The Truth
"Just keep an open mind," state Rep. Jeff Espich, R-Uniondale, told taxpayers at a property tax reform committee hearing in South Bend Thursday.
Keep an open mind.
When your property taxes have gone up by 24, 50, 100 or 200 percent, it's difficult to keep an open mind. The only thing you're thinking about is getting rid of what ails you.
Eliminating property taxes was a common theme at the Indiana House Ways and Means Committee hearing, which was held at Indiana University South Bend. We're pretty sure there's no gray area for most folks when it comes to their position on property tax reform. But if people could look at it objectively -- which is admittedly next to impossible to do when you're paying the bill -- it would be difficult to eliminate property taxes and continue to fund schools and local government at adequate levels.
Gov. Mitch Daniels has proposed caps on property taxes for homeowners, rental properties and other businesses, between 1 percent and 3 percent, respectively; removing school funding from property taxes; increasing the state sales tax by 1 percent; capital projects decided by referendum; and elimination of elected township and county assessors. House Bill 1001, which was the subject of Thursday's hearing, mirrors the governor's proposal.
There are several scenarios legislators could follow during this short session on property tax reform:
* Gridlock, which could lead to no reform at all. While that's certainly possible, especially in a short session, it's highly unlikely in an election year when constituents are clamoring for them to take drastic action.
* A last-minute solution, which could lead to a panic bill that actually makes the property tax situation worse. Always a good chance for that happening in the Indiana General Assembly, where members love 11th-hour compromises that often fail to reflect the intent of original bills. Surprises and property taxes don't mix. Hoosiers have had enough of that over the past several years.
* Not thoroughly considering the long-term impact of whatever they do on cities, towns, counties, schools and other local government entities. This is the most likely result. Often legislators do what sounds good, or they pass the buck down to local government officials, thinking the "powers that be" in Indianapolis know better than those doing the work at home. State-sponsored solutions may sound good to constituents (like eliminating property taxes), especially in an election year, but the taxpayers end up paying in the long run, either in higher taxes or reduced services. Legislators and other state officials can then point fingers and say, "It wasn't us. We were helping you. It's local government. They can't manage their money."