From a lengthy article in the Indianapolis Star:
Several City-County Council Democrats on Tuesday suggested tapping $8 million from the city’s sports board to prevent a slight increase on most homeowners’ tax bills.
Their goal is to sideline Indianapolis Mayor Greg Ballard’s proposal to eliminate the homestead property tax credit as part of the 2013 city-county budget he presented Monday. The move would contribute $8.1 million toward closing a $65 million budget gap.
That tax credit reduces bills by $22 a year on average for the roughly 60 percent of homeowners who benefit, and council Vice President Brian Mahern said ending it would amount to an unacceptable tax hike.
Instead, Mahern and two other Democrats proposed that the Capital Improvement Board pony up $8 million next year.
The CIB oversees facilities including Lucas Oil Stadium and Bankers Life Fieldhouse. Mahern said the payment would compensate the city for police protection and other services that benefit the CIB, which has tax-exempt status.
But the Democrats’ alternative faces a couple of hurdles.
For one, the Republican mayor’s spokesman said that sum wouldn’t fully offset the annual cost of keeping the tax credit because of the complexities of how the credit works. He said it costs the city $13 million to offer the credit, which is backed by diverted county income taxes, while ending it would save only $8.1 million.
Mahern’s solution? He said later Tuesday that the CIB could afford to pay the higher amount, especially since its reserves are projected at $50 million next year.
And then there’s the question of whether the CIB’s leaders would be eager to dip into those reserves.
Unlike with the much larger $1.1 billion city-county budget, state law limits the council’s ability to make changes to the separate CIB budget. Because the CIB is a semi-independent municipal corporation, the council can subtract from — but not add to — the bottom line of its budget.
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See the full article here:
http://www.indystar.com/apps/pbcs.dll/article?AID=2012120814032
