Kenley Threatens To Cut Funding To Northwest Indiana If Lake County Doesn't Adopt A Local Income Tax

Lake County is the only major metropolitan county in the state of Indiana that does not impose a local income tax, which the General Assembly authorized as a way of allowing local governments to provide property tax relief to property owners. The lack of a local income tax in Lake County is a selling point Lake County officials have for luring people who live in the neighboring Chicago land area on the Illinois side of the border where taxes are higher to move their homes and businesses to Indiana. Sen. Luke Kenley (R-Noblesville), who chairs the committee that controls the state's purse strings, has been perturbed that Lake County officials refuse to enact a local income and is now threatening to withhold state funding for the Northwest Indiana Regional Development Authority unless Lake County adopts an income tax increase. Rich James explains in his column at Howey Politics:

Kenley on Tuesday threatened to eliminate the $10 million in annual state funding for the Northwest Indiana Regional Development Authority unless Lake County adopts a local option income tax.

He said that to RDA President Bill Hanna during a meeting of the State Budget Committee.

State support for the RDA comes from the lease of the Indiana Toll Road. But that money is expected to run out at the end of 2015.

“We’re getting down to the point where we can’t just keep saying, ‘OK, we’ll give you another five years of subsidies’ or something like that,” Kenley told Hanna . . .

“We’ve kind of pushed this money at you for your own discretionary use with some positive effects … but I think we’re really not doing anything like this for anybody else,” Kenley said.

Kenley apparently forgets that RDA funding isn’t a one-way street. Lake and Porter county government as well as the cities of Gary, Hammond and East Chicago each contributes $3.5 million annually . . .

And as long as we are talking about Lake County, how about the millions in casino tax dollars that the region sends to the state. That represents the third greatest source of revenue for Indiana.

And as long as we are talking Region money, let’s not forget about all the taxes industry – particularly steel – sends to the state general fund.

And, Luke, as you renew the fight for an income tax in Lake County, let’s not forget one thing. That tax is called a local option income tax. The operative word is “option.”

And to date, Lake County elected officials have opted not to adopt the tax.

Kenley must have already forgotten about the state bailout of the CIB he sponsored, which gives millions of state sales tax dollars generated within a downtown sports development authority to the CIB to spend annually, as well as the stadium authority he sponsored that allowed the state to build a more than $700 million new stadium for the CIB, which it, in turns, leases to the Colts rent-free.