State of the City Celebrates Accomplishments, Pushes for Increase in Income Tax
Bloomington Mayor John Hamilton spent most of his 30 minute "state of the city" celebrating his first six years of office. The last portion was dedicated to three key initiatives, highlighted by a need for new revenue. The new revenue would come in the form of a countywide income tax increase. The proposal was vague on what that increase would constitute. Most likely, this would be a half of a percent to 1.8450. Based on Indiana State law, the income tax would encompass all of Monroe County. Ellettsville and the county council would weigh in as well but with since the majority of the population resides in Bloomington, it has the majority of the votes. The annual revenue returns would be somewhere around $10 million in new revenue annually.
Mayor Hamilton was also vague on details of where the new revenue would be earmarked. When he first floated this proposal in 2020, it was part of his climate action plan. It failed to pass the city council by a 4-5 vote. When speaking about investments, the Mayor lead with the need to pay for police salary increase that the council passed last year. He then went into the need to address the damage done to police and fire facilities from last June's flood. From there he listed investments in current facilities and parks, followed by IT infrastructure.
The other means Mayor Hamilton pointed out to generate new income was issuing bonds. He resurrected his 2022 budget request for the issuance $10 million in bonds. The plan is to have the council approve $10 millions in bonds every five years. The idea when first floated last October had half would go through the general fund and the other through parks to undertake his climate initiative.
The City Council unanimously approved to move forward in the first part to designate the Catalent expansion as a revitalization area. Final approval of the tax abatement in exchange for $350 million in investment and 1,000 new jobs will be on March 2nd after a public hearing. Bloomington is competing with Louisville, Madison, and Kansas City. $10 million of this investment will be to develop real property. The Real property would be abated at a rate of 50 percent a year for 10 years, while the larger portion is the personal property, which is 90 percent for 20 years. The impact of the abatement on TIF revenue would not be significant as it is calculated on real property but not personal. The Impact on COB revenue would not be significant. Local taxes are collected is based on the City’s budget. The abatement does not reduce total revenue on a dollar-for-dollar basis, but rather spreads that loss to the other taxpayers. Where the issue comes is how close we are to the state-restricted CAPS which puts a levy on the amount a tax can go up. According to the the City’s Alex Crowley does not believe it will be an issue. The main reservation from the Council was housing, where are these people going to live? Currently, half of Catalent’s 3,212 workforce lives outside the county which Monroe County reaps no financial benefit from.
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