Hoosier’s Dreams Trended Away  Years back, taxpayers in St. John, Indiana filed a law suit arguing that the Indiana property tax system was unconstitutional.  An Indiana Judge ruled in their favor, that ruling was upheld by the State Supreme Court, and the Indiana State legislature was effectively ordered to create a new system of property assessment and valuation.  Our legislators voted to institute a “market-based” property valuation system featuring something called “trending.” Trending was a feature designed to prevent dramatic swings in assessed valuation – smooth out the peaks and valleys.  If you own property in Porter County you undoubtedly received the 2nd installment bill of your 2007 taxes payable in 2008.  You may have noticed a dramatic spike in accessed value on your tax bill.  If you only paid attention to the decrease in the amount you owed, go back and dig up the bill and note the top line “accessed valuation” and note any increase.  That number will be increasingly important because it is upon THAT number that your tax caps will be computed in the future.  A great many taxpaying citizens believe their 2007 taxes went down because of tax caps.  NOT TRUE.  They primarily went down because of the increased homestead credit granted by the State legislature when they discovered their new “market-based property valuation featuring trending” was flawed.  The homestead credit is scheduled to be  phased out in favor of tax caps.  So how did this happen and what’s really going on here?  The value of many, many, many properties in Indiana were “undervalued” over the years for a wide variety of reasons which I will not speculate upon here.  Suffice to say, when the new “market-based” system was implemented there was no provision made for the  transition.  For some unexplained reason, everyone ignored the fact that there would be WIDE, GAPING discrepancies between the last property valuation under the old system and the first under the new system… and that the effect could be catastrophic for some taxpayers.  Assessors will argue that many of the property owners such as myself who are facing whopping increases were UNDERVALUED for many years and are now confronting “the great catch up” or reconciliation to market value.  Is that an explanation or an excuse?  I can’t tell.  Either way, I lose.  Here’s the problem with the whole concept of market valuation.  For it to be TRUE and VALID all properties in Indiana would have to be set at the exact same time.  Kinda like shopping for gasoline on the same day in search of the best price, the market value.  “Market Value” is a function of time and market conditions… not just condition and character of the property.  If properties are assessed at different times and under potentially different market conditions, the “fairness” and equity of the system is fatally flawed.  This also begs the question, “if a property’s “market value” is the basis of taxation, what is the need for a County elected official responsible for assessment?” Why not hire the same professionals who appraise property for mortgages and transfers of ownership to do the assessments?  That way, the property tax valuation could also be used to substantiate loan or purchase value.  In defense of the State Legislature, the rationale to convert to “market-based” valuation was pretty sound.  The understanding was that the old system featured a lot of “pretence and personal touch” … great for getting elected, lowsy for creating consistency and equity.  In theory, market-based valuation would not only be more consistent, but more realistic and more equitable.  In theory, if all property were market valued, the aggregate increase in total property value in an entire tax district would rise thereby driving down the tax rate.  But that is NOT what occurred.  My property value increased and my rates remained about the same.   My 2007 taxes went down, but with my homestead credit removed and tax caps in place I am among the losers in this new game.  Trending or “neighborhood factoring” effectively gives the Assessor power to pick the winners and losers. Certain “classes” of property effectively cover the assessment gap created by other properties.  When the dust settles, I’m guessing it’s not going to be too terribly tough to identify just what “classes” of property do the giving and which ones do the receiving.  (From each according to their ability to pay to each according to their need – right?).  You read it here first… the use of trending or neighborhood factors to calculate assessed value is tantamount to ECONOMIC RED-LINING.  Trending and neighborhood factoring is unlawful.  We outlawed red-lining for any purpose. What infuriates me most is that while Rome burns, the county elected officials responsible for this system – good or bad – have demonstrated their inability or unwillingness to acknowledge the problem, embrace it, and FIX IT.  They know it’s broken, how can’t they?  They look you in the eye and utter, “it’s the DLGF’s fault, we’re only doing what we’re told.”  I THOUGHT you were an elected official.  Where’s all those “checks and balances” you promised us you’d provide.  Yeah, blame it on the DLGF!  They’re 2 ½ hours away in Indianapolis and they’re a faceless, nameless government agency trying to make sense of what a past legislature mandated for 92 counties in Indiana.  Are we supposed to believe that our Assessor just realized this was going to be a problem?  Am I the only one who believes our Assessor had the responsibility to walk down the hall and work with the Auditor and Treasurer to head off this debacle?  Are we to accept the fact that the trinity of officials elected to safeguard our taxes could not have banded together on our behalf and argue our case before the DLGF, our State Legislators, our Governor, our State Supreme Court to ask what could be done BEFORE the taxes were calculated and the bills went out.   Thank you Representative Soliday for coming to our aid, however I find the absence and the silence of your fellow NW Indiana legislators disturbing. This is nonsense and I for one am sick and tired of the blame game, the excuses, and the bickering among the elected officials responsible for this mess; none of whom can put their personal pasts, political prejudices, gripes and grievances aside for one moment and WORK TOGETHER to fix a broken system.  They’d rather blame each other, the DLGF, the software vendor, the State legislature, the Governor, the Supreme Court, Mr. Madoff, ANYONE but the person they gazed at in the mirror this morning.  Rather than work the problem, they appear determined to make it worse.  Is it surprising they can’t agree on software?  Is it surprising when they do, it fails and can’t muster State certification?  Then to add insult to injury they effectively force the taxpayers to foot a $ 400,000.00 consulting bill to fix the problem … only the problem never gets fixed and the consulting bills mount and we STILL receive tardy bills from a broken system. THIS MADNESS MUST STOP!!!    Perhaps now you better understand why for years now I have advocated consolidating the functions of the Assessor, Auditor and Treasurer under a single elected office?  Assign ‘em, elected ‘em, hire ‘em … I don’t care any more at this point.  I just want one qualified professional to take responsibility for fixing the problem and restore SANITY to the system.  Unless we elect someone with multiple personalities, I’m guessing the finger pointing and the blame game will come to a screeching halt.  So here’s what YOU can do.  Check your 2007 tax bill and if your accessed value increased, then file an appeal.  Forms are available in the office of your County Assessor.  The deadline is April 12, 2009 for the 2007 tax year. It’s a “use it or loose it” scenario.  If you don’t file, you loose your right to appeal.  Let your appeal constitute your vote.  Help flood the place with paperwork.  NOW, TODAY… Contact your State Representative and State Senator and tell them:  1.) I demand tax caps in our State Constitution. 2.) I demand Kernan-Shephard local government reform in the offices of the County Auditor, Assessor and Treasurer. 3.) I demand revision of the property assessment legislation. If our State legislators and our Governor cannot or will not get it done, then lets band together to create St. John taxpayers, version 2.0. As always, I can be reached via e-mail at b@219.com Notice to Reader: The following are comments from readers. In no way do they represent the views of editor of the article or 219.com. We will not edit or alter your comments, but we do reserve the right to not post or to remove comments that violate our code of conduct. No comment may contain potentially libelous statements; obscene, explicit or racist language; personal attacks, insults or threats	Read Bob's other articles on local government reform   Government Of, By and For the People - Essay #1 Retooling Tax Bills - Essay#2 Our Taxing Situation - Essay#3 A Plan for Local Government - Essay #4 Stepping Up to the Plate - Essay #5 School's Only Half of it - Essay#6 Roadmap to Reconstruction - Essay #7 Don't Blame the Zebras - Essay #8 Restoring Faith & Integrity - Essay #9 51-26-1 - Essay #10