SJR 1 makes the 1%-2%-3% legislative property tax caps permanent by including them in the Indiana Constitution. SJR 1 passed the Indiana Senate 40-7 and the Indiana House 79-20 on March 14, 2008. SJR 1 again passed the Indiana Senate 34-16 on February 9, 2009. SJR 1 must also pass in the Indiana House in 2009 to put the constitutional property tax caps amendment on the 2010 ballot. We the people can then vote to make the property tax caps a permanent part of the Indiana Constitution.

HB 1001 phases in the 1%-2%-3% legislative property tax caps by 2010. Also, 2008 property taxes are reduced 26% from the prior year. An increase in the sales tax from 6% to 7% and county-wide local option income taxes will be used to replace the property tax revenue reductions that result from the property tax caps.

HB 1001 is a Taxpayer Friendly budget bill because the General Fund & Property Tax Replacement Fund $26.0722 billion expenditures total for the 2008 and 2009 fiscal years is less than the $26.1946 billion revenues total. HB 1001 also includes additional homestead credits from the Property Tax Reduction Trust Fund of $300 million in 2007 and $250 million in 2008.

HB 1478 is Taxpayer UNfriendly for the following reasons: (1) Homeowner property taxes will increase 1.2% each year from 2009 through 2013 with annual decreases in the Homestead Standard Deduction. (2) The 2% Circuit Breaker Cap on residential property taxes passed by the General Assembly in 2006 has been watered down to the point where it is almost eliminated. (3) The new local option income tax for property tax relief will be offset by future property tax increases unless the new local option income tax to replace property tax increases is implemented. (4) Using the new local option income tax to replace property tax increases means that income tax increases on Hoosier working families would lower the proportionate tax burden of businesses and utilities by freezing business and utility property taxes without a corresponding increase in other business and utility taxes. (5) A new local option income tax has been authorized for public safety.

Details regarding HB 1478 that are important to Hoosier working families are listed below.

Homestead Standard Deduction: The 2007 Homestead Standard Deduction of $45,000 (or up to one-half of the property’s assessed value, whichever is less) was to be decreased to $35,000 in 2008. HB 1478 keeps the 2008 Standard Deduction at $45,000.

Local Option Income Tax (LOIT) for Property Tax Relief: HB 1478 authorizes a county to adopt an additional County Adjusted Gross Income Tax (CAGIT) or an additional County Option Income Tax (COIT) of not more than 1% to provide any combination of (1) property tax replacement credits for all property, (2) an increase in the homestead credit percentage, and (3) property tax replacement credits for qualified residential property. The LOIT rate must be imposed in increments of 0.05%. The annual increase in the maximum permissible property tax levy for civil taxing unit operating funds in Lake County will be reduced to zero if the county does not implement the LOIT for property tax relief at a rate of 1%. Any LOIT authorization that provides property tax replacement credits for ALL property would result in property tax relief for businesses and utilities paid for by Hoosier working families. If all counties imposed a 1% LOIT solely for homestead credits, 2008 property taxes for the average homeowner would decrease about 28.7%. Of course, unless the LOIT to replace property tax increases (see below) is implemented, there is nothing to keep future property tax increases from offsetting the LOIT property tax relief.

Homestead Standard Deduction: HB 1478 decreases the Homestead Standard Deduction to $44,000 in 2009; $43,000 in 2010; $42,000 in 2011; $41,000 in 2012; and $40,000 in 2013. The Homestead Standard Deduction decreases will increase homeowner property taxes 1.2% each year.

Circuit Breaker Cap on Residential Property Taxes: Prior to HB 1478, all counties (beginning with taxes payable in 2008) were required to provide credits against the property tax liability of all forms of residential property – homesteads, apartment complexes, and other residential rental property – if the net property tax on the property, after all other credits were applied, exceeded 2% of the property’s gross assessed value. The credit, which would have reduced revenues for local taxing units and school corporations in affected counties, was to apply to all other real and personal property beginning with taxes payable in 2010. The average homeowner’s property taxes were to have decreased 3.8% in 2008, but the HB 1478 provisions listed next eliminated all but 0.1% of this decrease. (1) Credit from the circuit breaker cap will be reduced by the portion of the credit that would be allocated to school general funds (a school corporation’s tuition support property tax levy may not be reduced because of a circuit breaker cap credit). (2) Redevelopment commissions or TIF governing bodies may exclude TIF replacement levies from the computation and application of circuit breaker cap credits. (3) The 2% circuit breaker cap will apply only to homesteads, instead of all residential property, in 2008 and 2009. (4) The circuit breaker cap that begins in 2010 for all other real and personal property increases to 3% from 2%. (5) A county that contains a taxing unit that loses at least 2% of property tax revenue in a year to the circuit breaker cap (distressed unit), or a group of at least two distressed units on their own, may submit a petition for relief (that would increase property tax bills) to the Circuit Breaker Appeal Board (composed of state-level bureaucrats and special interest nominees).

