INDIANAPOLIS -- Gov. Mitch Daniels on Wednesday threw out the controversial property assessments in Marion County that have led to large tax increases for some homeowners.

In a news conference in his office, Daniels said he was ordering all property in Marion County reassessed, saying the most recent assessment put an unfair portion of the tax burden on homeowners.

Daniels also said he has ordered Marion County's tax bills frozen at last year's levels, and recommended the county issue provisional tax bills until the reassessment -- which could take up to eight months -- is complete.

Homeowners in the county will be able to pay the amount they paid last year, with the difference -- either up or down -- to be made up later, 6News' Norman Cox reported.

Daniels had indicated for several days he had serious doubts about the most recent assessments, calling them "very suspicious" because the values of very few industrial and commercial properties changed. This, he said, caused homeowners' tax bills to rise too high and businesses' bills to rise too little.

The governor said he ordered a reassessment after his new commissioner of local government finance, Cheryl Musgrave, confirmed his belief that the original assessment was botched.

"She came in very quickly, looked and has assembled an overwhelming factual case the local assessment here was completely unsatisfactory and, in fact, wasn't even done in many, many cases, with a very unfair effect for homeowners," Daniels said.

The governor's order raises many questions about implementation and impact for those who have already paid their bills at the higher assessment. Marion County Treasurer Mike Rodman's aides told 6News that he and some top assistants are working frantically to answer those questions, something they hope to do by Thursday morning.

House Speaker Pat Bauer, D-South Bend, praised the actions of Daniels, a Republican.

"When something's done wrong, you fix it. You just don't go ahead and pretend it hadn't happened, and that's why he did the right thing and ordered the reassessment," Bauer said. "It is also the right thing to say, 'Don't pay a bill that might very well be wrong.'"

Gov. Appoints Blue-Ribbon Panel To Consider Long-Term Solutions

Also Wednesday, Daniels announced a blue-ribbon panel to consider long-term property tax solutions, including restructuring of local government and school districts.

The panel will be headed by Indiana Supreme Court Chief Justice Randall Shepard and former Gov. Joe Kernan. Both said they are not entering the study with preconceived notions, but Kernan indicated he thinks it's time for some changes.

"Our local governments were really organized a century and a half ago," Kernan said. "I don't know of many organizations that have the same structure that they had a century and a half ago that are still around," Kernan said.

There has been speculation that Daniels would like to convince the Legislature to get rid of township government, at least in urban areas.

Daniels declined to say whether he is still considering ordering a special session of the Indiana Legislature to further blunt the tax blow.