Big Surprise! IndyGo Does Want More Tax Money

To no surprise whatsoever, the bus system that requires some 80+ of its funding to come from taxpayers, now wants even more. From the Indy Star:

IndyGo, another agency dependent on property taxes, also adopted a 2011 budget Monday, and it, too, will pursue a shortfall appeal as expected.

If approved by the City-County Council, the appeals would bring in $1.8 million for the library and $1.5 million for IndyGo. But for most homeowners, the increase combined would be only a couple of bucks.

The one-time levy, which would not increase the actual tax rate, would increase taxes by $1.21 for a $100,000 property, said library Chief Financial Officer Becky Dixon. The IndyGo increase would be roughly $1 per $100,000.

And just as typical is the Republican response:

Angel Rivera, a Republican who initially expressed opposition to the move, said because the increase was small, he "would give it a lot more consideration," though the council is still exploring other options.

"I don't like tax raises," Rivera said. "But if it's $2.50 per parcel, I think we'd have to seriously consider it."

Republicans are against tax hikes, until they are for them.

There are too many other things the Library and IndyGo can still do to generate revenue. They can charge their users for the services they use. Hike the fares, charge more for overdue videos, and charge to use the internet. Is this so hard to figure out?

I suppose it's easier to simply claw at the community as a whole.

IndyGo "Could" Nick The Taxpayer?

Way to go Indy Star headline writer! You gave me the chuckle that will carry me through this Monday! It read, "Action by IndyGo and library could nick taxpayers".

No kidding! Could nick the taxpayer? Bwaaahahahaha! That's about the only thing IndyGo does with any consistency!

As pointed out many, many times on this blog, IndyGo is heavily subsidized, with taxpayers making up a minimum of 80% of the bus service's funding. Fares, on the other hand, make up less than 20%.

As pointed out many times before, this represents a transfer of wealth from those who don't ride to those who do. What's that old saw about the sum of good government being not picking my pocket or breaking my leg? How's that go? Not IndyGo, that's for sure.

So here's the trick, per the Indy Star:

Municipal corporations that receive less tax money than expected can file what's called a shortfall appeal with the Department of Local Government Finance. If approved, that will raise how much the corporations receive the next year, but it also will raise property taxes for those who are not paying the maximum under the tax cap.

It's time to scale back our empire building. No, I'm not talking foreign policy in this case. I'm talking the empire of government. The money is not there. When the property tax reassessments happened a few years back, we were not in the midst of a down economy. Hit people now, with a 10% unemployment rate? For buses people don't ride?

Here's an idea: Raise the fares. Let the people who use the services pay for the services. Either that, or scale them back just as surely as families have scaled back on eating out or grilling t-bone steaks.

How Did This Happen?

I received a copy of the property tax statement from the Hamilton County Treasurer, and found that my property taxes went down by about 12% from last year.

This is remarkable, because they went down 10% the year before. I am astonished. So, why?

One large item: A "Supplemental Deduction" item added to my table of deductions, roughly equal to my Homestead Deduction.

It's still quite a soup sandwich. The "State property tax relief" item went down by 90%, meaning, I liked that one a whole lot more last year... but it's hard not to like this "Supplemental Deduction". Here's an interesting breakdown on the distibution on my property tax money, by taxing authority, by percentage change:

State: -100%
County: -15.73%
Township: +98.26%
School District: -54.06%
Corporation: -12.76%
Library: -18.31%
TIF: -22.5%

I guess that's a plug for eliminating Township Government. Everybody else seems to get that the economy is down, and therefore so should the spending be down.

Next year, the property tax caps will kick in for residential property at 1%. As my net liability was under 1% this year, I'm pretty happy with the progress there. It still isn't the elimination of property taxes, but it is movement in the right direction.

Now, I'll be interested to learn how others are affected. I still expect Marion County, and others, to feel it moving in the wrong direction.

New LPIN Podcast Posted

This week's edition features Hagerstown Libertarian Rex Bell. He ran for Indiana House in District 54, and put up some fantastic numbers:

2006: 14.3% in a 3-way race, D-L-R
2008: 33.5% in a 2-way race, L-R

One of the planks of Rex's platform was the elimination of property taxes. He believes that was a key position to take in getting these results. I asked him to discuss the proposed property tax caps, which he did in some great detail.

