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One of the biggest laments that I will hear from lawmakers outside of Indianapolis is how they don’t like dealing with what they label “Marion County” legislation.  This session there were three major bills that fit that category, mass transit, financial assistance to the Indianapolis Motor Speedway and Senate Bill 621 – known by supporters as Marion County government reorganization and opponents as a power grab.  The legislation did a number of things, but the two big ones are that it gives the Indianapolis mayor more budgetary authority by reducing spending for county offices that overspend their allotments and it eliminates the four at-large City-County Council offices once the terms expire of the current office holders.

Many of my friends who are lawmakers from outside Marion County wondered why they and their constituents should care about the inner workings of the state’s largest city.  My response is they should care and they shouldn’t care.  That may seem like a confusing and contradictory response, but if you follow my logic, it will make perfect sense.

Think of the state of Indiana as an airplane with four engines.  Indianapolis is one engine. Central Indiana is one engine and northern and southern Indiana make up the other two engines.  If one of those engines goes out, it becomes much more difficult to fly the airplane and the other engines have to work that much harder to keep the plane in the air and avoid it from crashing.  So I tell my “outstate” lawmaker friends that it is in their own region’s best interest that Indianapolis state healthy and vibrant, because if Indy goes south the rest of the state will soon follow and without Indianapolis, Indiana is Wyoming without the scenery and natural resources. And that is the point where they should stop caring.

One of the biggest lines of attack opponents of SB 621 have used is that if lawmakers gave the mayor more budget control and eliminated the at-large City-County Councilors that their counties would be next.  I always thought that was a poor man’s version of the old domino theory in global politics that if one country fell to communism that eventually their neighbors would fall  if something wasn’t done.  The problem with that logic, and I use the term loosely, is that as the state’s largest city, Indianapolis and Marion County have needs and issues that other counties don’t.  For example, I don’t know of any other counties that have a sheriff that overspent his budget by more than $20 million over the past three years, even though he had his original budget requests fully met.  And 25% of the overspend was on salaries and supplies.  I also don’t know of any other counties that have the third largest government bodies in the United States.  Indianapolis is the 12th largest city in America, but only New York City and Chicago have larger city councils.  Indianapolis has more council members than Los Angeles and L.A. has four times as many people.  Just something to ponder.

I can sympathize that my “outstate” friends can get a little frustrated and feel like they are caught in the middle of Indianapolis politics.  However, they have as much of vested interest in a healthy and financially sound capital city.  And by voting in favor of SB 621 in both the House and Senate, they have done their part to help keep Indianapolis on the right path and now they can stop caring.

As I sat down and did my research on the late Governor Otis “Doc” Bowen, two things really fascinated me about his time in public service.  One was his frankness about sex when he was the Secretary of Health and Human Services in the mid-1980s.  The other, which I would argue had just as much impact, if not more so in the Hoosier state, was putting Indiana on the road to property tax reform.

In fact, I would submit to you that had it not been for Bowen, Indiana would probably not have gone down a path which would eventually lead to providing hundreds of thousands of Hoosiers with property tax relief.

When Bowen became Governor in 1972, Hoosiers had experienced a doubling of their property taxes in the previous decade.  Bowen used a mix of policy and good old fashioned politics to provide Hoosiers with meaningful relief.  According to an article by Dagney Faulk in the Indiana Business Review, Orr’s plan did four things…

1. Doubled the sales tax from 2 percent to 4 percent (exempting groceries)  and allocated the extra revenue to property tax reduction through the Property Tax Replacement Credit (PTRC);
2. Permitted counties to levy local option income taxes (CAGIT) with most of the revenue used to reduce property taxes;
3. Set limits on property tax rates and levies for counties adopting CAGIT;
4. Established tax control boards.

Faulk also notes that school funding was treated separately and increased through a state school aid formula.

The measure was controversial, to say the least.  Bowen used every political trick in the book to get it passed and even then it came down to a tie in the State Senate and it was Lt. Governor Bob Orr who had to cast the tie breaking vote.   The end result, a 20 percent drop in Hoosiers property tax bills and a more equitable system of taxation.

Unfortunately, as Bowen noted in a 2008 editorial in the Indianapolis Star that by the time he left office in 1981, lawmakers had carved out 18 exceptions to the spending controls lawmakers had put in place.

The rest they say is history, in 1979 lawmakers limited tax levy growth to the same as the average growth in assessed value over the past three years.  In 1993, the famous Town of St. John v. State Board of Tax Commissioners case was filed and by the year 2000 the Indiana Supreme Court has ruled it was time for a new property tax system based on more on market value of property rather than the replacement costs of property.  In 2007 property finally began to be reassessed and the end result was a tax revolution that threw out an incumbent Mayor of the largest city in the state and scared lawmakers into passing property tax caps and giving Hoosiers permanent property tax relief that would be enshrined in the state Constitution.

It is unlikely much of this would have happened in the manner it did had it not been Otis “Doc” Bowen.  Or as I like to refer to him, the grandfather of property tax caps.

It is customary at the end of the legislative session to do a postmortem  and talk about how lawmakers did, or in some cases, didn’t do.  So as I join the list of political prognosticators, allow me to offer my opinion.  In this case, everyone won big, ironically by losing a little.  Let’s walk down the list…

Governor Mike Pence

• Although he did not get his full 10% income tax cut that he asked for, he got half of it, 5%.  But even better for the Governor, he got a total  $1 billion tax cut.  In an era where states are either raising taxes or sinking under a backlog of debt and unpaid bills, Pence can claim a billion dollar tax cut, while at the same there is increased funding for roads and schools, workforce development, state debt is being paid off and Indiana is still keeping its surplus.

