Tuesday, April 30, 2013

Courier-Times Reports Leising Calls Legislative Session a Mixed Bag

From the New Castle Courier-Times:

Taxpayers and motorists were winners because of what happened. Those receiving welfare assistance were, too, because of what didn't.

But more than a roll of the dice stopped a gambling bill in its tracks, leading some to believe the handwriting, albeit not cursive, may be on the wall for further declines in gaming revenue.

That sums up for State Sen. Jean Leising the good, the bad and the disappointing of the 2013 Indiana General Assembly, which ended Saturday in the early morning hours.

Taxpayers received a lot of the good news, through elimination of the inheritance tax and a 5 percent tax cut spread out over four years.

Hoosier motorists could celebrate the prospects of better local roads, thanks to changes in funding made during the session.

But as good as that news was, Leising, R-Oldenburg, said she understood how some might be disappointed with the demise of cursive writing, the funding local schools will receive and the fact that a bill requiring drug testing of welfare recipients failed.

Those in favor of live table games at Indiana casinos didn't get their way, either.

Such were the ups and downs of another legislative session. Here are some of the highlights Leising listed Monday in an interview with The Courier-Times.

Tax cut

It wasn't the size Gov. Mike Pence wanted but Leising said she was pleased with the cuts included in the state's $30 billion state budget.

"I think most people know how better to spend their money than the government does," Leising said. "I'm glad we were able to lower the rate a little."

Perhaps even more significant than the 5 percent income tax cut spread out through 2017 was the complete elimination of the inheritance tax.

During the 2012 session, legislation was passed that phased out that tax over a nine-year period. But new legislation this session not only eliminates the inheritance tax immediately, but makes it retroactive to Jan. 1, 2013.

"Anybody that has lost a loved one since Jan. 1 should be aware of that," Leising said. "It will make a difference. People who were retiring were moving to other states because of our antiquated inheritance tax. Now there will be no reason for that."

Road funding

Some creative shifting of how the Indiana State Police is funded has freed up more money for local road work. Leising said Henry County is due to receive about $659,000 more than it did the previous year. That amount would be coming in both 2014 and 2015.

"We are finally going to put some money back into local roads," Leising said. "We are replacing the motor vehicle highway fund appropriation for the Indiana State Police and using state general fund dollars for that instead. I think this is a big plus I know for people in Henry County as well as the other six counties in my district."

Leising also said a Major Moves 2020 trust fund was established with $200 million allocated for future projects, such as adding lanes and other improvements for Indiana highways.


While she realizes not everyone likes the large part gambling plays in Indiana now, Leising expressed disappointment that a bid to add live table games to Hoosier racinos and casinos was defeated.

She was a co-author of the legislation, primarily because it would have been a job creator.

"No matter how people feel individually about gaming, it has become a big part of our revenue," Leising said. "Gaming has been either our third- or fourth-largest source of revenue after sales and individual income taxes."

Currently, table games are available at Anderson and Shelbyville facilities, but they are electronically operated. No live dealer is involved. In the end, some balked because it was considered an expansion of gambling.

Leising disagreed.

"Many of us here maintained it really wasn't an expansion of gambling, just a replacement of machines with people. The racinos had both told us they had planned on hiring about 300 people for those positions and each one of those jobs carried a $40,000 salary. My area needs good jobs like that. I was pretty disappointed we didn't get that accomplished."

The bill would have also allowed riverboat casinos to build land-based venues on any land they already own. That passed the Senate with Leising's support, but the House balked, stripping down the measure to mostly tax breaks to help casinos compete.

Leising thinks more help may be needed. Growing competition from Ohio, particularly the new Cincinnati casino, which is already land-based and does have live dealers at table games, is a major concern, according to Leising.

"Someone in Harrison, Ohio, would find it easier to drive to Shelbyville instead of downtown Cincinnati, but with the live table games offered there, they probably won't come this way," Leising said.


Journal-Gazette Reports Pence Pleased by 5% Tax Cut

From the Fort Wayne Journal-Gazette:

Gov. Mike Pence on Monday hailed an income tax cut legislators passed late Friday night, while also addressing a number of other bills.

The newest state budget calls for a 5 percent income tax cut starting in 2015 and then fully implemented in 2017. It also includes an immediate repeal of the state inheritance tax while continuing other business tax cuts.

Pence said repeatedly it was the “right tax relief at the right time.”

He said the income tax cut will save Hoosier taxpayers $300 million annually when fully implemented.

Pence did acknowledge, however, that after weeks of vigorous debates lawmakers swayed him from the 10 percent income tax cut he sought.

“I think the tax relief we crafted together was better than what I was proposing,” he said.


