Proposal to Eliminate Homestead Tax Credit Fails in Council
The homestead tax credit in Indianapolis will remain intact after a proposal which would have phased it out over two years failed in the Indianapolis City-County Council.
The proposal, which failed by a vote of 11 to 18, would have cut the tax credit in half next year, and completely eliminated it in 2015. Mayor Greg Ballard introduced the idea of eliminating the tax credit in his budget proposal last year, but it was cut from the final budget approved by the council.
While many councillors hoped the money would go to public safety, others, including Democratic councillor at-large Zach Adamson were wary of where the money would come from. "While the elimination of the homestead credit will put $8.3 million into the city's general fund, I cannot in good conscience balance the city's budget by taking $5,248,000 from the public schools, public transit, public health and hospital and libraries."
Republican councillor Ben Hunter supported the proposal. He said the elimination of the homestead tax credit was the only sustainable source of income for public safety. Hunter said while eliminating the tax credit was a tough decision, it would be the right one to make.
In a statement Monday night, Mayor Greg Ballard said, “City-County Council leaders tonight failed to back up their rhetoric about providing more funding to our police and fire departments. I introduced this proposal a year ago. An independent, bi-partisan study commission recommended this step which would have cost only a percentage of homeowners less than a dollar per month and generated more than eight million dollars to support public safety in our city.”
Council President Maggie Lewis released a statement, saying, "Eliminating the Homestead Tax Credit is the equivalent of a tax increase that will hurt those who can least afford it - retirees and families. It is essential that we develop a budget to address the critical needs of our community, and as the fiscal body for the City/County it is the Council's responsibility to ensure that every option is reviewed, and that we look under every rock, before considering the last option - a tax increase."