Thursday, January 22, 2009


If you want to know more about the proposed food and beverage tax, make plans to attend the next Team Hammond Taxpayers' Group meeting on Tuesday, January 27, 2009 at the Woodmar United Methodist Church, 7320 Northcote Avenue in Hammond. Meet and greet will begin at 6:30 p.m. with the general meeting to follow at 7:00 p.m.

Our guest speaker for the evening will be Ms. Christine Cid, 2008 Lake County Council President. Ms. Cid will speak not only on the food and beverage tax but the 2009 county budget and other county-related issues.

As County Council President, Ms. Cid played an important role in getting the 2009 county budget reduced by $15 million.

Bring yourself, bring your friends and neighbors. The food and beverage tax is just one of several new taxing proposals the county will be addressing in 2009. This tax affects everyone living in Lake County. You don't have to be a Hammond resident to attend this important meeting.

As always, refreshments will be served. See you on Tuesday!

Monday, January 19, 2009


Hat tip to Frugal Hoosiers!!!

Whoa! Senator Mike Delph didn't forget that we got socked with a sales tax hike of 17% to offset the property tax caps? Well, what happens if we don't get those promised caps and Pat Bauer gets his way? Senator Delph wants to make sure we get our sales tax money back. (We like Senator Delph more every day!)

He introduced SB 243 to make sure the people don't get ripped off! Here's the skinny of the bill from Frugal Hoosiers blog:
"Quite simply, this bill requires a return to a 6% sales tax if the General Assembly does not successfully work to put the property tax caps in the constitution. Doing so requires a resolution to pass in two, separately elected, General Assemblies, and passage on the general election ballot. In other words, if the property tax caps that passed in 2008 in exchange for the increase in the sales tax aren't put in the constitution, you get your money back."

Click here to read SB 243, contact your legislator, or write a letter to the editor.

From Frugal Hoosiers


Indiana state Sen. Beverly Gard, a Republican from Greenfield who has long championed the cause of open government, will try again this year to put teeth in the state's public access law.

If every Indiana lawmaker felt as Gard does about the importance of making government records easily available to all citizens of the state, we would have far fewer government doors shut in the faces of Hoosiers.

It was Gard and, from this area, Rep. Russ Stilwell, D-Boonville, who led a successful campaign in 2007 to limit the ability of public officials to hold "serial meetings." That was a shameful tactic used by some officials to legally prevent Indiana residents from attending some meetings of their government boards.

The new law came as a huge victory for the cause of open government, but there remain other government doors that need to be opened to the public.

The issue for this session is one that prevents citizens from easily gaining access to some public records. Indiana law already makes those records legally available, but that law includes no sharpened teeth for officials who resist.

Indiana has made progress in this area of public policy. Former Gov. Frank O'Bannon temporarily created the public access counselor position to advise citizens and officials on the law and to render opinions on whether the law was violated.

The counselor position was later made permanent by the Legislature, but the law still lacked a serious enforcement mechanism. Even with the counselor giving an opinion that public records should be provided, the elected official could refuse. And then it is left to the person making the request to seek relief in court.

We would guess that in a lot of cases, that is the point at which the frustrated citizen asking to see public records walks away.

Anyway, Gard has introduced Senate Bill 232 in the current legislative session. It has been referred to the Committee on Local Government. It would allow a court to assess a civil penalty of up to $1,000 against public officials or employees or the agency itself for refusing to open records or meetings to the public.

Everyone remotely involved with this issue knows that a law lacking teeth is a law difficult to enforce.

The Legislature seems to take its time dealing with public access issues, and that may prove to be especially true of one that threatens political allies back in the home county with hefty fines.

We understand that, but we ask that lawmakers give Gard's bill a fair discussion, and then, we hope, pass it in some similar form during the current session.

In doing that, lawmakers could truly boast that the interests of their constituents —not their cronies — come first.

From the Evansville Courier Press
Friday, January 16, 2009

Blunt Proof of the Feasibility to Permanently Abolish Property Tax

Media Contacts:
Melyssa Donaghy 317-938-8913
Max Katz 765-409-6669

Hoosiers For Fair Taxation, Senator Delph, Representative Noe, Representative Elrod and many other legislators along with Stop Indiana, attorney John Price, Eric Miller's Advance America, and the Statewide Taxpayer Alliance know that property tax abolishment, without substantial increases in sales tax and income tax, is realistic and possible. The economist Dr. Bill Styring's 2/2/2 Plan demonstrates that the state of Indiana can completely replace property tax without changing the state's current spending habits.

Dr. Styring's plan does not account for positive changes in Indiana's economy that will undoubtedly follow the elimination of property tax such as heavy real estate investment and increased consumer spending due to increased statewide disposable income. The real estate investment in Indiana alone would cause such an economic boom that it could likely end our abandoned property and foreclosure crisis. Property tax elimination would also likely cause a surge in Indiana's population as more people locate to Indiana to take advantage of real estate purchase opportunities without the burden of property tax. With the population surge would come more sales and income taxes.

The General Assembly does not have to adopt a specific plan until the year 2011. In the meantime, we recommend that the General Assembly approves the 27steps outlined in the report prepared by the Sheperd Kernan commission. While the Governor's commission cannot forecast the savings to the state once the plan is implemented, there is no doubt that the savings would be substantial--perhaps equivalent to the the entire property tax burden currently placed on Indiana's homeowners because our legislators have not had the political will to liberate Indiana's governing structure and her taxpayers from the 19th century.