Courier & Press Reports Evansville Mayor Tells Council Hotel Needed

From the Evansville Courier & Press:

Evansville needs the commerce and jobs a Downtown convention hotel will bring, and the project must not be delayed any longer, Mayor Lloyd Winnecke told the City Council Monday.
The city is to provide $37.5 million of the development’s $70 million cost, according to a predevelopment agreement with HCW of Branson, Mo. Of the city’s share, $20 million is a direct contribution to construction of the 253-room Doubletree by Hilton, which will be owned and operated by HCW. The remaining $17.5 million is to be for a 330-space parking facility, connections between the hotel property and The Centre and Ford Center and storage for the Ford Center.
HCW also plans a tower with 78 upscale apartments, and a restaurant on the property. The hotel is to include 6,400 square feet of ballroom space.
Bonds issued by the city are to be retired using tax increment financing, Casino Aztar funds and food and beverage taxes, according to city officials. The City Council was told at Monday’s called informational meeting that those three funds generate nearly $18 million in net revenue in an average year, roughly $8 million of which is currently set aside to retire debt on the Ford Center.
Debt on the hotel development’s cost is projected to be about $2 million per year for about 25 years, city financial consultant Robert Swintz with the London Witte Group.
See the full article here:

Tax Court Schedules Two Hearings for May

Joseph and Jeanne Hutcherson v. Hamilton County Assessor (View)
Friday, May 03, 2013 10:00 AM - 11:00 AM

This is a hearing on Respondent's Motion to Dismiss.

For a description on the merits of the case see the Tax Summaries at http://www.in.gov/judiciary/opinions/taxsumm.html

Vodafone Americas Inc. et. al. v. Indiana Department of State Revenue (View)
Thursday, May 16, 2013 10:00 AM - 11:00 AM

The taxpayer challenges whether income tax sought to be refunded was based on adjusted gross income from Indiana sources.


Revenue Determines Taxability of Transactions for Commercial Printer

Excerpt of Revenue's Determination follow:

Taxpayer is an Indiana commercial printer which generates billing statements and related products for its clients. In the course of an audit, the Indiana Department of Revenue ("Department") determined that Taxpayer had not paid sales tax on some transactions upon which tax should have been paid during the tax years 2008, 2009, and 2010. Therefore, the Department issued proposed assessments for use tax and interest for those years.
Taxpayer protests the imposition of use tax on certain transactions during the tax years 2008, 2009, and 2010. The Department examined Taxpayer's records and used a statistical sample and projection method to determine use tax compliance for ordinary purchases. The Department reviewed capital purchases separately and assessed use tax on a purchase-by-purchase basis. Taxpayer protests that some of the ordinary purchases included as subject to use tax in the Department's projection method were not actually subject to use tax and that the projections need to be recalculated and reapplied. Also, Taxpayer protests that certain capital purchases were not subject to sales or use tax.
The first category of transactions under protest consists of three transactions for a 120 KVA UPS umbilical power supply. In the course of the protest and hearing process, Taxpayer was able to supply documentation and analysis which establishes that the equipment provides power solely to production equipment.
[S]ince Taxpayer has established that the umbilical power supply system equipment is used solely to power exempt production equipment, it is exempt as provided in 45 IAC 2.2-5-8(c). Taxpayer has met the burden imposed by IC § 6-8.1-5-1(c) for this portion of its protest.
The second category under protest consists of a single charge listed under "Capital Asset 1091" in the audit report. The charge is for generator equipment used to supply power to Taxpayer's computer room at Taxpayer's production facility. As part of the protest process, Taxpayer provided additional documentation and analysis which supports its position that the generator was used solely to provide backup power to computers directly used in Taxpayer's production process. As discussed above, 45 IAC 2.2-5-8(c) provides an exemption for such equipment. Taxpayer has met the burden imposed by IC § 6-8.1-5-1(c) for this portion of its protest.
The third category under protest consists of rental of server capacity on a third-party MTA Hurricane Server. Taxpayer states that this server is the device upon which Taxpayer's programs generate the billing statements for Taxpayer's clients.
Taxpayer has provided sufficient documentation and analysis to establish that this server is used solely in its production process. Therefore, the rental of tangible personal property in the form of server capacity is a retail transaction as provided by IC § 6-2.5-4-10(a). Since that transaction involves manufacturing equipment which Taxpayer directly uses to directly process the billing statements for its clients, it is exempt from sales and use tax as provided by IC § 6-2.5-5-3(b).
The fourth category under protest consists of a Storage Area Network ("SAN") server which Taxpayer states is necessary to hold all of the data which it uses to directly produce the billing statements for its customers. Taxpayer explains that none of its other servers have hard drives and so they rely on the SAN to hold all of the operating systems and data directly used in its production process. The data is fed back and forth to the various production servers and since the newly available information shows that the SAN is used exclusively for production purposes, the SAN is exempt as provided by 45 IAC 2.2-5-8.
The fifth category under protest consists of payments to the vendor "Xiotech" for service to the SAN server discussed above. A review of the documentation supplied during the protest process shows that the service agreement covers service and parts for the SAN server. The Department based its determination that the service contract was taxable on the lack of documentation available during the audit...
It has now been shown that the service agreement covered service and the provision of repair parts to a piece of manufacturing equipment which is directly used in the direct production of Taxpayer's product. As provided by 45 IAC 2.2-5-8(h)(2), those parts are exempt from tax. Since the service agreement calls for the provision of service, which is exempt, and for the provision of exempt parts, as provided by 45 IAC 2.2-5-8(h)(2), there is no part of the service agreement which is subject to sales or use tax. Taxpayer has met the burden imposed by IC § 6-8.1-5-1(c).
The sixth category under protest consists of payments to another service vendor. Taxpayer states that the payments were for services only and that the transactions were therefore not subject to sales and use tax. The Department based its determination that the transactions were subject to sales and use tax on the basis that the vendor's service included the provision of tangible personal property in the course of providing data storage services. Taxpayer protests that the data storage is collected and stored throughout the production process.

