Budgets and Taxation

This is a big deal and I would not be surprised if you clicked here first.

No, I’m not interested in new taxes

Most people care about this more than anything: No, I am not interested in new or higher taxes. I want to seek ways to increase people’s wages and improve the places they live. It’s frequently difficult to do that when you give people a pay-cut through a higher tax.

If I could wave a magic wand I would invert the “pyramid of taxes” we pay so the bulk of the money we all pay in taxation would go to local governments first, then states, then the federal government. Currently, most of the money we pay in taxes goes to the federal government, then states, and finally the least amount to local governments. I do not have that power and as a Councilor I can’t change that.

Indianapolis’ $1.1 billion budget is big. But for scale, IUPUI’s budget is about the same.

Problems with the current budget

  • Indianapolis is 22ndin the nation for local government employees per-capita. There is 1 government employee for every 65 Indy residents and each earn about $40,000-$45,000 annually. This puts us between Austin, Texas and Boston, Massachusetts.
  • A police officer once told me, “Issuing tickets isn’t about punishment or money. It’s about changing behavior.” I believe him, and speeding recklessly violates the safety of others. But there’s still money raised. Currently, that money goes into the police general fund.
  • Tax abatements, usually through property taxes, are easily accessible to large employers and enterprises. But those kinds of benefits are rarely accessible to small businesses and organizations.
  • Most city departments can reasonably be considered “poorly” or “adequately” funded. But do we know which ones, truthfully? Which ones are providing the most value for every dollar spent?

Ideas for future spending

  • Indianapolis should right-size its employee rolls and weigh its use of outside contractors. Typically, when a government “employee” is removed, the position is just filled with a “government-hired contractor”. This saves the City money on benefits, but in white-collar jobs the contractor is often paid morethan their “full employee” counterpart. In blue-collar jobs the employees are often just worse off with less-than-meager pay and no benefits. But we can do better by investigating public-private partnerships where it makes sense. For example, much of Indianapolis’ trash service is provided by Republic Services, a private company. District 12 residents are serviced by the Department of Public Works. Is there a benefit today to moving wholly to one or the other?
  • Money raised from the issuance of tickets and citations should be placed back in the neighborhood they were raised. For instance, an officer who issues 10 citations at $125 each along Raymond Street has generated $1,250 in fines. That money should go into improvement funds for roads in that community. It should help make the movement of people more efficient, calm traffic, and enhance safety.
  • Indy’s budget grows when Indy grows. And to achieve growth you need to empower people to improve their own lives through learning and entrepreneurship. Some ideas to make this easier and long-lasting include establishing a no-income-tax benefit for one year for sole proprietors and small businesses. For every business, we should consider allowing a one-year tax deduction of the salary of new employees earning less than $50,000 annually. At the very least, we should consider supporting local small businesses with tax abatement and TIF districts, or eliminate them entirely. It’s unreasonable a Buffalo Wild Wings can get a tax abatement but a local grocer can’t.
  • The Indianapolis Sheriff’s Department has audited for possibly being over-funded. Other departments should routinely undergo audits through two processes:
    • Professional, independent auditors should have on-demand access and compare with sister cities.
    • By being ridiculously transparent, city departments should allow citizens and journalists access online to budgeting and planning materials. It’s not enough to know a department spent $1.6 million on salaries. We should know what the jobs provide and perform for the City.

Justin Harter for District 12