Cyclical Reassessment Practice Efficiency Debated

Indiana’s 92 county assessors have 18 months to visit each of their county’s land plots to update property record cards and adjust property taxes.

Indiana’s mandated general reassessment will cost Monroe County about 0ne million dollars. That’s about $700,000 more than the assessor says she usually spends to conduct a cyclical reassessment. But  some law makers insist the cost is warranted to ensure fair assessing practices.

Originally state law required general reassessments  every 10 years, then six years, then four years and this year statute requires a general reassessment  on the fifth year. That means Indiana’s 92 county assessors will have just 18 months to physically visit each of their county’s land plots in order to update property record cards and adjust property taxes accordingly.  Monroe County assessor Judy Sharp said the practice of a general reassessment is expensive, and outdated. She said many times in the past it’s led to delayed tax bills which is why she said she and many assessors in the state have been using a cyclical reassessment system.

“Since 2002 when we went to the Market Value system the assessing system in Indiana has changed dramatically. Through the Market Value system it was decided that the best way to get our data cleaned up, keep it clean was to do a cyclical reassessment where each year we would do a portion of a county,” Sharp said.

So each year Sharp assesses about a quarter of the properties in Monroe County meaning each house is still reassessed once every four years, but that not every house is reassessed on the same schedule. Property taxes specifically for the houses assessed in a given year increase only if a change has been made to the house that affects its base assessed value and taxes change across the board for all real property in a county due to annual adjustments which take into account fluctuations in market value and inflation. And Sharp said the method has been working

” This is the first year since the 2002 reassessment that every county has billed on time. We’re back, but I’m going to tell you right now, what’s going to happen, like it happens every reassessment. It’s such a huge, huge project, too much stuff to be crammed into 18 months, you’re going to see the state be back to the point where we were where counties were not billing on time, the job was not getting done,” Sharp said.

Sharp said she and other Hoosier assessors have been working to change the state’s laws. They had hoped a bill before the legislature last year would change the requirement from mandating general reassessments to allowing cyclical reassessments instead.

But Columbus Representative Milo Smith who raised concerns about changing the law during the last general assembly said general reassessments are necessary. Smith said he worries counties assessed a quarter at a time will face inequality in taxing as newly assessed rates are applied to those quadrants individually.

” If I own a convenience store on the West side of Bloomington and I own one on the East side of Bloomington, and you’re reassessing properties in my geographic area that doesn’t take into account the other three and you’re applying new land values and new cost schedules to that property you just looked at then that assessment is higher than the other three so you don’t have uniform and equal assessments,” Smith said.

And that, Smith said, is unconstitutional.

Smith said he’d like to propose a compromise. In Smith’s plan the counties would assess 33 % of their properties every year and wait to apply the cost schedules until the entire assessment is complete. I wouldn’t be a cyclical reassessment he said, it would be a general reassessment, but counties would have the full three years to complete it. Smith says under his plan he’d throw out annual adjustments completely.

But Sharp maintains annual adjustments are crucial in order to continue a system based on market value, says Smith’s offer is not one she’s willing to accept, although the President of the International Association of Assessing Officers Bill Carroll said it could be a viable solution, but not one without problems.

“You know you run into the same kind market condition problems because different neighborhoods go up and down at different rates and if you don’t look at each neighborhood each year then you’re going to have some inherent inequity,” Carroll said.

The best case scenario, Carroll said would be a general reassessment every year and he said some states do that, but the majority, he said, follow a cyclical reassessment cycle. In the mean time, assessors around the state are working now to meet the general reassessment’s closing deadline.

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