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Potential effect of Daniels’ plan on Clay County unknown

Wednesday, October 24, 2007

Governor Mitch Daniels laid out a plan for property tax relief for Indiana residents Tuesday night, but it left much to be desired.

“It was only an outline,” Clay County Auditor Mary Jo Alumbaugh said. “I understand he only had 15 minutes, but there were no facts or figures to back up what he was saying.”

Daniels plan was highlighted by three ideas.

The first was to set a property tax cap of 1 percent of a home’s true value, the second was to increase the state sales tax by one cent to counteract the reduction of revenue from the property tax cut and the third was to make the position of Assessor an appointed one instead of politically elected.

“The changes could make a major effect in the short term, but there was no information about the long-term effects,” Alumbaugh said. “Also, without figures of how this could affect the state, it is hard to determine what the impact on Clay County would be.”

Another change Daniels proposed to create relief for residents on their property taxes is to remove the rest of the school operating costs.

“This would definitely make things less difficult on homeowners if school funding was lifted completely from the local tax levy,” Alumbaugh said. “The problem is the money to compensate for the loss of property tax revenue needs to come from somewhere.”

Alumbaugh explained there are three sources of tax revenue: income, property and sales taxes.

“Sales tax is part of the state’s revenue, and then they distribute it to the local levels,” she said. “The need to collect taxes to help run the county is still there.”

One thing missing from Daniels’ statement was how these changes would affect entities controlled by the counties themselves.

“He didn’t say anything about how locally controlled funds, like the Cumulative Capital Development and County General funds would be affected,” Alumbaugh said. “Also, he said nothing about where the plan came from. There’s no telling if this was a plan he came up with on his own or if he had help elsewhere.”

Alumbaugh also said until more information was given about the plan, speculation on its potential effects is futile.

“Everything is still kind of up in the air as to what could happen,” she said.

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Go Mitch Daniels!!! Who ever planned this plan, Mitch or others, did a great job. This shows how he is changing things around Indiana for the better!!!!

-- Posted by OntheRight08 on Thu, Oct 25, 2007, at 4:30 PM

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