<b>By ANN HINCH<br>
Assistant Editor</b> </p><p>

FORTVILLE, Ind. — Not surprisingly, property tax talk dominated a legislative town meeting in Fortville Saturday morning, hosted by the local Chamber of Commerce and led by state Sen. Beverly Gard and Rep. Bob Cherry, both Greenfield Republicans.<br>
Last week, the Indiana House passed a property tax relief bill 93-1, based on Gov. Mitch Daniels’ proposal to cap homeowners’ land tax at 1 percent of the home’s assessed valuation. He also proposed raising the state sales tax from 6 to 7 percent to help offset the property tax revenue loss for local communities, which the House approved, along with several of its own amendments.
Cherry said House legislators introduced amendments on the floor rather than in committee, because there were so many. He was disappointed at two losses: language allowing a referendum on all school projects reduced only to recreational construction, and language taking out a cap for state spending.<br>
“We have to live within our limits just like you individuals do,” he told a packed room at the Fortville Town Office meeting room. But, “when it’s all said and done, you’re going to receive one of the true and permanent tax relief packages for a long, long time.”<br>
Gard said the Senate is through with its committee work on the 10 different bills into which it decided to split legislation based on Daniels’ proposal and she expected votes on them this week, after which the Senate can go to work on the House’s proposal and vice versa.<br>
“Basically, what’s coming out of the House and Senate … the framework is basically the governor’s property tax reduction proposal,” she said.<br>
Ben Spurlock, an attorney who builds custom homes and is developing a gated community near the area, recounted assessed valuation increases last year that resulted in higher property tax bills for Hoosiers. He referred to the provision in the House bill that would eliminate township assessors and said he felt they were being made “the scapegoats” in this issue, when it’s a need for more money by other agencies driving the tax increases.<br>
“You tell me how one assessor can assess every town, every residence,” he said, calling this effort in the General Assembly “another patch job.”<br>
The sales tax, he contended, is based on different types of spending and is fair in comparison to property tax, which he would like to see eliminated entirely because he said it’s not based on an individual’s ability to pay. As a senior citizen, he pointed out if he weren’t still working, he couldn’t pay his property taxes.<br>
“If it’s not right, in four years’ time everybody’ll find out,” Spurlock said of trying property-tax abolition.<br>
“I think our ultimate goal is to eliminate homeowners’ (taxes), but what we (are doing) immediately (is) because people are hurting,” Cherry said.<br>
Gard added if school levies are removed from local taxing structures and assumed by the state, that will change property tax rates significantly.<br>
Last summer, she said Daniels appointed a commission on local government reform, which submitted a report in mid-December. Suggestions included, among other things, phasing responsibility for township-supported services into similar county services – such as fire protection and assessment/trustee services.<br>
“I don’t think the legislature is beginning to give this report the scrutiny … that it needs to,” Gard said, adding local government structure has not changed in 150 years and that it needs to in order to deliver services more efficiently.<br>
She said she is not sure if state legislators can find the “political will” to make such changes based on the report, since representatives seem to often base their votes on their relationships with local government officials.<br>
Fortville business owner and landlord Bob Ferryman pointed out “there are more of us than there’ll ever be of factory owners in Indiana,” referring to tax breaks that bring industry into the state, while imposing and raising property taxes on small business owners. “The backbone of Indiana is small business people. We’re hurting.”<br>
The problem with eliminating the property tax entirely, Gard countered, is the revenue would have to be made up elsewhere, likely by a 13 percent sales tax. Because 60 percent of Indiana residents live close to the state border, for large purchases such as vehicles, at least, she worries they would drive across state lines to save that extra up-to 7 percent on sales taxes.<br>
“What are you as individuals willing to pay otherwise to replace property taxes?” she asked the room.<br>
Cherry added that only 18 percent of sales tax revenue is from out-of-state visitors. “We want consumers to spend. We don’t want to drive them across state lines.”<br>
Forced annexation<br>

Other legislation Gard has in the Senate concerns forced annexations by cities. A recent example is the effort by Fishers to annex Geist, which the Indianapolis Star reported the Fishers Town Council did on Jan. 22 (those who own the 2,200 homes have 90 days to complete a petition drive to protest, according to the Star).
The legislation, Senate Bill 114, prohibits municipal annexation unless all affected property owners agree to it. If passed as is, it would be retroactive to Jan. 1, 2008.<br>
Gard expected the third reading to be polled this week, though she also expects that failure to adopt an amendment removing the Jan. 1 date will be used as a reason by some legislators – who represent municipalities – to vote against the bill.<br>
She said she’s been trying to get anti-forced annexation legislation passed for years. Right now, if a municipality declares its intentions to annex into its borders, the burden and cost is on the affected property owners to oppose. Many cases end up going to the Indiana Supreme Court, which she wryly noted “has never seen an annexation it didn’t like.”<br>
Gard said her bill will not prohibit voluntary annexations nor stop municipal growth.<br>
She also said if a municipality is expected to provide services outside its borders, she has no problem with those recipients being assessed extra fees.<br>