Podcast archive. You know what to do.

We Vote With Our Feet

This is a theme I have returned to many times over the years, because I myself have done it a few times.

I once lived in Cleveland and worked in suburban Parma, OH. Each city had a municipal income tax of 2%. When I finally gave up on my rough, decaying Cleveland neighborhood and moved to Parma, I gave myself a 2% raise. I got to thinking that I had to be an idiot to stay where the schools sucked, the crime rate was high, my auto and homeowners insurance rates were higher, and my commute was longer besides.

Later, I moved to Indianapolis. The Indiana tate income tax was lower than Ohio's, 3.1% to 7%; the sales tax was lower, then 6% to 8%; the property taxes were then about a third of what Ohio's were. Again, I thought what an idiot I would have to be choose Ohio.

Then we moved to Fishers. Again, the schools are better, the crime lower, the property taxes lower, the county income taxes lower, the insurance rates lower. Yet again, the thought of what kind of idiot I would have to be to choose Indy over Fishers came to mind, and continues to every time I learn of a violent crime in our previous neighborhood.

I expect to see a lot of migration in the next few years, as high tax jurisdictions are exposed for their empty rewards. From an AP report:

The number of people leaving California for another state outstripped the number moving in from another state during the year ending on July 1, 2008. California lost a net total of 144,000 people during that period — more than any other state, according to census estimates. That is about equal to the population of Syracuse, N.Y.

The state with the next-highest net loss through migration between states was New York, which lost just over 126,000 residents.

Two high-tax states lose population- before the economy really began to tank! It isn't news to me. We're going to see a lot more of it. Just wait until the legacy costs of those states and their cities do to them what they've done to GM, Ford, and Chrysler.

Among other things: California's unemployment rate hit 8.4 percent in November, the third-highest in the nation, and it is expected to get worse. A record 236,000 foreclosures are projected for 2008, more than the prior nine years combined, according to research firm MDA DataQuick. Personal income was about flat last year.

With state government facing a $41.6 billion budget hole over 18 months, residents are bracing for higher taxes, cuts in education and postponed tax rebates. A multibillion-dollar plan to remake downtown Los Angeles has stalled, and office vacancy rates there and in San Diego and San Jose surpass the 10.2 percent national average.

What I observed first-hand about Cleveland seems to hold true anywhere: The combination of high taxes and lousy schools is lethal. People of means and high values flee. Cities become magnets for the poor and the stupid.

In 1950, Cleveland's population was a shade under 915,000. By 2006, Cleveland had lost more than half its population. Chart.

Cities don't learn. Rather than lowering the taxes so as to attract people of means, they are wed to the glories that are their 'services', so they raise taxes evermore in order to keep revenues up, thereby chasing evermore people from their jurisdiction. The population gets poorer and dumber.

There are exceptions. Places like New York can get away with it because of the incredible cultural offerings. But, Detroit? Cleveland? Indianapolis? I think when the legacy costs come home to roost, you will see an exodus from NYC as well.

Blame the highways. Blame 'white flight'- although blacks with means flee all the same. Blame anything, but unless you start looking at tax policy and ask people of means just how much they value the 'services' provided by government, you're going to miss the mark. Notice that people of means leave the places with the most services, and taxes. They prefer to leave what they built behind for others, starting completely new in another area, just to be left alone, away from the greedy hands that gobble taxes.

I will probably vote with my feet again, if Fishers continues to grow, and add services, and employees, and legacy costs. I don't want any of that stuff, but the Bigger Brains create it and fatten it, so I'll eventually flee it.

It should become an environmental cause to lower taxes. Hey- it would prevent sprawl!

(h/t: Duncan Adams, for the California article)

Petty Little Tyrants

Abdul Hakim-Shabazz recently blogged that there may be retribution directed at those vocal Marion County opponents of property taxes when the reassessments are released. Ed Angleton reports that he is seeing such retribution:

I attended all the rallies, filed an appeal, and spoke unkindly about the ability of the Center Township Assessor's Office to assess their way out of a paper bag. Our neighbors did none of these.

Now comes the reassessment.

My assessment dropped from $256,000 to $232,000.
My neighbors dropped from $225,00 to $141,300.

