LOIT: exploring the numbers

By Dustin Grove (grove@wsbt.com)

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LOIT protest

People protested outside the County City Building before South Bend Common Council members met to discuss increasing the Local Option Income Tax. Despite impassioned pleas from the public, South Bend Common Council members gave the thumbs up to a tax hike. (WSBT photo)

By WSBT News1

Story Created: Dec 12, 2008 at 4:45 PM EST

Story Updated: Dec 12, 2008 at 8:46 PM EST

ST. JOSEPH COUNTY — Despite impassioned pleas from the public, South Bend Common Council members gave the thumbs up to a tax hike.

The higher Local Option Income Tax (LOIT) isn't a done deal yet in St. Joseph County, but it is one step closer. Thursday night, council members voted to raise the income tax a half-percent and a public safety tax by a quarter-percent.

The proposal goes to the County Council for a final vote Monday.

However, exactly how much money does that translate into?

Breaking down the numbers — the median household income in St. Joseph County is $41,500. If this proposed increase goes through, it would mean people making that much will pay about $312 more a year in local option income taxes.

That breaks down to $26 a month, or about $6.50 a week.

The people against this plan are dead serious.

"I'm going to get down on my knees and beg you, please don't do this to us!" said tax hike protester Kelly Havens.

If passed, the increase would cost the average Joe in St. Joe County each week about what he'd pay for a value meal at Arby’s.

A small price to pay, city leaders say, to keep police and others on the streets.

“The only thing worse than enacting local income taxes at this time is not enacting local income taxes that are needed to sustain our community,” said South Bend Mayor Steve Luecke.

The mayor insists it isn't really an increase for people who live here, but a replacement for money lost when state lawmakers voted to cap property taxes. Homeowners saved, but local governments, like South Bend, lost millions.

And while city officials say it's a worthy price to pay — even considered "fast food change" for some, others maintain — in today's tough times — the amount isn't the point.

"You don't tax people during a recession,” said one protester, “everyone's hurting way too much to be paying any new taxes. They need to cut back."

Not every city in this county agrees on raising taxes. Mishawaka says it doesn't need to.

And as WSBT reported Thursday, Governor Daniels says more cuts could be made instead of raising the tax. He said government in our area is "bloated," and taxpayers have been asked to pick up the bill for too long.

And now it moves on to the county council. Monday night will be another long meeting.

WSBT talked with three council members this afternoon — all of them said if this was just a quarter-percent public safety tax, they'd have no problem. But state statute demands it be tied to the local option income.

And that, they say, is making their decision a whole lot tougher.

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