If you have been following the City of Muncie’s financials, a shorted till will be of no surprise. If not, you may find your paycheck missing a few pennies as the rush to fill the cash register gets underway. Yes, folks, the LOIT has entered the minds of our elected officials. L-O-I-T (Local Option Income Tax) if passed by the City of Muncie, digs into the pocketbooks of every working stiff in Delaware County. I believed it was just a matter of time before it was introduced and approved.
I’m not going to spend much time discussing the merits or pitfalls of LOIT today. Instead, I am offering two articles and an opinion piece for your reading pleasure.
The first article is the introduction of the tax, setting the tone. The second, a recap of the first and lastly a column by a local journalist (saved the best for last). Perhaps after reading, you’ll get a better understanding.
Here’s a side note: A few months ago I crossed paths with columnist Larry Riley and the chit-chat soon turned to the SAFER grant. I asked if he knew the status. Nope.
Next question, if the grant is not renewed, how would the shortfall be met? Larry responded (much to what he penned) – Mayor Tyler stated there would be enough money to cover the fire department.
The previous mayor, McShurley, was asked the question in 2011 and her answer much the same. If the SAFER grant did not come through, there would still be money to maintain the fire department. Then she said good-bye and left the city with over $7 million operating balance.
The real kicker is after Mayor Tyler said the property tax revenue was down and the LOIT tax is needed for fire safety and to shore up the coffers of Economic Development Tax Revenue (EDIT) he proposed an additional amount of spending nearing $50 million.
Here’s the short of it all.
1.) Mayor Tyler – the city would have enough money for the fire department. Never a word to the contrary.
2.) Mayor Tyler – the tax revenue is down and will need to pass LOIT to maintain the fire department and EDIT funding.
3.) Mayor Tyler – reveals the $48 million canal project.
Chew on it a while…
“Are you feeling lucky, citizens? Well, are you?”
Making a play on words from Clint Eastwood’s famous movie, Larry Riley’s column continued with an outline of the debt the City of Muncie has accrued over the past few years. Read the rest of this entry »
LOIT comin’ back?
Here we go again, an opportunity for Muncie City Council to open back up the LOIT debate. This time we can be taxed for public transportation throughout the county.
In 2009, if you will recall, Muncie City Council held a public hearing to pass a tax on every working person regardless if you lived in the city or county. It never got passed, and I don’t believe it was ever tabled. Somewhere in the abyss it’s still festering. This time though, Indiana wants to use it for transportation.
At least, voters will have a say instead of allowing nine people to make the decision. The majority of which salivate over any tax increase, where spending millions delights and barely blink an eye at increasing city tax levies. The majority increased the Muncie City tax levy and the budget, County was looking at passing Cumulative Capital Development (CCD tax). They also came out in support of $45 million tax increase and finally in ’09 the love for the Wheel Tax came to fruition.
LOIT was their baby, too.
Muncie City Council ignored the budget for nearly two years, and what is the first thing when realizing there is a fiscal problem? Why increase your taxes, of course. Last year the city ended with over $8 million balance and a tax increase. Proof any time is a good time for more taxes with the majority of Democrats in office.
Provides for the establishment or expansion of public transportation services in an eligible county through local public questions placed on the ballot under ordinances adopted by the fiscal body of the eligible county. Provides that Delaware County, Hamilton County, Hancock County, Johnson County, Madison County, and Marion County are eligible counties. Authorizes eligible counties to fund approved public transportation projects through various parts of the local option income tax rates that are available under current law for other purposes and by imposing on C corporations a county income tax or a county employment tax. Specifies that fares must cover 25% of the operating costs of a transportation system established or expanded under the bill. Authorizes interlocal agreements, public-private partnerships, and bonding with respect to a public transportation project. Provides that if a transportation project is approved in an eligible county, transportation services must be provided through the transportation project throughout the eligible county and must be made available under this article to all citizens of the county. Prohibits a political subdivision from using public funds to promote a position on a local public question regarding transit. Prohibits an eligible county from carrying out a light rail project. Provides that in the case of a public transportation corporation in an eligible county that has approved a local public question, labor agreements may provide for the nonbinding mediation of salaries, wages, and salary and wage related fringe benefits, including accident, sickness, health, dental, vision, life, disability, retirement benefits, and paid time off. Provides that the provisions in the bill do not create a moral obligation of the state.
Click on the Indiana General Assembly for SB176 and 2014 Session.
