Next Tuesday Hoosiers will go to the ballot and vote on a number of state, federal and local races. They will also vote on putting property tax caps into the State Constitution. The formula is pretty simple; the amendment would cap residential, rental and commercial property taxes to one, two and three-percent of the property’s assessed value, respectively.
Now local governments have complained the caps are going to put major restraints on their ability to raise revenue. The caps will also result in police layoffs and fire stations being closed. Schools have said the tax caps will cause teacher firings. Libraries will close. Cats and dogs will start dancing with each other, etc. etc. Please spare me the apocalyptic rhetoric.
For one thing, my friends in local government need to be reminded that it is not their money; it is the taxpayers’ money. Secondly, I would have a lot more sympathy for local governments if many of them had done their parts. You have to remember, when the property tax crisis exploded back in 2007 and lawmakers were scared into addressing the issue in 2008, the Governor offered up two plans; one for tax caps and Kernan-Shepard local government reform. Since no one wanted to put their friends out of a job; lawmakers chose tax caps. Little did they know. By choosing caps over consolidation, the government has literally slit its own throat and I am contempt to let it bleed to death.
Don’t come to me crying about tax caps, when school districts can’t even come together to do joint purchases on little things like paper, which would save the taxpayers’ money. Don’t come to me crying about caps, when Indiana has more local government, per capita, than the state of California. And please don’t come crying to me about property tax caps when you decide you want to build a new building as opposed to lease existing space.
Like I said, it would be one thing had the locals pursued policies of consolidation and collaboration and truly demonstrated they were operating with taxpayers’ best interests at heart. But when your first instinct is to fire teachers or layoff police and fire, pardon me if I remain just a little cynical. Now I do think that in a world of caps, locals will need more tools to pay for basic services. I have no problem with removing some of the barriers that would allow locals to transfer funds to pay for programs. And I also think local city-county councils should have more authority to raise or lower income/sales taxes in their jurisdictions.
But at the end of the day, property tax caps about protecting the taxpayer, plain and simple. I don’t favor their elimination, because I do believe the land should help pay for benefits it receives. However, the person who has lived in his or her home for decades should not have to fear losing that home, because the local governments have decided to let their spending get out of control.