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NIRPC opposes loophole money going to RDA

McDermott

McDermott

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Updated: March 7, 2014 1:15PM



PORTAGE — The Northwestern Regional Planning Commission’s executive board is asking state lawmakers to return $4 million from a Lake County low income tax credit loophole to the gaming communities where the revenue was generated.

The amended version of Senate Bill 367 routes the new-found money to the Northwest Indiana Regional Development Authority, earmarking it for the $571 million extension of the South Shore commuter rail line from Hammond to Dyer.

The bill is being considered by a joint chamber conference committee and must be acted upon by March 14 when the General Assembly adjourns.

The amended NIRPC resolution, adopted Friday, specified the returned loophole money be used for mass transportation in Lake County, including the resurrection of bus service.

Despite backing from the RDA, Lake County officials saw the demise of the Regional Bus Authority last year after they failed to come up with a tax to sustain it.

Hammond Mayor Thomas McDermott Jr. is leading the fight for the money he says is being unfairly taken by the state.

McDermott and other officials from Lake, Porter and LaPorte counties said they’re not opposed to the General Assembly reauthorizing the RDA or to the South Shore extension.

McDermott said the resolution probably won’t make a difference.

“It probably won’t change anything at the end of the day, but it’s not fair. We’re dealing with a lot of pressure on this issue,” McDermott said. “I want the South Shore expansion to happen. I want the RDA reauthorized. But if you have a gun to our head, it’s not fair.”

Some NIRPC commissioners, however, voiced concerns on the resolution.

“I fear for the future of the extension if this message is sent,” said Jim Ton, a Chesterton Town Council member. “We sent a message with Illiana , not all of us agreed with that, but it was a regional development plan. The extension is a regional activity.”

Lake County Commissioner Roosevelt Allen, D-Gary, first discovered the loophole in 2012 as the county searched for revenue to support the Regional Bus Authority that folded last year when money to continue its operation didn’t surface.

Allen said it was discovered that a cutoff limit wasn’t included on a low income tax credit, so even wealthy people could take it.

Now, Allen said he’s questioning the $2.1 million allocation Lake County targeted in its capital development plan for the South Shore extension. “We did this not knowing they’d do a run around, we’ll reconsider our capital allocation.... We cannot not sit back passively.”

The state contributes $10 million annually to the RDA, while Gary, Hammond, East Chicago and Lake and Porter counties each contribute $3.5 million. Unless the state reauthorizes its share, the RDA disappears in 2015.

McDermott argued that Hammond already contributes $3.5 million annually to the RDA and in losing the loophole money, he said Hammond would give up another $600,000 in revenue to the RDA.

NIRPC Chairman and Hobart Mayor Brian Snedecor said sending the money back to the gaming communities is a matter of principle.

“It says all tax credit is paid by the state which deducts the casino tax revenue that would have gone to Hammond, Gary and East Chicago,” he said.

Snedecor said NIRPC still supports the re-authorization of the RDA and the South Shore extension.

“We’re not trying to be obstacles,” he said.



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