"IT IS THE DUTY OF THE PATRIOT TO PROTECT HIS COUNTRY FROM THE GOVERNMENT." - THOMAS PAINE (1737-1809)


Saturday, March 7, 2009

GOVERNOR UNLOADS ON LAKE COUNTY POLITICIANS

By John Byrne
Post-Tribune staff writer

GRIFFITH -- Gov. Mitch Daniels is fed up with Lake County government and he's tired of pretending he isn't.

During a wide-ranging question-and-answer period with locals at Griffith High School on Friday, Daniels returned time and again to one point: Lake County will remain alienated from the rest of the state until voters here hold public officials to a higher standard.

"You are entitled to all the lousy, crummy, graft-ridden government you want and are willing to pay for," Daniels told a crowd of about 450 people, one of the largest turnouts he said he's seen at such a forum.

Daniels was invited to Griffith by Team Hammond, a property tax reform group, to discuss tax caps and township government reform.

The governor said those issues are symptoms of the broader political culture that makes Lake County a black sheep in the eyes of many Hoosiers.

"Ultimately nobody, not me, not anybody, can advocate for Lake County and Northwest Indiana unless there is some evidence the people here are prepared to clean up the act that has made the rest of the state look sideways at Lake County for a long time," Daniels said.

Some local officials in the audience bristled at Daniels' characterizations, with North Township Trustee Frank Mrvan Jr. calling it "unacceptable" for Daniels to sling arrows at Lake County elected officials as a group.

"I have made my career of five or six years at the township about reform, lowering payroll and cutting taxes," Mrvan said.

With Lake County's public transit systems in peril, Mrvan said local township offices that provide poor relief are becoming ever more important to people who'd find it difficult to travel to the county government center in Crown Point if the service gets centralized there.

"It takes 42 minutes to get to the county from my township," Mrvan said.

Some in the audience shouted for Mrvan to sit down.

Others applauded and yelled, "He has a right to speak."

Daniels also faced skepticism from residents who questioned the real benefit of eliminating townships.

Rita Jackson of North Township asked how the governor can guarantee she would actually see a lower tax bill if her township ceases to exist.

"There are no guarantees," Daniels said, before he guaranteed that poor relief could be more efficiently distributed than it is in Calumet Township.

The governor agreed that most of Indiana's elected officials have the best interests of their constituents at heart.

But he returned to his frequent complaint that Indiana's patchwork of 1,008 townships is a hopelessly antiquated, inefficient system that must be retired.

And he agreed his rhetoric on Lake County is getting harsher the longer he sees resistance here to change.

"I guess after five years of trying to speak always to the positive and encourage people to move in a positive direction, that I'm trying to express candidly my thought that I'm a little tired of waiting," he said.

Contact John Byrne at (317) 631-7400 or jbyrne@post-trib.com.

Posted by Team Hammond at Saturday, March 07, 2009

Friday, March 6, 2009

TEAM HAMMOND PRESENTS GOVERNOR DANIELS WITH TAXPAYER FRIENDLY AWARD


Members of Team Hammond Taxpayers' Group present Governor Mitch Daniels with a "taxpayer friendly" award for his continuing work on property tax and government reform. The award was presented after the town hall meeting at Griffith High School Auditorium on Friday, March 6, 2009.

Posted by Team Hammond at Friday, March 06, 2009

TRIPLE DIP AND WE'RE NOT TALKING ICE CREAM

The next Hammond City Council meeting on Monday, March 9, should prove to be interesting if not downright entertaining.

Councilman Al Salinas plans on introducing a resolution appointing himself to a seat on the Port Authority Board.

The same seat Councilman Bob Markovich was appointed to by the city council and whose appointment is being disputed by Mayor McDermott.

McDermott has asked Indiana Attorney General Greg Zoeller for an opinion on council members holding two paying positions.

Now that's really rich. McDermott is complaining about Markovich double dipping as a councilman and port authority board member.

What about Councilman Kalwinski double dipping as a councilman and port authority board member?

What about when Scott Rakos was double dipping as a Hammond firefighter and a port authority board member?

And Councilman Salinas not only double dips as a street department foreman and 2nd District councilman, he wants to become a port authority board member and triple dip!

If the mayor wants the rules to apply to Councilman Markovich, then they should apply to the other councilmen and city employees as well.

Posted by Team Hammond at Friday, March 06, 2009

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Blunt Proof of the Feasibility to Permanently Abolish Property Tax

IMMEDIATE RELEASE
Media Contacts:
Melyssa Donaghy 317-938-8913
Max Katz 765-409-6669
www.HoosiersForFairTaxation.com

BLUNT PROOF OF THE FEASIBILITY TO PERMANENTLY ABOLISH PROPERTY TAX.
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.

PROPERTY TAX HISTORY PREPARED BY DR. BILL STYRING
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.