Futhermore, I can point to two other neighbors who exprienced similar decreases, one for $193,00 to $114,000 and another that went from $254,400 to $170,200.

So, did the petty little tyrants choose to drop the hammer on my wife and I for speaking up?

You bet they did.

Petty little tyrants, indeed. This is government at its worst- when decision-making is arbitrary and capricious, when it is directed by revenge.

It is when I learn of stories like these that I think back to days gone by, when the oppressed tarred and feathered unjust officials, or sent them out of town on a rail, and think that such action was wholly justified. The apparent lack of ethics on the part of the Center Township Assessor's Office is staggering, and should be met with some punishment. We'll start here in the Court of Public Opinion, but somewhere, some higher authority should be slamming a hammer down on the Assessor's Office.

Corporate Taxes In America - Too Low?

I frequently hear my friends on the left complaining that corporations are not taxed fairly, which means, not highly enough. The reasoning is that business can afford higher taxes, while individuals struggle.

Let's put that second thought on the shelf for a moment, and look at whether or not corporate taxes in the USA are high or low.

According to The Tax Foundation, the US corporate tax rate is 35%. That's highest in the world, with France right behind at 34.43% and Belgium at 33.99%. Ireland is lowest, at 12.5%.

But those are just federal taxes. Let's not forget that our states add their own corporate taxes. After the state corporate taxes are added, corporations in 24 states by higher taxes than anywhere else in the world. Indiana is among these 24. Only 3 states add zero corporate tax: Nevada, South Dakota, and Wyoming. Wonder no longer why so many corporations are registered in those states. Here's a link to the rankings.

My wife has been urging me to incorporate my business. I have been hesitant. Can you blame me?

Can business afford the taxes? No, but then, they really don't pay them. Individuals do, in the marked-up price that covers these (and so many other) taxes.

Even still, can they afford it? It means that products made in Ireland can be shipped here and still be vastly cheaper than products made here. Ever wonder why we have a trade imbalance? Hmm. Maybe this has something to do with it. Coincidentally, Ireland has been one of the world's economic growth leaders. Hmm. Maybe, just maybe, this has something to do with it.

What is more important? Our ability to compete in the global marketplace? Or, to fund more government? From the Tax Foundation:

24 states have a combined corporate tax rate higher than top-ranked Japan.
32 states have a combined corporate tax rate higher than third-ranked Germany.
46 states have a combined corporate tax rate higher than fourth-ranked Canada.
All 50 states have a combined corporate tax rate higher than fifth-ranked France.

"If federal lawmakers are serious about making the U.S. corporate tax system more competitive globally, they will have to partner with state officials to lower the nation's overall corporate tax burden," Hodge added. "Likewise, state officials should have a vested interest in cutting the federal corporate tax rate because there is only so much they can do to improve their own competitiveness. After all, even corporations in the three states that do not impose a major state-level corporate tax—Nevada, South Dakota, and Wyoming—still shoulder a higher corporate tax rate than France, and 25 other major countries, because of the 35 percent federal corporate rate."

I'd say the corporate tax rate is ridiculously too high. The left may enjoy targeting big, bad corporations as some kind of evil, but funnelling tax money to government is something they actually do with aplomb- to the detriment of us all.

What's Wrong With Government

(Sierra Vista, AZ)- Ok, this is the excerpted Reader's Digest version...

One of the things I find most wanting today is the absence of consistent thought, and the development of solid ideas into public policy. One of my favorite quotes is of John Adams:

"A government of laws, not of men."

This means, not a government of personalities, of popularity, or any other whimsical nonsense. Personality and popularity is fleeting and ever-changing. Solid law based on solid principles gives the opportunity for clear understanding and thus clear footing.

Reading recent posts by Hoosier Pundit and Doug Masson on the crafting of property tax legislation brought this all to mind, as it focused on the importance of three figures: Governor Mitch Daniels, Republican State Senator Luke Kenley, and Democratic House Leader Pat Bauer.

It's ironic. They're drafting law. But it is illustrated here that we are a government of men first, with laws resulting secondly.

I could stand it if there was great clarity where either of these three men stood on the issue. Kenley in particular is a "stick your finger in the air and see which way the wind blows" kind of man. For certain, none of these is a statesman. Oh, for a statesman or two!

