If you read yesterday’s post, I provided you with some details about why the Indiana State Teacher’s Union is not a big fan of the property tax reform plan that came out of the Legislature.    Well, today I have another one for you.

ISTA was critical of the State picking up the final 15 percent of the operation costs in order to provide homeowners with property tax relief.  In an e-mail to its members the organization said the state picking up the tab would leave no local source of funding for those costs.

What this is really about is contract negotiations.   Think about this.  A few years from now a school district and its local teachers’ union will sit down to negotiate a contract.  Things will go south and probably hit a major impasse.  The union will demand more money and the district will say they don’t have it, the State does so go negotiate with them.  That local will have to go to the state and right after one does it another will follow and then another and then another.

Eventually this could lead to statewide negotiations between the State and ISTA.   And I would argue it would be much more difficult for a teacher’s union to hold the entire state hostage over contract negotiations than a local school district.

Now you know the rest of the story.

I can’t believe there are people in this world who can’t grasp the concept of reform.  I have heard people complain that local governments will lose money.   I think what they mean to say is governments will get to keep less of YOUR money. 

One group that doesn’t get it is the Indiana State Teacher’s Association.  Check out this excerpt from an e-mail they sent out to their members.

“Property tax relief legislation passed both Houses Friday and is expected to cause negative repercussions to schools and other local units of government. The legislation shifts the last 15% of local property support for the School General Fund to the state, leaving instruction  without the safety net of local funding when state funds decline.   State revenues are now $250 million LOWER than projected for 2009 and revenue growth forecasts are being revised downward.”

Let me translate this into English, “We won’t have as much of the taxpayers’ money to play with anymore.”  Here’s another excerpt.

“Among the promises to public education which are now not likely to be kept are: State-wide implementation of full-day kindergarten; funding for PL 221 mandated standards; funding for the P-16 Education Plan; restoration of remediation funding.  Most importantly, school funding formula increases in 2009 and 2010 are in doubt.”

Let me translate this section into English for you, “We won’t have as much of the taxpayer’s money to play with anymore.”

I have yet to hear from one person who complained that the government was losing money who did not work for the government.   Local governments should use this opportunity to reinvent themselves by consolidating, privatizing and looking for efficiencies.    And if the squeeze is going to be put on them then I say fine.  They should have been doing this a long time ago. 

It’s a new day in Indiana and it’s time for everyone to get with the program or get lost.

Indianapolis Mayor Greg Ballard announced this weekend that he is picking former City-County Councilor Sherron Franklin to oversee the city’s efforts to reduce the number abandoned homes. Ballard made the announcement Saturday at the monthly meeting of the Marion County Neighborhood Associations. Franklin, a Democrat and police officer, will be assigned under IMPD’s Crime Reduction Strategist program. She will be assigned to the Mayor’s office as part of a special unit and will work with Deputy Mayor of Neighborhoods Olgen Williams.

Abandoned homes was of Franklin’s main issues while she served on the council from 2003-2007. As a City-County Councilor her goal was to increase the accountability of owners of abandoned homes. A formal announcement is expected in the near future. There at 7,000 abandoned homes in Indianapolis.

Okay, okay, enough with the Journey references already! But I couldn’t help myself. Let’s face it, it’s not everyday you get your hands around the biggest property tax reform package in darn near 50 years. So while my last post was who gets the credit, with this post we do another survey, who wins and who loses under this plan, politically speaking. Here is my list…

Winners (At Least for Now Anyway)

Governor Mitch Daniels – It was his plan. He got the Legislature to go along with most of it. His re-election effort just go a lot easier.

Sen. Luke Kenley – If Daniels was the architect, Kenley was the builder. That guy is brilliant.

House Speaker Pat Bauer – The Speaker is nothing if not one of the smartest politicos I have ever met in this state. He saw what was coming and made sure his members would be safe. By the way, sources close to the House Democrat leadership team say they knew they were going to vote for the proposal days before it passed, knowing there was no way this session could go by without real tax reform.

Senate Pro Temp David Long & House Republican Leader Brian Bosma – Not bad guys. And a little 11th hour posturing with a joint news conference didn’t hurt either. But you know what, it worked. Don’t hate the players folks, hate the game.

Indianapolis Mayor Greg Ballard – With the state assuming the burden of a number of levies (including the pre-1977 police pensions that his critics called him an idiot for asking for even though they now says it’s a good thing for all of Indiana) the city will save an estimated $65 million. That seems pretty darn close to the $70 million the Mayor promised to cut. See, timing is everything in politics.

Anyone running for re-election – Any lawmaker who is running for re-election and who voted for this reform plan is basically a shoe-in. If you know the perfect campaign counter strategy, let me know.

Losers (Or better luck next year)

Democratic Gubernatorial Candidate Jim Schellinger – Schellinger is a smart guy, but to put out a news release to say the state needs to wait until next year for tax reform is the equivalent of handing Daniels a victory on a silver platter with a square plate and garnish on the side.

Democratic Gubernatorial Candidate Jill Long Thompson – By passing tax reform, lawmakers took this issue away from the Democratic candidate and so now she’s going to have to find something else to run on. By they way, Speaker Bauer told us Friday he would have no problem pointing out errors in the criticism of the plan by either Thompson or Schellinger.

