INDIANAPOLIS — Indiana homeowners might be in for a surprise this week when they get their mail and open up their property tax bill.
That’s because some homeowners are going to find out their property taxes went up because their home’s assessed value went up.
“The bills are literally going out as I stand here,” said Rep. Ed DeLaney, D-District 86, who expects to hear from constituents who are unhappy about the increase.
“There's going to be a lot of people that are going to be troubled,” said DeLaney, explaining some home values are up close to 19% from last year.
The reasons for the increase can be found looking at the past few years.
When interest rates were low, a lot of people bought houses. Add to that a pandemic, which led to fewer houses being built. That all equaled fewer houses on the market, which drove up home prices and values, said DeLaney.
Higher assessed values mean higher property taxes.
“My bottom line is, the property tax system is too clumsy, too rigid to deal with those changes,” DeLaney explained, saying the state legislature needs to examine the property tax system and look at ways to improve it.
A large portion of the property taxes fund public schools, followed by police and fire services, roads, courts and local government.
DeLaney said the state should pick up more of the school funding, leaving more property tax revenue for local government.
“The local government would have to decide, ‘Do we want to take the additional money and fix the streets or give it back to the homeowners?’ That’s a tough decision, but that’s the kind of conversation we have to have. Right now, we’re not having that conversation,” he said.
In 2007, state lawmakers passed a one-percent property tax cap for homeowners to alleviate property tax burdens then. DeLaney said 15 years later, more needs to be done.
“It’s working, but it’s showing its age. It’s like a used car – it’s wearing down,” he said.
When it comes to property tax bills for residents in Marion and Madison counties, they have until June 15 to appeal their home’s assessed value with their county auditor.