Friday, July 31, 2009

Long Live the Tax Caps

Without the property tax caps coming on line this year and next, Decatur residents would be in disastrous straits trying to pay their pay-2009 tax bills. That is because of the irresponsible non-oversight of the MSD Decatur School District by the School Board which has allowed the school property tax rate to more than double in two years; even though the State is taking over all operating costs for the Schools during this time.

For the pay-2008 property taxes, which were recently due, the Decatur Schools had the highest rate of any School District in the County at $2.75 per one hundred dollars of assessed value. Not only that, they were the highest of any of the other 270 school districts (out of 316 total districts) whose numbers are currently being reported on the Indiana Department of Education's website. Hey great ! Last year we might very well have been number one in the State !!! Unfortunately it wasn't in the graduation rate or ISTEP passage rate. Just the property tax rate.

In Marion County, the next highest pay-2008 rate was Franklin School District which charged $2.13 per one hundred dollars of assessed value. The hyperinflated School tax rate made Decatur the highest taxed Township with a total rate of $4.31; a full 20% higher than Franklin and 80% higher that Washington Township.

But wait ! There's more !

For our pay-2009 property taxes, Decatur Schools are charging MORE this year for the schools alone, than the TOTAL property tax rate for all government units combined last year. According to the legal notice published in yesterday's Indianapolis Star, they are charging $5.28 per one hundred dollars of assessed value; 75% higher than last year and two and a half times higher than the year before that. This is twice that of our new competitor, Beech Grove School District who weighed in at a paltry $2.62. This makes Decaturite's total property tax rate, including all governmental units, an astounding $7.04; a full 75% higher than the next highest Township, Wayne, and a staggering 263% higher than Washington Township.

Thanks to the School District's irresponsible debt accumulation, we will be extremely hard pressed to keep the few businesses we have, much less attract any new ones. Let me repeat this new tax rate, thanks to the Schools -- $7.04. Businesses do look at these things before deciding where to locate. So, if you want more for Decatur, vote the School Board out of office in the next election, which will be held in the Spring of 2010.

More later on all of the extraneous property owned by MSD Decatur Township that can be sold to make at least modest reductions in our appalling property tax situation.


Pete Boggs said...

Maybe it's public "education" that compels legislators to sign but not read legislation proposing caps; a theorem which claims to do that which no mathematician can- control (cap) a variable in the form of trending assessments. Reminds me of a beer commercial, "brilliant."

Had Enough Indy? said...

Actually, the caps do modulate and control one otherwise wildly variable component of the tax bills; the total. The assessment must be within 10% of actual sales prices or it is not market value - and overturnable one parcel at a time on appeal, or wholesale through the Courts. Not perfect but somewhat predictable. And putting those caps into the Constitution creates a multi-year hurdle that ultimately must pass a vote of the people to undo.

Perfect, nope. But better than nothing, which is what level of protection property owners have against the greed of empire builders who build their empires with other people's money.

Pete Boggs said...

Joel Fox & California's prop 13 failed to deliver for reasons of variability. A taxing district can be a single property if it's deemed "unique" & that's happening here in the Circle City. Caps leave in place abusive methodologies & hence more problems than solutions for taxpayers. Market value is one thing only, a transaction; not a third party opinion. If the state wants to look at taxing transactions, where dollars are crossing the table, that might make some sense, but caps are more a commission schedule than citizen protection. And keep an eye on funky reclassification schemes (i.e. farmers homestead & one acre @ 1%, blgs & other "commercial" structures @ 3%). The GSA hasn't solved anything, but is playing yet another game of can soccer.

Had Enough Indy? said...

Well, we just may have to agree to disagree. I think we'd notice paying $1.00 or $1.50 per one hundred dollars of assessed value vs. $7.04. The AVs can wiggle some, but they are tied to sales figures from roughly 2 years previous.

As for prop 13 in California, it halts any tax increases for property as long as the same person owns it. When it changes hands, the tax changes. It allow predictability, but in a different way than our method.

There is another camp in Indiana that wants to do away with property taxes altogether - the ultimate in predictability. But, until and unless we get there, we must have the caps in the constitution to protect property owners from the whim of our unresponsive State Legislature.

Pete Boggs said...

If we're going to "tinker" with the Constitution, replacing property taxes with a citizen centered / stable source is better policy (i.e. sales & a transaction tax on real estate sales). It's citizens & not government, who need a legitimate & therefore stable, predictable method of tax. I'm with the replace & repeal camp. Few people realize it's the intent of some & therefore too many in the legislature, to remove language like "uniform & equal" from the state's Constitution- not good for taxpayers who rely upon standards which assuming best possible definitions, are intrinsically uniform & equal, lest they fail to be standards.