From the Farm Bureau Public Policy Dispatch:
PERSONAL PROPERTY AND PROPERTY TAX APPEALS KICK OFF FISCAL ISSUES The Senate Tax & Fiscal Policy Committee chaired by Sen. Brandt Hershman (R-Buck Creek) started the session by examining the property tax appeal process and with the issue of reducing the burden of personal property tax which is important to farmers whose operations are so capital intensive. SB 152, authored by Sen. Doug Eckerty (R-Yorktown), states that once an assessment has been appealed and settled through the Property Tax Assessment Board of Appeals (PTABOA), the new assessment is the base value to be “trended” for the following year’s assessment. Katrina Hall of Indiana Farm Bureau testified in favor of the bill, stating that she hears from members frequently who are frustrated by back-and-forth struggles with assessors on appeals. Those representing assessors expressed concerns about how the bill would interfere with providing true market value assessments. The bill was held so the author could work out issues with assessors.
SB 353, county option exemption for personal property, authored by Sen. Hershman would permit a county council to approve personal property tax exemptions in the county for all taxpayers and set a maximum dollar amount. Testimony for this bill was taken along with testimony on SB 375, depreciable personal property assessment authored by Sens. Dennis Kruse (R-Auburn) and Jim Buck (R-Kokomo). SB 375 would change the 30 percent floor used in personal property assessment to 20 percent. Katrina Hall testified in favor of both bills, stating that Farm Bureau policy supports the elimination of personal property tax as long as the revenue is replaced for local units of government. Replacement revenue is the most complicated part of this issue since personal property tax generates about $1 billion in local revenues. The problem for the agricultural community is that its part of that revenue is large to Indiana’s farmers but a small part of the personal property pie. If personal property were eliminated, most farmers would pay more in additional real estate taxes than they would receive in relief. These bills were both held for future action.
SENATE LOCAL GOVERNMENT COMMITTEE HEARS ASSESSOR QUALIFICATION AND GOVERNMENT MERGER BILLS SB 19, dealing with local government reorganization and authored by Sen. Jim Tomes (R-Wadesville), was heard on Wednesday. Katrina Hall testified in favor of the bill that attempts to provide for a separate vote tally for those inside and outside the city limits when a city and county are attempting a merger. Sen. Tomes offered the bill to address the unequal playing field that rural residents were subjected to in the recent merger referendum dealing with Vanderburgh County and the City of Evansville. Hall offered three additional provisions to improve the bill, including the requirement of a public fiscal plan that would give voters an idea of the ramifications of proposed mergers and a prohibition of referendum campaign contributions to the city or county from vendors doing business with either. The Indiana Chamber testified against the bill saying it was not needed due to the extreme success those opposing the Vanderburgh/Evansville merger had on November 6. The bill was held until next week when a major amendment is expected to be offered.
The Senate Local Government Committee also heard SB 12 (Sen. Phil Boots, R-Crawfordsville), which deals with whether a county assessor must obtain a Level III certification before running for or continuing to hold office. The bill would instead allow an employee or contractor to hold the Level III designation. County assessors who were in Indianapolis for a training conference testified against the bill saying that the Level III certification has provided credibility to their office and much needed expertise. The assessors present felt SB 12 was a step backward. The bill was held for further negotiations.
HOUSE WAYS & MEANS HEARS ONLINE SALES TAX BILL On Wednesday, the House Ways & Means Committee considered HB 1007, authored by Reps. Tom Dermody (R-LaPorte) and Ed Delany (D-Indianapolis), which would require online vendors with a physical presence in Indiana to collect sales tax and remit it to the state of Indiana. Studies estimate that this bill would raise anywhere from $75 million to $150 million per year for state coffers. The bill only requires collection of sales tax already owed by those buying from Amazon, for example. Taxpayers who are not charged sales tax in an online transaction are supposed to report that sales tax owed as “use tax” and remit it with their annual Indiana income tax return. Most taxpayers are skipping the reporting so the revenue is lost and, more importantly, local retailers are put in the position of being a showroom for online retailers. This situation is very anti-competitive for brick-and-mortar retailers – particularly small retailers who are often in rural towns. Katrina Hall testified in favor of the bill stressing that IFB members see many constructive ways the state could spend these tax dollars that are in fact already owed. HB 1007 was held for further consideration.
SHOULD IT BE EASIER TO CREATE A TOWN? This question was examined on Thursday morning in the House Local Government Committee chaired by Rep. Tim Neese (R-Elkhart) when HB 1186 was presented by author Rep. John Price (R-Greenwood). HB 1186 would lower the threshold for the number of landowners required to initiate the proceedings of incorporating a town. If this happens, a referendum of voters, not landowners, would decide whether or not the designated area becomes a town. This bill does not involve annexation per se but deals with areas being designated parts of a new town rather than joining an existing one. Katrina Hall testified against the bill, in particular because it removed the provision in current law allowing 51 percent of the landowners to stop such a proposal. Others testifying on the bill pointed out concerns. HB 1186 was held so Rep. Price could propose an appropriate amendment next week.
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