Chesterton Tribune

Two Chesterton Tribune Editorials

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Two Chesterton Tribune Editorials:

 

Vote policy not politics (below on this page)

 

A vote for COIT is a vote for Chesterton

Last year the Chesterton Town Council made what could only have been a wrenching decision when, beset by fiscal uncertainty, it elected not to grant raises to town employees in 2003.

Wrenching, because its five members never miss the chance to praise the dedication and professionalism of Chesterton’s police officers and firefighters, of the crews who plow our streets and treat our sewage and maintain our parks, of the men and women who make this town safe and clean.

Now, however, the Chesterton Town Council has a rare opportunity, in the form of a County Option Income Tax, to prove its faith in the town’s employees.

For the sake of argument, let’s grant the following: The Porter County Council has badly botched the issue, should have acted last year, delayed committing itself this year until the last possible moment. For weeks the County Council had the chance to take its best case to the Chesterton Town Council and make it at a public meeting. Instead the County Council fiddled.

But the question has long since ceased to be What should they have done? The only question worth asking now—right now—is What should we do?

The Chesterton Tribune urges the Chesterton Town Council to vote to endorse COIT. The best available figures show COIT to be the clear choice for a town desperately in need of revenue and just as desperately in need of the loyalty of its employees.

Chesterton’s Share

First, contrast the estimated revenues which COIT and a County Adjusted Gross Income Tax—the County Council’s likely default strategy—would respectively raise for the Town of Chesterton.

•Chesterton’s share of a 0.2 percent COIT—less a 1 percent homestead credit—would total some $182,000. Put that figure in context: a customary $1,000 across-the-board raise for town employees this year, plus a $75 per year longevity bonus, would have cost Chesterton $85,725. COIT would raise sufficient revenues to cover that raise and nearly $100,000 more.

•Chesterton’s share of a 1.0 percent CAGIT, on the other hand, would total only a projected $106,500, or fully $75,500 less than under a 0.2 percent COIT.

(Under either COIT or CAGIT, an Economic Development Income Tax would be enacted. Chesterton’s share of a 0.2 percent EDIT would total $278,800 if that share is distributed in accordance with the town’s proportion of the total property-tax levy, or $437,000 if that share is distributed by population. Those revenues can be used for any number of capital projects—sidewalk repairs or street paving—or else for debt repayments.)

The Taxpayer’s Share

Now consider a married couple with two children, an adjusted gross income of $50,000, and an annual property-tax bill of $600:

•Under a 0.4 percent COIT-EDIT with 1 percent homestead credit, that couple would pay $161.60. Under a 1.25 percent CAGIT-EDIT with a projected 13 percent average property-tax cut, that couple would pay $445.75, or fully $284.15 more.

•Under a maximum 1.0 percent COIT-EDIT—which would not take effect until 2009—that same couple would pay $371, still $74.75 less than under a 1.25 percent CAGIT-EDIT.

Or consider a married couple with two children, an adjusted gross income of $70,000, and an annual property-tax bill of $1,500:

•Under a 0.4 percent COIT-EDIT, that couple would pay $231. Under a 1.25 percent CAGIT-EDIT, that couple would pay $573.75, or fully $342.75 more.

•Under a maximum 1.0 percent COIT-EDIT, that couple would pay $495, still $78.75 less than under a 1.25 percent CAGIT-EDIT.

The Clear Choice

Brass tacks: (1) The town’s share of revenues would be far greater under COIT-EDIT than it would under CAGIT-EDIT. (2) Chesterton residents would pay far less under COIT-EDIT than they would under CAGIT-EDIT. (3) CAGIT is a bad tax; COIT is a resourceful one.

The anti-COIT activists are ardent, but in this case they’ve lost sight of certain flesh-and-blood realities in pursuit of an abstract principle.

Our quality of life in Chesterton depends not on anything so faceless as “government.” It depends on people, who are working without raises this year to serve us and protect us.

Members of the Chesterton Town Council who vote for COIT on Monday may lose friends—they may lose allies—they may even lose an election—but then the best and the brightest in public office have always been prepared, have always been eager, to make the hard decision when those around them would quaver.

Four of five members of the Chesterton Town Council, simply by voting to hold a public hearing on COIT, have already demonstrated a degree of courage conspicuously lacking in their counterparts in Valparaiso, Portage, and Porter.

