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January 18, 2014

FLASHPOINT: Economic prosperity means strong businesses and vibrant communities

Whether you are talking about college graduates looking for a first job, older citizens who are deciding where they want to live as they age, or new parents deciding on the right place to raise a family, future Hoosiers can afford to be picky. Their options are growing as more cities and towns adapt to an environment where economic development means so much more than it did just 10 years ago.

Gone are the days when you decided where to live based solely on where the job was or where you were raised. These are the days where safe sidewalks, quality parks, diverse transportation options, great schools, access to first-rate health care, as well as beautiful, crime-free streets are all active influencers.  Communities which aren’t investing in themselves to create quality places to live are not going to be the thriving communities of the future.

I talk to city and town officials every day and I see this transformation playing out all across Indiana. Corporate site selectors do care about the tax environment. However, the tax menu is no longer the deciding factor it once was. In addition to understanding the fiscal picture, they drive through our communities, they talk to our residents and business leaders, they visit parks and make note of each city or town’s infrastructure in a way that is much more critical than before. Business leaders are looking to locate and grow in places where they can attract the most talented workers and the most talented workers want to live in vibrant communities.

In an effort to make Indiana even more attractive to business, as the General Assembly goes about its work this new session, they will consider a measure to eliminate the business personal property tax. This cut certainly sounds like a great deal for our corporate citizens. Following the elimination of the inventory tax and the break they received from the property tax caps, another major tax cut seems attractive and is gathering much attention during the proposal’s rollout. I’ve said many times in recent weeks that it’s an interesting proposal and I know that municipal leaders are keenly interested in seeing Hoosier businesses succeed.

But, just like the site selectors that come into Indiana’s communities, city and town officials have to look at all of the details before they can support this enormous change to Indiana’s tax structure. Removal of the personal property tax would subtract about $1 Billion dollars from local budgets. That’s money that can’t be spent on roads, parks, schools, sidewalks, public safety, transportation, trash removal and more.

There once was a time when most Hoosiers likely bought into the notion that government at all levels could withstand budget cuts of any size. While a great deal of skepticism still remains, Indiana’s city and town residents trust their local officials. They know that a financial hit like this at a time when cities are trying to be at their most competitive should only be done with great debate and complete knowledge of how the state will replace these funds without unduly burdening workers and homeowners.

As the General Assembly does its work, I urge them to listen to city and town leaders from around the state. Lawmakers need to hear firsthand how eliminating the business personal property tax will impact Hoosier communities and citizens need to hear what lawmakers propose as a viable form of replacement revenue in order to implement their plans for eliminating the tax.

Most important, however, is whether or not investing in our communities to ensure they are the quality places where today’s and tomorrow’s Hoosiers want to work, raise their families and retire is a priority we all embrace.

— Matthew C. Greller, executive director and CEO Indiana Association of Cities and Towns

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