BY PATRICK GUINANE, Times of Northwest Indiana
pguinane@nwitimes.com
INDIANAPOLIS | The property tax overhaul state lawmakers announced from on high this spring has begun to roll downhill, and region officials are less than thrilled with the new responsibilities headed their way.
The fine print of the 672-page bill, signed into law in March, forces county councils to review the budgets of nearly every taxing unit with their respective boundaries. For the Lake County Council, which already must identify $15 million in spending cuts to get its own financial house in order, the mandate means finding time to parse the fiscal plans of 19 cities and towns, 11 townships, seven library districts and dozens of other taxing units.
"We don't have enough time to be reviewing this, not at all," said Lake County Council President Christine Cid. "I can't say I'm happy about it."
Other region leaders, including Highland Clerk-Treasurer Michael Griffin and Lake County Councilman Larry Blanchard, say they're glad the state finally put someone in charge of adding up overall local spending. But in most cases, legislators only empowered the county councils to make nonbinding recommendations.
"We've taken the position that we're probably not going to recommend anything," said Porter County Council President Bob Poparad. "What's the point?"
Gov. Mitch Daniels originally sought to create new county review boards that would have full authority to prune local budgets, but lawmakers didn't go along with that plan.
As it now stands, county councils, and in some cases city and town councils, only can force budget cuts on taxing units controlled by appointed boards, such as library districts. And those binding reviews only kick in if a nonelected board wants to boost annual spending by more than 4 percent.
If the Porter County library system, for instance, wanted to grow its budget by 5 percent, the Porter County Council would have the power to force cuts. If the East Chicago library system sought to do the same, the city council would wield the budget sheers.
The review process comes into play at the same time as state property tax caps that will force local government to cut spending by an estimated $96 million next year in Lake County and $1.4 million in Porter County. The caps, also called circuit breakers, limit how much all units of local government can extract from taxpayers.
In most cases, the limit next year for homeowners will be 1.5 percent of assessed value, or $1,500 on a $100,000 home. Legislators created a special debt exemption for Lake County, putting the ceiling on homeowners' bills there closer to 2 percent.
The various units of local government shoulder the revenue loss triggered by the caps proportionally, which Blanchard said begs the need for the new central budget review.
"I'm really happy that law is there, that we're doing (the reviews) because we're all connected now with the circuit breakers," Blanchard said. "This makes a lot of sense to me."