Bill > HB1192

This bill amends the state's farmland assessment rules by modifying how agricultural land base rates are calculated. Specifically, the bill changes the method for determining agricultural land values from a four-year to a six-year rolling average, which means the state will now use data from six consecutive years to calculate land values. The bill requires eliminating the two highest-value years from this calculation to prevent extreme market fluctuations from skewing the assessment. Additionally, the bill adjusts the capitalization rates (the percentage used to convert income into property value) based on whether the preliminary base rate is significantly higher or lower than the previous year. If the new rate would be at least 10% higher, a 10% capitalization rate will be used; if it would be at least 10% lower, an 8% rate will be used; and in other cases, a 9% rate will apply. The bill also clarifies that agricultural improvements like barns and grain bins should not be assessed using the same factors as residential or commercial properties, ensuring a more accurate valuation of farmland. These changes will take effect on January 1, 2026, and are designed to create a more stable and equitable system for assessing agricultural property values.

Budget and Finance

https://iga.in.gov/legislative/2025/bills/house/1192/details