INDIANAPOLIS – For a few days in July, it looked like California's Proposition 13 fever had engulfed Indiana. Angry homeowners massed across Hoosierland, rising up against double- (and sometimes triple-digit) increases in Hoosier property tax assessments that were announced by snail-mail.
In Marion County, home to the state capital, hundreds of citizens gathered at the Governor's Mansion, the State House, Monument Circle and elsewhere to protest what citizens condemned as outrageous increases. Mirroring the 1978 California revolt, outrage intensified when it became apparent that several commercial properties had somehow escaped the re-assessment.
Your favorite columnist predicted last March that the General Assembly would fail to produce the needed tax reform to avert the current crisis. As new tax billing invoices hit homeowners, legislative leaders on both sides of the fence started finger-pointing. Indianapolis Mayor Bart Peterson openly called for Governor Mitch Daniels to call a Special Session of the Indiana General Assembly as the citizen's crisis mounted.
The crisis was produced in part by the final expiration of the despised former Indiana Inventory Tax, which previously produced a long-term chilling effect on expansion of Indiana's transportation, distribution and logistics industry. Marion County elected not to opt-out early on the tax, which led in part to the current crisis.
The emerging calamity was calmed earlier this week when Gov. Daniels announced that he was ordering a statewide re-assessment of all private and commercial property. Homeowners were told to pay the 2006 rates and essentially the crisis temporarily abated.
However, in ordering the re-assessment, Gov. Daniels did something very interesting. In his announcement, he also laid out plans to create and appoint a special commission that may have very profound and long-range impact on the Hoosier state.
Called the Commission on Local Government Reform, it will be co-chaired by former Gov. Joe Kernan (whom Daniels defeated in 2004 in his election as Governor) and Randall Shepard, chief justice of the Indiana Supreme Court.
According to Ed Feigenbaum, a lawyer and publisher of the must-read Indiana Legislative Insight biweekly newsletter, the Commission – whose other members are yet to be selected – will begin its work in early August and (by late December) recommend how local governments can increase the efficiency and effectiveness of their operations to lower taxpayer costs.
Feigenbaum toldMidwest Business that the impact of these recommendations could be far-reaching. They will consider:
- What local government offices might be eliminated to achieve efficiencies and cost savings for Hoosier taxpayers? Specifically, should township/county property tax assessors be abolished in favor of a uniform process managed by the state?
- What local units of government (including schools and libraries) might be successfully consolidated to reduce overhead and administrative expenses?
- What local government services or functions might be reduced, eliminated, or provided in new ways to achieve savings for Hoosier taxpayers?
- Is a Constitutional Convention necessary or desirable as a means to achieve significant reforms in the structure and organization of Indiana state government?
With his leasing privatization of the Indiana Toll Road and numerous other proposals, Gov. Daniels has demonstrated that he fears no criticism as a global change agent. The Governor, by championing the advance creation of the Indiana Economic Development Corporation (IEDC) and other business-friendly initiatives, has also demonstrated his administration's intense focus on making Indiana highly attractive to business relocation and growth.
The implications of this commission creation? Feigenbaum continued to Midwest Business: "Given the imperative behind creation of the panel, the long-standing propensities of the co-chairs, and the strong feelings of the public at large, and a longer rope than one might ordinarily expect (you don't recruit the caliber of co-chairs that this panel will feature by imposing constraints upon them) the Commission will undoubtedly propose far-reaching consolidations (interestingly, the day the panel was unveiled, the Center for Evaluation and Education Policy at Indiana University released a new study finding that school consolidation does not appear to improve student achievement, nor are meaningful financial benefits consistently generated from consolidation) that should prove to be interesting legislative fodder."
With major million-dollar studies on regional development and tentative road maps now in place from Indiana and Purdue universities, the Hoosier state could well be moving toward a regionally competitive approach. "The Governor is more than willing to take this consolidation effort as far as needed," predicts Feigenbaum.
The implications for technology are obvious, with a renewed regional focus – together with consolidated resources – helping make Indiana a go-to state for development.
Finally, while Hoosiers have advanced the idea of a state Constitutional Convention over many a beer and pretzel, a sitting Governor has never put forth such a possibility in recent times. If government services are indeed streamlined and financial resources released for economic development, Indiana could undergo profound change, beginning by early 2008.
Calling a Constitutional Convention also has alarming drawbacks, as many critics have been pointing out on Indiana airwaves. But has the Governor already thought of that?
Soothes Feigenbaum: "A constitutional convention poses all kinds of problems in terms of what could be introduced and how it could be hijacked, but the Chief Justice [Randall Shepard] is accustomed to tailoring his rulings as narrowly as possible, and I would expect this panel to try to do as much as it can without opening up too many cans of worms."
In announcing the commissions, Daniels predicted that one day people may look back at the 2007 tax crisis as having a small silver lining in the form of real reform. Whatever the outcome, Indiana certainly bears watching over the next few months.
Michael Snyder is principal of The MEK Group, a marketing and business development consulting firm that provides communications-driven strategies to increase market share, enhance productivity and build distinctive brand awareness. Snyder can be reached at msnyder@themekgroup.com.
Click here for Snyder's full biography.
Previous Columns in 2007:
State of Indiana's Defense Business: $4.6 Billion and Growing (7/5/2007)
Purdue Simulation of World Trade Center Impact Could Improve Design, Safety (6/21/2007)
Nobel Prize Winners, Scholars Primed For ‘Premier Conference' in Indianapolis (6/14/2007)
2012: Repeat of 1859 Solar ‘Super Storm' Catastrophe? (6/7/2007)
Indianapolis 500: 220 Miles Per Hour on 100 Percent Fuel-Grade Ethanol (5/31/2007)
‘Baby Steps' For Marcadia Biotech in Indiana Grow Into ‘Giant Leaps' (5/22/2007)
Indiana Legislature Scores Big With Innovative Patent Tax Credit (5/10/2007)
IEDC to Showcase Hoosier ‘Best, Brightest' at BIO 2007 in Boston (5/3/2007)
‘Little 500' Bike Race Sports 21st Century Indiana University RFID (4/26/2007)
Manufacturing Critical For Global Success, Indiana Expert Says (4/19/2007)
First-Ever Indiana Robotic Proton System Nukes Deep Tumors (4/12/2007)
Purdue's Discovery Park a $350 Million ‘Driver For Change' (4/5/2007)
Cellulosic Fuels, Ag Tech to Play Key Role in Indiana's Future (3/30/2007)
With FCC Deadline Looming, Indiana Ponders Telemedicine (3/22/2007)
Realigned TechPoint Set to Energize Indiana IT Growth (3/15/2007)
Indiana General Assembly on Tech: Chaos or Collaboration? (3/9/2007)
Indiana DSI Initiative Sets New Vision of Innovative, Large-Scale Tech Transfer (3/1/2007)
No ‘Corn Dot-Com Bust' For Indiana Ethanol, Says Ag Secretary Miller (2/15/2007)
Battelle Report: Indiana Biosciences Again Established as National Player (2/8/2007)
Indiana Defense Muscle Grows With West Gate Tech Park Expansion (2/1/2007)
Twenty in 10: President Bush Leaps Future of Hoosier Biofuels Forward (1/25/2007)
Outlook on Indiana-Based Biofuels, World Markets: ‘We're Ready' (1/18/2007)
ChaCha in Indiana Attracts Funding From Amazon, Compaq Founders (1/11/2007)
Purdue Ethanol Tech May Render Current Fuel Production ‘Obsolete' (1/5/2007)
Click for 2006 column archive.
Click for 2005 column archive.