[T]he value of tangible personal property transferred in the provision of a service must not exceed ten percent of the service charge in order for the exemption provided by 45 IAC 2.2-4-2 to apply. After review of the supporting documentation, Taxpayer has not established that all four requirements of 45 IAC 2.2-4-2(a) are met and that the data storage service is not properly subject to sales and use tax. Taxpayer has not met the burden imposed under IC § 6-8.1-5-1(c).
In conclusion, Taxpayer has met the burden imposed under IC § 6-8.1-5-1(c) in regards to umbilical power supply system equipment, generator equipment, the rental of an MTA Hurricane Server, the SAN server, and the maintenance agreement with Xiotech. Taxpayer has not met the burden imposed under IC § 6-8.1-5-1(c) in regards to the service agreement with the data storage services vendor. A supplemental audit will use these findings to adjust the use tax calculations for capital assets and the use tax compliance calculations determined via the sample and projection method.

Star Reports Colts' Luxury Suites Cited as Lawmakers Limit New CIB Taxes

From the Indianapolis Star:

A $2 million luxury suite expansion at Lucas Oil Stadium and other potential Capital Improvement Board projects helped spur state lawmakers to put a 10-year limit on two recent tax increases, a key sponsor says.

The tax sunsets — on increases to the Marion County event admissions and car rental taxes that benefit the CIB — were inserted into the two-year state budget bill passed in the closing hours of the General Assembly session, which ended early Saturday.

The move is evidence of some legislators’ long-standing frustration with the spending priorities of the CIB, which runs the city’s sports venues and convention center.

Given spending on such projects as the stadium suite expansion, said Sen. Michael Young, R-Indianapolis, “they didn’t need these tax increases.”

CIB officials call improvements to the stadium necessary to keep it in top-notch competitive shape. Detractors portray such decisions as welfare for wealthy team owners.

Young and some colleagues say their concern mostly lies in protecting the state’s investment in a 2009 bailout for the then-ailing CIB, which included two outstanding loans totaling $18 million.

The City-County Council OK’d the twin tax increases in January as part of that bailout package. The delayed tax options were available for enactment only in the first two months of this year.

In 2009, the CIB struggled with costs of operating the new stadium and unanticipated loan and insurance obligations.

Indianapolis Mayor Greg Ballard and CIB leaders have said that while the CIB is in stronger financial shape now, the tax hikes were needed to secure the CIB’s bottom line for years to come.

The admissions tax — charged for events at CIB-run facilities — was increased to 10 percent from 6 percent, and the Marion County auto rental excise tax was increased to 6 percent from 4 percent. (That made the total sales taxes paid on car rentals in Marion County 17 percent.)

Those increases are expected to raise $6.7 million a year initially. All proceeds will go to the city’s police and fire budgets in the first year, but after that, the CIB will keep 75 percent.

See the full article here:


News and Tribune Reports Jeffersonville City Council Outlines Cuts

From the Clark County News and Tribune:

The Jeffersonville City Council mapped out the cuts it plans to make at a special meeting Monday to pull the budget within the reductions needed as a result of circuit breaker tax caps.
The city was forced to cut $3.25 million out of its budget to cover the reductions as a result of hitting the tax caps. The state of Indiana limits how much money can be collected in property taxes. It limits property taxes for individual homeowners at 1 percent of the assessed value of the property, 2 percent for rental properties and 3 percent for businesses. Any amount over the percentages cannot be collected by the taxing unit.
Indiana’s Department of Local Government Finance approved Jeffersonville’s 2013 general fund budget at $25.6 million, the same amount at which it was submitted by the council. The Parks Department budget before the tax caps totaled $2.7 million, and the Sanitation Department’s budget totaled $2.99 million.
With the tax-cap hit taken out of all of the budgets that were approved for the city, the total amount Jeffersonville has to operate on for 2013 was $28 million.  In 2012, the city was forced to cut $3.5 million out of the city budget to account for the caps.
See the full article here:

