05/19/2025 Council Special Meeting [13:30-18:32]

Moving on to the next page, page number three, the chart at the top of the page. This chart is really very consistent with what we see over the state of Indiana. And it's something I think taxpayers sometimes don't understand. Your tax rates have actually gone down over lots for one or five years, just like a lot of units in the state. So why are people paying more on their tax bills? It's because their property values have gone up. That's really the reason. So look at this chart. It compares your net assessment value to your tax rates. So in 2022, the county unit's tax rate was 0.5690. So in most 57 cents. In 2025, that tax rate is 0.4655. It's gone down by 18%. So again, tax rates aren't going up. It's the property values that have gone up that has caused the taxpayers tax bills to increase. Now, the reason why your tax rate has gone down is because your net assessment value has grown at a pretty good rate since 2022. Your net assessment value in 2022 was 1.68 billion. It is now 2.3 billion. So as you know, you're limited to how much money you bring in. So when your assessment value goes up, that doesn't mean you bring in more property tax owners. It simply means that you need a lower tax rate to generate your maximum tax dollars that you can bring in. So that's why your tax rate has gone down. The next section there on that page is local income taxes. So this is going to be very important because we are going to have a complete restructuring of the local income tax system starting in 2028. But I wanted you to see where you are right now because it's important to know that as we start estimating where you're going to be in the future. So in Lawrence County, the total local income tax rate is 1.75%. And that is made up of certified shares at 1% which that revenue is deposited into your Japanese fund can be used for any county purpose. The second category is public safety local income tax at 0.25%. That is deposited in a separate lit public safety fund and can be used for public safety purposes. Those two combined, you can 1.25%, but you also have a component that is a property tax relief local income tax on that rate is 0.5%. That is a very good tax to have because that actually helps bring down your circuit breaker credits because this property tax relief credit is applied to the tax growth first and then circuit breakers are applied. So that helps to keep those circuit breaker credits down. So all of that combined is 1.75%. The maximum that you can have in the expenditure rate category which is the public safety and the certified shares together is 2.5%. So you're well below that. Now even though this local income tax structure is going to change, you could if you wanted to increase or enact another one of these current local income taxes for 26 and 27 if you wanted to. But by the end of 2027, all of these local income tax rates will expire. All of them. Public safety, certified shares, property tax relief, they will expire and you will not get that anymore. So in its place, there is going to be something called a county services local income tax. You as a county council have the ability of adopting that local income tax up to 1.2%. That is the maximum. Now, I will say this in this report, we are estimating that you're only going to go to 0.9%. But you can go up to the 4.1.2. But 0.9% should be plenty to cover your budgetary needs. But we can discuss that as we get closer to 27 because you will need to adopt this in 2027 for distribution in 2028. And you will have to renew the rate every year. These rates expire at the end of every year. So you're going to have to renew that rate every year. So then, let me just repeat that you as a county council will have the ability to adopt a 1.2% county services rate. We as the assumptions we made in this report, we will adopt 0.9%. And if you look at the top of page number four, there's a pair of that that kind of talks about this.