Indianapolis Business Journal. January 13, 2023.
Editorial: Property tax legislation is good idea that needs more time, study
We’re intrigued by Rep. Peggy Mayfield’s bill that aims to reduce the number of smaller businesses that pay the personal property tax—legislation that IBJ reporter Peter Blanchard details in a story on this week’s cover.
We see plenty of positives in the idea, most notably that it will reduce work both for thousands of Indiana businesses and for county officials who process property tax payments. That seems at least as important as the actual savings businesses could realize.
But we have a few concerns as well and think the proposal needs a thorough vetting before passage—or might even need to be part of a larger study of business taxes that the Indiana Senate Republicans are proposing.
Companies pay the personal property tax on equipment—things like printers, grinders, compressors, desks, computers, etc.—that they own. Already, companies that paid $80,000 or less in total for that equipment are exempted from the tax. Additionally, the total value of the property is depreciated based on age (down to no less than 30% of the original value) before the tax rate is applied.
Mayfield’s proposal would expand the exemption so companies that paid $250,000 or less in total for their personal property wouldn’t be subject to the tax. That is likely to eliminate the tax for tens of thousands of companies in Indiana (the fiscal impact statement for her bill is not yet available). That would be good news for those companies both financially and simply in eliminating what’s essentially a regulatory hurdle.
In addition, the change would mean county assessors across the state would have thousands fewer property tax filings to process. That can also be a good thing.
But here are the caveats. Personal property tax revenue flows to local governments, libraries and schools. Reducing the total amount that companies pay will have two primary impacts, neither of which we think is desirable.
First, some of the tax burden will shift to other taxpayers, including homeowners, farmers and businesses that pay so-called “real” property taxes, which are taxes on real estate. Local governments are allowed to collect a set amount of property taxes—called a levy—so reducing what’s paid in one area can increase what’s paid in another.
But second, the change could also reduce the amount of tax revenue collected by local governments, libraries and schools. That’s because the bills paid by individual taxpayers—those homeowners, farmers and businesses—are capped at 1%, 2% and 3% of assessed value, respectively.
The machinations are complicated. But in short, reducing the amount of personal property tax collected will shift some tax burden to other payers. Then, when those payers hit their property tax caps, the amount collected by local governments goes down. Both impacts are problematic and worthy of exploration before moving forward with Mayfield’s bill.
One catch is that a big increase in assessments across the state—thanks to higher property prices over the past few years—means bills could be up regardless of other changes. That’s why a delay might be in order. Letting the impacts of higher home and property prices settle before considering other changes is probably the smart thing to do.
Terre Haute Tribune-Star. January 12, 2023.
Editorial: Engaged citizenry key to good government
The 2023 session of the Indiana General Assembly convened this week for the legislature’s biennial budget-writing session. It’s the kind of exercise that can make an ordinary citizen’s eyes glaze over. Yet it is crucial work being done on behalf of Hoosiers, and issues of grave importance often get wrapped up in the discussions and debates over how tax revenues are spent and how the state meets its constitutional obligations.
But state finances won’t be the only item on the agenda. A range of issues — including those motivated by ideology and the culture wars — will get their share of time in the spotlight.
Among major issues set for deliberation is Gov. Eric Holcomb’s proposal to do away with textbook fees for Hoosier school kids. Indiana’s massive $6.1 billion budget surplus gives legislators plenty of breathing room to give serious consideration to such a plan.
Whatever serious debate occurs will be between Republicans. That’s because the GOP, which enjoys supermajority status in both houses of the legislature as well as control over the executive branch, doesn’t have to pay much attention to anything minority Democrats have to say.
That doesn’t mean the majority party can pay no attention to the people. Legislators are elected to serve voters. Don’t let them forget that.
West-central Indiana’s legislative delegation remains the same as in recent years. Rep. Tonya Pfaff, a math teacher at Terre Haute North Vigo High School, is the only Democrat in the area’s delegation. Other lawmakers, all Republicans, include state Sen. Jon Ford of Terre Haute, and state Reps. Bob Heaton of Terre Haute, Bruce Borders of Jasonville, and Alan Morrison of Brazil.
Rep. Todd Huston of Carmel is serving as speaker of the House. Sen. Rodric Bray of Martinsville is the Senate president.
We urge citizens to interact with their representatives. It’s easy to contact legislators to share views. Here’s how:
• Members of the Indiana House of Representatives can be reached by phone at 1-800-382-9842.