I'd much rather see solid competing IDEAS, rather than these three egos, and the kind of horsetrading they will marshall. Let's talk about abolishing the property tax. Let's have a discourse about the things the property taxes fund. 

The dialogue should be much more than, "what can we do to look it make like we've created tax relief all while maintaining the funding status quo." That's what it has all come down to, and it is because we are a nation of men, not of laws.

Voting With Your Feet

One fabulous recipe for driving away wealth is to raise income taxes or property taxes. The more money a person earns, the more incentive that person has to leave so as to preserve their rightful earnings. When property taxes outstrip the perceived value of contributing to the upkeep of a neighborhood or a municipality, the higher the tax, the greater the incentive to find a place that will be worth the bill.

I've long said that people vote with their feet. I've done it twice in my life. My great-grandparents crossed an ocean to do it. One place I voted with my feet on is Indianapolis. I did it before the City-County Council, on Mayor Peterson's recommendation, raised the income tax. I did it before the property tax assessment issue came to fore. Thank goodness!

Even NuVo gets it:

When the deleterious effect of high taxes is apparent even to NuVo, then it's as plain as the nose on your face. Wayne Bertsch at NuVo.

I love the "World Class Mayor" bit on the t-shirt. Peterson likes to crow about making a "World Class City" and that high taxes are the price to be paid. What a load. When the murder rate is higher than Detroit's, Indy is not a World Class City in any sense, except perhaps Third World. The priorities are a wreck. Public safety should be fully funded while everything else plays second fiddle. It isn't the way things are done in Indy, so I left. Now that I'm making more money than when I lived in Indy, I'm damn glad I did, because it would be a crime to pay more for getting less.

The people who remain in Indy have to decide something: Do you want to have Indy as a cauldron of poverty and crime? Or, do you want to have increasing wealth and decreasing crime? It's a simple matter of policy, and while I'm no fan of the Republicans (because they create disincentives for wealth, only are slower on the implementation), the Democrats are quickly destroying Indianapolis. So, while too many partisan Democrats would rather fiddle like Nero and keep their people in office, will the independents be swayed to vote Libertarian? Or at least stop voting Democrat? (I can't even bring myself to say 'vote Republican'. They haven't earned it.)

I'll keep looking from a safe distance.

Hat tip to Hoosiers For Fair Taxation on the strip!

Excellent Time for a Protest

The NFL season opener is in town tomorrow night. The Super Bowl champ Colts host the Saints for a big deal game, with big deal entertainment on Monument Circle. (Kelly Clarkson is ok by me, because she had Mike Watt play bass on recent recordings.) The national TV cameras will be focused on Indianapolis.

What better time to dunk some property tax assessment tea bags into the canal? Details:

INDIANA TEA PARTY

NFL Opening GamePan Am Plaza - Across from RCA Dome.
Thursday, Sept 6th - Meet at 6pm.
Bring your assessment (or facsimille) to put in the giant tea bag.
At 8pm we march to the Downtown Canal to dunk the tea bag once more

I've heard some grumbling about this, along the lines of, 'why can't you just enjoy the moment and not try to give the city a black eye?' Har har, the city already has the black eye. Check out the murder count, murder rate, general crime rate, tax rates, wealth flight, and then see if people trying to right the ship is in fact 'giving the city a black eye'.

Sometimes, embarrassment is the only motivation for fixing obvious and huge problems.

Update: Matt Tully wrote a truly unfortunate column for the Indy Star, urging everyone to enjoy the 'circus' part of the 'bread & circuses' charade, essentially sneering at the tax protesters. From his column:

"We want to communicate with the rest of the country what's going on in our city," event organizer Melyssa Donaghy, also the city's best-known dominatrix, told me.

All I can say is, huh?

A little perspective, folks. Something tells me people in Dubuque, Detroit and Durango don't care about tax increases in Indianapolis. And I'm betting NBC will steer its cameras away from those protesting in the streets. But since you're going to be here, Kelly and Faith, I thought you could use a primer on what's going on.

A. Why must Tully identify Melyssa Donaghy as a dominatrix? Does he identify every person he writes about by their proclivities? Or, is this just his shabby attempt to smear her? That was rhetorical. Matt Tully lives to smear the earnest little people who endeavor to make our region a better place to live. I know, he's done it to me.

