Previously, and including a lengthy discussion: Dare WE loiter on LOIT? (Part 1).
To continue the discussion concerning the Local Option Income Tax (LOIT), I’d like to address the if’s, how’s & why’s of the benefits for the citizens of New Albany/Floyd County.
Having just completed the 2009 budget process for the city, which left us all spitting cotton and wondering whether or not there’ll be any point in calling 911 next year, the Safety Tax portion of the option seems to be a no-brainer.
But then one has to have ‘em in order to use ‘em.
For three years or longer both police & fire departments have been attempting to hold the line with less live bodies than recommended by any study I’ve seen to date. Yet the selfsame councilmen who readily pass along complaints from their constituents about the lack of protection & service are just as quick to target those departments as the prime culprits of wasted tax dollars.
“Park the cars!” “Take away their cell-phones!” “Cut out overtime!” “Put off maintenance!” All of these and more are the constant battle cry of those who at the same time demand and expect an immediate response to a need, be it real or perceived.
The local newspapers have run several articles during the last several days depicting views from various individuals on both sides of this issue.
FOP President and New Albany Police Detective Paul Haub presented what I thought was a good argument for passing the LOIT based on the ever increasing crime rate in our city.
Floyd County Republican Party Chairman Dave Matthews followed with an admonition that local government needs to trim even more from their budgets.
NAFC Chief, Matt Juliot expressed his concern about providing the quality of service that we’ve all come to expect from our fire department with no funds in his 2008 budget for overtime.
Then, to further confuse the argument, an article in Sunday’s Courier-Journal reports that the Indiana legislators are split on whether to make Their Man Mitch’s property tax cuts permanent, or take a “wait & see” position.
So, from the feedback I’ve gotten so far, the choice locally seems to be rolling the dice and taking our chances.
I’ll grant that’s the politically safe thing to do and I suppose that’s OK as long as it’s an acceptable risk that one's house doesn’t catch fire, one's family isn’t burglarized, or one's grandmother doesn’t need an ambulance or other services.
The question becomes: Now that the citizens have more money in their pockets, do our local leaders have the intestinal fortitude to pass the insurance policy (LOIT) that the state provided, or are they going to gamble our safety and security in hopes of a vote come next election?
Is it really a wise decision to "wait & see" how many homes get broken into or burned to the ground, or worse yet, how many helpless citizens die waiting or an ambulance to arrive?
The stuffed shirts in Indianapolis may be quite willing to take that risk.
I hope our local leaders have more concern for us than that.
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From a recent C-J article concerning the Republicans' wish to amend the state constitution making property tax caps permanent before gauging their impact:
Republicans say they are willing to consider ideas from local officials. But Ed Clere, a New Albany Republican who was elected to the state House on Nov. 4, fears legislators might lose momentum for the limits if they wait a year, particularly as pressure from local officials grows.
"It would be nice to think that we could defer action for a year and not lose any momentum, but I'm not sure that's realistic," he said. "There would have to be a compelling reason not to move forward at this point, especially with the sales tax already having been increased."
In other words, if people get the chance to see how the caps actually affect their communities, they might not support them.
I would suggest that Ed start explaining what should be cut at the local level, what the impact of those cuts would be, and how that impact would benefit our community.
If he's unwilling or unable to do that, he has no compelling reason for moving to make the caps permanent.
Local officials, local media, and local citizens should all pressure him to do so.
For reasons too complex to go into here, I'm not a C-J reader. But thank you for pointing this out.
I can't actually express how extremely disappointed I am in Ed Clere...and he hasn't even sat in his new seat yet.
Either a maroon, or the devil. Hard to believe, but then I've always been naive. But then, I have no reason to believe Mr. Cochran would have leaned differently.
Third Way, anyone?
Mr. Matthews makes a good point with this:"...if I read this correctly, we don’t have to take the whole 1 percent to get the 0.25 percent. We can adopt LOIT at any rate between 0.05 percent and 1 percent, in 0.05 percent increments."
Would I be willing to endorse a .25% increase only and have it go to police, fire and EMS? Probably so. Will the council be willing to push for this increase only? Probably not.
Does this mean you were against a tax increase before you were for it? Didn't you just say the other day that you didn't want taxes to go up at all and that we need to tighten our belts? "Times are tough" you said. Now you're saying you're okay with a small tax increase...you're a complicated man, Daniel.
Sorry Daniel but that is not an option.
Your man Mitch conveniently managed to set it up so the county can only adopt the 0.25% if it accepts one of the other two 1% options as well.
Thanks for trying though.
Bayer, I was willing to bend slightly for the police and fire. Now I understand that it is not an option. Me complicated? No way. Indiana, Floyd County, New Albany and all the tax codes...now those are complicated.
Folks, there are other options. A LOIT of .25% under either of the two options would make another .25% IT possible for public safety. There's no requirement that a full 1% be imposed before doing the .25% safety tax.
I personally prefer the 1% LOIT that isn't a property tax giveback, plus the public safety tax. Carol Shope, who voted for it and now plans to reverse field. Dana Fendley, who voted against it, tells me that the vote implemented the tax at 1.25%. No further vote is needed. I do not know if it will be repealed, but according to Fendley there is no such thing as a second reading on this matter. It has been done.
Shope insists that there will be no tax. If things go to hell, too bad.
She also reports that they will "take it up again in April." Whatever that means. If the repeal of the tax goes through, the next opportunity to raise new revenue is January 2010, unless the law is changed. I see no reason at all why April has anything to do with it.
Does Ms Shope know enough to come in out of the rain? Or does she look at it rain, the go out to stand in the rain, and then open an umbrella?
