Taxes top the list

Jay County residents had concerns to address with local legislators Saturday.

The largest dealt with tax changes currently being discussed at the state level.

State Sen. Travis Holdman (R-Markle) and State Reps. J.D. Prescott (R-Union City) and Matt Lehman (R-Berne) shared legislative session updates Saturday at John Jay Center for Learning.

Regarding Senate Bill 1 — among other items, it addresses deductions and tax credits and requires the Department of Local Government Finance to develop and maintain a property tax transparency portal — Holdman indicated that the bill will be significantly overhauled when brought to the Senate Tax and Fiscal Policy Committee on Tuesday.

“We’re working hard to come up with a plan, we’re trying to toe the line between being responsible to the taxpayer but at the same time, realizing we have to have local government services, schools, cities, towns, government, and we’ve got to be responsible for those folks,” he said.

Recommended cuts in Senate Bill 1 total $1.1 billion dollars, he added. In three years, that amount would increase to $1.4 billion.

“Some units of government would not even be able to make their debt obligations,” he noted. “So we’re looking to trim that back significantly from where it is today.”

Prescott talked about House Bill 1229, a measure he proposed that would abolish property tax and establish a sales tax on services. He said the property tax system is overly complicated and pointed to repeated reductions in assessed valuation.

“I think the property tax system itself is flawed, so I came up with a completely new system,” he said.

The bill — it has not cleared committee yet — would repeal property taxes as well as eliminate assessor’s offices, tax increment finance (TIF) districts and referenda. It would then enact a 7% sales tax on services. Prescott said the change would offset revenue from property taxes.

Jay County Council member Bryan Alexander said he believes House Bill 1229 is the least popular policy to date that Prescott has brought to the statehouse.

“Think about this, what we’re doing, think about being fiscally conservative, have local control, and then think about every time a person has a service that gets taxed, every time that small business owner has to fill out the report and submit that back to state,” he said. “That’s a political disaster, in my take.”

Prescott argued the process would be similar to how sales tax is currently figured on goods. He also said it would work as a “fair tax” because it would tax everyone equally.

“It’s regressive,” said Alexander, with Prescott saying he disagrees.

Dunkirk Mayor Jack Robbins questioned whether doing away with property taxes would impact blight programs, wastewater maintenance and other issues.

Prescott said the bill won’t pass this year because it isn’t getting a committee hearing. Regardless, he said it’s important to have a discussion about changing the system.

Holdman noted property values have been increasing at a high rate across the country since the height of the coronavirus pandemic. While tax caps are in place, he added, debt is added on top of those caps.

He warned residents, noting property tax bills they will be receiving in a few weeks will be on average 7% higher than bills in 2024. Those figures were determined before the current legislative session.

“We are working to control growth and/or slow spending down (for) local units of government,” he said.

Holdman referenced his Senate Bill 451, which calls for decreasing the state income tax rate by 0.05% in even-numbered years beginning in 2030 as long as certain fiscal conditions are met. (The bill was approved in the Senate last month and was referred to the House.)

“For the 10 years prior to COVID, revenue’s increased year over year 3.24%,” he said. “And so, my philosophy is, if we don’t need it … don’t spend it on something frivolous, give it back to the taxpayer to support state government.”

Questions also surfaced Saturday about House Bill 1231 proposed by Prescott, which would require the Ten Commandments to be displayed in all school libraries and classrooms. 

Portland City Council member Kent McClung noted the United States Supreme Court’s ruling on Stone v. Graham in 1980, which found a Kentucky law requiring Ten Commandments to be posted in classrooms to be a violation of the First Amendment.

“Are you spoiling for another fight to take to the Supreme Court?” he asked.

Prescott noted justices and decisions made by the Supreme Court have changed in recent times, indicating there may be a path forward for the case now. 

During their update, which lasted nearly two hours Saturday, legislators also shared information about other bills they are working on amid the 2025 session.

Lehman summarized a few of his bills, including:

•House Bill 1003, which would improve transparency in health care pricing and billing and increase access for patients to their health care information and grant more control over their treatment options

•House Bill 1004, which tightens regulations on nonprofit hospitals to ensure they are acting as nonprofit entities delivering health care

•House Bill 1007, which addresses energy generation resources, with Lehman noting he would like to see more nuclear energy being harnessed in Indiana

•House Bill 1008, which would create a commission to discuss a possible state line adjustment regarding Illinois’ 33 counties that have voted to secede from the state

Prescott also highlighted a few of his bills in the works, including:

•House Bill 1012, which calls for police to inform property owners when there is damage to the owner’s property crops or a structure and it’s reported to a law enforcement officer or agency, and when debris from a vehicle accident is identified by police is left on the property that could damage farm equipment or other vehicles or property.

•House Bill 1230, which requires political party affiliations to be indicated on school board ballots

•House Bill 1399, which among other items makes “unlawful presence in Indiana by an alien,” referring to those who have entered the country illegally, a Class A misdemeanor

Holdman highlighted a need for residents to keep themselves informed about legislative changes and later encouraged folks to visit Indiana General Assembly’s website, iga.in.gov. He pointed out bills are available there to view and watch as they make their way through the chamber.

“You can track any bill,” he said. “As Matt (Lehman) said, if a bill does not have a hearing this week, this coming next week, the bill for all intents and purposes is probably going to die.”