Lawmakers move too quickly on caps

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January 20, 2010

Anonymous The Kokomo Tribune Wed Jan 20, 2010, 08:01 PM EST

Lawmakers move too quickly on caps

Indiana lawmakers have approved a measure that would add property tax caps to the state constitution. That’s unfortunate. Critics have suggested the measure is a wrong-headed approach that will hamstring local government and make it harder for future legislators to address the situation.

And not only that, they say, the tax caps are unfair. The caps limit taxes on individual homes to 1 percent of assessed value while putting the limit on rental property at 2 percent and the limit on businesses at 3 percent.

Does it really cost twice as much to provide government services to an apartment or three times as much to provide those same services to a business?

Organizations representing business and agriculture don’t think so. They think their members are being asked to pay more than their share.

At the same time, cities around the state have blamed recent layoffs and other cost-cutting measures on reductions in property tax revenues, and they point out that the caps have been fully in place only since the beginning of the year, so it’s really too early to judge their full impact.

But none of this has slowed down Indiana lawmakers who moved with almost record speed to send this issue to the voters.

It is, after all, an election year, and few legislators wanted to explain to constituents why they refused to give taxpayers a chance to lock in the savings these tax caps will provide.

Of course, it’s not entirely clear how much taxpayers will truly save.

The average home in Indiana is already taxed at less than the 1 percent cap. And the tax caps do nothing to restrict a rise in assessment.

Still, it’s not clear that anyone will mount a campaign against the proposed caps. After all, what are the odds that the average voter will say no to a potential tax break?

Frankly, the chances seem pretty good that the measure will be approved by a healthy margin. Sixty-four percent of Indiana residents surveyed in December by Ball State’s Bowen Center for Public Affairs favored the constitutional amendment.

So it seems likely we’ll be living with these caps for some time. Our best hope is that the critics are wrong.

— Logansport Pharos-Tribune

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