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.

(H/t In The Agora) Here is a little timed name the Presidents quiz. I got them all in 3 minutes, 23 seconds. (I’d like to thank my Richmond High School AP U.S. History Teacher, Ed Johns, whose teaching style fairly burned many details of American history into my brain. He’d probably think my time was a bit slow given that I would be competing against all the rich kids at the prep schools out East when I took the AP test — nice “us” versus “them” motivational technique.) I also have a bit of a leg up in that my grandparents happened to live across the street from the old house of Rutherford B. Hayes, the most forgotten President.

The Governor has announced his intent to have the property values in Marion County reassessed. I haven’t found where the Governor himself has this power, but do see where the Department of Local Government Finance has such authority (thanks to a commenter over at Advance Indiana.) According to a DLGF press release:

Daniels decided to order the Marion County reassessment after receiving a recommendation from Department of Local Government Finance (DLGF) Commissioner Cheryl Musgrave. The DLGF and the state’s government efficiency group have been poring through parcel data for the county in recent days. Musgrave outlined findings that prompted her recommendation in a memo to the governor. For example, assessed value for nearly three-fourths (16,000 of 22,100) of commercial and industrial parcels in Marion County did not change at all over a six-year period.

The state will take charge of the commercial and industrial reassessment in Marion County using professional assessment assistance and instruct county officials to do the residential work. Marion County property taxpayers will receive bills with a new 2007 amount promptly after the reassessment is completed and tax rates certified, a process that is expected to take six to eight months.

To begin the formal process of initiating a Marion County reassessment, the DLGF has issued a resolution that calls for a public hearing in 10 days. Following the public hearing, DLGF will issue an order to reassess.

According to another DLGF press release, Cheryl Musgrave took office as Commissioner on July 16 and has held office for all of 2 days. And, it’s a little disturbing to me that the hearing is to be a mere formality. The process for DLGF to take charge of a reassessment is set forth in
IC 6-1.1-4-9:

Reassessment resolution of department of local government finance; hearing; reassessment order
Sec. 9. In order to maintain a just and equitable valuation of real property, the department of local government finance may adopt a resolution declaring its belief that it is necessary to reassess all or a portion of the real property located within this state. If the department of local government finance adopts a reassessment resolution and if either a township or a larger area is involved, the department shall hold a hearing concerning the necessity for the reassessment at the courthouse of the county in which the property is located. The department of local government finance shall give notice of the time and place of the hearing in the manner provided in section 10 of this chapter. After the hearing, or if the area involved is less than a township, after the adoption of the resolution of the department of local government finance, the department may order any reassessment it deems necessary. The order shall specify the time within which the reassessment must be completed and the date the reassessment will become effective.

Notice that the Department is supposed to conduct a hearing first and make its order second. The Governor has apparently made the decision for the DLGF. This is backward from the way IC 4-22-5-1 says things are supposed to run:

Sec. 1. Where under the provisions of any statute, the department of local government finance . . . is required to conduct a hearing, the commissioner [may appoint hearing officers, if done in writing]. In the discharge of their duties, the hearing officers shall have all the powers to investigate and to require evidence granted to the department[.] The department . . .may conduct any number of hearings contemporaneously through different hearing officers. At the conclusion of a hearing, the hearing officer shall make a written report thereof. After receipt of the report the department . . . may take further evidence or hold further hearings. The decisions of the department . . . shall be based upon the report, additional evidence, and records as the department . . . deems pertinent.

Odd that the Governor didn’t agonize over whether he had the authority to order reassessment without a prior hearing of the DLGF the way he agonized over whether he had the authority to take action on fuel taxes.

The reassessment of Marion County may not be a bad thing, but the process is important. This is a democratic government we’re running, warts and all. Laws mean things — even if the Governor chooses to ignore them, such as when he suspended the bar closing time because Daylight Saving Time made it inconvenient or when he intervened in opposition to St. Joseph County’s request to move to Central Time despite the law requiring him to support such a request.

Reading the Indianapolis Star today and yesterday, I got the impression of mass tax protests, sweeping the State. The Star told me that special sessions were routine. Some are using the opportunity to promote the idea of replacing property taxes with sales taxes. I get the idea that problems are substantially worse in Marion County than elsewhere and that some of the folks pushing hard on the sales tax are not just responding to this property tax crisis, but have been pushing the sales tax over other sorts of taxes for quite some time.

