Northwest Indiana Discussion

Lake County *DEMOCRATS* may sue to lift property tax freeze

CROWN POINT | Lake County (democrat) officials may sue for the repeal of a state law that punishes local governments here for the county's refusal to pass a personal income tax.

John Dull, Lake Board of Commissioners attorney, reported to the board Wednesday that he and Anthony Overholt, an Indianapolis lawyer working for the Lake County Council, have concluded after weeks of legal research that a lawsuit might succeed in freeing county, township and municipal government to collect tens of millions of dollars of additional property taxes they now are denied under a punitive state law.

The dispute revolves around Lake being the only county in the state without a local income tax. It also has some of the highest property tax rates in the state.

State legislators, who believe Lake County is too reliant on taxing property, passed a law in 2007 that has frozen the total amount of property taxes the county can collect in any one year at the amount it received three years ago.

The law in question would unfreeze the property tax levy only if the county were to adopt a 1 percent tax on the personal incomes of county residents and employees of county businesses. No other county is under a similar freeze.

The County Council attempted in December 2007 to pass an income tax, but commissioners vetoed it, and the seven-member council couldn't muster the five votes needed to override that veto.

Since then, the council has avoided the issue, and County Councilman Larry Blanchard, R-Crown Point, recently calculated the freeze has denied local government more than $60 million in property taxes.

The freeze rewards property owners who haven't had to pay the additional $60 million, but has put increasing pressure on local officials who are limited in the amount of new revenue they can raise to counterbalance inflation that squeezes government employees' pay.

Although county officials have complained for years about the law, Dull said he and Overholt only began looking into a legal remedy about two months ago. Dull said he may file court papers as early as next month, assuming elected officials give him the green light.

"We have standing to sue, and I will prepare a complaint that would be an equal protection attack on the law on grounds it's illegal special legislation," Dull said.

Commissioners Fran DuPey, D-Hammond, and Gerry Scheub, D-Hammond, said they are eager to challenge the law.Council President Tom O'Donnell, D-Dyer, said Wednesday he hadn't heard of any recent talk about litigation, but said he would support it.

Dull said the litigation would be unrelated to the property tax caps, which voters put into the state constitution through a Nov. 2 referendum. The caps place a ceiling on how much individual property owners can be taxed each year.

Why do Lake County democrat hacks always leave out the part about LC having some of the highest property tax rates in the state?

They also conveniently forget about the fact that LC is exempt from the law for years to come.