INDIANAPOLIS | Gary officials asked the state for continuing relief from property tax caps Wednesday, while Gary residents told the same state board the Steel City should be allowed to die.
Armed with a roadmap from the city's fiscal monitor to get Gary in compliance with tax caps by 2012, Mayor Rudy Clay and Controller Celita Green asked the state's Distressed Unit Appeals Board for permission to continue charging the state's highest property tax rates in the meantime.
"We need relief," Clay said.
When fully implemented, state-mandated property tax caps will reduce Gary's property tax revenue from about $60 million a year to about $30 million.
The city's fiscal monitor, Dean Kaplan, has created a plan he describes as "tough, but workable," to adjust government services to conform to the new reality of property tax caps. The plan includes closing excess fire stations, requiring city workers to pay higher health insurance premiums and transferring many city services to Lake County.
"Under the tax cap numbers, it's not possible for the city to continue spending what it has been spending," Kaplan said.
Clay said many of Kaplan's recommendations are already in the works.
"We have cut 446 jobs and that was in 2009, so we're headed in the right direction," Clay said.
This is the second year in a row the city of Gary has petitioned the distressed unit board for relief. The city's petition was joined this year by the sanitary district, stormwater management district and airport district. In 2009, the board granted Gary $23.5 million in relief. As a result, Gary property owners currently pay tax rates that are about one-third higher than the rest of Indiana.
Approximately 50 of those taxpayers came to Indianapolis on Wednesday to tell the board they're sick of paying more.
Ann Gallagher, of Gary's Miller neighborhood, called Gary a "dying city" and compared it to a Third World country dependent on outside aid in order to get by.
"Throwing good money after bad is only prolonging its inevitable death," Gallagher said.
The nine member board has not scheduled its final Gary hearing. At that session it will decide how much relief to provide if it agrees to continue property tax relief for the city.