Local Option Income Tax (LOIT) to replace Property Tax Increases: HB 1478 authorizes a county to adopt an additional County Adjusted Gross Income Tax (CAGIT) or an additional County Option Income Tax (COIT) at a rate not to exceed 1% sufficient to raise tax revenue to replace the allowable increase in the following year of property tax levies for all civil units in the county. The initial election to fund operating growth from LOIT is a two-year election. The LOIT rate is doubled (or increased by 50% in Marion County) in the initial adoption year, with the excess tax proceeds deposited in a county stabilization fund. Money in the stabilization fund could be distributed to the county taxing units when a year’s certified LOIT distributions are less than the calculated levy growth amount. After the first two years, the county may increase the LOIT rate annually. The LOIT tax rate for levy replacement may not be reduced or rescinded, but may be increased each year (up to the 1% maximum). Using LOIT to replace property tax increases means that income tax increases on Hoosier working families would lower the proportionate tax burden of businesses and utilities by freezing business and utility property taxes without a corresponding increase in other business and utility taxes.

Local Option Income Tax (LOIT) for Public Safety: Under HB 1478, a county that imposes both a LOIT to replace property tax increases and a LOIT for property tax relief may also impose a County Adjusted Gross Income Tax (CAGIT) or a County Option Income Tax (COIT) tax rate of up to 0.25% for public safety. The rate may not exceed the LOIT rate imposed in the county for tax relief. However, Marion County may impose a COIT tax rate up to 0.5% for public safety if the COIT to replace property tax increases is imposed.

Allen County Innkeeper’s Tax: HB 1478 increases the Allen County innkeeper's tax rate from 6% to 7%.

Howard County COIT (County Option Income Tax): HB 1478 provides that the additional COIT rate permitted in Howard County must be adopted in increments of one hundredth percent.

Monroe County COIT (County Option Income Tax): Under HB 1478, Monroe County may adopt an additional COIT tax rate up to 0.25% to fund the operation and maintenance of a juvenile detention center. In order to impose the additional COIT rate, the county must agree to freeze the part of the county property tax levy that is currently used for the operation of the facility.

Parke County CAGIT (County Adjusted Gross Income Tax): Under HB 1478, Parke County may adopt an additional CAGIT tax rate up to 0.25% to fund the costs, including repayment of debt, of a capital trial.

Vanderburgh County Innkeeper's Tax: HB 1478 raises the cap on the Vanderburgh County innkeeper’s tax rate from 6% to 8%.

County Boards of Tax and Capital Projects Review: HB 1478 establishes a County Board of Tax and Capital Projects Review in each county on January 1, 2009. Each County Review Board will have nine members, with two county residents elected to a four-year nonpartisan term by county voters (except in Marion County). In those counties that have a county tax adjustment board, the County Review Board will have all the powers and duties currently held by the county tax adjustment board before all the county tax adjustment boards are abolished on December 31, 2008. Counties that have abolished their tax adjustment board by December 31, 2008, and counties that adopt an ordinance by July 2^nd of any year, would not have to submit tax rates, levies and budgets to the County Review Board. The County Review Boards will also have some duties, including the setting of initial maximum levy limits for new taxing units, previously assigned to the state’s Local Government Property Tax Control Board (which is abolished December 31, 2008). Beginning in 2010, the state’s Department of Local Government Finance will forward petitions for relief from civil taxing units to the appropriate County Review Boards for recommendations.

Capital Projects: Each civil and school taxing unit must adopt a five-year capital projects plan every two years after holding public hearings on the proposed plan. The plan must cover all controlled projects with a cost exceeding $7 million. The County Review Board is required to provide a written review of the plan and approve or disapprove a project. The state’s Department of Local Government Finance will not have to approve a debt issue for a project approved by the County Review Board. A taxing unit may initiate the petition and remonstrance procedure for approval or disapproval of a project that has been disapproved by the County Review Board. County Review Board approval is not required for water projects, wastewater projects, highway or road projects, or bridge projects.