• Members of the Indiana Senate can be reached at 1-800-382-9467.
• The mailing address for representatives and senators is 200 W. Washington St., Indianapolis, IN 46204.
• If you have online access, there is a wealth of information, including email addresses of legislators, about the General Assembly and related services at www.IN.gov/legislative.
Another avenue for interacting with legislators are at area crackerbarrel events during the session. The first of such is Saturday at the Vigo County Public Library from 10 a.m. to noon. Not every lawmaker attends every event, but usually enough of them do to make participating worthwhile. These Terre Haute crackerbarrels will occur the first Saturday of each month during the session.
Government is at its best when citizens are informed and engaged.
Lawmakers work for you. Let them know your opinions.
Fort Wayne Journal Gazette. January 15, 2023.
Editorial: Indiana House’s energy plan proposal stuck in 20th century
Republican state Rep. Ed Soliday, chairman of the House Utilities, Energy and Telecommunications Committee, filed a bill last week that would establish a statewide energy plan – something Indiana has lacked since Mitch Daniels left the governor’s office in 2013.
Two years ago, the Indiana General Assembly reestablished the 21st Century Energy Task Force to weigh the impact emerging technologies and a transition from fossil fuels might have on the state’s electrical system. Soliday’s House Bill 1007 lays out “five pillars” of Indiana utility service he announced in October: reliability, affordability, resiliency, stability and environmental sustainability.
But the exclusion of any expansion of affordability initiatives in the proposal shows indifference to the plight of vulnerable Hoosier populations and their struggles paying utility bills.
Creation of a new strategic energy policy was first discussed in 2019, when House Enrolled Act 1278 formed the original 21st Century Energy Task Force after the Indiana Chamber of Commerce and consumer advocates pointed out the state hadn’t had an energy plan since Daniels’ Hoosier Homegrown strategy of 2005.
“The idea was the energy task force would be somewhat of a surrogate for a more strategic plan coming from the governor’s office,” Kerwin Olson, executive director of the Citizens Action Coalition, told The Journal Gazette Tuesday. “It’s never been clear to any of us where (Gov. Eric) Holcomb is on energy, and that was the driving force to create the task force.”
Citizens Action Coalition didn’t like the first iteration of task force recommendations in 2020, Olson said, and the organization is disappointed with its latest proposals.
The new recommendation the energy task force made concerning affordability was that state agencies such as the Indiana Housing & Community Development Authority and the Office of Utility Consumer Counselor should communicate with utilities and stakeholders to increase awareness of customer assistance programs.
“That fundamentally misunderstands what’s going on out there. Why (Low Income Home Energy Assistance Program) funds get exhausted every year. Why township trustees are doling out assistance dollars left and right,” Olson said. “Many of the poor relief agencies that we’ve spoken to say they basically use all of their money to help people pay their utility bills, meaning they don’t have money to help with school fees and doctor bills and toothbrushes and backpacks and clothes.”
There’s no recommendation about increasing investments in conservation and energy efficiency, either.
The energy task force completely ignored the need to expand opportunities for rooftop solar, despite passage of the federal Inflation Reduction Act, which offers tax credits and incentives for such efficiency upgrades, and a recent Indiana Supreme Court ruling that allows southwest Indiana’s CenterPoint electric utility to drastically slash compensation customers receive for the extra solar energy they produce and send to the grid.
“We were very disappointed with what we felt was a report that was anything but 21st century,” Olson said. “This should have been called the 20th Century Energy Task Force because it turns a blind eye to where the markets are, where the energy delivery system is going. It seems to be conflating the idea of reliability, resiliency, affordability, and all of this stuff with the old business model that is rapidly changing.”
Indiana is swimming against a national tide of energy transition: federal policy encouraging greater adoption of customer-owned energy resources such as solar and batteries; a rapidly changing energy marketplace driving innovation and investment across the nation; and demand from Hoosiers for local, clean and affordable energy.
In this legislative session, lawmakers could reduce wear on the electric grid by codifying the credit solar owners earn for the electricity they generate, increase reliability and resilience at a lower cost for the same electrical service, and address inequities in access to affordable and clean energy.
There are opportunities for investment in energy transmission, customer savings and economic growth this legislative session. As an energy plan, HB 1007 maintains the status quo. This is not the leadership Hoosiers need.