The Tribune trusts that all five will demonstrate their courage on Monday: the courage to be unpopular, to change their minds if necessary, to assert some measure of control over this town’s destiny.

 

A Chesterton Tribune Editorial:

Vote policy not politics

It is a shame that the Chesterton, Kouts and Hebron town councils are the only ones with the courage to take a vote on the Porter County Council’s County Option Income Tax-Economic Development Income Tax proposal.

The three towns may very well feel backed into a corner, now that the County Council has tentatively endorsed a back-up tax plan for a County Adjusted Gross Income Tax. But the county really didn’t put Chesterton in this unenviable spot. The other towns and cities did, by recklessly passing the buck.

In January, the Porter County Commissioners publicly urged the council to take a vote on COIT, allow the towns and cities to do the same and then to be prepared to vote in a CAGIT if the COIT failed. In mid-February, at a time that it appeared that COIT was dead, this newspaper reported that the council appeared to have the votes for CAGIT. There has been no secret that CAGIT-EDIT could very well be the council’s back-up plan.

This newspaper also reported that Council President William Carmichael intended to bring up CAGIT at Tuesday’s meeting. Because of the unfortunate time crunch that now exists, the income tax may not get decided until just minutes before the midnight deadline on Monday.

Reassessment Fears Unfounded

Concerns have been raised about how reassessment will impact property owners.

Favoring CAGIT based on fears of reassessment rings hollow. The truth is that no one knows for sure yet the impact of reassessment. State projections in 2001 showed that the average residential tax bill in Porter County will go up 9 percent. Porter County’s farms and businesses, meanwhile, were expected to see a drop in the range of 7 percent. But Porter County fared much better than the state average. In neighboring Lake County, for instance, taxes on homes were expected to soar 23 percent.

It was those projections that pushed the Indiana General Assembly to pass a tax restructuring package last year. The state will increase the homestead credit from 10 percent to 20 percent and will assume 60 percent of the school general fund tax rate. That’s a substantial chunk of one’s property tax bill. Newer projections show that the tax restructuring will lead to an overall cut—yes, a cut—in the range of around 12 percent for all property, including homes, after reassessment.

County in Crisis Before Bethlehem’s Demise

Fears have been voiced that COIT will lead to a windfall for county government, a free for all in spending. This is ludicrous. By next year, the county government will have lost a cumulative total of around $6 million in tax revenues from the Bethlehem Steel bankruptcy. And the county government still has a loan of about $5.5 million to pay back due to Bethlehem, not to mention the loans that have been taken out, and will be needed, just to keep county government’s doors open this year. The county will also have to cough up around $1.4 million for new, federally mandated voting equipment. And like all other taxing units, it will be set back considerably by this year’s reduced tax draws.

The county government’s funding problems didn’t happen overnight with Bethlehem’s bankruptcy. Concerns that departments have been underfunded and understaffed go back for years.

Back in the 2000 budget hearings—more than a year before Bethlehem declared bankruptcy—the council, mindful of an ever-tightening budget crunch, gave departments an across-the-board increase of just 3 percent, lower than the 5 percent state levy restrictions would have allowed. A month or so later, the council put a halt to additional appropriations and curtailed spending in other ways, such as restricting use of county vehicles.

In the 2001 budget hearings—a few months before Bethlehem’s bankruptcy—the council already knew the county couldn't afford employee raises and it put departments on notice that they couldn’t fill vacancies. It was described then as the worst fiscal crisis in years. Little did they know what was to come.

Struggling Back to Good Government

With a COIT in place county departments that have survived years with slashed budgets will begin to struggle back to meet state staffing guidelines. County employees may be able to get their first raise in three years. There will also be a possibility of funding some long-awaited projects such as the highly acclaimed Family Court, or the award-winning land use plan which cost $130,000 but isn’t being enforced.

Residents, businesses and farms suffer if local government is weak. Builders and developers are the first to complain about delays in securing approvals from the plan commission, building department and health department. CAGIT will do next to nothing to restore these services and will cost wage earners more for little in return. The county government, projected to get no more than $800,000 from CAGIT annually, will still be forced to make deep cuts in spending. People will pay a new tax that will cost them two to three times as much as a COIT would initially, but their government services will still diminish.

COIT will cost wage earners less, even if it is allowed to reach the maximum 1 percent in nine years. It will provide the revenue county and municipal governments sorely need.

Say yes to COIT.

 

Posted 3/28/2003