2013 Indiana General Assembly

Hammond City Council takes stand against 2 pieces of legislation

2013-02-13T21:00:00Z Hammond City Council takes stand against 2 pieces of legislationChelsea Schneider Kirk chelsea.schneider@nwi.com, (219) 933-3241 nwitimes.com

HAMMOND | The Hammond City Council is sending notice to state lawmakers of its opposition to bills that could potentially cost the city about $4.5 million in gaming revenue and $800,000 in rental registration fees.

City Council members voted to send letters to state lawmakers after hearing a legislative update from Hammond Mayor Thomas McDermott Jr. while in caucus before their Monday meeting.

House Bill 1313 would bar Hammond, and other municipalities with similar policies, from collecting an annual registration fee on rental units in the city. Hammond uses those dollars to back the city's Inspections Department, which largely deals with rental housing. In 2012, $814,865 was collected from the $80 per rental unit fee.

“Basically, it would make it impossible for us to charge a fee, which means we would lose that source of funding, which means (the Inspections Department) would go back on the general fund instead of it being supplemented by the rental registration fee,” McDermott said, “which exacerbates our already tight budget that much more.”

McDermott said that in his testimony to a House committee on the bill he stressed landlords have saved $2.5 million in Hammond since the property tax caps were enacted.

“Don't believe they aren't getting a good deal,” McDermott told council members. “The tax caps have benefited rental properties greatly.”

Separate legislation dealing with taxes on state casinos may cause Hammond to lose $4.5 million per year in revenue, according to City Controller Bobby Lendi. Senate Bill 528 eliminates the admissions tax, but creates a new tax to supplement the current wagering tax.

At issue is whether state lawmakers will make the supplemental tax subject to the same cap as the wagering tax. If it falls under the same ceiling, Hammond expects to lose $4.5 million, or what it received annually in admissions tax.

“The scary thing is this bill is moving,” McDermott said.

As of January, Hammond's Horseshoe Casino is the sole gaming establishment in the state to hit the cap, meaning the city already has received the most it can from the wagering tax about halfway through this fiscal year, state records show.

In 2012, Hammond hit the cap, along with boats in East Chicago, Evansville and Lawrenceburg, among other locations, according to records provided by the state auditor's office.

Councilman Anthony Higgs, D-3rd, stressed to council members the need to send letters because the legislation “is going to hurt Hammond.”

Lendi asked council members to emphasize in the letter the impact of the proposed bill.

“Please let them know that at this point taking another 15 percent of our gaming revenue, which we're counting on to make critical infrastructure improvements in our aging city, is going to be detrimental to the health and safety of our residents," Lendi said.

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