NWI Reports Lake County Legislation Does Much; But Not All

From the Northwest Indiana Times:

Senate Bill 585 brings some necessary reforms to Lake County -- changing the makeup of the Gary/Chicago International Airport Authority; requiring studies of the need for a trauma center, an academic medical center and a new port in Gary; and more. Left undone is the income tax necessary to make Lake County able to pay its bills.
Sen. Ed Charbonneau's legislation, not yet signed into law by Indiana Gov. Mike Pence, rolled a number of major Lake County issues into a single bill. It's good that it passed.
Left undone in the legislation is the creation and distribution of a Lake County income tax. It isn't popular, but it's necessary.
It's up to lake County Councilwoman Christine Cid, the swing vote, to make this happen so not just the county, but also its communities, can provide necessary services.
More money for these communities could be used to pay down debt, among other uses.
This unfinished business not included in the final version of SB 585 must be addressed by the County Council.

NWI Reports Anti-Tax Frustration Aired at Crown Point Rally

From the Northwest Indiana Times:

Those who gathered Monday night for an anti-tax rally expressed more puzzlement than outrage.
Three present and former Lake County officials attempted to answer questions about whether a proposed 1.5 percent county income tax will be imposed on Social Security benefits, why the county would collect an income tax and give it back to the public as property tax relief and whether it was a redistribution-of-wealth scheme.
Commissioner Gerry Scheub, D-Crown Point, Councilwoman Christine Cid, D-East Chicago, and former county Councilman Larry Blanchard attempted some explanations, although they warned some important details have yet to be worked out.
The Lake County Council passed several ordinances by a 4-3 vote April 9 to create three separate taxes amounting to 1.5 percent to be imposed on the income of all county residents and out-of-state residents, who earn income from work performed within the county.
That includes a 1 percent income tax to be given back as property tax relief, a .25 percent tax to build public safety agency budgets and a .25 percent economic development tax that can be earmarked for roads, bridges and other infrastructure.
Property tax reductions funded by an income tax will vary from 7 percent to 27 percent depending on the taxpayer's home community.
Although county government will reduce its tax rate by the same amount — 45 cents on every $100 of assessed real estate value — across the county, the dollars subtracted from each bill differ. Property tax relief will be greater in small communities and rural areas than it is in large cities where other local government agencies demand their share of the total tax levy.
Robert Dittmer, director of public relations for the Indiana Department of Revenue, which oversee county tax collection, said last week a local income tax wouldn't be imposed on Social Security benefits, but it will on most pension income.
Blanchard said the county tax will be imposed on the same income state tax already is on. Lake is the only county in the state without a local income tax.
If the council passes the tax on second reading May 6, it moves to the three-member Board of Commissioners, where Scheub said he will veto the tax.
If Scheub's veto is joined by that of a second commissioner, the tax would die, unless the seven-member council musters five votes to override the veto.

Monday, April 29, 2013

IBJ Reports Residents Decry Fortville's Annexation Plans as "Land Grab"

From the Indianapolis Business Journal:

Property owners in a largely agricultural area southeast of Geist Reservoir are vowing to fight involuntary annexation by the town of Fortville, calling the plan a blatant land grab.

Fortville is seeking to annex almost 6,000 acres to the west, tripling the size of the Hancock County town and adding $53.5 million to its property tax base.

Town officials did not respond to inquiries from IBJ, but a summary of Fortville’s fiscal plan for providing services to the targeted territory described the annexation as “a means for providing for the orderly and planned growth of the municipality.”

Opponents see the proposal as a desperate effort to capture additional tax revenue for the town, which has seen income drop as the result of statewide property tax caps. But adding 9 square miles of territory—and the associated services—doesn’t make sense if Fortville is having trouble making ends meet now, they say.

“Annexation is expensive,” said opposition leader Florence May, who lives in the targeted area despite her McCordsville mailing address. “We think it’s a pretty major stretch.”

The area targeted for annexation has 240 homes and businesses—mostly farms—and an estimated population of 600, according to the town’s fiscal plan summary.

See the full article here:


Indiana Public Media Reports Bartholomew County Seeing Rise in Property Tax Appeals

From Indiana Public Media:

Bob Crase has lived here in Columbus since the early 1960s. The last time his homes was assessed was 1983, so when he got his reassessment in the mail earlier this month, he was stunned.
“This year when I got my assessment it was up quite a bit from last year, and I checked with some of my neighbors and all the neighbors in the cul-de-sac, their assessment had gone down and mine had went up quite a bit,” he says.
In the assessment some property owners did see their taxes dip, but there are a lot of people like Crase who do not understand why their bills went up so much. County assessor Lew Wilson says his office has seen  four or five times more appeals than usual.
“The 10 year gap is the main thing. It makes it more dramatic,” he says. “Plus when we started the assessment you only had approximately 18 months to finish it from beginning to end. So you’re cramming in an awful lot of work in a short period of time.”
Crase is among those who have decided to appeal. He is retired and on a fixed income. But due to the  unusually high number of appeals the assessor’s office has gotten, Crase’s appeal will not be heard before the first payment is due on May 10.
“They want me to go ahead and pay the first installment and then after I go in front of the board,” he says. “If they agree I am too high, then they will deduct that off the second installment.”
Crase is presenting his case to the Bartholomew County Assessor’s board May 22.