School Debt Payments: HB 1478 provides that after May 15, 2007, the state’s Department of Local Government Finance may not approve a school corporation's proposed bond issue that does not provide for payments toward the principal of the bonds on at least an annual basis, lease rental agreement that does not provide for repayments toward the present asset value of the lease at its inception on at least an annual basis, or debt service fund loan to purchase school buses that does not provide for payments toward the principal of the loan on at least an annual basis. HB 1478 could increase school debt service fund levies in the short term, but reduce bonding cost in the long term.

House Bill 1835 is Taxpayer Friendly because it establishes the Property Tax Reduction Trust Fund, which will be administered by the State Treasurer. Money in the Fund is to be used for property tax relief in any manner prescribed by the General Assembly. HB 1835 requires revenue to be distributed to the Fund from (1) initial Slot Machine Licensing Fees, (2) the Slot Machine Wagering Tax, and (3) excess money from the racetrack owners’ 15% set aside of slot machine adjusted gross receipts.

(1) HB 1835 requires from each licensee an initial licensing fee of $250 M payable in two annual installments. It also requires the Indiana Gaming Commission to deposit the initial licensing fees into the Property Tax Reduction Trust Fund. The initial licensing fees will total $300 million in fiscal year 2008 and $200 million in fiscal year 2009.

(2) HB 1835 imposes a graduated Slot Machine Wagering Tax equal to (a) 25% of the first $100 million of adjusted gross receipts received during the state fiscal year, (b) 30% of the adjusted gross receipts in excess of $100 million but not exceeding $200 million received during the state fiscal year, and (c) 35% of the adjusted gross receipts in excess of $200 million received during the state fiscal year. It also provides that all Slot Machine Wagering Taxes are deposited into the Property Tax Reduction Trust Fund. Slot Machine Wagering Taxes will total $63.3 million in fiscal year 2009 and $87.5 million in fiscal year 2010.

(3) Excess money from the racetrack owners’ 15% set aside of slot machine adjusted gross receipts will total $9.2 million in fiscal year 2009 and $9.1 million in fiscal year 2010.

HB 1001 is primarily a residential property tax reduction bill. The Homestead Credit is increased for one year in 2006 from 20% to 28%. The standard Homestead Deduction is increased for one year in 2007 from $40,000 to $45,000. Beginning in 2007 for Lake County and 2008 for all other counties, HB 1001 also establishes a cap on residential property taxes equal to 2% of the assessed value of the residential property.

Ordinary Hoosier working families, particularly those who are homeowners and dine out, took a hit during the 2005 Indiana General Assembly session. We were skewered by the multitude of state lawmakers who voted for the Governor-supported House Bills 1001 and 1120.

The HB 1001 budget bill includes the Property Tax increases listed next. These property tax increases overshadow the positive development of a 2% property tax cap for Lake County.

(a) $436 million over the next two years from placing a cap on the state's Property Tax Relief Credits (PTRCs) while providing PTRC funding equal to the amount paid in 2002 plus the revenue generated by one percent of the sales tax. NOTE #1: A February 17, 2006, E-mail from the Indiana House Republican Senior Fiscal Analyst states that "Current estimates reveal that the new cap will not be reached in 2006 (so no negative impact on property taxes).... because actual property tax levy growth has been slower than previously estimated!" NOTE #2: A July 23, 2007, presentation by Larry DeBoer (Purdue University Agricultural Economics Department) to the Commission on State Tax Tax and Financing Policy indicated that the PTRC cap will increase homeowner property taxes 4% in 2007.

(b) School property tax increases of 1.2 percent the first year and 1.3 percent the second year for basic funding.

(c) One to 1.2 percent school property tax increases to provide textbooks to low-income students, recoup state cuts for transportation, and pay for utility and insurance costs.

(d) Lowered base assessed values for farmland will benefit farmers but shift property taxes to other property owners such as businesses and homeowners, especially in rural counties.

(e) Counties can issue bonds to be paid off with property taxes to fund about $100 million owed the state for housing juvenile offenders.

(f) $52.5 to $63 million in county levies this year to enhance and adequately fund services to protect abused and neglected children.

