Unlike in 2002, however, as we told you before, business assessments have remained largely unchanged. “In Marion County, preliminary numbers suggest business assessments increasing by single-digit percentages,” we told you back then. Indeed, our estimates now are that at least 50% of business real property assessments have not changed one iota since the 2002 reassessment. This alone has forced homeowners to consume more of the property tax pie in Marion County.
Mind-boggling but true, while local assessors appear to have a fairly accurate perspective on residential property values, they have seemingly seriously under-assessed (or failed to examine altogether) the entire business property segment. These low business assessments, of course, have contributed greatly to an increase in tax rates.
Feigenbaum thinks you should keep a close eye on the disparity between residential and business/commercial assessments. He anticipates a class action lawsuit on behalf of homeowners to rectify the disparity.
Feigbenbaum also outlines a series of pro-business legislative changes which have contributed to the problem, including a reduction in the state property tax replacement credits, elimination of the business inventory tax, investment deductions for business personal property (automatic abatements) and business real estate and increased use of local tax abatements. While those things contribute to changes statewide, there also appears to be problems unique to Marion County. "A closer look at the Marion County 2006 ratio study, which was approved by the DLGF, shows that the majority of the property classes studied in Marion County failed to meet the statutory requirements for assessment accuracy and uniformity," Feigenbaum writes. "As Hoosiers would say in the vernacular, it means things are really screwed up . . . and that State conclusion is based on Marion County’s own study; an independent analysis could show even more troubling results."
Feigenbaum notes that similar problems were detected in other counties, but the DLGF stepped in to correct problems, in Marion Co. the pressure to get tax bills into the hands of taxpayers seemed to win out. "In some cases, interposing an equalization factor as statutorily required would have resolved the problem, but neither the Marion County Assessor nor DLGF opted for this resolution, which would have decreased tax rates for homeowners in at least some of the townships," Feigenbaum writes. So why didn't Marion Co. Assessor Greg Bowes insist upon applying the equalization factor to help relieve the problem? That's a good question people should be asking him.
Abdul Hakim-Shabazz adds a couple of other interesting tidbits to Marion County's situation. On those abatements for property taxes, he reports the state picked up the tab this past year for nearly $330 million in property tax subsidies for Marion Co. If the state hadn't picked up that tab, Shabazz notes Marion Co. homeowners would have been hit even harder. He also notes the failure of the city-county council to enact county economic development income tax (CEDIT) to make up for the $80 million Marion Co. was losing from the phaseout of the inventory tax. Now, Mayor Peterson is seeking a 100% increase in county option income tax to raise $90 million at the same time skyrocketing tax bills are hitting taxpayers mailboxes. So it looks like there's plenty of blame to go around for this year's property tax crisis.