B. The point of shining the light of truth on the tax situation for people outside to see is not because they have an interest. It's because this event is a sham designed to prop up the gilded face of the city. Underneath the glitter is a hell of a lot of decay. The protesters are, as the kids say, keeping it real.

C. Perspective? It doesn't matter what the problems of New Orleans or the third world are. We live in Indiana. All politics being local, we work to make home a better place. If we ignored home and focused elsewhere, home would get worse. Why does Tully want home to decline? What kind of 'thinking' is that? Perspective, indeed!

Maybe it's just that the Star sells a lot of newspapers and draws a lot of website hits by running pictures and stories about the Colts, thus selling a lot of advertising. Maybe that's Tully's motivation for this slime-dripping hack job.

An Online Petition To Sign

This is pretty straightforward:

To: Indiana General Assmebly, Governor Mitch Daniels

We, the People of the State of Indiana do hereby DEMAND that our State Legislature act immediately to abolish property taxes and institute a fair system of taxation.

Sincerely,
The Undersigned

Follow this link to sign online. I did!

Lazy Blog Entry

OK, not so lazy. I've been working my tail off. But here are some excellent items I've read lately. You should read them, too.

UnCivil Defence's take on the TSA screening bus riders for dirty bombs, anthrax, and other WMD's, I guess:

I am reminded more and more of my years in South Africa during the Apartheid era. I never thought I'd see the day come when I could make that sad comparison while living in the States.

Rex Bell's letter to the Richmond Pal-Item, on property taxes, and why they are what they are:

There's a good chance that we won't see any reduction in our taxes as long as a majority of voters keep demanding that government should oversee and manage every aspect of our lives from the cradle to the grave.

If you don't think it has come to that, just try to name three things that our government doesn't tax or regulate.

That's a worthy challenge. It is left as an exercise for the student.


Doug Masson's blog entry breaks down in six steps the twisted property tax mess caused in the Statehouse, via an article by Purdue economist Larry DeBoer. It's an excellent demonstration of how fixes can be worse than the problems in their effects. I liken it to driving a car on ice- the harder you jerk the wheel to straighten it out, the more you lose control.


Advance Indiana was the first to take Jen Wagner of the Indiana Democrats to task for her belittling treatment of tax protesters, from Saturday's "Tea Party". Jen Wagner is the Communications Director for the Indiana Democrats, and she posted a blog entry calling the 500 or so protesters, "attention-starved", in her blog Taking Down Words. Per Advance Indiana:

Having attended several of these protests, I can attest to the broad, cross-section of voters they attract, including Democrats, Republicans, Libertarians and independents. I frankly don't understand from a communications standpoint why Wagner would want to attack these citizen protestors. Is that good politics?

No, it isn't, and it isn't pro-democracy either. I can see disagreeing with the point the protesters wanted to make. But when the Communications Director of a political party sneers at people for participating in the political process by protesting- largely the domain of Democrats and leftists- she should at least get a mirror, and at best apologize. If there's one thing we need of Hoosiers, it's to shed their apathy and to participate. Wagner was way off-base in her commentary.

Go to Indy Undercover. It's always great stuff.

And then, it's back to work...

Your Home, Seen Through The Eyes of Others

Courtesy Tim Maguire, here's how it goes....

Your home, as you see it:

As seen by a buyer:

As seen by your lender:

As seen by your appraiser:

As seen by your Assessor:

Tim Maguire is a Libertarian candidate for City-County Council, at-large. Could any candidate but a Libertarian circulate this joke without a sense of deep shame or guilt? I think not.

Sunday's Property Tax Protest Creates "Petersonvilles"

I was not able to attend the 'Black Sunday' downtown property tax protest, but I was enthused to see the press coverage:

Indy Star: front page article.
Fox-59 TV: Lead story this morning, top of the hour. No direct linkage yet, but many clips about property tax issues currently.
RTV-6: AWESOME photo slideshow.
WISH TV-8: Article focused on affects on rental properties.

Most of these articles have video to accompany. Great imagery! The history buff in me was delighted to see the modern Hooverville, with the cardboard boxes and shopping carts as homes. Let's call them "Petersonvilles", shall we?

