By Jason McFarley, Truth Staff
INDIANAPOLIS -- County officials from northern Indiana said Gov. Mitch Daniels largely agreed Wednesday with their thoughts on property tax reform and making the issue the top priority in next year's legislative session.
Representatives from six counties, including Elkhart and St. Joseph, met for an hour with Daniels and the head of the Indiana Department of Local Government Finance.
The coalition of counties delivered a property tax proposal that the group had drafted this summer, offering a general framework to ease local governments' reliance on property taxes.
"We just sat down across the table from one another and had a good discussion," said Elkhart County Commissioner Mike Yoder, who described the governor as open to the local officials' ideas. "I was somewhat surprised by the areas in which there was general agreement between the governor and the commissioners."
The proposal calls for removing property tax funding for a measure of school and welfare expenses. Increased state income or sales taxes or both would pick up the shortfall.
The northern Indiana officials also call for taking a closer look at which agencies are eligible for tax-exempt status and caution against raising local option income taxes as a means of reducing property taxes.
Daniels, who has proposed that local governments explore option income taxes, again mentioned the idea at Wednesday's meeting.
But the governor didn't tout that alternative as the lone or best solution to the property tax dilemma, Yoder said.
"I went down there with the perception that he would pressure us to do that," Yoder said of the chance that Daniels would push counties to adopt option income taxes. "He didn't, and I was pleasantly surprised."
Elkhart County officials have expressed opposition to raising local taxes, though Yoder said the possibility isn't entirely out of the question.
Part of the hesitance, Yoder said, is that local officials want state lawmakers to enact long-term reform of the property tax system. The governor and northern Indiana leaders agreed property tax reform should be the biggest issue in January, when the Legislature reconvenes.
In the meantime, the local officials plan to begin setting up meetings with state legislators from their communities. The key conference would be with Indiana House Speaker B. Patrick Bauer, D-South Bend.
Yoder said arrangements for that meeting are in the works.