Five amendments were filed, and voted down, on the bill laying out Gov. Mike Braun’s plan for property tax cuts as it was heard for the first time by the whole Senate Thursday.
Senate Bill 1 would address rising property taxes with the system Braun campaigned on. The bill would change the homestead standard deduction amount of 60% of the homestead’s assessed value if the value is more than $125,000 or $48,000 plus 60% of the remaining assessed value if the homestead has an assessed value of $125,000 or less.
The bill was amended by the Senate Tax and Fiscal Policy Committee to include portions of Senate Bills 6, 8 and 9, which Senate Republicans signaled would also impact property taxes on the first day of session.
The amended bill lessens some of the cuts to school districts, libraries, and local government that garnered widespread outcry.
The fiscal impact of the amended bill would cut $1.4 billion across the state between 2026 and 2025, including $370.9 million from schools, $67 million from libraries, $304.3 million from cities and towns, and $346.6 million from counties, while the original report from the Legislative Services Agency detailed $4.1 billion in cuts between 2026 and 2028, including $1.9 billion from schools, $254 million from libraries, $890 million from cities and towns, and $765 million from counties.
Sen. Fady Qaddoura, D-Indianapolis, proposed an amendment to give renters relief of $3,000 in 2025, $6,000 in 2026 and $9,000 in 2027.
Sen. Travis Holdman, R-Markle, who authored the bill, said renters were included in a different bill that wasn’t heard by the Tax and Fiscal Policy committee, which Holdman chairs. Holdman said renters weren’t included because the fiscal impact would be $10 million at the local level and $17 million at the state level.
The fiscal impact of Senate Bill 1 is in the hundreds of millions of dollars, Qaddoura said. The 600,000 families that rent their properties deserve relief, he said. The amendment failed 10-36.
Sen. Michael Young, R-Indianapolis, filed four amendments, all of which failed.
Holman nixed two amendments — a proposal that would prohibit investor-owned property from impacting the property tax of nearby residential properties and one regarding the assessed value of a homestead property based on substantial renovation or new improvements — on the basis that they would violate the precedent established in the Town of St. John v. the State Board of Tax Commissioners, a tax case from 1997 in which the courts ruled the Indiana General Assembly has to provide a uniform and equal rate of property assessment and taxation.
Young’s other amendments included offering homestead exemptions to those 65 years old and older and an idea to address the maximum increase in property tax liability to 3% for local governments. With the latter proposal, Holdman said it would upset the current maximum levy growth quotient that has been established under law.
The committee amendments would allow all units of government to utilize the referendum process, property tax levy calculations and credits for veterans, seniors and first-time home buyers.
Senate Bill 8, which was folded into Senate Bill 1, would require referendums to be held in even-year general elections, which is when most voters cast a ballot and require the unit of government requesting the referendum to include the rate and the amount of money being raised.
The portions of Senate Bill 9 that were amended into Senate Bill 1 include a cap the maximum levy growth quotient at 0% pay in 2026, 1% pay in 2027 and 2% pay in 2028 and then the remaining calculation goes into what Senate Bill 9 proposed.
Language from Senate Bill 6, which was tacked on, allows counties the option to set up a process for a homeowner to defer up to $500 of their property taxes annually. The total amount that could be deferred is $10,000. All deferred property taxes would become a lien on the property, and would have to be paid off before the home could be sold.
Sen. Linda Rogers, R-Granger, presented an amendment in committee for veterans and senior citizens. Under the amendment, a veteran with either a total disability or 62 years of age with a partial disability would see an increase in deduction from $14,000 to $20,000 with a change in the assessed value limit from $240,000 to $300,000, she said.
For those 65 years or older, the income limit for deduction and credit shifts to $60,000 from $30,000 for a single filer and to $70,000 from $40,000 for a joint filer, Rogers said. It also changes the assessed value limit from $240,000 to $300,000, she said.
Sen. Tyler Johson, R-Leo, shared an amendment in committee that would create a property tax credit for most first-time home buyers. The credit would be $2,500 annually for five years, for a total tax credit of $12,500, he said.
The bill will move forward to third and final reading by the Senate.