Abstain, vote yes, and then want to vote no. Sounds like some on the City Council.
OK..my bad! I guess misunderstood the 1% figure.
So am I correct in saying that in order to get the $0.25 safety tax the county must choose either one or both of the other two options at some rate not to exceed 1% per each?
(See..!!! This is what happens when my BAC level gets too low! If I've got it wrong this time, I'm gonna revert to a cartoonist to draw me a picture so's I can understand it!)
Highwayman,
Just go ask Erika.
Third Way, anyone?
In terms of candidates, yes. It'll be interesting to see how Ed performs, how people react to it, and who the Dems try to peg as the heir to Cochran's many years. Beyond that, independents are welcome.
As far as taxes are concerned, I'd advocate for a fourth, fifth, and sixth way at least. There's been no real discussion about how taxes levied and distributed.
Why don't people whose lifestyle choices cause us to incur more expensive pay more?
As referenced above, if sprawl contributes to tax problems, why do we distribute EDIT funds to the unincorporated counties to encourage growth in those areas?
Why does the state set school guidelines that call for large acreage when building schools and then complain about school system spending when following those guidelines is what causes building, maintenance, and transportation costs to rise?
Why are the majority of state approved tax incentives aimed at greenfield construction and industries in which we struggle to be competitive?
If it's a time for creative local solutions, why is the state actively handcuffing local governments more and more?
Why are a majority of our transportation dollars aimed at the most inefficient means of travel?
Those are just a few of the real questions involved in reform that aren't actively being asked. Without them and others like them, this property tax cap stuff is just knee-jerk avoidance.
As I understand it, you don't need to raise the full 1% (Option A or B) before imposing the special safety tax. I do think that if you want the maximum .25% for public safety, the underlying LOIT must be at least .25%.
And there are sufficient votes right now to impose a (total) .5% local option income tax. But for some reason, they intend to repeal the tax now and defer the revenue measure for at least another year.
If there are 4 votes for a .5% tax, why not just go ahead and pass that. Carol Shope has positioned herself as the swing vote and she told us last night that she would not vote for a tax for 2009 while out of the same mouth she said we need to make the tax .5%.
Many urban areas have gun buy-back programs. In lieu of providing an effective police contingent, maybe New Albany could offer a gun giveaway and let us enforce the law and protect ourselves. Derringers for the kiddies, .22s for the petite ones, and other weapons will be distributed according to body mass.
Can somebody persuade me that all of this isn't being filmed for a popular reality show in Europe?
And thank goodness for the YMCA. We all need to get down there and start building our upper body strength for the impending bucket brigades. Think that will convince the fire insurance rating agencies not to raise our fire rates 800%?
For what it's worth, here is the explanation of the law from the state (previously posted on LOIT Part 1 thread).
I'm no expert here, but it appears that, at minimum, we need to adopt either option 1 or 2 for a combined rate of .25% in order to raise the additional .25% safety tax.
In 2007, House Enrolled Act 1478 (Public Law 224) provided three more local income tax options.
The first would pay for the annual increase in civil government operating levies (that is, property taxes for government other than school corporations, for spending other than big capital projects). That part of the tax levy would be frozen. The maximum rate for this tax is 1%. The income tax rate is calculated so as to raise enough to pay for a particular year's levy increase, so the rate would be much lower than 1% in most counties at first. The tax must be adopted for two years initially, and the first year's rate is doubled, to establish a stabilization fund. This fund protects local units from revenue shortfalls which might occur because income tax revenue is less stable than property tax revenue. After the first two years, counties can decide each year whether to pay for the levy increase with the property tax or an added income tax rate. Once adopted, these income tax rates cannot be reduced or rescinded.
The second new option provides property tax relief by reducing existing property taxes. The maximum rate is 1%. This tax can be adopted at any rate between 0.05% and 1%, in 0.05% increments.
The third new option provides added revenue for public safety, including police, fire and emergency medical services, facilities or pensions. The maximum rate is 0.25% (0.5% in Marion County). To adopt this option a county must adopt one or both of property tax relief options, with a combined rate of at least 0.25%. The law passed in 2007 required that both property tax options be adopted, but the property tax reform of 2008 reduced this to one.
Let me give you guys some more to talk about on the LOIT issue. It is a property tax replacement, to be used to offset the loss of revenue from the tax caps. Since the tax caps will be phased in during the next two years, the bulk of our loss in revenue will be in 2010 and beyond. The state is forcing the county to use LOIT or face losses that we can't make up with cuts alone. The problem I have with it is it is being implemented too soon. We don't know the extent of our loss and won't know the impact until next year at the earliest. The state offered us the safety tax as a carrot to get the police to pressure us to vote for the tax. The safety tax doesn't have to be used for new services and most likely will be used for existing services in the safety budget. I talked to the FOP about this and they chose not to hear me, because it's not what they want. I would be happy to answer any more questions and I am still a no vote.
Jeff, you love to ramble about sprawl and green space. In case you missed it, this is a county tax, so all the rednecks in the sticks that you attack with your pseudo-intellectualism will pay up to. Not everyone can, will or even wants to live in your disfunctional city.
Daniel, I will give you credit for spelling intellectual correctly. But your post is so snotty I missed the point entirely. So let's pretend we're all in this together. I'd like to follow-up Ms. Fendley's incisive and to the point post with more information from the intelligent "no" side of the equation.
Gina, I did spell "too" wrong. My bad. I get so tired of Jeff blaming sprawl or those living out in the county for the problems we all must face. Snotty perhaps, but to the point.
This LOIT tax discussion is getting boring can we talk about strippers tomorrow.
matt
And, in the interim, they advance your position for you. Lovely.
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