Category Archives: Local Government

“Corrected” property tax bills have been mailed, and welcome as the effort to equalize assessments is, values overall continue to increase.
The problem is that, while assessed values are increasing, actual home values are declining. There are both short-term and longer-term reasons for that decline: rising gas prices will inevitably affect the price of homes that do not have access to public transportation. (In Indianapolis, unfortunately, that pretty much describes the whole city.) The slowing economy reduces both the number of buyers, and the prices the remaining buyers are willing to pay.
Then there’s the ballooning mortgage foreclosure rate. It is tempting for those of us not caught up in that crisis personally to be sympathetic, but detached. Sure, we say, it’s a shame that some (other) homeowners find themselves embroiled in the foreclosure process. Of course, some of them weren’t as prudent as they should have been. But that really isn’t our problem.
Except that it is.
Recently, IUPUI’s Center for Urban Policy and the Environment used a statistical modeling process to estimate the effect of foreclosures on housing values in Marion County. The study was limited to foreclosures during 2004. (There is always a lag in the availability of data for this kind of analysis.) The researchers found that the properties that had been foreclosed sold for 26 to 29 percent less than comparable non-foreclosed properties. Even more troubling, in neighborhoods with a number of foreclosures, those “fire sales” get used as comparable transactions for purposes of establishing housing values and sales prices for the other homes in the area. That limits what banks and mortgage companies are willing to lend against those properties. This so-called “foreclosure discount” can thus have a significantly negative impact on the value of other homes in the area.
In 2004, the total decline in housing values across Marion County due to foreclosures was an estimated 9 percent.
Protestors complain that higher property taxes also drive down the market prices of residential real estate. True enough. But lower housing values will in turn drive down tax receipts, giving local government even less money to spend on the public services that—as we sometimes forget—add to the market value of our properties. The quality of our parks, schools, public transportation, police and fire protection all factor into the price a prospective buyer is willing to pay for a home.
There is no easy “fix” apparent. From all accounts, we have yet to see the worst of the housing crisis. The federal government has led by bad example, running up its own unaffordable mortgage—our gargantuan national debt. That bill is coming due, and further straining our ability to tackle our economic problems. Gas prices may level off, but they are unlikely to decline, and energy costs drive up the cost of everything else.
We have been living on our national credit card, unwilling to control the wheeler-dealers or invest in our communities. Now the bill is coming due.
It’s going to get ugly.

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The Indiana Senate has demonstrated that it will spend its limited time during this short session on those matters most important to—who, exactly?

 

At a time when public passions are at a boiling point over our dysfunctional tax system, when citizens are demanding that we streamline Indiana’s wasteful, overlapping government structures, the Senate has decided to take decisive action—to ban same-sex marriage.

 

By this point, the arguments against SJ7 are well-known. It “solves” a problem that doesn’t exit, by denying still-theoretical gay couples access to hundreds of legal rights that heterosexual citizens enjoy. Those include the right to be appointed as a guardian of an ailing or injured partner, the right to take family leave, and the right to half of the partnership’s accumulated property if the relationship dissolves. Same sex partners pay more taxes because they aren’t entitled to spousal gift and estate tax exemptions and deductions. They can’t seek damages for a partner’s wrongful death. There are hundreds more—rights enjoyed by heterosexuals married two days, but denied to gays who have been partners for 30 years.

 

Worse, as constitutional expert Aviva Orenstein testified, part B of this poorly-drafted Amendment is likely to hurt all unmarried couples, not just gay ones, and is an invitation to the “judicial activism” that proponents claim to detest. No one has a clue what “legal incidents of marriage” are.

 

SJR 7 is opposed by Indiana’s largest employers, by many clergymen and religious organizations, by university professors, by dozens of professional organizations, and in recent polls, by a majority of Indiana citizens. So what compelling justifications are offered for cluttering the Indiana constitution with this confusing and discriminatory language?

 

Basically, proponents say gays shouldn’t be allowed to marry because some religions teach that homosexuality is immoral. (Of course, all religions teach that rape and murder are immoral—but Indiana allows rapists and murderers to marry. Go figure.) They say marriage and sex are for procreation (although we allow sterile folks to marry). Most of all, they insist that recognizing gay unions will undermine families and the institution of marriage. (Similar claims were made about interracial marriage, and about allowing women to own property and vote.)

 

Let’s at least be honest. This isn’t an effort to protect families—it is an effort to privilege some families at the expense of others. SJ7 is not about religion or morality—it is about whose religion, whose morality.

 

This is also not about our Senators responding to some groundswell of public opinion. This is an issue rapidly losing its salience with most voters, who are understandably a lot more concerned about taxes, crime, access to health care and other bread-and-butter and quality of life issues. To the extent the Senate is responding to public pressure, it is pressure coming from a small but highly vocal constituency.  

 

We can only hope that when SJR7 arrives in the Indiana House, our Representatives give it the priority it deserves—and bury this bad bill whose time has thankfully passed.

