2019 Legislative Priorities: making assessments and local funding fairer

In theory, assessing property for tax purposes ought to be logical and predictable.

But in the real world, it doesn’t always work out that way because the rules are complicated and, all too often, subject to personal interpretation.

The Indiana Farm Bureau board of directors has made “Improve assessment uniformity and local government funding” one of the organization’s priorities for the 2019 legislative session. The goal is to put accountability measures into state statute so that assessments are based on the assessment manual rather than on a particular assessor.

Assessment uniformity is also involved in the “dark-box” issue. Dark-box stores are empty or abandoned warehouse or large retail structures. Because they are empty and generally in less desirable locations, they are taxed at a much lower rate than large, inventory-filled buildings often called “big-box stores,” explained Justin Schneider, INFB state government relations director.

However, Schneider said, it’s becoming increasingly common for big-box stores to appeal their assessments and ask to be taxed at the dark-box rate. Surprisingly, the tax court has approved this, and some counties have reluctantly agreed to the reduced assessment because they cannot afford litigation.

“It’s a huge tax hit to the county,” Schneider said. “If they don’t get the tax revenue from the big-box retailer, they have to get it from somewhere else – such as the county’s farmers.”

The second goal for this priority is to improve local government funding, particularly by addressing problems with the referendum process.

“Jails are bursting at their seams, and mitigating the need for improved jails is a priority,” said Shelby Myers, INFB associate policy advisor. “We see this as an opportunity to be at the table in regards to the allocation of property taxes.

“The referendum process – which is tied to the jail situation – needs to be addressed because so many voters don’t understand how capital projects outside of the tax caps can impact local communities,” she added.