Statehouse Republicans

• For the same reasons as Governor Mike Pence, by giving up a little on the income tax cut Statehouse Republicans can claim a major fiscal victory.   But I would argue the even bigger victory this session was the fact that while they could have literally ramrodded anything they wanted to, they did not.  And by showing some self-restraint they demonstrated to Hoosiers than they can govern with a super-majority without some of the political insanity that goes along with it.

Statehouse Democrats

• Albeit, they are the party of the super-minority, Democrats can still claim a victory or two, while they lost the fight for their big issue, they can claim victory when it comes to the career and work councils.  Those are the panels that will look at help putting Hoosiers to work by closing the skills gap and getting people back to work.

Education Reform Advocates

•  No, they didn’t get the expanded vouchers they wanted, but more was added to the pie and more children are eligible to take advantage of them.  The jury is still out though on the Common Core.  Although lawmakers voted to put its implementation on “pause” there is still a question about whether that applies to what has already been done or just on any future implementation.

Mass Transit Advocates

•  They may have lost by not getting mass transit through the legislature, however they got it further this time than in any other in previous history.  Last time mass transit didn’t even make it out of committee.  This time it passed the House before being sent to study committee in the Senate.  However, there is plenty of time for it to make it on the referendum in 2014.  And who know, an even better plan may come out of committee this year.  And they didn’t lose any state funding this year.

Indianapolis Mayor Greg Ballard

• The Mayor of the state’s largest city got a big win with SB 621 which reorganizes Marion County Government by reducing the size of the City-County Council and giving him more authority to deal with overspending in the budget.  The Mayor did not get as much authority as he asked for, but at least he can put the brakes on a vehicle that was running the city towards a fiscal cliff because certain county officials couldn’t keep their hands out of the taxpayers’ pockets.

Political Pundits

• The only thing we lost was sleep.  But we won a lot of great issues and stories to write to about and pontificate.  Now we get to spend our summer following up on all these issues and writing about how they impact you.  And then comes the Fall where we start getting candidates who are announcing for 2014.  Joy!  Rapture!  Divinity!

When it comes to SB 621, Marion County Sheriff John Layton may have saved his own skin by cutting a deal with Republicans at the expense of his fellow Marion County Democrats.

You can get that, and more in the latest daily installment of my political gossip column, the Cheat Sheet.  Here’s what else you’ll find…

• The latest on the budget deal
• Delph v. Zoeller?
• Casino Royale
•  Your Arms Are Still Too Short to Box with God

If you’re a Cheat Sheet subscriber, check your e-mail.  If not, click here.

And as always, the Cheat Sheet is brought to you in part by our totally awesome sponsors:  the Indy Cigar Bar, the small business law firm of Thrasher, Buschmann and Voelkel, and Downtown Comics, your place to escape.

More gossip in 24 hours.

Although a lot of the focus in Senate Bill 621, the Marion County Government/Power Grab reform bill, has been on whether to eliminate the at-large City-County Council seats, the legislation includes much more substantive, far-reaching provisions that are, in my opinion, far more important than whether four politicians keep their part-time jobs.

Part of SB 621 would give the Mayor more authority over the budget. Currently, the Mayor and other county officials submit a budget, the council votes, the Mayor signs or vetoes and that’s pretty much it. By giving the Mayor more budgetary control we “marry accountability with responsibility”. None of the County offices (Auditor, Clerk, Coroner, Prosecutor, Surveyor, Assessor or Sheriff) play a role in voting or signing a budget. The Mayor and the Council are publicly accountable for the finances of the city. As a result, the County offices are disengaged but more specifically they are not held publicly accountable for their spending and the adjustment of taxes that go to fund their spending.

When was the last time you saw people marching in the streets demanding the Sheriff quit spending so much when the Council and the Mayor raise a tax to fund him? No, of course you don’t. They go after the Council and the Mayor. Do you see people getting upset when the Sheriff says he needs more funding to adequately provide public safety and the Council and the Mayor keep cutting his budget? Yes, you do. Why? Because people already believe the Mayor has this authority and, in fact, he doesn’t. The result is that the Sheriff (and related offices) know they are unaccountable.

Practically speaking, you can’t balance a $1.2 billion budget with a $50 million operating shortfall if you can only control (reduce) spending of $700 million of that budget. This is either a unified system of government or it is not but we can’t continue to be financially “half pregnant,” our issue are too great.

And if you are still not convinced that the Mayor needs more budgetary control, take a look at how the Sheriff’s budget has grown since 2008, even though control of the police department was put back under the Mayor’s office.

? 2008 – $87.4 million allocated / $92.6 million spent
? 2009 – $85.7 million allocated / $85.3 million spent
? 2010 – $93.8 million allocated / $97.2 million spent
? 2011 – $103.5 million allocated / $109.8 million spent
? 2012 – $101.7 million allocated / $113.2 million spent
In the past three years the Sheriff has overspent his budget by more than $20 million. Now the Sheriff would say that it is the cost of inmate health care that is driving this overspending. There’s no doubt that inmate costs are rising, but how does that explain overspending by nearly $3 million on staff in 2011 and 2012 and more than $1.1 million on supplies in 2012? Is this what Marion County Democrats are defending? If SB 621 is a power grab, then so be it. Someone has to act like a fiscal grown up around here.

Be sure to tune in on-line Monday, April 22 at 9 p.m. (EDT) on the Indiana Talks Radio Network as Indy Democrat blogger Jon Easter and I debate the merits of SB 621. the Marion County Government reorganization bill.

Easter calls it a power grab by Mayor Greg Ballard.  I call it common sense.  Who’s right?   I am of course, but it will make for a fun debate nonetheless.

We both hope you will tune in.