever get to that point so I'm not too worried about it," Huston said.
Huston and Braun also are backing Senate Bill 518 that would require many Indiana school corporations to share a portion of their soon-to-be-reduced property tax receipts with local charter schools.
Legislative proposals must win approval by both the House and Senate, with identical language, on or before April 29 to go to the governor to be signed into law or vetoed.
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