The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1919-01-03
SCHOOL FUNDS
SHORTAGE TO Be
SOLVED BY BILL
Measure Deals With Borrow
ing Power of Taxing Units
in State.

lNDlANAPOlIlS, Jan. S.-Ine pres
ant shortage of funds being suffered
by school cities and other local taxing
units because Of the enactment of the
prohibition law, which reduced their
revenue, and for number OF other
reasons, will be solved if the new tax
bill to be presented to the Legislature
Is adopted
The bill has been printed and copies
are being distributed. That part OF
the measure dealing with the state
board of tax commissioners control Of
the tax rates in cities, towns, town
ships and counties and the borrowing
power Of these taxing units is regard.
ed as one of the important features Of
the proposed law.
The bill makes 1t explicit that there
shall not be a tax rate made which
will produce more revenue that was
produced in 1918. The theory of The
bill is that all property, real and per
soral shall be listed on the tax dupli-
cate at full value and intangibles for
one-fourth actual value. Thus the ,ax
tate must decrease In proportion to
the increase in assessments. The ra-
ito between the assessment and the
tax rate of 1918 must be maintained
hereafter. under the bill.
Must Certify Tax Rates.
This means that II county has q
S1.0G0,00C assessment on the tax du-
piicate and the rate was cents in
1918, the rate must be reduced 10 /
cent in 1919, If the assessment of tax
ables in that county increases to g.
100000 under the new measure The
bill prescribes that all tax rates must
be certified to the state board each
September for approval.
II the bill is enacted, therefore, no
taxing unit in the state can raise more
revenue at any time In the future than
IL did last year. 1t was foreseen that
occasions or emergencies may arise,
and In fact already had arisen, In
some taxing units, where more reve-
nue. would be needed. For that reason
a provision was written into the bill
whereby taxing units could appeal for
higher tax rate.
This section of the bill is based on
the Public Service Commission law 1t
provides that il any taxing unit must
raise more revenue it shall petition
the state board of tax commissioners
for the right to increase the tax rate.
Public notice must be given to all the
tax payers in that particular city,
town. township or county Of the fling
of the petition for an increased rate.
The matter would be set for hearing
to determine the validity Of the claim
for a higher rate. Any local taxing
unit may at its own option reduce its
tax rate or the state board, after a
hearing, can can reduce the tax rate
the bill provides.
Controls Borrowing Power.
The proposed law would control the
borrowing power of any locality In the
same manner That is, money could
be borrowed by the taxing unit only
after being granted permission by the
state board after filing of a petition
ana hearing.
Fred A. Sims, member of the state
board, which has had charge Of draft
ing the measure, explained that when
the approval Of the state board was
given to a local taxing unit to borrow
the bonds or certificates of indebted
ness issued would be incontestable. At
present litigation often results as to
the validity Of bonds or certificates is
sued by local taxing unit. At the
time the taxing unit is authorized to
borrow the bill provides that the tax
rate shall be adjusted to meet the
payments Of the principal and interest
when due.
Under the constitution of the state
borrowing power is limited to 2 per
cent. of the gross amount of assessed
valuation. For this reason many tax
ing units are now bonded to the limit
Under the theory Of the new bill this
condition would no longer exist in any
part Of the state because all property
will be placed on the tax duplicate and
the assessment will show double or
triple the figures shown at present.