House committee advances amendment to Senate Bill 1 after hours of debate over property-tax overhaul

The House Ways and Means Committee on Tuesday approved Amendment 45 to Senate Bill 1, a broad package of property-tax and local-income-tax changes, after more than three hours of questions and debate. The committee approved the amendment and moved the amended bill out of committee by a 15-8 vote.

Amendment 45 would shift many existing property-tax deductions to credits, establish a capped homestead credit (7.5 percent of the final tax bill, capped per the amendment), raise the de minimis personal property exemption, change farm-ground capitalization rates for a two-year period, place new caps on bonding rates that trigger referenda, and reorganize portions of the local income tax (LIT) distribution so county councils would control a larger “bucket” of LIT proceeds. The amendment also includes provisions affecting tax treatment of virtual-school enrollments, TIF neutralization language and a change to the maximum rate for newly formed fire territories.

Why it matters: Committee members said the changes aim to give homeowners immediate, targeted relief while restructuring how local governments receive and control revenue. Opponents said the proposal shifts costs to local units, creates uncertainty for counties and school corporations, and lacks a complete fiscal analysis by district and taxing unit.

Committee discussion and key provisions

Chairman Thompson opened consideration of Amendment 45 and summarized the measure’s major components, including moving referenda to the November election calendar; restricting general-obligation bonding; neutralizing TIF…