(g) A new rule requiring annual assessments of homes will increase 2007 homeowner property taxes between 8 to 11 percent.

Senate Bill 296
(signed by the Indiana Governor on March 16, 2004 after passing the Indiana Senate 47-0 and the Indiana House 97-0)

The key provisions of Senate Bill 296 (SB 296) are effective January 1, 2005, and include the following:

SB 296 does not provide sufficient property tax relief for Hoosier homeowners. The property tax reductions of those qualified persons receiving increased deductions are shifted to all property owners in the form of a higher property tax rate.

The Indiana General Assembly concluded its special property tax session on December 5 by passing Senate Bill 1 (SB 1). SB 1 makes 24 changes to Indiana's property tax system. When analyzed from the perspective of all residential homeowners statewide, eleven of the 24 changes will likely decrease residential property taxes, one will redistribute the taxes, seven will indirectly affect the taxes, and five changes will not affect residential property taxes.

SB 1 does not provide sufficient property tax relief for Hoosier homeowners.

Only one of the six causes of current and future residential property tax increases has been addressed. To help combat excessive levy increases by local taxing units, some measures have been enacted such as annual increase restrictions, using all extra property taxes collected to lower the next year's budget, approval of library board levies by an elected fiscal body, and a decrease in the number of signatures to begin the petition or remonstrance process against public building projects. However, SB 1 does not satisfactorily alleviate the following causes of property tax increases: (1) reassessment, (2) the so-called homestead credit calculation correction, (3) the K-12 school funding property tax increases in the current budget, (4) the 2004 manufacturing inventory tax shift, and (5) the 2007 shift of the entire inventory tax.

When the General Assembly imposed the 20 percent sales tax increase (from 5% to 6%) effective December 1, 2002, a 16.3% decrease in the Pay 2003 property tax was promised to the average homeowner statewide AFTER reassessment. In other words, a $740 million increase in the sales tax was supposed to fund a $329 million DECREASE in residential property taxes. After the actual statewide effects of reassessment become known in a few months, it will be interesting to see just how far the General Assembly has fallen short of its residential property tax decrease promise.

The so-called homestead credit calculation correction reduced the General Assembly's promised property tax relief another $102 million. K-12 school funding property tax increases passed by the General Assembly this year will increase residential property taxes another $48 million. The 2004 manufacturing inventory tax shift will add $121 million to the homeowner property tax burden. Another $282 million will be paid by homeowners when the entire inventory tax is shifted in 2007.

The General Assembly must restore the property tax relief promised to Hoosier homeowners when its 2004 session gets underway next month.

Meaningful residential property tax relief occurs when homeowners pay less property tax without other taxpayers having to pay more in property or other taxes. In other words, property tax replacement credits paid by the state through spending decreases are necessary for meaningful property tax relief. Homeowners deserve the meaningful property tax relief that modest spending cuts can provide. For example, $400 million in property tax replacement credits can be provided if the state's current biennium budget is cut just 2.63 percent.

New property tax replacement credits must be created to help vulnerable homeowners whose property taxes have increased the most.

Reassessment has resulted in property tax bills that increase dramatically for the owners of older homes in well-kept neighborhoods throughout the state (see the "stories"). Also, the inventory tax shifts in 2004 and 2007 will cause homestead property taxes to skyrocket in those 40 townships that pay 80% of the total business inventory tax (the counties that will be hit hardest include Adams, Cass, DeKalb, Delaware, Elkhart, Jackson, Knox, Lake, Montgomery, and St. Joseph). In particular, older Hoosiers on fixed incomes and disabled homeowners may have to give up their homes because property tax increases limit the medicines or food they can afford.

SB 1 requires the Commission on State Tax and Financing Policy (CSTFP) to study the elimination of property taxes as a source of funding for local government services along with alternative sources of revenue that might be used to replace property taxes. The CSTFP is a statutory commission which consists of five members and is staffed by the Legislative Services Agency. The study is to be completed no later than December 31, 2005. Enough information will be available during the 2004 General Assembly session to make property tax elimination decisions. We must insist that our state legislators seriously consider property tax elimination without waiting for the results of an unneeded study by CSTFP.

Following next are (1) a spreadsheet listing the statewide residential property tax effects of SB 1 and (2) a description of each of the 24 SB 1 changes analyzed from the perspective of all residential homeowners statewide.

