CROWN POINT | Millions of dollars generated by a proposed income tax could migrate out of the pockets of Gary, Merrillville and Hammond residents to benefit homeowners in Munster, Dyer, St. John, Schererville and Crown Point.
A source close to the Lake County Council disclosed Monday a study that indicates many communities north of U.S. 30 would be the losers while those to the south would benefit from a property tax reduction plan depending on a new local income tax.
County President Elsie Franklin, D-Gary, questioned the authenticity of the data obtained by The Times on Monday, saying she hasn't seen it and won't comment until she does.
Council members Larry Blanchard, R-Crown Point, and Thomas O'Donnell, D-Dyer, said the data sounds a lot like the assumptions they are making from the most recent calculations by Crowe Chizek, a financial consultant for the council.
The council adopted a 1 percent local income tax 4-3 last week and has scheduled a special meeting 1 p.m. Dec. 11 for a vote on second and final reading.
It would raise approximately $78 million from residents, workers and some business investors countywide. But Crowe Chizek states not every dollar of income tax a resident pays would result in a dollar of property tax reduction to that same resident.
Differences in the number of homeowners and renters and their wealth or poverty skews the income tax's distribution geographically, Crowe Chizek said.
The council publicly released a township-by-township breakdown last week showing Calumet, Hobart and Ross townships would lose millions of dollars, while Center, North and St. John townships would gain millions.
However, last week's analysis didn't break the distribution down to a more user-friendly focus on each city and town.
Data obtained by The Times confirms Calumet Township's Gary, Griffith and unincorporated Calumet Township residents would pay out more than they would receive.
It indicates Munster, Whiting and Highland gain the most in North Township, while Hammond and East Chicago see some of their money depart as subsidies to others.
It indicates Hobart Township's losses would be concentrated in Lake Station while Ross Township's losses would be confined to Merrillville.
O'Donnell, a possible swing vote in the tax's future passage, said he hasn't seen any new data, but he isn't surprised if his district, including Dyer and much of Munster, Schererville, Highland and Griffith, benefits.
Blanchard remains a tax opponent despite indications that benefits would flow to St. John, Crown Point and Winfield in his district.
He said any distribution system available to them now is flawed.
"This system has no heart and soul," he said. "This is a terrible shift of wealth."
