January 6, 2008

Editorial

David Long has a target on his back, but the president pro tem of the Indiana Senate isn’t complaining. In fact, he’s the target of the repeal-property-taxes crowd by his own design.

State Sens. Luke Kenley and Robert Meeks are doing the tough work of forging a property-tax agreement amenable to the Republican-controlled Senate and Democratic-controlled House. Meanwhile, Long said, he will hear Senate Joint Resolution 8, which would amend the Indiana Constitution to prohibit property taxes. It will be a thankless job for Long, who deserves credit for recognizing that while the anti-property-tax voices deserve to be heard, they can’t be permitted to tie up the process with an approach considered and rejected as unworkable.

Key lawmakers have been meeting for months to gather ideas and information about the state’s property tax plight – a situation that erupted in some communities with Boston Tea Party-style protests and in some with the Election Day defeat of local officials – notably former Indianapolis Mayor Bart Peterson.

Now the protesters’ attention is squarely on the General Assembly, which reconvenes this week to consider measures proposed by Gov. Mitch Daniels and a bipartisan panel that spent more than 35 hours hearing testimony on all aspects of tax policy, including arguments for property tax repeal.

Protesters rallied Thursday at the Statehouse “to bring illumination to the plot of fervent anti-repeal Senator David Long to kill SJR 8,” according to a news release issued by Stop Taxing Our Property, an alliance of anti-property tax groups from around the state. Group members lit candles in a protest they called, “Votives to expose their motives.”

“People want to say something to gin up emotions about this issue,” Long said last week. “Particularly in Marion County, where there have been extreme cases. But you’ve got to be honest about the cost of local government. It’s a very difficult task.

“The more prudent way to approach this is to say, ‘You shouldn’t give up your goal of eliminating property taxes, if you really believe that’s the solution.’ But it has to be done in steps. This year’s step would be the first one – see how it impacts Indiana’s economy, then take another bite out of the apple a few years later.”

Long said the repeal plans offered up by Eric Miller, a former GOP gubernatorial candidate, and Bill Styring, an economist and former Indiana Chamber of Commerce official, simply don’t work.

“It doesn’t come anywhere close to raising the amount of revenue necessary,” he said. “I think most legislators want to be responsible about it and not nuke the entire government system. When you talk to everyday Hoosiers, they understand there needs to be fire and police protection, road-building. … There’s a cost to that. Is it too high? – then we need better controls, so we can reduce the percentage of local government costs.”

If there is a way to eliminate property taxes, no other state has figured out a way to do it. For one, it would play havoc with bond markets, which are based on the stability of property taxes and reward taxpayers with lower interest rates. And the argument that property taxes constitute “rent” ignores the very real costs attached to services for a parcel of property – fire protection, for example.

The proposed amendment is a simplistic approach to a problem better served by the deliberate approach the General Assembly and Gov. Mitch Daniels seem to be taking. Give the repeal proponents another chance to state their case, but don’t let them get in the way of a real solution.

 http://www.journalgazette.net/apps/pbcs.dll/article?AID=2008801060325