Marion County residents may have to pay nearly double the amount of county income tax starting in October to cover Mayor Bart Peterson's spending plans.
If the tax increase is approved, it would mean a Marion County resident earning $50,000 in annual taxable income would pay $375 more a year for the tax starting in October. The tax would jump from $450 per year to $825.
It is not clear how the City-County Council will react to Peterson's plan to increase the tax to 1.65 percent from 0.9 percent to pay for the $85 million needed for the budget deficit and crime-fighting measures.
The General Assembly gave Marion County and other counties authority to raise income taxes to keep property taxes down. Another goal was to give local government new revenue options. The bill lets Marion County raise the tax 0.5 percent, but Peterson has said he's not certain whether he will ask for the full amount this summer when the City-County Council plans the 2008 budget. He said other legislative action, budget underspending or unexpected revenue could reduce the amount needed from the county income tax.
"It's clear it will be an income tax increase," Peterson said. "We think the legislature gave us the ability to plug our budget, though we might not need to go to the limit if we find other alternatives." . . . .
Cathy Burton, president of the Marion County Alliance of Neighborhood Associations, said she thinks the public agrees that public safety pensions should be honored and that police and jail issues should be fixed. The disagreement comes over how to pay for the costs.
She said she constantly hears complaints about how the city can build a new football stadium or give economic incentives to Downtown developments but can't pay for basic services. She said neighborhood leaders are leery of trading one tax for another.
"It doesn't matter what pocket it comes out of . . . it all comes from the public," Burton said. "People will complain as long as they think we are still subsidizing private enterprises."
She noted that paying for police and fire pensions with income taxes shifts a greater portion of the burden from the old city limits, roughly Center Township, to all of Marion County.
For years, property taxes collected in the old city limits alone paid the pension costs. The pension obligation is projected to total $1.3 billion over the next three decades.
In a normal world, the Republican Party in Marion County would be poised to take advantage of the gross mismanagement of the city over the past 8 years, which has led to tax increase after tax increase, skyrocketing crime and a public school system in crisis. Instead, Bart got his wealthy buddies to pull strings within the Republican Party to make sure it fell on the mayor's race again this year just like it did four years ago. So we have an election this year without any serious alternatives, thanks to this self-serving group of Republicans who would rather continue on Mayor Peterson's gravy train than look out for the long-term interests of our city. Indianapolis is now officially on the fast-track to become another Detroit or St. Louis.