Tax-cap concern growing
Law limits property levies, but local officials fear resulting service cutbacks
By Peter Schnitzler pschnitzler@ibj.com
Local officials say a new state law that caps property tax bills for homeowners and businesses will send the city into a financial tailspin if legislators don’t modify it in an upcoming session.
The law was intended to shield homeowners from unmanageable tax increases as Indiana moves to a market-based assessment system. But city leaders say the new cap limits their ability to generate revenue and will cause them to forfeit millions of dollars in taxes from businesses, some of which already pay more than the cap would allow.
Bond rating agencies have noted the city’s predicament, which is increasing the cost of issuing municipal bonds. In just a few years, the law might force local officials to choose between firing cops, firefighters or teachers.
“It’s a recipe for disaster,” said City Controller Bob Clifford. “If this remains unchanged, you will see draconian cuts in every aspect of the city.” Continues ...
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