Installment Payments of Property Taxes: Under certain circumstances, the county treasurer may petition the Department of Local Government Finance (DLGF) to establish a schedule of installments with respect to one or more classes of real property for the payment of property taxes.

Waivers of Late Penalties: Under current law, if an installment of property taxes is not completely paid on or before the due date, a penalty equal to 10% of the amount of delinquent taxes is added to the unpaid portion. This bill allows the DLGF to accept waivers of penalty payments for property taxes on real property for which a general reassessment or an annual assessment adjustment caused a tax increase from the preceding year of a percentage determined by the county treasurer.

Maximum Tax Rates: After a general reassessment (or an annual AV adjustment beginning with taxes paid in 2006), the increase in assessed value can cause an increase in certain levies or appropriations if they continue to be based on the unadjusted maximum statutory rate. This bill would result in an adjustment to each of these maximum tax rates so that the available levy or appropriation would be unaffected by changes in AV due to reassessment. These levies and appropriations would continue to grow by actual added property value. The bill includes language to adjust the 2003 base rate as if this bill was in effect for 2003 taxes.

Maximum Levies: Under current law, a civil taxing unit's maximum permissible levy grows each year by the six-year average increase in Indiana nonfarm personal income. The annual increase is limited to 6%, although a taxing unit may appeal to the state's Local Government Property Tax Control Board for a larger increase in the maximum levy if the unit's AV growth is 3% greater than the statewide average growth in AV. This proposal would change the calculation for the maximum levies of units, the Family and Children Fund, and the Children's Psychiatric Services Fund. Beginning in 2004, these maximum levies would be based on the previous year’s actual levy (subject to the maximum levy) rather than the maximum levy itself. This change removes the previously unused portion of maximum levies and eliminates any "banking" of unused levy authority in the future. In addition, this bill clarifies current statute that the school transportation maximum levy computation begins with the previous year’s certified levy as opposed to the previous year’s maximum levy. However, the actual levy would not be reduced below 2003 levels.

Certified Assessed Value: Under current law, the county auditor may keep the AV of certain property in bankruptcy and assessments under appeal separated from other property on the tax duplicate. This AV is not considered in the county auditor’s certification of AV for use in fixing tax rates. When assessed value is removed from the AV certification, the tax rate is increased in order to generate the desired certified levy. This bill would remove county auditors’ authority to reduce the certified AV to compensate for appeals. The inclusion of AV that is successfully appealed would cause some tax rates to be set too low, resulting in tax shortfalls. However, the bill also allows civil units and school corporations to seek an excessive levy in the following year to compensate for shortfalls caused by successful appeals.

Appeal Process: Provides that the initial step in the appeal of property assessment is a written request by the taxpayer for a preliminary conference with a county or township assessing official. The written request need not be on a DLGF form. Notwithstanding a property assessment agreed to by the township assessor and the taxpayer in resolution of an appeal to the county property tax assessment board of appeals, the bill permits the board to determine its own assessment under its authority to assess property for the current year. The bill allows, for the assessment years 2002, 2003, and 2004, an appeal of a real property assessment that is filed within 45 days after a taxpayer receives the notice of change in assessment or the related tax bill, whichever occurs first, to apply to the taxes imposed for that assessment date and payable in the next year even if the appeal is filed after May 10 of the assessment year.

Elimination of Appeal for Alternate Use of CAGIT PTRC: Eliminates the property tax appeal provision that permits local units to reallocate CAGIT property tax replacement credits for a purpose other than property tax relief.

Levy Excess Fund: Under current law, if the actual property tax distribution exceeds the certified levy, a local unit may retain an amount equal to 2% of the certified levy in the fund and deposit the amount over 102% of the certified levy in the Levy Excess Fund. The DLGF may require a civil taxing unit to include the amount in the Levy Excess Fund when setting the unit’s budget. The bill requires the total amount of actual property tax distributions that exceed the certified levy to be deposited in the Levy Excess Fund and requires the unit to use the amount in the Levy Excess Fund when setting the unit’s budget.

Validating Actions Taken by the Department of Local Government Finance: Legalizes and validates any action taken by the DLGF before January 1, 2004, to extend the deadline for filing an assessment appeal to the county, to allow the payment of property taxes in installments, or to waive a late payment penalty.

