Truth
The question of what to do about higher property taxes in Elkhart County is not as simple as hoping Gov. Mitch Daniels will order another reassessment.
In fact, that might be the exact wrong move.
A reassessment will cost a lot of money -- property tax money paid for by you. It has to come from somewhere, which means less services because an additional reassessment isn't something for which the county budgeted.
A reassessment doesn't necessarily guarantee that property taxes will go down. They could go up. They could also stay the same, which is a more likely scenario. There's no evidence at present to show that our reassessment was wrong in the first place.
There is no short-term solution to the property tax mess. And there's plenty of blame to go around.
The Legislature has known this problem was coming. There were predictions about a 24 percent average increase statewide while lawmakers were in session, yet the best they could pass was a "rebate" that will arrive too late for taxpayers to pay this installment of their bills. That's not property tax reform.
Elkhart County homeowners are seeing an increase based on two factors: reassessment and the loss of the inventory tax. Neither should have been a surprise.
Following a lawsuit by property owners in Lake County several years ago, the state tax court ruled that Indiana property assessments be based on market value. Stated simply, that means homes are assessed based upon what they would sell for. That has affected older homes and rentals, especially.
When the Legislature made some adjustments to the system, it shifted the tax burden from business to homeowners. That will not change with a new assessment. That will take a systemic change on the part of the General Assembly.
Meanwhile, the inventory tax was phased out during the past three years. The Elkhart County Council had the option to increase the local income tax to offset some of the inventory tax loss. Council members chose not to do so in 2005 because it had earlier adopted a wheel tax and a special income tax to fund the new criminal justice complex, which is set to open later this year.
Daniels has extended the time under which counties can raise the income tax to October. While local officials have indicated they'll look at it, it's unlikely they'll make a move to actually do it.
We believe it deserves a fair hearing. After all, it would more equitably place the burden on those who are earning money and not upon those who are on fixed incomes. It would replace some of the property tax burden. It's a shift, not an additional tax, but the perception of raising taxes is what keeps local officials from doing what probably needs to be done.
On Monday, we'll look at the blame game and inaction by elected officials.