It’s almost as if Christmas came eight months early this year for taxing
units in Porter County.
The Porter County Auditor’s Office will shell out more than $1.8 million in
County Economic Development Income Tax (CEDIT) dollars next week that was
part of the $205 million in revenues undistributed by the state since 2011.
By the end of this year, the county will have more than $6 million of the
County Auditor Robert Wichlinski invited heads of the county’s 29 taxing
units to attend three open sessions at the county administration building
this week to talk taxes and the impact the state’s 1-2-3 tax caps are having
on revenue for each of the units.
Thursday’s session was particularly interesting for the county’s 11
municipalities as Wichlinski also provided calculations of the increases
they will receive this year in their CEDIT revenue. The calculations are
based on population figures provided by the Center of Workforce Development,
Wichlinski said, and funds that were to be distributed by the Indiana
Department of Revenue through April 2012 will go out either Monday or
Tuesday in this month’s installment of CEDIT payments.
The Indiana Office of Management and Budget disclosed the gaffe a week ago
Thursday, reporting it was made due to a computer programming error.
All together the county will receive an additional $3,045,644.77, which
includes all of 2011 and 2012 additional funds and interest. From that
amount, Porter County Government will take in $1,270,447.44. The
municipalities from greatest amount of funds received to lowest amount are
Portage ($687,537.65), Valparaiso ($580,353.81); Chesterton ($232,236.79);
the Town of Porter ($95,338.50); Hebron ($71,275.61); Kouts ($34,986.07);
Ogden Dunes ($23,268.29); Burn Harbors ($19,186.64); Pines ($14,510.92);
Beverly Shores ($12,706.38); and Dune Acres ($3,796.67).
CEDIT funds can be used for a number of purposes but its main function is to
maintain and build infrastructure to support economic development.
Wichlinski said for each CEDIT dollar that comes in, 50 percent goes to
governing entities, $3.5 million is paid to the Northwest Indiana Regional
Development Authority and the remaining balance is used in the form of
The additional CEDIT money will now be included in monthly payments
throughout the rest of 2012. In Duneland, the Town of Chesterton will see an
additional $12,019 per month, Porter will see $4,468.09, Beverly Shores
$563.77 per month and Dune Acres $167.43. Porter County will get a boost of
$62, 990 each month.
County Commissioner President John Evans, R-North, said he thinks the
county’s cut of the money should be placed in a CEDIT fund for E-911 rainy
The county’s current rainy day fund can only be sustained until the middle
of 2013 and if no solution is made, a shortfall of more than $2.5 million
per year will plague the E-911 budget.
State lawmakers passed a law this year that would impose a new monthly
surcharge of 90 cents on all phones but Evans said it could be some time yet
before the state gives the county any relief.
“We need to make sure that we have money shored up for 911,” said Evans.
If the bonus money ends up not being needed for the 911 system, Evans said
the money could always be used for other CEDIT projects.
County commissioners create CEDIT funds for specific purposes while the
county council is the body which appropriates the money.
Benefits in the
form of Homestead Credit
For taxpayers with homestead credit, the auditor’s office determined the
state will kick back $3,042,163 of new homestead credits from 2011
($1,228,335.50) and 2012 ($1,813,828.77). However, it will be 2013 before
taxpayers see any relief since the 2011 pay 2012 tax bills just went out
Wichlinski has reminded taxpayers they have until the end of this year to
verify their eligibility for homestead credit with his office. If they fail
to do so, taxpayers could see their exemptions left off their taxes in the
future. To prevent this, taxpayers are advised to fill out the Pink
Homestead Credit Information Form included in this month’s tax bill and
direct it back to the auditor’s office.
Tax Caps make
revenue a “challenge”
Meanwhile, Wichlinski updated local taxing unit heads on the ramifications
of the “1-2-3” tax cap amendments to the Indiana constitution.
The “1-2-3” title refers to legislation passed that limits the tax on gross
assessed value. Primary residences are capped at one percent, residential
property not attached to primary residences such as sheds and apartments are
capped at two percent, agricultural land is capped at two percent, and
commercial and industrial properties are capped at three percent.
Wichlinski and financial consultant Jim Bennett said the state has passed
new legislation this year (House Bill 1072) that revenue given will first
need to pay off a taxing unit’s debts before it can be used for anything
Wichlinski believes that eventually all taxing units in the county will be
held to the circuit breakers, the policy approved by 72 percent of Indiana
voters in the 2010 elections.
“With the 1-2-3 tax caps, revenue is becoming a challenge,” said Wichlinski.
“It’s not a perfect system. There are a lot of moving parts. But we’re all
in this together.”
If one unit in the county is being affected by the tax caps, it indirectly
affects the other units which make up the county’s total gross assessed
The best way to handle the situation, Wichlinski said, is for taxing units
to keep the lines of communication open with his office so they can make
accurate projections of the incoming taxes and what options are available to
“The sooner you know what the impact to your revenue is, the better,” he
The auditor’s office also provided a summary report on the revenues
generated by the county’s twelve Tax Incremental Finance districts.
Part of the report includes revenue collected by the TIF districts that was
not distributed to taxing units that would normally go to public use.
TIFs throughout the county in cities and towns collected a total of
$16,233,540 in net revenue for 2011-12. TIF #7 located in Duneland took in
the following net revenue amounts from its three subsections:
Chesterton-Liberty ($1,946,179), Chesterton ($658,641), and
Chesterton-Jackson ($0). TIF #8 in Burns Harbor reportedly captured
Wichlinski said new commercial and industrial properties will have an
increasing role in TIF districts and thus tax revenue for the county.