Herald-Bulletin Reports "Local Legislators Have Mixed Feelings on 2013 Session"

From the Anderson Herald-Bulletin:

Local legislators didn’t see eye-to-eye on every issue, but they definitely agreed that this year’s legislative session was less bitter than last year’s, when Indiana became the 23rd right-to-work state.

The Indiana General Assembly approved a two-year, $30 billion budget Saturday afternoon that included a modest increase in school funding and new money for roads and highways — both cut under former Gov. Mitch Daniels during the recession — along with a 5 percent income tax cut that will be phased in beginning in 2015.

“The tone of the session was more cooperative and civil this year, but we didn’t tackle as many contentious issues,” said state Sen. Tim Lanane, D-Anderson.

Issues he would have liked to seen addressed, such as employment and the skills gap, were lacking. While there’ll be new jobs with the money used for roads and highways, he said, legislators “could’ve done a lot more.”

And the 5 percent tax cut will not only affect the average taxpayer minimally, but not even be felt for another two years, he added.

State Rep. Terri Austin, D-Anderson, said the savings will be the equivalent of a cup of coffee every week — and “not even the fancy coffee.” In other words, about $1.50 a week, Lanane added.

“We missed some big opportunities quite honestly,” Austin said, like in health care, where expanding Medicaid could’ve provided nearly 300,000 private sector jobs in addition to offering more of the 800,000 uninsured Hoosiers a chance to get insured.

The bill died in the House.

“Everybody said jobs would be No. 1,” she said, “and we failed miserably.”

Something she, Lanane and state Rep. Jack Lutz, R-Anderson, were all disappointed by was the rejection of legislation that would have enabled the state’s racinos — Hoosier Park and Shelbyville’s Indiana Grand — to offer live table games and create as many as 800 new jobs between the two locations owned by Centaur.

“To me, it was an easy way to create 800 decent jobs and we just said ‘no, we’re not going to do it,’” Lanane said.

Both Gov. Mike Pence and Indiana House Speaker Brian Bosma, R-Indianapolis, were against the change. Lanane said it would not have been an expansion of gaming, as opponents stated, but rather just a job creator since table games are already offered in the racinos electronically.

Lutz said local legislators and Rep. Jean Leising, R-Oldenburg, and Rep. Sean Eberhart, R-Shelbyville, worked hard to get those jobs but, “it just didn’t get done.”

“There’s some unaccomplished business there,” he said, adding he jokingly told Austin to take a week off and then be prepared to work on it again.


Herald-Times Reports Monroe County Facing Budget Pressures

From the Bloomington Herald-Times:

Although the Monroe County budget looks OK for the first quarter of 2013, some revenue sources are lower than expected so far.

Total revenues for the year are about $1,479,000 — about 7.5 percent of the total budgeted in the county general fund. For the first quarter of 2012, about 12 percent of projected revenues were received.

Seeing revenues under 10 percent for the first quarter is not unusual, according to Steve Saulter, Monroe County auditor. The largest revenue source for the county are property taxes, not due until May 10.

But there are concerns that departmental revenues — particularly in the building department — are on the low side for the first quarter of the year, which could cause problems later for the budget.

“In my opinion, it’s too early to get panicky about any of these departments,” Saulter said. “But in six months, if these have not reached 50 percent, I would be concerned.”

A few of the revenue sources that the Monroe County Council will be monitoring include fees collected by the building department and the clerk’s office, as well as interest revenue, said Geoff McKim, president of the Monroe County Council. These departments tend to bring in higher revenue streams than other departments.

