Mary Beth Schneider, writing for the Indianapolis Star, has an article on the Marion County Reassessment that highlights some more issues with the Governor’s order, apparently by fiat, that properties in Marion County be reassessed.
1. Who is going to pay for the reassessment? It’s the governor’s order, apparently. (He’ll get DLGF to implement an order in 10 days or more — the required public hearing on the issue being a mere formality.) The Marion County reassessment fund is depleted. So, we have State ordered local government spending — kind of how we got in this mess in the first place.
2. Mortgage companies may or may not honor the Governor’s unilateral order. The Star article quotes one homeowner who was told, without a new tax bill, she would have to send her mortgage company an escrow amount based on the most recent 2007 property tax bill.
3. Some taxpayers had bills that decreased. Are they now obligated to make higher payments?
4. The inventory tax that was eliminated this year was on the tax bills last year. Are businesses obligated to pay the bigger bill that included the inventory tax?
5. Will local governments have to default on their obligations? Because of the freeze, “cities, counties, townships, schools, libraries and other Marion County government units will be getting $132 million less than they were expecting.” Gov. Daniels did not freeze the obligations of local government, he merely froze the means with which local government can meet its obligations.
6. With the same assessment rules in place, will the reassessment result in different values? This one is probably easier to answer — if business properties are significantly undervalued, as the reports seem to indicate, those assessment values should rise (while residential assessments probably won’t change that much). The net result will be a higher total assessed value for the county, resulting in a lower tax rate. Businesses will pay more while residential property owners will probably pay less. I wonder what the Chamber of Commerce thinks of this move.
No other Republican stood up until State Representative Jackie Walorski paved the way, and made a DECLARATION on July 9th in Elkhart Indiana, that we have a TAX crisis, and called on the leaders to listen to the people! She called upon legislative leaders to pave the way for a complete overhaul of the tax system. She is leading the state in this call for a complete reform and PERMINENT reform of the tax system. I am so glad she had the courage to go against the flow!
4. “The inventory tax that was eliminated this year was on the tax bills last year. Are businesses obligated to pay the bigger bill that included the inventory tax?”
WTHR is reporting that Marion County Treasurer Michael Rodman stated, “Businesses are also in for shock. They were enjoying the fact that the inventory tax was abolished this year and paying last year’s bill will remove that benefit.”
I don’t see how businesses can be compelled to pay the inventory tax. The tax was eliminated by the General Assembly. The power given to the DLGF is to reassess the value of real property. I can see where that power of the DLGF might also give it remedial authority to impose the 2006 rates while final determination on the 2007 rates is pending. However, I don’t see where either the Governor or the DLGF has the power to make people pay a tax that was eliminated altogether. I’ve been wrong before, though.