Property tax plan calls for more help

Kuzman said his tax relief plan, House Bill 1007, "would be huge for Lake County," but acknowledged it still would require belt-tightening by county and local officials.

"I think they're going to have to look to ways to consolidate and save money, but we've given them tools (in this plan) to utilize to fill those gaps," Kuzman said. "I think the 2 percent cap is something that should stand, at this point."

How it would work

The plan would give counties the power to impose an individual income tax of up to 1 percent. Six out of every 10 dollars raised by this income tax would have to be earmarked for property tax relief. County councils would decide how to split the benefit between homeowners and other taxpayers.

The remaining 40 percent of the new money would be earmarked for police, fire and other public safety services.

Counties imposing the individual income tax in Kuzman's plan would have to charge the same rate on corporate income. It would bring an estimated $75 million statewide to be used for tax relief to homeowners.

Welfare costs

The proposal also would freeze local property tax levies for child welfare services at 2005 levels, with the state picking up the future growth in those programs. Counties also would get a one-time refund for 2006 and 2007 welfare costs that exceeded 2005 levies, which Kuzman said would mean about $5 million for Lake County.

Local governments in turn would lose the power to "bank" unused portions of their annual levy and apply the taxing power in later years. A control board would be created to oversee nonschool construction projects that would require bond debt.

Kuzman's property tax-relief plan

-- Counties could impose individual and corporate income taxes of up to 1 percent. They must charge same rate for each one.

*Individuals: 60 percent of proceeds must go to tax relief (county decides split between homeowner/other taxpayers) 40 percent for public safety -- police, fire, etc. That would generate $732 million if every county charged 1 percent.

*Corporate: Would go to homeowner tax relief, generate $75 million statewide.

-- State assumes growth in child welfare programs at a cost of $121 million next year, $141 million in 2009 and $162 million in 2010

-- Counties would share one-time welfare refund of $149.5 million -- estimated $5 million for Lake

-- New Local Government Capital Project Control Board would review requests for bond-funded construction projects

-- Local governments can no longer "bank" unused portion other levy for use in future years

Source: Indiana House Democrats