See the full article here:

Courier & Press Report Vanderburgh County Prepares to Cut Employees to Reduce Budget Deficit

From the Evansville Courier & Press:

Vanderburgh County plans to cut at least a dozen positions from its bureaucratic structure this year in an attempt to reduce its overstretched budget.
Otherwise, its 2013 budget will spend more money than the county has — at least $1.5 million more.
The county council, its fiscal governing body, hopes that quickly downsizing staff will stave off a dip into the emergency funds.
“We do have rainy day funds and reserve funds,” County Council President Tom Shetler said. “I would rather not dip into those. If some emergency would arise, like the fertilizer plant in Texas — we’ve had tornadoes, we could have a bad thunderstorm. We might have to spend several million dollars to clean up.”
Shetler does not plan to lay off anyone or cut salaries. Rather, when employees leave, retire or take a new job, the council will try to leave those positions vacant. On average about 15 people leave county employment every year.
More property tax payers than expected hit state-mandated tax caps, causing the $1.5 million gap, county Auditor Joe Gries said. And that figure assumes everyone will pay their taxes this year, which never happens, Gries added.
“Plus, every year there are additional costs,” he said. “The sheriff’s office needs more overtime to staff the jail. They need more food for the inmates. We have a death penalty case this year, that will add costs. We could have workers’ compensation insurance claims. We could have to cut more than $1.5 million.”
With this in mind, the County Council intends to carve about $2.2 million from the approved budget. Two-thirds of that money will come from creative accounting, said Shetler. The Council will use various accounts that are otherwise underused to pay for general fund expenses.
For example, the county has a convention fund budget that collects taxes from area hotels that Shetler plans to use for rent and utility expenses. That should be another $600,000, he said.
The rest will come from downsizing.
The county has 13 elected offices and eight departments. Seventy-two percent of the county’s budget is spent paying the employees who man those offices. Add in health insurance and retirement benefits and that percentage jumps to about 85 percent, Gries said.
Significant cuts to the general fund must come from downsizing staff. Lower level county positions pay about $30,000 a year. With benefits, the average employee costs the county about $50,000, he said.
See the full article here:

Herald-Times Reports Westside TIF District Could Expand in Monroe County

From the Bloomington Herald-Times:

In what could be a sign of improving economic health, the Westside Tax Increment Financing District might be getting a little larger.

Expanding Monroe County’s Westside TIF District will be on the agenda for the Monroe County Plan Commission at its meeting Tuesday. An expansion must be reviewed by the plan commission and the Monroe County Board of Commissioners before going to the Monroe County Redevelopment Commission for a public hearing.

The plan commission will make a recommendation based on how the TIF expansion fits into the county’s comprehensive land plan, said Larry Wilson, planning director.

“The plan commission makes sure it is compatible with the comprehensive plan and other plans for the area,” he said.

This is the first expansion of the Westside TIF since 2008, and Wilson said the plan commission has not seen many requests from properties wishing to be included in the county’s TIF districts in recent years.

See the full article here:

Daily Journal Reports Whiteland TIF, Planned Projects, Seen as Lever for Development

From the Johnson County Daily Journal:

New businesses have rarely opened in Whiteland in recent years, and a few have closed or left.

Town leaders hope that wider roads, new streets, better drainage and other projects can make Whiteland a more inviting place for business.

Whiteland has created an economic development area and more than $50 million in potential infrastructure projects. The plans are long-term, and most projects would be years off.

Picture a wider Whiteland Road, expanded utility services and even a new town center east of the current downtown. The town wants to extend sewer and water utilities, build another water tower to supply utilities around Interstate 65 and fix drainage across the town.

Star Reports Hamilton Southeastern's and Noblesville's Push for Referendum Approval Hit Home Stretch

From the Indianapolis Star:

Seven Indiana school districts — including two in Hamilton County — are making a final push this week to explain why voters should approve hundreds of millions of dollars in new property-tax revenue for school improvements.

Ahead of the May 7 referendum, superintendents, political-action committees and supporters are holding public forums, installing more yard signs and sending mass mailings. Brian Smith, superintendent of Fishers-area Hamilton Southeastern Schools, has made the pitch more than 60 times in recent months, and he will continue his efforts through the weekend, on why homeowners should OK a $95 million tax increase for the district.

Hamilton Southeastern wants funds to build classrooms for 1,000 more students at Fishers and Hamilton Southeastern high schools, increasing the capacity to 3,700 each. Noblesville Schools is asking for $28 million to expand its high school and relocate a middle school — steps required before Ivy Tech can open a satellite branch in an old middle school. Both districts expect enrollment increases in the next few years to use all the current classroom space in the upper grades.

At Hamilton Southeastern, more than 80 portable classrooms, would be needed to absorb increased student enrollment. Some parents have told Smith if that happens, they’ll move. In Noblesville, a failed vote would prevent Hamilton County from buying the old middle school from the district for $14.5 million and leasing it to Ivy Tech — a plan that has gained widespread support from business leaders and others in the community, Trisler said.

If the referendum passes, all Hamilton Southeastern homeowners will pay a new tax rate. But due to property-tax caps, as well as the eventual expiration of other bonding expenses, only some homeowners will pay tax amounts higher than their current rate. The greatest impact would fall on homeowners with houses valued at or above $230,000. They would pay at least $159 more annually in taxes.

For Noblesville Schools homeowners, if the referendum passes, those with houses valued at $200,000 would see a tax increase of $44 annually in the next few years. But that would more than double in 2021 and continue through 2032.