Our citizen networks will work to replace all legislators who do not support property tax repeal in the November 2008 election.

The 2/2/2 Plan, to replace property taxes in Indiana based upon the latest revenue forecast (07/08 fiscal, estimate):

1) Current IN sales tax (state level rate of 6%): $5.601 billion2% increase would yield an additional $1.867 billion

2) Current corporate profits tax: ~$2 billion

2% increase would yield an additional $.286 billion ($286M)

3) A 2% statewide average of the COIT would yield $2.705 billion to cover local civil units of gov.

By adding these three together ($1.867 billion + $.286 billion + $2.705 billion), a total of $4.858 billion is realized; enough revenue to replace property taxes.

Indiana has a 70-plus year history of attempts to lower property taxes by raising other, non-property taxes. In every case these have failed miserably. The new taxes, or higher rates on old taxes, remain in place. And, in short order, property taxes rise back to their old levels, poised to roar even higher.

--1933. General Assembly imposes two new taxes: an individual gross income tax and a corporate gross income tax. The morgue of the Indianapolis Star indicates that the political leadership at the time said this was for property tax relief (1933 was the pits of the Great Depression, and people were losing their homes. Home prices declined by over 40% in the 1929-1933 period). Property tax relief was nonexistent. The state used the money to bail out the state's own finances.

--1963. General Assembly imposes a new sales tax at a rate of 2% and changes the 1933 individual gross income tax (from 1933) to an adjusted gross income tax (the one we have now) at a rate of 2%. Again, the ostensible reason was for property tax relief and again little PTR was forthcoming.

--1967. Those 1963 tax changes were raising more money than projected. The GA decides to give back 8% of sales and income tax revenue to local government for property tax relief. Local units spent the money. No PTR.

--1973. Gov. Otis Bowen launches the most determined PTR offensive yet. The sales tax goes to 4% and a new corporate supplemental net income (profits) tax is imposed. Strict property tax levy controls are imposed. It works... for a time. By 1980, property taxes adjusted for inflation are some 30% lower than in 1973. When Bowen leaves office the levy controls are relaxed. By the end of the decade, property taxes (adjusted for inflation) are back to 1973 levels. The doubling of the sales tax rate from 2% to 4% remains in place, along with the new corporate SNIT.

--2002. More fiddling with the sales tax in the hope of property tax relief. The results of this are obvious, or we wouldn't be debating the current property tax mess. All of this suggests that unless the property tax is totally ripped up by constitutional amendment, the assessment and collection mechanism dismantled, it will grow back. The PTR-inspired hikes in other taxes remain. That is our history. It is a terrible deal for taxpayers.

2. A vote in the 2008 legislative session for a constitutional amendment to repeal property taxes does not amend the constitution. It merely starts the amendment process. Amendments must be passed by two consecutively elected General Assemblies, then submitted to a referendum. Thus any amendment passed by the '08 Assembly must be passed by either the 2009 or 2010 legislatures, then submitted to the voters at the 2010 general election. The General Assembly does not need to decide on a "replacement revenue" package until the 2011 session.

3. What might such a "replacement revenue" package look like? The particular answer will come from the 2011 General Assembly and cannot be determined now (if for no other reason than forecasting state level taxes and property taxes out that far would be a most unreliable exercise. No one need be locked into any particular plan just yet. However, as an illustration that a replacement plan is feasible and less scary than many fear (we don't need to be talking about a 12% or 13% sales tax ... in fact, we should not be), consider just this one possibility.

Local sales taxes are generally very bad policy, for a whole host of reasons too numerous to mention in this short sketch. Sales and corporate taxes are best levied at the state level. It happens that roughly a 2% increase in the sales tax and a 2% increase in the corporate profits tax roughly take care of school propertytaxes. The loss of local control by the state assuming school property taxes is minimal. About the onlylocal control left is on building projects.

For local civil units, a statewide average increase in the individual adjusted gross income tax of about 2% suffices to replace local civil government property taxes, higher than 2% in some units, less than 2% in others.

Thus, a "2-2-2" plan~2% sales and 2% corporate profits at the state level for schools and a 2% average on personal income taxes for civil units—is about what would be needed. This is merely a ballpark projection to 2011.

There may be better plans, it's really a policy question for the General Assembly: do you want to make the trade of something like this in exchange for no-property-taxes-forever-on-anything? Everyone understands "zero."

4. Are there "practical problems? Of course. The two identified are how to make the civil government transition from a property tax base to an income tax base, and how to handle debt backed by property taxes. Without elaborating, the former can be handled using locator software (Map quest-type programs). The debt problem might be handled by treating the current state paid PTRC's as in lieu of property taxes (which they are) and paying PT-backed debt service from each unit's own PTRC.

Conclusion: Total elimination of the property tax via constitutional amendment is the only way to give property tax relief that will stick. The other tax action necessary to achieve this goal—in 2011-are large but not so scary as "a 13% sales tax." They are feasible. The question is for the General Assembly. Are we going to once again go down that 70-odd year path of failed PTR policies or are we going to rip the property tax up by the roots?

Posted by Hoosiers For Fair Taxation on Friday, January 4, 2008.