Our take on the "2% Cap" debate

This week’s Indianapolis Business Journal features an in-depth look at the “2% cap” property tax circuit-breaker passed in the 2006 General Assembly. IBJ reporter Peter Schnitzler turned to IAR for our take on the 2% cap (click here for the full piece):

Legislators love the political results, said Karl Berron, vice president of government relations for the Indiana Association of Realtors. Rising property taxes regularly top the list of constituent complaints. The cap shows voters their groans are heard.

“This is something that’s pretty tangible, easy to explain,” Berron said. “In some ways, you wonder if the more people hear about it, the more they’re going to like it.”

We haven’t written very much here on the IREN Blog about the 2% cap, but it isn’t because we don’t think it is important. It raises critical questions that must be answered (probably in the next legislative session) about acceptable levels of property taxation and whether or not this revenue source should be available to local governments in an essentially unlimited capacity to fund both operations and capital projects.

We realize that there are legitimate concerns, but instead of pointing fingers at legislators we should use this opportunity to build consensus around a viable plan to reduce property taxes and provide some fiscal autonomy for local government.

Side Note: While on the topic of property taxes, we should keep in mind that Indiana is not alone in having a property tax “problem”. Click here to read an article on Stateline.org about property taxes emerging as an election issue in Pennsylvania, New Jersey, Montana, and elsewhere.