By Dan Carden, Times of Northwest Indiana
dan.carden@nwi.com
INDIANAPOLIS | The city of Gary has asked state officials to exempt the Steel City from state-mandated property tax caps for a second year.
Gary's petition to the state's Distressed Unit Appeals Board was received Tuesday, The Times has confirmed. A hearing on the petition must be held within 30 calendar days.
Mayor Rudy Clay said Gary's continuing financial problems require further state assistance.
"We're still a distressed city," Clay said.
Gary has had to repeatedly cut its budget to fix the gap in city revenue caused by property tax caps. If the 2010 property tax caps were fully implemented, Gary's revenue would plummet to $30 million from $60 million.
Indiana's property tax caps limit homeowners' property tax bills to 1 percent of their homes' assessed value, with 2 percent caps on rental property and 3 percent on business property.
Earlier this year, the Distressed Unit Appeals Board required Gary to cut $11.25 million from its budget in exchange for $23.5 million in additional property tax revenue.
As a result, Gary property owners are paying the highest tax rates in the state: 2 percent of assessed value on residential, 3.27 percent on rental property and 4.55 percent on businesses.
Gary also was required to hire a fiscal monitor to recommend further ways to cut the city's budget.
Clay said he hopes the monitor's report, which is expected next week, will show state officials Gary's need for continuing property tax relief.
Gary was the only local government to request state assistance this year.