Information on the seven school referenda (as well as a parks referendum) can be found here:


As a side note, despite the suggestion to the contrary in the above article, referendum-approved tax dollars are OUTSIDE the tax caps:

"If the majority of voters in your district have approved a referendum to allow a building project or to allow your school district extra operating funds, those charges are exempt from the cap."


NWI Reports Lake County Income Tax Provokes More Questions than Answers

From the Northwest Indiana Times:

The local income tax the Lake County Council passed has raised questions, and fueled anger and confusion.

The council approved ordinances authorizing a 1.5 percent tax on first reading April 9 by a 4-3 margin.

However, the tax was buffeted by political currents last week when legislation to divert part of the revenue to commuter train development caused council members to call a special meeting Friday to avoid the diversion by passing the tax on second reading in its original form.

Legislators, however, chose not to meddle with the tax Friday and council members canceled their meeting, announcing they had failed to publish notice of their proposed vote far enough in advance.

The council is next set to meet May 14.

Council members said they have been bombarded in recent weeks with questions about who will pay the income tax, whether Social Security or pensions will be taxed, who will get property tax relief and other technical queries.

They said the consensus around a final form of the tax is so fluid it's hard to nail a definite picture of the tax's details and impact.

If the income tax passes again May 14, then the proposed tax goes before the three-member Lake County Board of Commissioners, where two of the three commissioners have said they cannot support it.

If commissioners veto it at their next meeting, the council will get a chance to override that veto at a subsequent meeting, so long as it has five votes.

While county officials sort out the tax issue, the Indiana Department of Revenue, which has oversight of other county option income taxes, has its own fact sheet and can declare some things with a degree of certainty, according to Robert Dittmer, director of public relations for that department.

See the full article here:


Tribune Reports St. Joseph County Taxes Can be Paid in Mishawaka

From the South Bend Tribune:

If you'd like to pay your property taxes in Mishawaka rather than at the treasurer's office in downtown South Bend, you may do so this week.

St. Joseph County Treasurer Mike Kruk announced the special hours in a news release of 8 a.m. to 3 p.m. today through Friday on the main floor of the County Services Building, 219 Lincoln Way W. in Mishawaka.

You should bring your property tax bill along with your payment, he said.

For a fee, you may also pay online (go to www.stjosephtax.net) or by phone (800-809-5849).

Or you may mail your payment and bill to the treasurer's office at P.O. Box 4758, South Bend, IN 46634. For a receipt, include a self-addressed, stamped envelope.


News-Sentinel Argues "Something for Everyone in New Budget"

From the Fort Wayne News-Sentinel:

Members of the Indiana General Assembly had only one task they were absolutely required to get done this session: Approve a new-two-year budget for the state.
They seem to have crafted a reasonable, balanced one, and their work on it shows that deliberation, cooperation and compromise are still possible, even when both the House and Senate have a supermajority of Republicans who can do pretty much anything they please.
Yes, compromise – real compromise. That word is too often used to stridently insist on an agreement between two groups who have profound philosophical differences on such difficult issues as abortion, gun control and immigration. The only way to find “common ground” in those cases is for one side to turn its back on its fundamental values.
The budget compromise, however, was pure give and take on the same middle ground.
Gov. Mike Pence wanted a 10 percent income tax cut in the budget. The Senate countered with an offer of 3 percent, and the House offered zilch. Then the regularly scheduled revenue forecast came out, showing an increase in expected funding, but only a modest one. So everybody sat down and came up with a budget that includes a 5 percent income tax cut.
That’s enough for the governor to declare a major victory. But it’s not too much for legislators worried about having too little in the rainy day fund if another economic downturn hits.
After the cut is completely phased in after four years, Hoosier taxpayers will get about $250 million a year. That will seem modest to individual taxpayers, but in the aggregate it should be a good stimulant for economic activity. So will the other tax relief in the bill: an immediate end of the inheritance tax instead of the planned 10-year phase-out, repeal of the financial institutions tax and the continued phase-down of the corporate tax. Overall, this is a very good budget for the Indiana economy.
The budget also contains modest spending increases in two critical areas, education and transportation.
It will spend about $330 million more on education over the next two years. It also increases spending on state and local roads by $400 million, and invests another $400 million for major highways expansions.
Those amounts will seem too small to some, especially the education figure. Gov. Mitch Daniels reduced education spending by $300 million during the recession.
But, again, the key word here is balance. Nobody got exactly what they wanted in the budget, but all of us got something. Important areas will be taken care of by the government, and Hoosiers will have a little more money in their pockets.

