FROM INDIANA PUBLIC RADIO

A property tax case heard by the Indiana Supreme Court this week could have a huge impact on local government and school finances — and, some worry, throw the state’s property tax assessment system into chaos.

The case deals with how property is classified under the state’s property tax caps.

The Indiana Constitution and state law use different language. State law says the one percent property tax cap is for “homesteads,” which it says consists of a dwelling and up to one acre of land immediately surrounding it.

The Sawlani family has a home on nearly four acres of land in Lake County. One acre was taxed under the one percent cap, while the remainder was under the three percent property tax cap.

Attorney Gerold Stout, representing the Sawlanis , told the Supreme Court that the state law’s one-acre limitation is unconstitutional. Rather, he says, property should be classified depending on how it’s used.

But Ayn Engle , representing the Lake County assessor, says that’s not practical. She notes that the state constitution specifically says property assessment and taxation must be “uniform and equal.”

There is no timetable for the court’s decision.