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Senate Enrolled Act 1 will lower assessed value and push local school tax rates higher, consultant says
Summary
A Policy Analytics presentation to the Beech Grove City Schools board explained how Senate Enrolled Act 1 changes to homestead and business deductions will reduce net assessed value, raise tax rates and shrink some school revenues, potentially forcing districts to consider more referendums or other measures.
Barry Gardner, director of school services with Policy Analytics, told the Beech Grove City Schools board on June 3 that Senate Enrolled Act 1 will reduce the district's taxable base and likely raise local tax rates even where district revenue does not increase.
Gardner said the legislation changes homestead deductions and other valuation rules and “spoiler alert, tax rates are going to go up,” and explained the mechanics: “rate times levy gives us our money or our revenue.”
The presentation laid out three main effects: (1) new homestead deductions and a post-circuit‑breaker local credit will lower net assessed value (the amount taxpayers are taxed on); (2) expanded deductions for some 2% property classes (for example, apartments and long‑term care) and large increases to the…
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