Saturday, November 17, 2012

Gary overspending is what is bankrupting Lake County

The lack of an income tax and the levy freeze have nothing to do with it.

Lake cities, towns and townships are currently home to some of the highest property tax rates in the state. Gary's and East Chicago's rates are more than five times the state's average, according to state records.

 ... 

That loss is most keenly felt in north county's city halls, but county government suffers collateral damage since it must attempt to extract taxes in those same capped communities.

 ...

 He told the county council last week, "Even if you cut that $15 million this year, you will be right back next year with the same problem because you inherit tax cap credits from other communities. It could be $10 million, $12 million or $15 million next year." 

Because of the tax caps, all tax rates for all municipal entities interact with one another. Because Gary, East Chicago, Hammond, and Whiting have ridiculously high tax rates, Lake County's rate has to be lower. Because Lake County's rate is the same across the county, they can't raise as much revenue elsewhere.

Lake County's problem has nothing to do with the tax caps and the levy freeze, or lack of an income tax. It has everything to do with overspending in North Lake County. The answer is for the cities to disincorporate and reincorporate as towns, while providing far less "services".

1 comment:

Anonymous said...

This perspective is interesting. Any idea on the magnitude of the problem for the county?