I’m just a small town lawyer, so what the heck do I know? But, I get a little edgy at the idea of panicked Marion County lawmakers joining forces with opportunistic sales tax promoters jumping into an impromptu special session to slap together wide-ranging property tax legislation. Makes me feel like checking my wallet every so often to make sure it’s still there.

Step one: Analyze the problem state wide to see how bad the problem is in, for example, counties that took advantage of the opportunity to adopt a county option income tax to offset the inventory taxes that were eliminated.

Step two: Take a breath, think it through.

Step three: Make changes in a regular session. This ensures the process is less arbitrary and reduces the pressure to do something just for the sake of doing something. Probably lawmakers should do something, but if they get into a special session and find that all of their alternatives are worse than the current situation, I’d hate to see them go ahead with one of those alternatives simply because they need to do anything.

Many will say “local government needs to spend less.” That’s a good idea. But, ask those who propose this as a solution to the current problem to identify which government services ought to be reduced or eliminated. Some will say that their property taxes impose too great a burden. And this may well be true. But ask them to identify those whose taxes should increase so that theirs might be reduced. Because these are your two options: 1) Cut or reduce specified government services; we need to know which ones. 2) Reduce the tax burden on one class of citizen and impose an additional tax burden on another class of citizen; we need to know who should gain and who should suffer.

[tags]property taxes[/tags]

3

More gratuitous pics of my kids. This one is from a bunch my wife Amy took for her 2 year portraits. The rest of the set is here.

It’s County Fair Season. Here are the dates for all of the County fairs in Indiana. For those in my neck of the woods, the White County Fair goes from July 14 – 19th in Reynolds, Indiana. The Tippecanoe County Fair in Lafayette goes from July 21 – 28th in Lafayette, Indiana.

Through diligent sacrifice and research in years past, I have concluded that the White County rib eye sandwiches are the best around. In the name of science, it is my intent to conduct further research this year.

Doghouse Riley – again with the brilliance, this time entitled:Bats Left Throws Right: May You Live In Interesting Times, And May You Be Required To Have Them Reported To You By People Who Aren’t, Even Remotely.

I was about to blockquote the fun parts, but then realized I was pretty much just going to quote the whole thing. So, just enjoy.

Well, o.k., just one:

When the die-hard anti-New Dealers at the Star start sounding like raging populists it’s best to keep a firm grip on your wallet, unlock the gun cabinet, and check the facts, in that order.

Heidas brings us the Third Annual Simpsons linguistic roundup. Good stuff — if you’re a Simpson’s-loving nerd.

George Bush is opposed to government assistance with insuring kids, reports the New York Times. Specifically, he is working to block expansion of the States Child Health Insurance Program.

Administration officials have denounced the Democratic proposal as a step toward government-run health care for all. They said it would speed the erosion of private insurance coverage. And they oppose two of the main ideas contemplated by Democrats to finance expanded coverage for children: an increase in the federal tobacco tax and cuts in Medicare payments to private insurance companies caring for the elderly.

Indiana and Governor Daniels get a mention:

To return the children’s insurance program to what he calls “its original intent,” Mr. Bush has asked Congress to reduce federal payments to the states for coverage of children in families with incomes of more than twice the poverty level. (A family of four is considered poor if its annual income is less than $20,650.) At least 18 states cover children with family incomes more than twice the poverty level.

In Indiana, Gov. Mitch Daniels, a Republican who was Mr. Bush’s first budget director, recently signed a bill into law that raised the ceiling to 300 percent of the poverty level, from 200 percent.

[tags]health care[/tags]

The Louisville Courier Press has an article reporting that, 5 years after creation of the program, publicly funded charter schools in Indiana are mixed in their performance. “Charter schools receive public funding but operate outside the rules of traditional public schools, and they are independent of local school boards.”

The surprise to me is not that some Charter schools are doing well, some are average, and some are poor. To me, the surprise is that there doesn’t seem to have been much of a plan to measure their performance. They were sold as being superior to regular schools. I would’ve thought some way of telling whether we’re getting what we’re paying for would have been put in place.

I certainly think charter schools have their place. Some kids just aren’t wired to be good little cogs in the public school machinery. With greater flexibility, charters have the potential to help these kids.

[tags]education[/tags]