Home Rule

The concept of “home rule” permits local communities within a state to provide for their own governments and to exercise all powers not prohibited by state law or by the state or U.S. constitutions. Historically, the home rule authority of local governments in Indiana has been limited. State officials specify the government structure and many of the powers of Indiana cities and towns. One of the principal arguments made in favor of the 1851 Indiana Constitution was that the original 1816 Constitution had involved the state government too much in the affairs of local communities.

Even under the 1851 Constitution, the Indiana General Assembly has exercised considerable control over cities and towns, defining their powers and establishing their governmental structures under a classification system that categorized municipalities as towns or as first-, second-, or third-class cities. Cities such as Indianapolis could not substantially alter any aspect of their governmental organization or finances without state legislative approval.

In a first-class city (Indianapolis is the only city in Indiana that currently meets this standard), state law set the size of the city council at 29 members and specified that 25 would be elected from districts and 4 at large. State law further provides that both the council members and the mayor serve renewable four-year terms. When it took effect in January 1970, the reorganization of Indianapolis county and city government, Unigov, passed by the Indiana General Assembly in 1969, followed this structure for the new city-county council.

The number of state laws regulating local governments accumulated for more than a century until the General Assembly created a Local Government Study Commission in the 1970s. The commission’s recommendations led to the rewriting and recodification in 1980 and 1981 of many state laws concerning local governments. The new laws, gathered under Title 36 of the Indiana Code, included a home rule statement of the relationship between state power and local government autonomy. The state legislature declared that local units of government could exercise any powers not specifically denied to them.

In spite of the home rule declaration, the state still specifies municipal government structure in Indiana. The state continues to divide municipalities into towns and three classes of cities, based on their populations. State laws prescribe the size, powers, and length of terms of the city council or town board and the mayor for each class of municipalities.

The list of powers that the state specifically denies to municipalities remains substantial. The Indiana Constitution restricts the borrowing authority of municipalities. State law regulates the incorporation and annexation actions of municipal governments, and in Title 36 cities and towns are denied the power to: impose any tax except as expressly granted by statute; impose a license or other fee greater than that reasonably related to the administrative cost of exercising a regulatory power; impose a service charge greater than that reasonably related to the cost of the service provided; invest money except as expressly authorized by statute; prescribe a penalty of imprisonment for violation of a municipal ordinance; prescribe a fine of more than $2,500 for violation of an ordinance; regulate conduct that is regulated by a state agency, except as expressly granted by statute; impose duties on another local jurisdiction, unless expressly granted by statute; condition or limit their civil liability except as expressly granted by statute; regulate or restrict rents; or prescribe the laws governing civil actions between private persons.

Many more home-rule restrictions have been added in the 21^st century following a national trend in Republican-controlled state legislatures across the country.

In 2008, the General Assembly passed property tax caps that “limit an owner’s property tax burden to afixed percentage of the property’s gross assessed value.” Other recent additions to home rule in Indiana included a law that forbids cities from regulating firearms and one that bars local jurisdictions from passing minimum wage ordinances. Both bills were signed in 2011.

In 2013, the Indiana General Assembly made significant changes in Unigov. It redrew City-County Council districts and eliminated the four at-large seats.

The Indiana General passed a law (HB 1279) that had direct implications for public transit in Indianapolis in 2014. It put in place provisions to hold a referendum in Indianapolis for mass-transit projects. It also added a clause that required IndyGo (Indianapolis’ public transit system) to establish a nonprofit foundation and to raise privately 10 percent of its operating costs. IndyGo estimates that its foundation must raise between $5 million and $6 million annually to meet these requirements. 

More restrictions followed. In 2015, the General Assembly passed legislation to prevent local governments from regulating housing and, in 2016, it preempted cities from regulating worker schedules and from implementing a tax or ban on the use of plastic bags. The Indiana General Assembly also passed Senate Bill 213 in April 2017 that allowed a massive rollout of small cell wireless structures throughout the state giving local entities little or no control over where towers are placed.

The 2020 session included passage of Senate Enrolled Act 148 (SEA 148) designed to prevent local governments from regulating any aspect of tenant-landlord relationships, including protections that Mayor Joe Hogsett had proposed to require “landlords to notify renters of their rights and responsibilities, and fining landlords who retaliate against renters for reporting problematic housing.” The Indiana House and Senate passed the measure, but Governor Eric Holcomb vetoed it, stating that the language included was “overly broad.” The Indiana Senate voted to override Holcomb’s veto of this bill during the 2021 session. House Bill 1451 then was introduced to narrow the scope of SEA 148. It eliminated vague language and prohibits landlords “from forcing tenants to sign away their rights.” With these changes, Holcomb signed this legislation into law.

Other efforts to limit home rule continued during the 2021 session.  Two bills related to the governance of the Indianapolis Metropolitan Police Department (IMPD) were considered by the Indiana General Assembly. The bills came in the face of a record level of homicides and the 2020 protests and were proposed in response to the creation of a civilian-majority General Orders Review Board. Both bills would have given Indianapolis citizens much less input into IMPD’s operations and policies. One, Senate Bill 168, would have created an oversight board for the IMPD but was referred to summer study. The other, Senate Bill 394, would have given police chiefs “the sole authority to make general or special orders to the police department establishing the department’s procedures and policies, including use of force policy.” It died in committee. A bill to deter IndyGo’s rapid-transit plans again did not make it to the governor’s desk.

Revisiting legislation passed in 2017, legislators moved to make it easier to erect 5G cell towers. House Enrolled Act 1164 limits a local government’s ability to restrict the erection of 5G cell poles.