Deduction/Credit Filing Extension: Extends the deadline from May 2003 to December 15, 2003, to file an application to receive a Homestead Credit, $35,000 Standard Deduction, Mortgage Deduction, Aged Deduction, Blind/Disabled Deduction, and Veterans Deduction in 2004. Allows a person who acquires property after March 1, 2003, to file for and qualify for the Homestead Credit and deductions.

Homeowner's Property Tax Deduction: Would increase the maximum allowable homeowner’s property tax deduction under the Adjusted Gross Income (AGI) Tax in tax year 2004 only. The increase in the maximum allowable deduction would apply only to homeowners who pay any or all of their 2002 Pay 2003 property taxes in 2004. Under the bill, for tax year 2004 AGI taxes, a taxpayer would be entitled to a maximum homeowner’s property tax deduction equal to the sum of (1) and (2): (1) A maximum deduction of $2,500 for 2003 Pay 2004 property taxes. (2) A maximum deduction for the portion of 2002 Pay 2003 property taxes paid in 2004 based on the formula [(2002 Pay 2003 property taxes paid in 2004)/(2003 Pay 2004 property taxes)]$2,500.

Three Appraisal Methodologies for Rental Properties: Requires the property tax liability payable in 2006 and thereafter on residential rental properties that have more than 4 rental units to be computed using the lowest assessed valuation determined by applying each of the following appraisal techniques: (1) cost approach; (2) sales comparison approach; and (3) income capitalization approach. Provides that the gross rent multiplier method is the preferred method for valuing rental properties that have fewer than 5 rental units and mobile homes.

Bond Bank Investments: Would allow the State Treasurer to invest state funds in certain Indiana Bond Bank (IBB) obligations which are secured by tax anticipation time warrants or notes. The short-term investment of state funds in IBB obligations would help reduce the cost of issuing additional rollover funding for the local units of government who are unable to repay their current loans by December 31, 2003. Potential investment of state funds include funds in the Common School Fund, the Public Depository Insurance Fund, and any other fund under the authority of the State Treasurer.

DLGF Takeover of Assessment: Authorizes the DLGF to take over the 2003 general reassessment process (including the equalization study) in a county if the county's equalization study was not submitted to the Department before October 20, 2003, or if the DLGF determines that the county's reassessment is likely to be inaccurate.

Approval of Appointed Library Board Levies: With respect to the review of budgets and levies of taxing units that have a governing body comprised primarily of appointed members and propose to increase their property tax levies by more than 5%, the bill adds library districts to the entities subject to review by an elected fiscal body and authorizes reduction of the proposed levy to an amount that is less than the maximum permissible levy.

Qualifications of Assessors: Provides that each county assessor and each elected assessor who has not attained a Level II certification must employ a Level II assessor-appraiser. Each elected county assessor, township assessor, or elected trustee-assessor must attain Level I certification within one year after taking office and attain Level II certification within two years after taking office. A person who does not comply with this requirement forfeits the assessor's or trustee-assessor's office.

Assessment Software: Requires the DLGF to study the feasibility of creating uniform and common computer software programs for property tax assessment purposes, including computer software programs that allow the sharing and transfer of assessment data in a uniform format by the state and all counties.

Petition and Remonstrance: Requires the State Board of Accounts to design a standard form of the petition that is used to initiate the petition and remonstrance procedure. The bill provides that the petition requires the signatures of the lesser of 100 or 5% of the property owners in the political subdivision (instead of 250 or 10%). It also does not allow a political subdivision to promote a position on the petition or remonstrance by (1) allowing facilities to be used to promote a position unless equal access is provided to the opposition, (2) make expenditures from a fund controlled by the political subdivision except to explain the project, and (3) use employees during normal working hours or paid overtime.

Property Tax Study: Requires the Commission on State Tax and Financing Policy (CSTFP) to study the elimination of property taxes as a source of funding for local government services along with alternative sources of revenue that might be used to replace property taxes. The study is to be completed no later than December 31, 2005. The CSTFP is a statutory commission which consists of five members. The CSTFP is staffed by the Legislative Services Agency.

Electronic Submittal of Sales Disclosure Forms: Provides that after December 31, 2004, the sales disclosure forms and data forwarded by local assessors to the DLGF and the Legislative Services Agency must be provided in electronic format.

Automatic Refunds for Successful Appeals: The county auditor must determine the amount of the refund for successful assessment appeals without the taxpayer having to file a claim and without the board of county commissioners having to allow the claim.

