Remonstrance Rule Changes Anticipated
Submitted by: Colette Irwin-Knott, Partner

Indiana’s remonstrance process is anticipated to change in the 2007 General Assembly Session.  Last August, the Indiana Court of Appeals ruled that Indiana’s remonstrance process was unconstitutional because it allowed only real property owners to participate. In its ruling, the Court of Appeals provided the General Assembly the chance to revise Indiana code to address what the court found to be inadequacies of the current remonstrance process.

Overview of the Current Remonstrance Process

All property tax supported debt proposed by local governments and school districts exceeding $2 million of project cost is subject to the remonstrance process. After the Preliminary Determination hearing, a notice is published informing taxpayers that if they object to the issuance of debt for the project, they have 30 days to collect 100 signatures on a petition to begin a full remonstrance for eligible people in the affected geographic area (political subdivision).

If 100 signatures are received and verified, the next step is a 30-day period which allows supporters and opponents alike time to prepare for the remonstrance. The remonstrance is a subsequent 30-day period in which supporters and opponents collect as many eligible signatures as they can.  Currently, only owners of real property in the political subdivision are eligible to participate. The side with the most valid signatures wins the petition race. If the supporters win, the project continues; if the opponents win, the project is stopped for a minimum of one year.

Proposed Changes to the Remonstrance Process

The Court of Appeals ruling gave the General Assembly the opportunity to revise the current remonstrance law. Senate Bill 132 ("SB 132") has been introduced which allows all registered voters of the geographic area, regardless of whether they own real property or not, to participate in the petition and remonstrance process to approve property tax supported debt. It also requires that the petition be filed for verification with the county clerk, rather than the county auditor. As of January 9th, SB 132 had passed out of the Committee on Tax and Fiscal Policy.

As the legislative session continues, we will monitor this legislation and other legislative developments that impact your communities. We invite your questions and comments.  Please feel free to contact us at footnotes@umbaugh.com.