WHITINGCOMMUNITY FORUM

April 2, 2008

AGENDA

Property Tax Legislation – HB1001Drinking Water DecisionQuestions & Answers

PROPERTY TAXLEGISLATION

HB1001

BACKGROUNDProperty tax relief is and has been our

top priorityActions taken to date

Reduced expensesMaximus Good Government StudyImproved efficiency – not doneReduced staff by 20% since 2003Provided local relief

BACKGROUND

2007 sequence of eventsMarion County tax bills increasedIn most cases, less than Lake

County’s did in 2004Governor reacted with a plan that

appeased the voters

GOVERNOR’S PLAN

Caps – 1% - 2% - 3% State takeover of leviesFunded by 1% sales taxElimination of tax credits$750 million short to fully fund

PlanNo initial financial analysis done

GOVERNOR’S PLAN

Governor’s answer was to simply reduce the existing revenue for local government – Counties, Townships, Cities, Towns, Schools and Libraries to fund the $750 million shortfall

“Learn to live with less”, he said

HB1001

Governor’s Plan was presented to the Legislature via HB1001

900+ pages longVery complicated100’s of changes to tax law and

related laws

HB1001 IMPACT TO WHITING

Current Civil City & Sanitary Dist. combined property tax levies of $9.6 million of which 40% is Public Safety

Initial analysis of HB1001 showed a reduction in Whiting’s total property tax revenue of $3.8 million or 40%

HB1001 IMPACT TO WHITING

Several studies done, all indicating severe losses for Whiting

A privately funded analysis in January indicated that Whiting’s losses would be $5.7 million or 60%

HB1001 IMPACT TO WHITING

Current total levy - $9.6 millionWorst case losses - $5.7 millionPolice & Fire Pension - $500,000Insurance obligations - $1.5

millionDebt service - $1.2 millionBalance - $700,000

HB1001 SHORTCOMINGS

Not properly fundedNo time for local government to

make adjustmentsGranted additional large

industrial tax breaks

SAVE WHITING CAMPAIGN

Intention was to draw attention to our unique situation

Timing was intended to reach GA the week of conference committees

Wildly successfulEvery legislator knew our

situation

AMENDED HB1001

Police & Fire pensions to stateAdditional County levies to stateDebt service outside of the caps

for Lake & St. Joe Counties“Distressed Unit” appealNew projected losses of $1.6 M

DEBT SERVICE

Existing Civil City debt<$100,000 annually until 2012

Existing Sanitary District debt$1.1M annually until 2015

Existing School debtPaid off this year

DEBT SERVICE

County debt – no detailsMost Lake County property tax payers will not receive the full benefit of caps until debt is paidEst. adjusted Whiting caps will be

1.3% - 2.9% - 3.9% in 2010

DEBT SERVICECity will attempt to pay off debt

earlier than scheduled to maximize relief to property owners

BP project will expedite process and continue to drive the caps closer to 1% each year

By 2012 we should be close to 1%

IMPACT TO TAXPAYERSAverage Whiting Home

House AV 75,000$ 100,000$ 125,000$ 150,000$ 175,000$ 200,000$ 250,000$ 300,000$

2% Cap 1,500$ 2,000$ 2,500$ 3,000$ 3,500$ 4,000$ 5,000$ 6,000$ 20% Local Homestead 300$ 400$ 500$ 600$ 700$ 800$ 1,000$ 1,200$

Net Relief 2% - 20% 1,200$ 1,600$ 2,000$ 2,400$ 2,800$ 3,200$ 4,000$ 4,800$

1.5% cap 1,125$ 1,500$ 1,875$ 2,250$ 2,625$ 3,000$ 3,750$ 4,500$

1.3% cap 975$ 1,300$ 1,625$ 1,950$ 2,275$ 2,600$ 3,250$ 3,900$

1% cap 750$ 1,000$ 1,250$ 1,500$ 1,750$ 2,000$ 2,500$ 3,000$

TOTAL IMPACTStill need to reduce $1.6 million

or nearly 17%Property owners still get

significant property tax reliefCity services will continueAmended bill is much better

legislation than the Governor’s Plan

MISCELLANEOUS2008 Tax Bills????

2% cap in placeNo 20% local Homestead Credit$620M in additional State

Homestead CreditsIncreased BP AVShould be similar to 2007

MISCELLANEOUSRDA grant cannot be used for tax

relief – received many callsTIF changes

TIF revenue – WCEVery limited use of fundsLaw changes July 1 – more

restrictiveWill be using fund in prep for 2009-

10

ANNOUNCEMENT

Property Tax WorkshopThis Saturday, April 5 at 10:00

amProperty Tax problems

Billing errorsAssessment issuesExemption issues

DRINKING WATERDECISION

BACKGROUND2004 Options

Build a new plant - $3.5MBuy from Hammond - $2.5M

Required us to build storage tanks and a pumping station

Let Indiana-American Water provide our water – no capital cost

BACKGROUND2004 rate increase needed

Build a new plant – 15%Buy from Hammond – 15%Let Indiana-American Water

provide our water – 225%Average water (sewer fees not

included) bill from $9.76 to $32.00

BACKGROUND2005 - after significant research

and discussion, announced our intentions to build new plant

2005-2007 could not acquire property needed to build

Needed land to build storage tanksPumping station

ENVIRONMENT CHANGE

Hammond – Whiting working together on several projects

Discussions on water options reopened

Identified project to save $9M capital costs between both cities

ENVIRONMENT CHANGE

Hammond terms modifiedLower rateSplit capital costsStorage and pumping station no

longer neededTotal investment – less than

$500,000

BOTTOM-LINE

Stable rates for many years outNo debt needed to fund projectSignificant operational cost

savings - up to $250,000 annually

QUESTIONS & ANSWERS