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Simpson Suggests Marion County Sales Tax Hike To Bail Out CIB

Last updated on Friday, April 10, 2009

(STATEHOUSE) - Senate Democrats are offering two ideas to pay for a Capital Improvement Board bailout.

Instead of raising alcohol, hotel, and food and beverage taxes as Senate Republicans have suggested, minority leader Vi Simpson (D-Bloomington) says the state should let Indianapolis use the local income tax now reserved for public safety.

That tax now stands at .35%. State law allows Marion County to boost it as high as .5%, an increase would raise $26 million all by itself. But Simpson argues the state's decision last year to pick up police and fire pension costs frees up money from the existing rate.

Republican Mayor Greg Ballard has said the administration of his predecessor, Democrat Bart Peterson, under funded public safety through accounting gimmicks such as not including any fire department overtime in the budget.

He's said the public safety money is necessary to balance the city and county budget. The Senate will vote on Simpson's proposal Monday or Tuesday, along with an alternative offered by Senator Lindel Hume (D-Princeton).

Hume suggests rerouting sales taxes from Circle Centre Mall from the state to the CIB, and slapping a 15% tax on Colts, Pacers and Indians tickets. It's already six%, Republicans have proposed 10%. The sales tax proposal would take $8 to $10 million out of the state budget and give it to the CIB.

Indy and several other Indiana cities have "professional sports development areas" which earmark sales or income taxes, or both, for use in those areas, on the theory that the stadiums have spurred new development.

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