Times of Northwest Indiana
The Indiana General Assembly seems to be rushing to authorize a referendum on a constitutional amendment to lock in the property tax caps. Nothing against the tax relief, but it's time to hit the brakes on the constitutional amendment.
When the House Ways and Means Committee voted this month on the proposal, every Republican and all but three Democrats voted to move the proposed constitutional amendment forward. Rep. Scott Pelath, D-Michigan City, opposed it. Good for him.
It is clear that the property tax caps are having their desired effects.
Rep. Chet Dobis, D-Merrillville, has long been a critic of the Lake County Council, but now he is publicly praising the council for cutting millions of dollars in spending while refraining from pushing for a county income tax.
The tax caps are bringing about a reinvention of government that has been long overdue.
Gov. Mitch Daniels recently told The Times that Northwest Indiana needs to eliminate or consolidate some of its many units of local government. Lake County alone has 19 municipalities.
"Combine the administration, get a lot of duplicate overhead out, and put it to the use of the citizen," Daniels said.
The cooperation between municipalities that has begun is a promising sign.
What must not be forgotten in the debate over the constitutional amendment is that the property tax caps are already set in place by the Legislature. Until the General Assembly changes its mind, they're permanent.
In 2010, state law caps property tax rates at 1 percent of a homestead's assessed value. The numbers for rental and business property are 2 percent and 3 percent, respectively.
That creates the potential to shrink the revenue that has been flowing to local government. That's good.
Putting the tax caps in the Constitution, however, could prove troublesome in the future. What if there's an unforeseen emergency?
Nor do we believe in granting municipalities the power to enact their own income taxes, as some have suggested. The point of the property tax caps is to force local governments to use common sense in spending taxpayers' money.
Granting fiscal home rule to municipalities is tantamount to the Legislature opening the door to a spending spree. A municipal income tax or other local taxes would jeopardize the fiscal restraint that the property tax caps require.
Rejecting the constitutional amendment and resisting the temptation to open the door to additional municipal taxes would give the taxpayers the best protection from spendthrifts in local government.