Fort Wayne City Council members gave preliminary approval Tuesday night to a new property tax expected to raise up to $800,000 in new revenue next year.
If the city raises the new property tax, called the cumulative capital development fund, to its maximum each year, the revenue would grow to an estimated $1.5 million in 2015 and $2.1 million in 2016 and thereafter.
John Stafford, executive director of IPFW’s Community Research Institute, said the money does not have to be used the year it is collected but is intended for capital expenses, such as roads or vehicles.
To be enacted, the council must give the measure final approval at its regular session next week. It passed in committee session 6-1, with Russ Jehl, R-2nd, voting “no.” Councilmen Marty Bender, R-at large, and Glynn Hines, D-6th, were absent.
Stafford said there is a 30-day window in which the public can file objections to the tax with the Allen County auditor, but objections would only trigger a hearing by the Indiana Department of Local Government Finance.
“And it has to be a substantive objection,” Stafford said. “It can’t be just, ‘I don’t like it.’ ”
He also pointed out that at budget time in the fall, the council could choose to charge less than the maximum rate, just as it could each year after. But that is unlikely, as Councilman John Crawford, R-at large, said the council needs a sort of gentlemen’s agreement that the tax proposals it approves now will not be changed at budget time. He said it was only fair that the administration be able to prepare its budget based upon the decisions the council makes now and not have surprises in September or October.
The decisions the council must make are many but are narrowing quickly. The city has a 2014 budget shortfall of up to $9.2 million, and the council agrees it needs an additional $14.4 million for police and fire, roads and parks.
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