Senate Bill 145 (Property Tax Matters), authored by Sen. Brian Buchanan (R-Lebanon), passed the House Ways and Means Committee on Wednesday. This is referred to as the “big box” or “dark store” assessment legislation that has in one form or another been considered the last several years. It dictates that the commercial retail properties larger than 100,000 square feet and occupied by their original owner must be assessed based on the cost approach to valuation (meaning the typical cost of constructing such a building) for a period of five years.
The Senate version applied this cost approach method to be applied for the first 10 years following the building’s construction, but the committee amended the time period to five years. This change was viewed as essential to making the requirement palatable.
The Chamber has historically opposed this legislation because it departs from generally accepted appraisal principles, but we have for some time acknowledged that a problem existed and that there is no easy remedy. This is not ideal legislation, but with the committee’s amendment change to five years and the provisions being applicable to only a narrow segment of properties, we have elected to support the measures. All in all, we feel it offers resolution to a persistent problem without jeopardizing the integrity of the system as a whole. The Chamber expresses its appreciation to Sen. Buchanan for working with us and all the interested parties for several years to find this most reasonable resolution. Likewise, we extend special thanks to House Ways and Means Chairman Rep. Tim Brown (R-Crawfordsville) for the committee amendment that makes the bill acceptable.
Bill Waltz is vice president of taxation & public finance for the Indiana Chamber. He is also an attorney and has been with the organization since 2004.