 

 

 

   

 

 

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Marion County’s dramatically—if erratically—increased property taxes have been the topic of non-stop conversation and exhaustive media coverage for the past two weeks.  I’m hearing lots of complaining. What I’m not hearing is serious consideration of the causes of the problem (finger-pointing doesn’t count) or suggestions for sensible measures to reduce unnecessary costs.

 

I know that one person’s “unnecessary costs” are the next guy’s “absolutely essential public services,” but—at risk of enraging more readers than usual—let me suggest just two measures that could reduce taxes and improve services at the same time.

 

• Marion County supports eleven school systems. That’s eleven superintendents, making over 100,000 each. That’s eleven administrative structures, each with its own buildings and staffs full of deputy superintendents, curriculum experts, human resources departments and the like. Eleven transportation systems, bus fleets and dispatchers. Eleven food service operations. Eleven separate school boards, with per diems, travel budgets, and other expenses. Each school system hires its own lawyers, negotiates separately with the teachers’ union, builds its own schools, provides its own counseling, policing and standardized testing. Meanwhile, enrollments have been declining in several of those districts, even while costs continue to accelerate.

 

            The savings that would accrue from consolodating those districts would be         significant. (In 2006, the budget for IPS alone exceeded five hundred million            dollars.) We could also redirect resources from overhead into our classrooms, and            equalize services—and school tax rates—across the county.

 

• A similar argument can be made for consolodating (or preferably abolishing) the outdated Township Trustee system. Over the years, most of the duties originally discharged by individual trustee offices have been assumed by other agencies. And repeated studies have confirmed that trustees are not cost-effective providers (to put it kindly) of poor relief, their  major remaining function.

 

So why are these two measures, which could yield substantial savings without sacrificing service, essentially off the table? Simple: politics and patronage.

 

In the case of the schools, it has been the politics of money and race. When Unigov was enacted, it was common knowledge that including the schools would have been the kiss of death—privileged white parents weren’t going to send their children to school with poorer children, especially if they were black. Demographics (and, one hopes, attitudes) in Marion County have changed considerably since 1971. It’s past time to revisit the issue. 

 

In the case of the Township Trustees, patronage is the culprit. As the county has become increasingly Democratic, suburban Trustee’s offices are among the last Republican strongholds, while the Center Township Trustee is a longtime source of Democratic jobs, especially for minorities.

 

Meanwhile, political game-playing hasn’t helped. When President Bush “cut” federal taxes, states were stuck with the costs of services those taxes had paid for. Then state governments realized that two could play that game, and shifted costs to local units of government.

 

Now local government has to decide who it will hurt: property taxpayers, or those with vested interests in keeping things as they are.  

 

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If you criticize someone when you think they are wrong, you should be fair enough to applaud them when they do something right. Speaker Brian Bosma has recently done something right, by strongly endorsing HB 1009, Rep. Jerry Torr’s bill to replace gerrymandering with a nonpartisan redistricting process.

 

The way lines are drawn now is for the majority party to draw as many “safe” seats as possible—more for itself, of course, but also for the minority party, because in order to retain control, the winners need to cram as many of the losers into as few districts as possible, and those districts are also safe. Neighborhoods, cities, towns, townships—even precincts—are evaluated solely on the basis of voting history, and then broken up to meet the political needs of mapmakers. Numbers drive the process—not compactness of districts, not communities of interest, and certainly not democratic competitiveness. And computers have made this process very precise. Most state legislative districts in Indiana are safe for one party or the other. In this system, the interests of real communities are secondary.

 

Safe districts facilitate special-interest legislation: if you are guaranteed victory every election, it is less important to listen to constituents; easy to become lazy and arrogant. Party preoccupation with gerrymandering consumes an enormous amount of money and energy that could be better directed, while safe seats allow politicians to scuttle popular measures without fear of retribution.

Lack of competitiveness also makes it impossible to trace campaign donations, since unopposed candidates send their “extra” money to those running in competitive districts. (The current scandals surrounding Tom Delay are a case in point.) The most consequential results, however, are voter apathy (why play when the deck’s been stacked?) and the extremism—left and right—that is produced when elections are won or lost in primaries dominated by both parties’ most fervently ideological voters.

 

HB 1009 is not perfect. It raises legitimate state constitutional issues, and sets arguably incompatible goals. For example, competitive districts are desirable, but it is also important to respect natural community boundaries; if these two goals clash, which is most important? I would argue that an overwhelmingly Republican or Democratic neighborhood or city is entitled to have its majority viewpoint reflected, that the point of redistricting reform should be to move away from districts drawn to achieve political goals, worthy or not. The Torr bill also makes the recommendations of the nonpartisan panel advisory, rather than binding. This was probably an effort to avoid state constitutional issues, but it’s an invitation to partisan wrangling and wheeler-dealing. 

   

Nevertheless, while it will be very important to do this carefully and avoid making the current mess worse, HB 1009 is a welcome step in the right direction.

 

For Hoosiers interested in more detail, including information about what other states are doing, and nonpartisan analyses of HB 1009, a new Indiana nonprofit, the American Values Alliance, has valuable resources on its website (www.valuesalliance.org). This is an issue all citizens should care about.

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