Last night the long-awaited financial report was presented to the County Commissioners and the County Council. For a mere $25,000 we learned the county has money, we just need to move it from one fund to another. Take for example, the Highway Department. According to the Umbaugh report, the ending balance for this department is $2.8 million. Move some of it, all of it, or none of it into the Rainy Day Fund and from there use it to pay expenses from the general fund.
I am no CPA and I wouldn’t presume to tell them how to do this job, their findings ain’t nothing different from we have been sayin’. Of course, revenue from additional taxes and cuts in the budget go hand in hand with shuffling money.
The report also states a revenue stream for public safety of $2.5 million from an income tax called Local Option Income Tax (LOIT) can help ease the financial burden.
But, my question is simple, if the county is in good shape, we have the money, and all the report’s recommendations are followed, why would any additional taxes be needed?
So, without further ado, much has already been said, here is the link to the Muncie Star newspaper (available for seven days):
Heres the $25,000.00 report:
More will be forthcoming, for now let’s just chew on this.
At the same time, Tyler acknowledged that Democrats will now control both city and county government locally and with that control comes expectations.
“This isn’t going to be easy,” he said. “. But I think people will be pleasantly surprised.”
WALKER/ROYSDON REPORT: Tyler: No ‘good old boys club’
The cats out of the bag now. The newspaper reported today the city might be millions of dollars short in property tax revenue. Ouch. Back in ’09 the city was $4 million dollars short and by the time the past administration left office, there was $7,596,218 balance and the tax levy decreased in 2012 from 2011. Read the rest of this entry »
Yes, folks, summer is just around the corner and it will be time to get the piers out at Prairie Creek, Tuhey Pool open and Canan Commons off the ground and ready for outdoor fun.
But, that’s not all. Muncie City was awarded $150,000.00 in grant money to build a mountain bike trail and eventually extend the trail from Cardinal Greenway to Prairie Creek campgrounds. This will be interesting to watch and view the progress. Let’s hope the weather holds out and we can get it completed in a timely manner and within cost. Read the rest of this entry »
The Muncie 2011 Mayoral election has come and gone. Many people have expressed concern about the direction our city may take in the next four years. The British government, in 1939, produced a series of posters designed to motivate the people and alleviate feelings of anxiety.
Muncie citizens, take heart. Your property taxes will not be raised to meet any shortfall like the 11% increase we saw in 2006. With property tax caps firmly placed in the Indiana constitution your homestead will not rise above 1% of assessed evaluation – with a maximum of 3% on other properties. This is a bit of insurance for property owners.
Included in the HB1478 signed in 2007 is the ability to tax the working residents a certain percentage. This is known as Local Option Income Tax (LOIT). This tax if imposed, will encompass all of Delaware County. It was first introduced in 2009, by Muncie Council President Alison Quirk, which won another four-year term. The outcry was simply the Muncie Common Council had not considered any other options before introducing LOIT at the highest rate available. Adding to it, among other reasons, unemployment and foreclosures were at a record high.
I believe it is obscene to tax an economically down people because government couldn’t control their spending, and made no attempt to do so. We may want to keep an eye on this one should it be brought back up.
One other area which isn’t far from our minds, is the concern the city may be spent into debt. If you have been following the county, you will understand the county had a decent financial cushion going into 2009. At the end of that year, the county was struggling to find $10.5 million dollars.
It only took 12 months to go into debt.
The ramifications have yet to be fully realized. Just a little pin prick with the county building closed one day per week. For those needing to use the county building services, it probably affects them more. The human factor saw 25 people laid-off.
The city on the other hand, will feel more than a pin prick if we go from black to red in a matter of months. Some things take longer before the pain is realized. Like the two-year audit of the Community Development Office. Often we find the sins of the past rears its ugly head years after the actual event took place.
With a voter turnout of 29% our fate for the next four years has been decided.
It’s time-consuming, sometimes frustrating to follow local government. Fortunately for me, I have a wealth of information available in the form of video, documentation, resources and people. Living in the city you almost always have to do double duty…city and county both.
Kudos to those which keep a diligent eye on the National level. That must be very intense.
I followed the McShurley administration closely, and I hope you all gleaned a bit of information and insight into our local government scene. God willing and the creek don’t rise, I hope to continue in this same vein. That being said, here is a short list of things to expect in 2012.
- Coming up in 2012 are two projects which have already been earmarked. I will go into more detail as the year-end gets closer.
- Department head appointments. How departments are run and their effectiveness depends on the ability and experience of those appointed to the positions.
- We still have close to six weeks before the new administration begins, Muncie expects to have a $3 million dollar balance (approximately) to carry into 2012.
- SAFER grant ends.
- Decrease in EDIT funds from the State of Indiana.
- Opening of Mock Fire Station.