State Sen. Mike Delph – Delph tried to push an illegal immigration plan through that had more constitutional issues than the play 1776. And then the fight got personal towards the end and from what I hear almost came to blows in a Senate caucus. My suggestion, pass a law that says if the federal government finds an employer has hired illegal immigrants, then the state can step in and take the business’ license away. You’ll find you avoid a lot more grief that way.

SJR-7 Supporters – Like I tell my friends who are Chicago Cub fans, sorry guys, this wasn’t your year. Better luck next season when voters aren’t as concerned about losing their homes as opposed to who’s living next door to them.

Indiana Sheriffs – Now that lawmakers have made their pay equal to that of the County Prosecutors’ they can no longer make as much, or more, than the President of the United States.

Indiana Township Assessors -It’s been real and it’s been fun. Next time it will be real fun. Although they may be all out of a job soon, they may still get the last laugh out the door when the final reassessment numbers come back. That issue ain’t over by a longshot.

Kernan-Shepard Commission Supporters – Wait ’til next year.

Singing the Blues

Local governments – They’ve argued they’re going to lose a ton of money under this plan with the property tax caps, however they forget to mention the local option income tax which can be used to replace that revenue and the state is picking up levies that they have been clamoring for for years. So we’ll see.

Radio Talk Show Hosts, Pundits and Bloggers – Our livelihoods are centered around controversy and now the biggest issue of the last 25 years has been taken off the table in a bi-partisan fashion. Oh well, another issue will pop up soon because as the song goes, “the movie never ends, it goes on and on and on.”

Okay guys, you knew this one was coming, it’s time to pick the person or persons most responsible for the first real meaningful tax reform in Indiana in 50 years.

You can pick Governor Mitch Daniels, Sen. Luke Kenley, State Representative Bill Crawford, etc. You can also pick the tax protesters, Eric Miller, whomever.

My nominee, former Indianapolis Mayor Bart Peterson. Had he not lost his election which sent shock waves throughout this state and gave every elected official a major wake up call about how angry the voters were, this would not have happened to the extent that it did.

I’ll gladly take your nominations over the weekend. Enjoy your relief.

With strong majorities in both chambers Indiana lawmakers gave Hoosiers what they have been asking for months, property tax reform. The House voted 82-17 and the Senate 41-6 to cap assessments, cut taxes and assume levies, among other things. The two chambers by similar margins voted to put the tax caps in the Indiana Constitution. A number of lawmakers said while they liked the idea, just all of them acknowledged that it may be necessary to make adjustments in the legislation as time goes by.

However what I thought was most interesting is that a number of officials showed how flexible they were; not by voting for a bill they had problems with, but by patting themselves on the back while poking others in the eye.

I’m composing a list of winners and losers as a result of this session’s property tax reform for this weekend.  In addition to the obvious ones (i.e. the property taxpayers and even more so the protesters), but also Indianapolis Mayor Greg Ballard. 

Ballard asked lawmakers to pick up the tab for those pre-1977 police pension debt (at a cost to the city of $25 million a year) and they took it.  In addition, Ballard can also use the Local Option income tax to further reduce property taxes on residents.  I’d like to see it eliminated, but this is the next best thing.

A lot of people in this town laughed at Ballard for asking for the pension relief.  Well, who’s laughing now?

Although the bigger points of the Statehouse property tax reform have been spelled out there are quite a few details embedded in the 600-page document.  Here area few of them that may not not have made the headlines. 

PTRC & Homestead Credits – There’s an additional $620 million in homestead credits to help reduce property taxes by a statewide average of 31 percent. The property tax caps (1 percent for residential, 2 percent for rental, 3 percent for commercial) will all be phased in by 2010.

Seniors – Tax bills for seniors who make less than $30,000 (individuals) or $40,000 (couples) and have an assessed valuation of less than $160,000 can’t see their tax bills increase more than 2 percent a year.  Married couples can no longer claim more than one standard deduction.

Schools –  Schools can have a referendum to offset property tax caps.  Reserve funds are created to schools cover any shortfalls because of tax caps.

Local Option Income Taxes – Counties retain their local option income taxes which they can use to pay for property tax relief.  They can also pool their LOIT funds to pursue a single project.

County & Township Assessors – Anyone running for County or Township assessor will have to have attained a Level III Assessor-Appraiser Certification before taking office.  If they don’t, there are steps to remove them from office.

Bonds & Debt – Limits local governments ability to perpetuate bond debt.  Reduces the life of Tax Increment Finance Districts from  30 to 25 years and revenues from the TIF can only be used for improvements within or physically connected to the TIF.

And just so you know, more than a third of the 600-page bill deals with the state assuming the child welfare levy.

Lawmakers will vote on the property tax reform plan today. 

Hoosiers will have to wait until tomorrow morning at 9 a.m. to get meaningful property tax relief. Senate Democrats are not signing off on a conference committee report. State Senator Vi Simpson says they just got the full report tonight and need time to look it over.  However this morning, State Senator Tim Skinner said they had been left out of the process so I guess turn about is fair play. I’ve been here since 5:30 a.m. See you in the morning.

If you were hoping for illegal immigration reform (that would have been found unconstitutional by the courts) forget about it. Unless some mad scientist decides to resurrect this puppy it’s dead. It didn’t die on the floor, but due to a lack of conferee signatures.

All parties in the conference committee have to sign off on the compromise legislation before it can advance to the floor, but two of the members were not there. So unless something happens tonight or tomorrow, you’ll just have to wait until next year for the chance to take another crack at illegal immigration reform (that if you don’t do it right will be found unconstitutional by the courts).