By JENNIFER WHITSON, EvansvilleCourier & Press Indianapolis bureau whitsonj@courierpress.com
INDIANAPOLIS - Property taxes could change significantly under a bill the House approved 97 to 1 on Thursday, or in a best-case scenario, they could disappear all together by 2009.
House Bill 1001, carried by Rep. Jeff Espich, R-Uniondale, includes a laundry list of property tax changes large and small, including one that would help soften bills going out this year. Provisions include:
A one-time credit for homeowners against the cost of child welfare services, now paid by county property taxes. The change would slow the expected increases in 2006 property tax bills and cost the state $147 million.
For less populous townships that have a combined office of trustee and assessor, taking away the office's assessing duties and giving them to the county. The township official would still be a trustee and run poor relief.
An automatic referendum vote on any government construction project that exceeds the lesser of two thresholds: 2 percent of a taxing unit's assessed value or $50 million.
The transfer of all growth in costs in child welfare from the counties to the state budget, starting in 2007.
A requirement that units of government would have to limit the growth in tax rates to no more than 3 percent annually.
A limit on homeowners' total tax bills to no more than 2 percent of a home's assessed value.
Reinstatment of the ability of a local taxing unit to bank unused tax increases. Two years ago, the legislature got rid of banking, saying it hurt taxpayers by allowing for large, unexpected levy jumps. Now the pendulum has swung on that issue.
The House passed the measure 97 to one with all local representatives voting yes.
An amendment added late Wednesday stole some of the attention from the more substantive portions of the bill. Rep. Chet Dobis, D-Merrillville, added a provision that eliminates property taxes all together by 2009 without any ability for local units of government to replace the revenue.
Dobis said the amendment would help tie the legislature down to acting on reform. But Senate leaders scoffed at including what they saw as an empty promise.
Sen. Luke Kenley, R-Noblesville, said replacing property taxes altogether would take either a large hike in the state income tax or in the state sales tax to replace property tax revenue. "Without a replacement (for property tax revenue), this is a proposal that's not responsible," Kenley said. "We're going to stick to the mantra that if you want to cut taxes, you need to find a (funding) solution."
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