Reform is gamble for Ind. governor
The manner in which Indiana Gov. Mitch Daniels is handling the property tax issue reminds me of the movie "The Godfather Part II."
In the movie, young Michael Corleone and the crime family he inherited in the late 1950s is pulling its assets out of New York and moving into Las Vegas. He also is negotiating a casino deal involving an aging gangster in Havana, Cuba, which has many of his family members upset.
While the Vegas investments look like a sure thing, the Cuban deal was fraught with enormous political and financial risks.
Daniels, who projects an image of the affable, accessible and outgoing public servant, apparently has some firm ideas about the direction in which he would like to see local government evolve.
His recently appointed Kernan-Shepard Commission, dedicated to reforming local government, will no doubt suggest abolishing township government, and for us to consolidate as many cities, counties, school corporations and other local governmental units as is politically possible. This may facilitate marginal savings in local expenditures, but it will not significantly reduce residential property taxes.
By extending the deadline for homestead exemptions and tinkering on the margins of the problem, Daniels seems to be taking his cues from the Democratic leadership in the Legislature.
This approach may be relatively safe politically, but it demonstrates that, going into the 2008 election cycle, he has no stomach for addressing the enormous job of a comprehensive reform of the state's entire revenue structure a job he has turned over in "Godfather" fashion to the attention of state Sen. Luke Kenley, chairman of the Committee on Tax and Fiscal Policy.
On the other hand, he has appointed former Vanderburgh County Commissioner Cheryl Musgrave to the post of commissioner of the Department of Local Government Finance to handle another part of the dirty work. By having her order comprehensive reassessments of commercial and industrial properties in Posey, Gibson and other counties, Daniels is not only infuriating local elected officials many of whom are Republicans but may also be sowing the seeds to his own political demise, with local taxpayers bristling at this ham-handed, top-down management style.
In a recent form letter, Daniels argues that local government is largely the source of the enormous increases in property taxes. He wrote: "Overall, total local spending has been growing by 7 percent a year; by contrast, state government has grown by roughly 2 percent on average the last two years, producing a balanced budget with no tax increases. Any long-term reduction in property taxes depends on the fundamental reform of the structure of local government in our state."
By placing so many of his eggs in the local government reform basket, one is reminded of the $2 million gift that was carried to Havana on an airplane by Michael Corleone's brother Fredo, ostensibly a gift for Cuban dictator Fulgencio Batista. Of course, amid the considerable political unrest at the time and the onslaught of revolutionary guerrillas in many parts of the country the delivery was about to be made in an era of enormous risk.
Similarly, if one closely observes what is transpiring in all parts of the state public demonstrations, lawsuits and one taxpayer, Carry Malchow in Muncie, paying his $12,000 property tax bill in dollar bills — one has to wonder if the governor is getting the message.
With a profound anti-incumbent fervor simmering across the country from local elections held in 2006 to the presidential sweepstakes next year, at a time when the governor could be demonstrating real leadership, instead he is delegating authority in his Capo regime with the hope that his popularity among the corporate community can ensure an electoral victory next year.
Unfortunately, he may find that his political career is cut short prematurely, similar to that of Batista for oddly similar reasons. He isn't listening to the people.