Today's event: Hoosiers for Fair Taxation, which held the first rally on the 4th of July at the governor's mansion, will demonstrate at 5:30 p.m. at the City-County Building in Downtown Indianapolis. Topic? No surprise: excessive local taxation and Mayor Peterson's proposed large county income tax increase at the public hearing at City Hall.

Add your shanty to the Petersonville!

Upcoming Anti-Tax Events

Here we are at post #1,000 at Kole Hard Facts, and it's a lazy thing on my part, but important info to pass along. It's a link to a post on Hoosiers For Fair Taxation's blog, outlining several events happening in the very near future, all designed to get the attention of our sleeping elected officials, and to jolt them into action.

Here's the link.

Property Tax Ruckus

When I'm in Indiana these days, I am frequently conducting title searches for AT&T. My starting point can sometimes be the Township Assessor's offices, when I need detailed property information to start before I go pulling deeds and plats at the County Recorder's Office.

So, what a hoot to research at the following Marion County township offices: Washington, Lawrence, and Warren.

The lines were longest and angriest in Washington Township. Understand that there is rarely any kind of wait for me to get to a public computer for research. At the Washington Assessor's this morning, there were two lines with four property owners each. Every waiting room chair was filled. Every cubicle had a deputy reviewing a property with the owner present. All- and I do mean all- were seeking to file a form disputing the new assessed value.

I overheard one man, at wits end, explaining the absurdity of his re-assessment. He bought his property in 2005 at $180,000. It was re-assessed at $240,000. For 2005. He was beside himself, explaining that his purchase represents market price. He was the market for that house in 2005! Shouldn't his purchase price carry the day? Made sense to me. I had great sympathy for him. I thought he was going to burst a vein in his temple.

This scenario was similar at Lawrence and Warren Townships, just not quite as angry.

It pains me that it requires this kind of pain for taxpayers to finally stir. It bothers me more that the nature of the complaints is merely the new assessments. The assessments aren't the root problem. The spending by municipal and county governments is out of control.

The Governor is now in on the grandstanding, hinting at a possible special session to address the problem of property taxes. Yes, there is some good the Statehouse could do- like eliminate property taxes altogether. They won't do that, though. They'll come up with some new shell game that allows the local governments to spend to their hearts' content while providing the facade of tax relief. From the Indy Star report:

"As governor, I will take every step I have authority to take to help Hoosier homeowners," Daniels said in a statement issued by his office Monday night.

Nice rhetoric. Empty rhetoric.

The calls to the Statehouse and the Governor are misplaced. Call the City-County Council in Marion County. Call Mayor Peterson's office. These are the people in charge of the budgets.

Bottom line: if Indianapolis and other local governments weren't spending so much, there wouldn't have been a push to update the assessments. Re-assessing was seen as a way to gain tax revenues without being perceived as raising taxes. It certainly is raising taxes. Really, especially in the case of those on fixed incomes, it isn't merely taxing, it's confiscatory.

Anyhow, I'm sort of glad the people are somewhat awakened to the absurdity of our tax burden. I'm dismayed that what the awakening suggests is that it's okay to tax us at an incredibly high level, but we draw the line when we stand to lose the house. Yikes.

Tax Freedom Day is a concept I have promoted on this blog and on my radio shows in the past. What is Tax Freedom Day? It is the day that we are through working to pay for government. After that day, you are earning for yourself and your family.

This year, in Indiana, you stopped working for the government on April 23. After that you were earning for yourself. State map.

That's nuts. And yet, we accept it. We only draw the line when threatened with losing our homes. Here's a telling quote from the Tax Foundation:

"Americans will work longer to pay for government (120 days) than they will for food, clothing and housing combined (105 days)," said Hodge. "Since 1986 taxes have cost more than these basic necessities. In fact, Americans will work longer to afford federal taxes alone (79 days) than they will to afford housing (62 days)."

My understanding is that the Boston Tea Party was staged over a 1% tax. Oh, to have that kind of vigilance today!

Go to the various tax protests happening Sunday and Monday. From the Star:

• Sunday: "Black Sunday" asks supporters to wear black to show unity and bring signs to Monument Circle from 10 a.m. to 2 p.m. Several groups seeking tax reform are organizing the event.
• Monday: Hoosiers for Fair Taxation, which gathered at the governor's residence July 4, will rally at 5:30 p.m. at the City-County Building Downtown.