Revenue Finds Taxpayer's Refund Claims Untimely; But Allows Overpayment to Offset Proposed Assessment for Same Year

Excerpts of Revenue's Determination follow:

Taxpayer is a manufacturer that does business in Indiana and outside of Indiana. Taxpayer contracts with various third-party suppliers ("Suppliers") to design and manufacture component parts for Taxpayer. Before the Suppliers begin their manufacturing processes, Taxpayer inspects, accepts, and subsequently pays the Suppliers for the cost of tooling equipment Suppliers use to manufacture Taxpayer's component parts. The Suppliers then deliver the manufactured component parts to Taxpayer's designated facilities where those parts are assembled to make Taxpayer's finished products for sale. Taxpayer files its Indiana corporate income tax returns which includes the tooling equipment in the property factor (numerator and denominator) of the Indiana apportionment formula to calculate its Indiana income tax.
In 2012, pursuant to a federal audit, Taxpayer amended its 2003 (period ending March 31, 2004) and 2004 (period ending March 31, 2005) Indiana corporate income tax returns to report RAR adjustments. In its amended returns, Taxpayer also included a reduction of the property factor for apportionment purposes. Taxpayer explained that (1) it mistakenly included the tooling equipment in the property factor when the original returns were filed; (2) the amended returns removed the tooling equipment from both the numerator and the denominator of the property factor; and (3) the adjustments resulted in overpayments for both tax years, but the refunds were "barred by Statute of Limitations."
Upon receiving Taxpayer's filings, the Department processed the amended returns to reflect the federal RAR adjustments. However, the Department denied the reduction of the "property factor" stated in Taxpayer's amended returns, which resulted in additional proposed assessments for both years.
When Taxpayer amended its 2003 and 2004 Indiana income tax returns, Taxpayer claimed that when it filed the original returns, it mistakenly included the tooling equipment in the property factor for apportionment purposes, which resulted in an overpayment of income tax paid to Indiana. The Department disagreed and determined that "the tooling equipment in question is business property" because it is used to produce business income. Thus, the Department concluded that the tooling equipment "should remain in both the numerator and denominator of the property factor."
"Indiana imposes a tax on every corporation's adjusted gross income derived from sources within Indiana. [IC § 6-3-2-1(b).] In cases where a corporation derives business income from sources both within and without Indiana, the 'adjusted gross income derived from sources within the state of Indiana' is determined by an apportionment formula." Sherwin-Williams Co. v. Indiana Dep't. of State Revenue, 673 N.E.2d 849, 851 (Ind. Tax Ct. 1996). That formula operates by multiplying taxpayer's total business income by a fraction composed of a property factor, a payroll factor, and a sales factor.
In this instance, Taxpayer claimed that it "receives no income from the tooling property" because "[t]he tooling property is merely provided by Taxpayer to be used by [its Suppliers] to insure the parts are manufactured to [its] specifications." Taxpayer further asserted that it did not use the tooling equipment to generate income;rather, its Suppliers used the tooling equipment to manufacture the parts for Taxpayer and received income from Taxpayer. Thus, Taxpayer maintained that the tooling property should not be included in the property factor for apportionment purposes. To support it protests, Taxpayer provided additional documentation, including sample copies of contracts with its Suppliers, purchase orders, invoices, and tooling acceptance documents.
The documentation presented by Taxpayer demonstrated that upon inspection and approval of the tooling equipment, Taxpayer paid the Suppliers for the costs of the tooling equipment and the Suppliers used the tooling to manufacture the component parts to be sold to Taxpayer. Since Taxpayer did not use the tooling equipment, the tooling equipment was not required to be included in the numerator and the denominator of the property factor for apportionment purposes pursuant to IC § 6-3-2-2(c) and the ruling of Enterprise Leasing Co. Therefore, Taxpayer is correct to amend its 2003 and 2004 returns to exclude the tooling equipment from the numerator and the denominator of the property factor.
However, Taxpayer's documentation also demonstrated that its amended returns resulted in overpayments for both tax years. Pursuant to IC § 6-8.1-9-1(a), its overpayments were subject to the three-year statute of limitations.
IC § 6-8.1-9-1(a), in relevant part, provides:
If a person has paid more tax than the person determines is legally due for a particular taxable period, the person may file a claim for a refund with the department. Except as provided in subsections (f) and (g), in order to obtain the refund, the person must file the claim with the department within three (3) years after the latter of the following:
(1) The due date of the return.
(2) The date of payment.
In this instance, Taxpayer's original returns were filed in 2005 and 2006. However, not until 2012 did Taxpayer file the amended 2003 and 2004 returns pursuant to the RAR adjustments of the federal audit. Taxpayer's documentation failed to show that the federal audit adjustments addressed the very same issue of this protest. Thus, Taxpayer's refund claims for 2003 and 2004, if any, were barred by the three-year statute of limitations. Nonetheless, Taxpayer's 2003 overpayment should be applied to offset the proposed assessment, if any, for the same tax year. Similarly, Taxpayer's 2004 overpayment should be applied to offset the proposed assessment, if any, for the same tax year.