Provisional Property Tax Statements: For the 2003 pay 2004 assessment, the county treasurer may use a provisional statement based on 90% of tax liability if the county auditor fails to deliver the abstract before March 16 of the year following the assessment date. The county treasurer must give notice of the provisional statement by publication in a form prescribed by the DLGF. The county auditor or 50 property owners may request that the DLGF waive provisional tax statement requirements for a particular assessment date.

Taxpayer Notice of Tax Relief: The DLGF would be required to provide to each county a statement containing the amount of additional 2004 property tax that the average homeowner in the county would have paid without the tax mitigation measures enacted by the General Assembly. The DLGF must do this by February 25, 2004.

Special Masters: The taxpayer may appeal a determination of the DLGF to the Indiana Board of Tax Review. The Board may develop a form for petitions that outlines the appeal process. The Board may contract with, appoint, or otherwise designate special masters to conduct evidentiary hearings and prepare reports. The special masters must set a hearing date, give notice of the hearing, and mail to the taxpayer, the DLGF, the township assessor, and the county assessor. At the hearing the township assessor and the county assessor may attend.

House Bill 1001 (SS)
(as passed by the Indiana General Assembly during its special session on June 22, 2002)

An assessment of the homeowner property tax Pros and Cons for HB 1001 (SS) is listed next.

Statewide Residential Property Tax Effects
Senate Bill 1 (Signed by the Indiana Governor on December 12, 2003)
(compiled December 6, 2003)
(amounts expressed in millions of dollars for the indicated calendar years)

Residential Property Tax Decreases	2004	2005	2006
Installment Payments of Property Taxes	uncertain	uncertain	uncertain
Waivers Of Late Penalties	uncertain
Maximum Tax Rates Adjusted for Reassessment Effects	uncertain	uncertain	uncertain
Maximum Levies Limited for Local Taxing Units (1) (2) (3)	uncertain	uncertain	uncertain
Certified Assessed Value Used to Set Tax Rates	uncertain	uncertain	uncertain
Appeal Process Changes	uncertain	uncertain
Elimination of Appeal for Alternate Use of CAGIT PTRC		uncertain	uncertain
Levy Excess Fund Used for All Excess Distributions (4)	(14.8)	(14.8)	(14.8)
Validating Actions Taken by Dept. of Local Government Finance	uncertain
Deduction/Credit Filing Extension to December 15, 2003 (5)	(63.8)
Homeowner's Property Tax Deduction Increase for Income Tax		(12.0)
Total Decreases	(78.6)	(26.8)	(14.8)

Residential Property Tax Redistribution	2004	2005	2006
Three Appraisal Methodologies for Rental Properties			uncertain

Residential Property Tax Indirectly Affected	2004	2005	2006
Bond Bank Investments for Tax Anticipation Warrants	uncertain
DLGF Takeover of Assessment Under Certain Circumstances	uncertain	uncertain	uncertain
Approval of Appointed Library Board Levies by Elected Body	uncertain	uncertain	uncertain
Qualifications of Assessors to Hold Office	uncertain	uncertain	uncertain
Assessment Software for Uniform Statewide Assessments	uncertain
Petition and Remonstrance Signature Numbers Reduction	uncertain	uncertain	uncertain
Property Tax Study for Elimination / Alternate Revenue Sources	uncertain	uncertain

Residential Property Tax NOT Affected	2004	2005	2006
Electronic Submittal of Sales Disclosure Forms to the State
Automatic Refunds for Successful Appeals without Filing Claim
Provisional Property Tax Statements if Needed After 2003
Taxpayer Notice of Tax Relief Included in Tax Statements
Special Masters to Hear Indiana Board of Tax Review Appeals

GRAND TOTAL Residential Property Tax Decrease	(78.6)	(26.8)	(14.8)

SOURCE: November 24, 2003, SB 1 Fiscal Impact Statement from Legislative Services Agency.

NOTES:
(1) 2004-06 savings uncertain from civil taxing unit increase based on prior year actual vs max levy.
(2) 2004-06 savings uncertain from the elimination of "banked" levy amounts by civil taxing units.
(3) 2004-06 savings uncertain from school transportation based on prior year certified vs. max. levy.
(4) 41% of the $36.1 M annual levy reduction estimate is assigned to residential property taxes.
(5) $70.0 M tax shift from assessed value deductions reduced 30% by resulting higher tax rate.