Fight to Eliminate Property Tax Gains Steam; But Is It Possible?

by Dustin Grove (grove@wsbt.com)

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Fight to Eliminate Property Tax Gains Steam; But Is It Possible?

By Beth Boehne

(WSBT) An Elkhart City Council member is joining the push to do away with property taxes in Indiana.

Council member Mary Olson joins State Representative Jackie Walorski, who launched the movement earlier this month.

Property tax bills will rise an average of 24 percent statewide. In Elkhart County, the average increase is 25 percent, prompting some homeowners to call the situation a crisis.

Representative Walorski says support is growing for eliminating the tax. But there are still plenty of critics who say eliminating the tax simply isn't an option.

Meanwhile homeowners say whatever lawmakers decide, something has to give.

Marcia Bechtel is on a mission.

"We've gotten rid of 425 of them in one week," she told WSBT News.

Her signs demanding an end to property taxes are popping up all over Elkhart, and the grassroots movement gained more momentum Tuesday with support from City Councilwoman Mary Olson.

She is presenting a resolution to her fellow council members asking them to demand state lawmakers do away with property taxes.

"[The resolution is] speaking to the need of elimination of property taxes,” she explained. “And I'm asking this council and councils across the state of Indiana to join me."

Her resolution — along with a petition launched by State Representative Jackie Walorski this month — aims to send a strong message to lawmakers to consider alternatives.

"As we're doing with this resolution, think outside the box,” Olson recommended.

The difference, they say, could be made up through an increase in the income tax and sales tax, too.

"It's a much broader base of people no matter whether they live here, pass through here, visit here,” Rep. Walorski explained.

But property taxes make up a big chunk of every city's budget. So could you really make up the difference in income and sales tax? At least one economics professor says it's not that simple.

"Shifting the tax to sales tax in particular, and also our state income tax, may well wind up making the system less fair than it is now,” Notre Dame Professor Marty Wolfson told WSBT News.

Wolfson says that's because people with less money generally have to spend more of their income to live.

"So you have a higher burden on the sales tax on those less able to afford it,” he explained.

Whatever the solution, homeowners like Marcia Becthel hope it comes soon — her property tax bills doubled this year, and she says that's not fair.

“Because I don't have the funds to pay that,” she explained.

State Senator John Broden of South Bend is on a state commission looking into the property tax problems and how to address them.

He says when it comes to fixing it, all options are on the table, but, he doesn't think doing away with property taxes is the answer.

He says it would be very difficult to replace $6 billion in revenue without major increases in other taxes like sales and income.

House Speaker Pat Bauer has said the same.

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