SOUTHERN INDIANA — A recently-released study that examines the impact of property tax caps on the fiscal health of 18 of Indiana's cities shows that Jeffersonville's finances are in good shape.
The study, released on Tuesday by the Indiana Fiscal Policy Institute, looked at 16 cities with a population of more than 50,000, including Bloomington, Evansville, Terre Haute and Fort Wayne. With populations under 50,000, Jeffersonville and New Albany were included to represent Southeast Indiana "to provide geographic balance." Indianapolis was intentionally excluded.
The study identified six of the 18 cities, including Jeffersonville, as "gainers," based on revenue collected from property and income taxes in 2015 compared to 2008 numbers before property tax caps took effect in 2009. The property tax caps limit tax bills to one percent of assessed value on homes, two percent for rental property and agriculture, and three percent for commercial businesses.
Jeffersonville Mayor Mike Moore said the results of the study are an acknowledgement of the city's successes.
"Over the last four years we've worked hard to ensure that the city is fiscally strong," Moore said in a news release. "It's great to hear that our hard work has paid off."
At 54 percent, Jeffersonville showed the greatest increase in gross assessed property valuation between 2008 and 2015 out of the 18 cities. It also showed a more than 100 percent increase in certified property tax levies between 2006 and 2015. The study attributes the city's growth to large annexations between 2006 and 2009.
"I believe the annexation has served as a big part of the growth," Moore said Wednesday. "But you also have to understand the annexation also has increased more of a demand on public services as well. So you take the good with the bad."
Moore noted that he had not yet had the chance to fully review the 52-page study.
New Albany's gross assessed property valuation increased by less than five percent and property tax levies increased by more than 20 percent for the same time periods. Based on revenue collected from property and income taxes in 2015 compared to 2008 numbers, New Albany was identified as "modestly falling behind." New Albany Mayor Jeff Gahan could not be reached for comment by press time.
The study also looked at how cities are turning to other sources of revenue, like TIF districts and local income taxes, following the 2009 property tax caps. Jeffersonville collected 24 percent of its tax base from TIF districts, more than any other city in the study. New Albany's TIF districts made for around 15 percent of its tax base.
"I think our TIFs have definitely served a big purpose in our growth," Moore said.
Year-end balances were considered one of the most important measures of fiscal health. Jeffersonville ended 2014 with more than $10 million and New Albany ended with less than $5 million, according to the study. With more than $30 million in year-end balances, South Bend and Elkhart led the group.