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State gains $2 million-plus per year from fireworks sales

Employee  Gabrielle Dallecarbonare restock cake style fireworks Krazy Kaplans Fireworks near Cline Avenue interchange Borman Expressway Thursday June 30

Employee Gabrielle Dallecarbonare restock cake style fireworks at Krazy Kaplans Fireworks near the Cline Avenue interchange at the Borman Expressway Thursday, June 30, 2011, in Hammond, Ind. | Scott M. Bort~Sun-Times Media

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fireworks
Tax Revenue

2007: $2.4 million

2008: $2.5 million

2009: $2.5 million

2010: $2.4 million

What's the law?
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Updated: October 30, 2011 1:19AM



The retail fireworks season is brief but booming for Indiana, generating more than $2 million annually in extra taxes and fees that fund firefighter training and disaster relief.

The money started flowing in 2007, the year after the state Legislature decided to expand the types of legal retail fireworks. The new law came with a price tag: Customers would pay a 5 percent tax on top of the 7 per cent sales tax to purchase them. And, fireworks business owners would have to pay registration fees for each store location.

Krazy Kaplans owner Greg Kaplan said the new laws have helped, not hurt, his eight area stores.

“I don’t think it’s had any effect,” Kaplan said. “If anything it’s helped the business. Before, people were not too sure what they could do in Indiana, but now they have some certainty.”

Before 2006, only smaller fireworks such as sparklers and cone fountains were legal. Kaplan said the new law helped attract more customers from Illinois, which outlaws all fireworks except small items such as sparklers, smoke bombs and party poppers.

“We’re always going to get Illinois customers because fireworks aren’t legal in Illinois,” Kaplan said. “The majority of our customers are along state lines.”

While Kaplan said his business hasn’t been hurt, customers have noticed the 12 percent tax on their purchases. Kaplan said customers purchasing hundreds of dollars of fireworks end up paying a lot of taxes.

“They don’t just notice, it’s like sounding a horn,” Kaplan said. “To pay a 12 percent sales tax, they know they’re paying it. That’s just the cost of buying fireworks in the state of Indiana. The demand is still there.”

The 12 percent tax on a $150 purchase would add $18 to the bill.

The $2 million-plus generated annually by the 5 percent tax and store fees goes to two Indiana Department of Homeland Security funds: the regional public safety fund, which supports 10 newly created Indiana Fire Training System districts, and the state disaster relief fund.

Firefighters get training

Ron Svetic, Lake County chairman for Indiana Fire Training System District 1, said Northwest Indiana has received between $90,000 and $110,000 annually since 2007 to fund firefighter training. That money funds mandatory classes, textbooks and training equipment.

The first $2 million collected annually from the public safety fee goes into the regional public safety fund used for firefighter training around the state.

Before 2006, Indiana counties funded the state-mandated training requirements themselves. The Lake County Fire Chiefs Association used spare rooms in communities’ fire stations to hold state-mandated training classes.

“We would throw two classes per year and we had no money to do anything,” Svetic said.

Students had to purchase their own books for the classes, which Svetic said cost about $100 per person.

Hands-on training required more creativity than finding an empty room. The fire chiefs association found a car dealership willing to donate a few cars per year so trainees could practice extracting people from cars. The association also had to find abandoned or condemned houses to practice sawing holes into roofs for ventilation and breaking in doors.

The association was responsible for training and paperwork for nearly every firefighter in Lake County.

“If Hammond or someone did a big hiring or something, they’d do their own (training),” Svetic said. “But most of it was the Lake County Fire Chiefs Association. It’s an ungodly amount of paperwork. These records have to follow them for their entire career in the fire service.”

A disaster safety net

The training fund also supports programs sponsored by the Indiana Department of Homeland Security.

“We’ve used it to support a mobile training fire unit and a mobile hazmat unit that goes throughout the state,” IDHS spokesman John Erickson said.

Revenues in excess of $2 million go into the state disaster relief fund. The fund, created in 1999, sat empty for seven years until tax revenues and registration fees began rolling in.

Porter County Emergency Management Agency hasn’t received state funds yet, but Lake County Emergency Management Agency director Jodi Richmond said Lake County has received funds “a few times” since 2006.

Individuals, businesses and local governments can receive grants from the disaster fund.

“That’s if we had a disaster and we were denied federal funding from FEMA, or maybe we didn’t apply for it, but there’s still enough damage that there needs to be a government response,” IDHS spokesman Alex Bowsher said. “That money would cover disaster relief when the federal government isn’t paying.”



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