Different fates for tax relief, immigration reform bills

The tax bill passed by Indiana lawmakers gives homeowners an average cut in property taxes of close to 30 percent this year.

It includes caps on property taxes at 1.5 percent of a home’s assessed valuation in 2009. In 2010 and beyond, it caps property tax at 1 percent of a home’s assessed valuation.

It eliminates many of the state’s township assessors, calls for public referendums on capital spending projects and places controls on local government spending.

It adds $120 million to help schools offset the property tax caps.

The plan increases the earned income tax credit from 6 percent to 9 percent for lower to moderate income families, and makes it permanent. It increases the renter’s deduction from the current $2,500 to $3,000, and places additional caps for senior citizen homeowners on fixed incomes.

To provide property tax relief, the bill increases the state sales tax from 6 percent to 7 percent effective on April 1.

Local option income taxes are expected to be increased to make up for the shortfall caused by the property tax caps. The plan shifts the costs of child welfare, juvenile incarceration, health care for the indigent, police and fire pensions, and some school costs from local governments to the state.

Concerning immigration reform, a bill to punish employers who hire undocumented individuals failed.

A proposal to penalize employers who knowingly hire undocumented immigrants failed when a compromise between House and Senate versions of the proposal could not be reconciled.

Some of the concerns of the bill included the possibility of racial profiling, the detrimental effects on Indiana’s economy, and harm to immigrant families and children—both legal and illegal.

During the 2008 session of the Indiana General Assembly, the Indiana Catholic Conference testified in opposition to the proposal.

Glenn Tebbe, ICC executive director, said, “The Catholic Church does not support illegal immigration, and respects the right of nations to control its borders.”

However, Tebbe explained to lawmakers that the Church is concerned about the effects that the proposal would have on employers, immigrant families and children.

“Putting hundreds of people out of work will only add to the social concerns in the community,” Tebbe said. “Presently, those working are caring for their family needs and contributing to the common good.”

He noted that similar laws enacted in Arizona and Oklahoma are having “detrimental effects” on the economy and on the families of both legal and illegal immigrants.

In addition to the ICC, members of the Hispanic community, the Indiana Chamber of Commerce and the Indiana Manufacturers Association opposed the bill.

The bill would have punished businesses that knowingly hire undocumented workers by suspending their business license or revoking it after three violations.

The immigration reform proposal died when two of the conferees, Sen. Thomas K. Weatherwax (R-Logansport) and Rep. Scott Pelath (D-Michigan City), failed to sign off on the final conference committee agreement. †