Indiana 2025 Regular Session

Indiana House Bill HB1192 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	Introduced Version
3	3	HOUSE BILL No. 1192
4	4	_____
5	5	DIGEST OF INTRODUCED BILL
6	6	Citations Affected: IC 6-1.1-4-4.5.
7	7	Synopsis: Farmland assessment. Amends the six year rolling average
8	8	calculation and the capitalization rate percentage under the statewide
9	9	agricultural land base rate determination.
10	10	Effective: January 1, 2026.
11	11	Culp
12	12	January 8, 2025, read first time and referred to Committee on Ways and Means.
13	13	2025 IN 1192—LS 7203/DI 120 Introduced
14	14	First Regular Session of the 124th General Assembly (2025)
15	15	PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
16	16	Constitution) is being amended, the text of the existing provision will appear in this style type,
17	17	additions will appear in this style type, and deletions will appear in this style type.
18	18	Additions: Whenever a new statutory provision is being enacted (or a new constitutional
19	19	provision adopted), the text of the new provision will appear in this style type. Also, the
20	20	word NEW will appear in that style type in the introductory clause of each SECTION that adds
21	21	a new provision to the Indiana Code or the Indiana Constitution.
22	22	Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
23	23	between statutes enacted by the 2024 Regular Session of the General Assembly.
24	24	HOUSE BILL No. 1192
25	25	A BILL FOR AN ACT to amend the Indiana Code concerning
26	26	taxation.
27	27	Be it enacted by the General Assembly of the State of Indiana:
28	28	1 SECTION 1. IC 6-1.1-4-4.5, AS AMENDED BY P.L.8-2022,
29	29	2 SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
30	30	3 JANUARY 1, 2026]: Sec. 4.5. (a) The department of local government
31	31	4 finance shall adopt rules establishing a system for annually adjusting
32	32	5 the assessed value of real property to account for changes in value in
33	33	6 those years since a reassessment under section 4.2 of this chapter for
34	34	7 the property last took effect.
35	35	8 (b) Subject to subsection (f), the system must be applied to adjust
36	36	9 assessed values beginning with the 2006 assessment date and each year
37	37	10 thereafter that is not a year in which a reassessment under section 4.2
38	38	11 of this chapter for the property becomes effective.
39	39	12 (c) The rules adopted under subsection (a) must include the
40	40	13 following characteristics in the system:
41	41	14 (1) Promote uniform and equal assessment of real property within
42	42	15 and across classifications.
43	43	16 (2) Require that assessing officials:
44	44	17 (A) reevaluate the factors that affect value;
45	45	2025 IN 1192—LS 7203/DI 120 2
46	46	1 (B) express the interactions of those factors mathematically;
47	47	2 (C) use mass appraisal techniques to estimate updated property
48	48	3 values within statistical measures of accuracy; and
49	49	4 (D) provide notice to taxpayers of an assessment increase that
50	50	5 results from the application of annual adjustments.
51	51	6 (3) Prescribe procedures that permit the application of the
52	52	7 adjustment percentages in an efficient manner by assessing
53	53	8 officials.
54	54	9 (d) The department of local government finance must review and
55	55	10 certify each annual adjustment determined under this section.
56	56	11 (e) For an assessment beginning after December 31, 2022,
57	57	12 agricultural improvements such as but not limited to barns, grain bins,
58	58	13 or silos on land assessed as agricultural shall not be adjusted using
59	59	14 factors, such as neighborhood delineation, that are appropriate for use
60	60	15 in adjusting residential, commercial, and industrial real property. Those
61	61	16 portions of agricultural parcels that include land and buildings not used
62	62	17 for an agricultural purpose, such as homes, homesites, and excess
63	63	18 residential land and commercial or industrial land and buildings, shall
64	64	19 be adjusted by the factor or factors developed for other similar property
65	65	20 within the geographic stratification. The residential portion of
66	66	21 agricultural properties shall be adjusted by the factors applied to
67	67	22 similar residential purposes.
68	68	23 (f) In making the annual determination of the base rate to satisfy the
69	69	24 requirement for an annual adjustment for each assessment date, the
70	70	25 department of local government finance shall not later than March 1 of
71	71	26 each year determine the base rate using the methodology reflected in
72	72	27 Table 2-18 of Book 1, Chapter 2 of the department of local government
73	73	28 finance's Real Property Assessment Guidelines (as in effect on January
74	74	29 1, 2005), except that the department shall adjust the methodology as
75	75	30 follows:
76	76	31 (1) Use a six (6) year rolling average adjusted under subdivision
77	77	32 (3) instead of a four (4) year rolling average.
78	78	33 (2) Use the data from the six (6) most recent years preceding the
79	79	34 year in which the assessment date occurs for which data is
80	80	35 available, before one (1) two (2) of those six (6) years is
81	81	36 eliminated under subdivision (3) when determining the rolling
82	82	37 average.
83	83	38 (3) Eliminate in the calculation of the rolling average the year
84	84	39 among the six (6) years, the top two (2) years for which the
85	85	40 highest market value in use of agricultural land is determined.
86	86	41 (4) After determining a preliminary base rate that would apply for
87	87	42 the assessment date without applying the adjustment under this
88	88	2025 IN 1192—LS 7203/DI 120 3
89	89	1 subdivision, the department of local government finance shall
90	90	2 adjust the preliminary base rate as follows:
91	91	3 (A) If the preliminary base rate for the assessment date would
92	92	4 be at least ten percent (10%) greater than the final base rate
93	93	5 determined for the preceding assessment date, a capitalization
94	94	6 rate of eight percent (8%) ten percent (10%) shall be used to
95	95	7 determine the final base rate.
96	96	8 (B) If the preliminary base rate for the assessment date would
97	97	9 be at least ten percent (10%) less than the final base rate
98	98	10 determined for the preceding assessment date, a capitalization
99	99	11 rate of six percent (6%) eight percent (8%) shall be used to
100	100	12 determine the final base rate.
101	101	13 (C) If neither clause (A) nor clause (B) applies, a capitalization
102	102	14 rate of seven percent (7%) nine percent (9%) shall be used to
103	103	15 determine the final base rate.
104	104	16 (D) In the case of a market value in use for a year that is used
105	105	17 in the calculation of the six (6) year rolling average under
106	106	18 subdivision (1) for purposes of determining the base rate for
107	107	19 the assessment date:
108	108	20 (i) that market value in use shall be recalculated by using the
109	109	21 capitalization rate determined under clauses (A) through (C)
110	110	22 for the calculation of the base rate for the assessment date;
111	111	23 and
112	112	24 (ii) the market value in use recalculated under item (i) shall
113	113	25 be used in the calculation of the six (6) year rolling average
114	114	26 under subdivision (1).
115	115	27 (g) For assessment dates after December 31, 2009, an adjustment in
116	116	28 the assessed value of real property under this section shall be based on
117	117	29 the estimated true tax value of the property on the assessment date that
118	118	30 is the basis for taxes payable on that real property.
119	119	31 (h) The department shall release the department's annual
120	120	32 determination of the base rate on or before March 1 of each year.
121	121	2025 IN 1192—LS 7203/DI 120