From the Indianapolis Star:
Fishers, Cloverdale and Nashville have something in common this legislative session. The General Assembly is considering adding or changing a food and beverage tax for each.
If approved, Cloverdale would be able to use the revenue from this new tax for the construction, operation and maintenance of water, sewage and flood facilities (House Bill 1070). Fishers would be allowed to use its new revenue to reduce its property tax levy or for economic development (HB 1070). Nashville already has a food and beverage tax, but, if this bill becomes law, Nashville will be allowed to use the revenue for sidewalk and streetscape improvements and maintenance (HB 1133). These uses are specific and both bills seem to be making good progress through the legislative process.
Another food and beverage tax bill that is not making much progress, however. HB 1071 would give all municipalities the power to impose a food and beverage tax if they don’t have one already. The new revenue could be used to reduce the property tax levy, providing property tax relief, making payments on bonds and leases, paying for capital projects, and as operating revenue. In other words, it would give the municipalities that adopt a food and beverage tax under this new law very wide discretion for how the revenue could be used.
Few people can be certain of the real reason one bill moves and another stalls, but it would be difficult to ignore at least one thing about these bills. One of the bills would give all municipalities the power to impose a food and beverage tax without the approval of the General Assembly. The other two bills leave control of food and beverage taxes in the hands of the General Assembly. Some will say this is an example of the state government being too paternalistic and not giving local governments the tools they need to address the demands of their constituents. Others will say this is an example of the state government providing a check against rampant local taxing.
Indiana has a long history of the state government keeping a fairly tight hand on what funding mechanisms are available to local governments. Indiana voters put an even tighter hand on funding in 2010 when they approved putting property tax caps in the Indiana Constitution. Local governments across the state are trying to figure out how to continue to provide services their constituents request while also coming to grips with the cuts in revenue that have hit as a result of the property tax caps.
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See the full article here:
http://www.indystar.com/apps/pbcs.dll/article?AID=2013303210058
