Residents question tax disparity

BROWNSTOWN — Residents from Jackson and Redding townships again questioned Jackson County Council about what they consider an inequity in how the former inventory tax is made up and credited at the expense of property owners outside Seymour city limits.

Bill Lasater of Hoover Drive south of Seymour and others first approached council with the question last November.

He was back Thursday, still seeking answers, and a change in policy.

The window for making such a change is open from March to August each year, with the change taking effect the following year.

Council President Andy Fountain agreed the question should be explored again.

“The real property owners of all the townships in Jackson County are paying an unfair higher property tax amount than Seymour and are not provided the city services of police, fire, garbage pickup and other services,” Lasater said.

“You as a body could do something about this, but it seems nothing’s been done,” he added. “We’re asking you to make this inequity a more fair tax.”

Lasater pointed to the collection of an additional 0.25 percent economic development income tax adopted by the county to help offset loss of the state inventory tax. Most of that revenue — 95 percent — is allotted to the city of Seymour, because that’s where a majority of the inventory tax was assessed. That 0.25 percent CEDIT income is credited through a local tax relief deduction for homeowners.

“Never except in the last three years have I paid more property tax than a property owner in an equivalent home in Seymour, and you people, this council, did it, and it’s unfair,” Lasater said.

Citing property tax figures for his home and that of a similar home inside city limits, Lasater said his local tax relief deduction was $69.26 versus $891.50 for the Seymour home. The tax bill for his home is $640.54. That for the similar home in city limits is $299.72.

John Baker, who lives inside city limits in Redding Township, said his tax bills reflect a similar disparity when compared to homes across the street from his that fall in the portion of the city that’s in Jackson Township.

Questioned after the meeting, Fountain said he would look into the question again and expressed surprise at the comparison Lasater made.

“I think we do need to take a look at it,” Fountain said.

Fountain and Councilman Brian Thompson said they think the discrepancy grew with recent property tax changes enacted by the Indiana General Assembly since the county adopted the inventory tax.

“I don’t think there was a huge discrepancy when the vote was made, but there have been changes made in deductions at the state level that has made it worse,” Thompson said. “The council’s intention wasn’t to set people outside the city up for higher taxes.”

Fountain added he voted against the policy when council enacted it. Thompson was not on council at the time.

A retired history teacher and school administrator, Lasater offered a comparison between the colonialists who rebelled against the British crown to today’s tea party protests against excessive government. He said he would return to council’s next meeting to “see what you’ve done.”

Fountain said he did have the question researched last year but decided not to act because it appeared the city of Seymour would be moving forward with annexing additional areas of Jackson Township into city limits. That wasn’t done, he added.

Annexation of the Jackson Township property, however, would not have changed the disparity for a homeowner in Brownstown, Owen or any of the county’s other townships.

A review of state law appears to show the Legislature allowed counties three options when confronted with losing the state inventory tax. They could allocate CEDIT revenues to reduce property tax bills on owner-occupied residences only or apply it to owner-occupied and rental housing. Or the county could choose not to replace the lost inventory tax money.

Had the tax lapsed without the income tax being added, the opposite could have happened. Seymour’s property owners could have been socked with higher taxes to make up the loss of the inventory tax revenue or faced a loss or cutback of city services.

Lasater was also clear in saying he doesn’t oppose the 0.25 percent income tax to make up for the lost inventory revenue.

“I’ve never said the CEDIT isn’t needed, but I’m saying the way (the revenue is) spread out, it’s not equitable,” he said.

(EDITOR's NOTE: This story was garbled when posted. It was corrected at 3:33 p.m. Friday)