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Opinion

February 2, 2014

HOWEY: Tax repeals and the promise of Gov. Pence

(Continued)

Think of it like this. You can create the sexiest business climate to lure companies to Indiana. Geico is bringing not only its British accent lizard (or is that an Ausssie accent?) and hundreds of jobs to Carmel, but that city has great parks, a new performing arts center, a revived downtown, trails and an improving road system. Companies wanting to set up shop in Indiana look for those amenities to attract good employees.

What the tax caps, and now a potential business personal property tax repeal could end up doing is to create communities that can’t afford to bus their kids to school, keep the street lights on, plow the snow, and fix the streets. We’ve seen the police chief in Knightstown Tase himself in a publicity stunt to buy new squad cars.

Two bills in the General Assembly - House Bill 1001 and Senate Bill 1 - begin the repeal process, but neither one of them has replacement revenue for municipalities and counties, other than a slow phase-out and the income tax. SB1 would form a summer study committee while eliminating the tax for businesses with less than $25,000 in property.

There are about six weeks left in this session, and the replacement part of this equation is sketchy at best, and revealing when you consider how ill-prepared the governor and legislative leaders have been to find a replacement solution.

As they say on ESPN, “C’mon, man!”

Last week, Republican mayors Greg Ballard of Indianapolis, Jim Brainard of Carmel, Lloyd Winnecke of Evansville and Democrat mayors Greg Goodnight of Kokomo, Tom Henry of Fort Wayne and Peter Buttigieg of South Bend met with Gov. Pence to express their alarm at what cities would face with a repeal and no replacement.

Pence sent a letter to mayors later in the day, saying, “I want to assure you that I understand your concerns. You provide essential services to your citizens, and I can see why some believe the phase-out of the business personal property tax could threaten service delivery. I have said that we cannot phase out this tax in a way that shifts the tax burden to hard-working Hoosiers. You may be assured that I will stand by these commitments to your community and your citizens.”

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