Per Capita Spending from Property Taxes

             Population          2000          2001           2002
The Pines         798              $75            $82             $85
Hebron          3,596            $113          $117           $123
Kouts             1,698            $134         $135            $147
County       146,798            $170         $168            $189
Porter             4,972            $287         $308           $319
Chesterton    10,488            $288         $308           $324
Portage         33,496            $284         $300           $354
Valparaiso    27,428            $355         $367           $389
Ogden Dunes  1,313            $355         $411           $432
Beverly Shores  708            $504         $520           $542
Dune Acres        213           $953         $942           $947
Burns Harbor    766         $2,010      $1,312       $1,992
 

Sources: U.S. Census, Porter County Data Processing figures based on county tax billing.

Notes: The mix of services provided by the cities, towns and county government differ. Though property taxes make up the bulk of local government’s budgets, the units above get revenue from other sources, such as fees and excise taxes, not figured in the above calculations.

By VICKI URBANIK

The finding that Porter County government ranks in the lower half of spending among all other counties in Indiana has been a source of pride for some county officials.

But it may come as a surprise to some to learn that the county government holds the same distinction when compared to the cities and towns within Porter County.

A look at how much the units spend in property taxes per capita shows that the county government spends less than all but three municipalities.

Two towns with similar populations are at the opposite extremes: Burns Harbor spends the most per capita, while the Pines spends the least.

Chesterton and Porter are ranked seventh and eighth, respectively, out of the 12 taxing units.

It’s difficult, maybe almost impossible, to make a concise, apples-to-apples comparison of spending by the towns, cities, and county government, but property taxes are a good guide.

Property taxes make up the bulk of local governments’ budgets, even those that impose many fees or those that win many grants. All units face the same property tax levy restrictions, and their property tax draws are not affected by fluctuations in other revenue sources, such as excise taxes.

But property tax distributions alone don’t provide all the answers to government spending, since other funding sources vary from unit to unit and the services they provide differ.

In Chesterton, Clerk Treasurer Gayle Polakowski said that generally, the town gets two-thirds of its revenue through property taxes and one-third from miscellaneous revenues, such as fees, building permit fees, contractor’s fees, and excise taxes.

She estimated that the town gets $200,000 to $300,000 annually in excises taxes, which she noted isn’t much when one considers that the overall town budget is around $5 million.

Burns Harbor Clerk-Treasurer Esther Nickell said Burns Harbor’s town government is funded almost entirely by property taxes and the town probably collects fewer fees than any other municipality in the county.

“That’s why it hurt us so bad when Bethlehem filed (bankruptcy). That accounts for 85 percent of our revenue,” she said.

At the county level, Porter County Council President William Carmichael pointed as evidence of the county’s frugality the most recent county-by-county statistical report prepared by the Indiana Farm Bureau.

The report notes that Porter County is the ninth-most populated county in the state, but its tax rate is ranked 50th out of the 92 counties. Even before last year's 10 percent budget cuts, 56 other county governments spent more per capita than Porter County’s.

Carmichael also pointed to one statistic in particular: Porter County spends $38.09 per person for its jail and police, compared to the state average of nearly $54 per person.

Services Differ

The mix of services provided by the municipalities and county government differs.

Chesterton and Porter are among those towns that charge a fee for garbage collection. Burns Harbor does not. The county government doesn’t even provide trash service.

Some units may charge a fee that’s returned to their overall general fund; a similar fee elsewhere may be used to fund only a specific purpose.

Cities and towns provide fire protection. The county government does not; unincorporated residents get their fire protection through their townships instead.

Cities and towns provide police protection within their boundaries, while the county police – the Sheriff’s Department -- primarily handles calls only in the unincorporated areas, although all police units are expected to provide mutual aid when needed.

Similarly, cities and towns handle their own planning, zoning and building permits; the county provides these services only in the unincorporated areas.

And the county’s animal control department responds to calls countywide, but cities and towns pay the county a fee for the service.

It would be incorrect, however, to say that the county government provides services only to the county’s 61,322 unincorporated residents. The county government provides many services that the cities and towns don’t -- such as public health, the courts and probation departments, juvenile detention, the county jail, emergency dispatching (though Valparaiso and Portage have their own 911 dispatchers), ambulance service, assessing, tax bill preparation, tax distribution, assessed valuation certification, drainage, hazardous material responses, emergency planning, elections, and certification of gas pumps.

Bethlehem Factor

Burns Harbor and the county government were two of the taxing units most hurt by the Bethlehem Steel bankruptcy. However, in 2002, the first full year that Bethlehem failed to pay its property taxes, the taxpayers in both Burns Harbor and the county began paying toward new bond issues.

In 2000, the last full year that Bethlehem paid its property taxes, the county government’s take of property taxes totaled $25 million. The next year-- when Bethlehem paid only half of its $20 million tax bill -- the county government saw its property tax revenue drop to $24.8 million. But last year, with the new 5-cent tax rate for the new jail, the county’s property tax take went up to $27.8 million.

A similar situation occurred in Burns Harbor. Last year was the first year that town taxpayers began paying a new 62.8 cent rate for the sewer project. That rate, along with the town’s overall rate of 90 cents, would have been lower if Bethlehem’s massive tax appeal wasn’t partially taken out of the assessed valuation. But with the new bond, Burns Harbor’s property tax intake of $1.526 million was just slightly lower than the $1.539 million it got in 2000, before Bethlehem’s bankruptcy.

The 2002 property tax distributions, for both real and personal property after deducting the homestead credit and property tax replacement funds, for several other units are as follows:

Chesterton: $3.4 million.

Porter: $1.59 million.

Dune Acres: $201,738.

Valparaiso: $10.6 million

Portage: $11.8 million.

Beverly Shores: $383,788.

The Pines: $68,147.

Posted 4/11/2003